Mr Kniaz and Mr Martin, who are both 27-years-old, met working in Westpac’s innovation team.
“We got to do some very cool things there and learn about technology and product management and how to speak to customers and solve core problems, but we found it was ultimately very difficult to bring anything to market,” Mr Kniaz said. “It was really around the legacy issues at a big four bank. We thought we could move a lot faster by doing our own things.”
We can still be agile and nimble and a small team and we can move more quickly with support from them.
The pair started DiviPay from Mr Kniaz’s kitchen table using $100,000 in investment from fintech accelerator H2 to take the “very scary” plunge and launch the startup.
After an initial focus on virtual card technology in the consumer space, the pair decided to change tack and pivot to a focus on business.
“Consumers want everything for free,” Mr Kniaz said. “As a startup trying to play in that space it is very difficult to monetise.”
DiviPay’s ‘virtual credit card’ product has each businesses expense policy built into the card itself so when an employee makes a payment, the startup collects data to automate the coding and integrates with Xero, MYOB and QuickBooks.
DiviPay has 150 businesses and more than 1000 end users on its platform and customers include Canva, We Are Social and Buildcorp.
“Right now we have hundreds of customers making thousands of transactions every week,” Mr Martin said. “We see really strong word of mouth.”
DiviPay will use the money raised to expand its team of six and continue to evolve the product.
Mr Kniaz said working closely with ANZ will allow DiviPay to get access to core financial products it can innovate on top of.
“I think banks now are really proactively trying to work with the startup ecosystem and one of the reasons we see this amount of investment come from banks to startups is startups can still operate as their own entity,” he said. “We can still be agile and nimble and a small team and we can move more quickly with support from them.”
ANZi managing director Ron Spector is set to join DiviPay’s board and said the startup was bringing innovative solutions to small and medium businesses.
“Their expense management solution solves a very real pain point for business owners and aligns with our focus on building relationships with emerging growth companies that can support our customers, bankers and partners,” he said.
Cara is the small business editor for The Age and The Sydney Morning Herald based in Melbourne