Small Business: Mobile app developer eyes listing

Rod Macfarlane says revenue sharing works for his company. Photo / Dean Purcell

Strong growth of software creator with several releases in US top 10 has directors considering float.

The global trend for business and consumer mobile apps could see New Zealand developer MEA Mobile list on the stock exchange.

Rod Macfarlane and Gabriel Engel set up MEA six years ago as an IT and IP consulting and investment firm. Macfarlane was previously IP and commercialisation manager at Navman.

"MEA was about commercialising IP. Then we kept on getting IT projects and mobile projects to the point where it became a division of its own," says Macfarlane. They formed MEA Mobile in 2009 and spun it off a year later with the help of Sir Stephen Tindall's K1W1 fund, which has an 18 per cent shareholding in the business. The remaining 82 per cent is split equally between Macfarlane and Engel.

The company has offices in Hamilton, Auckland and New Haven, Connecticut. Managing director Bruce Seymour, who worked with Macfarlane at technology company PureDepth, is based in the US.

Why there? "Because the channel to market is so important to us," says Macfarlane. "We will build an app and say to the US office, 'go out and pitch to brands and agencies'."

MEA Mobile writes apps that it sells under its own name and others for established brands such as Levis, Samsung, ESPN, Intel, Walgreens, Blackberry and, locally, AgResearch, Otago University, and Jasons Travel.

"We are getting increasing inquiries from organisations looking for internally focused project apps as well as those with a customer focus," says Macfarlane.

Since beginning, MEA Mobile has released 200 apps.

Its biggest success has been Supr8 app, which gives users the ability to adjust the appearance of video footage to give it a vintage feel.

A photo printing app, Printicular, allows mobile users to print photos from their device and pick them up at their choice of 8000 Walgreens in the US. The developer now has six photo printing apps with US pickup and worldwide home delivery.

"We like to do work where we revenue share," says Macfarlane. For example, with the photoprinting app, there is a revenue share arrangement with Walgreens and the delivery service.

MEA Mobile has also acted as early investor for eight tech companies including GeoOp, which recently floated and for which MEA Mobile did some development work, as well as SmartShow, the event management app provider known for its app ShowGizmo.

In March, MEA Mobile merged with Verdict Communications, a full service creative agency based in Hamilton, which still operates under the Verdict name. It has given the business more New Zealand clients, such as Jasons Travel. At the same time it also acquired one of the early iPhone developers, SoftwareX, which wrote the Hundred Pushups app.

MEA Mobile has more than 40 staff in the three offices, and two in Canterbury, and Macfarlane expects the business's turnover and staff to double each year. The local market has strong demand and he will continue to grow through acquisition of companies that have a channel to market.

"The mobile market does not seem to be slowing down - we are keeping on with the strategy."

A float at some point is on the cards. "We are considering it - our model is scaleable," Macfarlane says.

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