Investor signs on as Rex eyes US

By ADAM GIFFORD

Former Telstra New Zealand chief financial officer Ron Goodfellow has taken a 26 per cent stake in content management software developer Rex.

As well as investing "a substantial sum", Goodfellow will work as chief financial officer, as the company tries to crack the US market.

Chief executive John Barlow said Rex had spent six months looking for a suitable venture capital partner, and connected with Goodfellow through the Government-sponsored Mine (mentor investor network events ) under the Business Angels programme.

"When we analysed the market, we saw that where software companies fall over is they may have a stable product, as we have, but they do not have the other 50 per cent: the resource behind their resellers; the training modules; the processes to deal with the customer wishlist," Barlow said.

The former school principal started Rex in Palmerston North in 1995 after completing an MBA at Massey University.

It was originally an intranet and web design firm but three years ago Barlow packaged the content management tools it had designed and turned them into a product.

"Other intranet developers were trying to tie customers into long-term maintenance contracts. We decided it was better to give them the tools to maintain their sites themselves.

"Now we don't sell hours or services, we sell software."

Rex has signed IT services company Synergy as a New Zealand reseller, and GDC's iVasp division sells Rex as applications to rent via the internet. Customers include The Warehouse, McDonald's, TelstraClear, Panasonic, Tower Group and Roche Pharmaceuticals.

The software suite, built on a Microsoft platform, includes RexConductor for website content management, RexInform for online forms and RexContact for contact management.

Its pricing is capped at $70,000 for an enterprise-wide licence. Barlow said Rex was not trying to compete with content management giants such as Vignette.

"What we have is an out-of-the-box intranet product with 80 per cent of the capacity most businesses want."

The company had already made sales in Australia and Britain.

Goodfellow said it was his first foray into venture capitalism after spells as Air New Zealand's European financial controller, CFO for Telstra England and New Zealand, and the last two years doing business strategy for Affco.

"It's easy to lose half your money on the stock exchange so I thought I might as well go the whole hog."

The fact that he could take a hands-on role at Rex was a plus.

Goodfellow said he would stay in for the long term, with a public float possible in three or four years.