Local tech stars wake up filthy rich

Technology entrepreneurs Mike Cannon-Brookes and Scott Farquhar have become overnight billionaires, pipping the likes of retail king Gerry Harvey — on paper at least.

Australia’s newest billionaires founded Atlassian — which makes software that helps IT departments, software developers and others to collaborate together online — in 2002 with $10,000 in funding from a credit card. US investment firms T. Rowe Price and Dragoneer Investment Capital invested up to $US150 million ($160m) in the company yesterday, pushing ­Atlassian’s valuation to $US3.3 billion, The Wall Street Journal reported.

The new valuation for Atlassian is about eight times its 2010 value, when venture capital firm Accel Partners purchased shares ­valuing the company at $US400m.

Accel Partners was the first and only external investor when it pumped $US60m into Atlassian in 2010. The funding makes Atlassian one of the world’s most valuable venture-capital-backed companies.

Mr Cannon-Brookes and Mr Farquhar are now worth more than $1.3bn each and inching ­towards media and mining equipment magnate Kerry Stokes’s net worth.

According to Forbes magazine, Mr Harvey is worth about $1.2bn, while Mr Stokes is valued at roughly $1.6bn.

The founders have about an 80 per cent stake in the company.

Atlassian has long been ­rumoured to be eyeing a $1bn IPO on the US stockmarket, ­either the Nasdaq or New York Stock Exchange, but the company has kept mum on any plans to go public.

Mr Cannon-Brookes told The Wall Street Journal that Atlassian chose T. Rowe Price and Dragoneer because their expertise in public markets might be needed when it came time for an IPO.

He said the company was in no rush to go public.

As reported in The Australian last year, Atlassian doesn’t employ a single salesperson.

“Fifteen years ago, as long as you had the best distribution you would win,” Mr Farquhar told The Wall Street Journal.

“It didn’t matter whether ­Oracle was worse than SAP. These days, people are making decisions based on how good the products are.”

Mr Farquhar said the London-based firm was profitable and had been cashflow positive each quarter for the past 12 years.

Sales have increased 40 per cent annually on average over the past five years, with revenues expected to hit $US200m this year.