A highly rated cloud software start-up working with one of the UK’s leading supermarkets is keen to avoid a common “trap” as it targets a serious investment raise.
Leeds-based Hark started out in 2016 with the help of a seed investment round which founder and CEO Jordan Appleson says was in the “low end of six-digit figures”.
Initially built to monitor, store and analyse temperature and humidity data for the life sciences sector, its cloud platform is now being used more widely. Last year it ran a trial with a huge UK supermarket and has been working with them since to roll out its technology across the supermarket’s estate, collecting and processing data around energy and buildings.
Appleson, who says energy is the supermarket’s “biggest spend”, is keen to expand Hark’s presence in the energy and manufacturing sectors as well as targeting retail.
“Over next 12 to 18 months there will be a funding round where we look at a serious raise but it’s about how much we need rather than just an arbitrary figure,” he told BusinessCloud.
“We don’t want to fall in the trap: when people have money in the bank, they spend it.
“Funding for us is about scale. Now we have the business running and we’re winning clients and people are benefiting from our tech, the next stage is how do we take what we’ve done and scale it horizontally and vertically rather than use it to fund the initial concept and R&D side?
“We’ve been through that first six to 12 months of making sure that our overheads are low and we’re on low salaries to make sure that we can invest money we do have in people and talent and I want to make sure that’s still core to the business going forward.
“Taking too much money for us right now could be detrimental to growth.”
Appleson says Hark, which employs ten people, is focused on organic growth for now and reveals that it is on track to hit potentially seven-digits in annual recurring revenue by the end of 2018.
One of the company’s non-executive directors has connections with another major supermarket and Hark is currently in negotiations with that company.
He speaks highly of the Leeds tech scene and says there is an opportunity for it to work even more closely with Manchester.
“We tend to keep our heads down and get work done, but when we are out there in the community and talking to people, everyone wants to introduce you to someone who they think can help you,” he said.
“That whole aspect of community within the start-up scene is really good and it’s the same in Manchester as well. There’s a lot of collaboration.
“There’s so much opportunity between Leeds and Manchester for some of these start-ups to collaborate and spread the wealth.
“The tech start-up scene is really growing, very vibrant there are lots of entrepreneurs, but we need more focus on these community hubs.”