Hi all,Like Graham, I am also an ex-employee of Tyro however I...

Hi all,

Like Graham, I am also an ex-employee of Tyro however I am no longer a share holder as I sold my position shortly after departing from the company. At the time of leaving Tyro, prospective dates for IPO were vague so despite regretting my decision to sell (in retrospect to current SP) I have some high level bullet points on where I see the company moving forward. Although I have no sentiment, I will post my concerns as this thread has been primarily bullish to date.

Tyro's core product is the merchant acquiring terminals (EFTPOS). This is the primary acquisition product with the hope of up-selling existing merchants with business loans & e-commerce. Tyro's point of difference is their integration capabilities with point of sale partners. Competitors are quickly gaining traction in this space with the Big 4 banks investing heavily with other integrator's and PC-EFTPOS also receiving investment last year. Major banks often extend EFTPOS facilities below cost price to secure large businesses which created past barriers for Tyro securing merchants of sizeable consequence. My concern in this field moving forward is Tyro being caught in the middle in the acquisition space, not price competitive to land major accounts, and not cost-effective for micro businesses with the presence of Square etc.

Highest margins are by far is the business lending space however this to is very crowded and the business banking account was very limited in scale during my time with the company. It was perfect in theory for 'businesses on the go' however, how many people really want to make major payments, pay suppliers and wages on their mobile? Uptake of the account was stagnant and then only way for Tyro to extend business loans. With the crowded nature of business lending and performance of others in the space (e.g. Prospa) this is a close segment to monitor.

The long-term positions of major share holders is also of concern. MCB stepped down as a director last year, initial founding members are also no longer present. Given current prices, institutions that participated in the 2015 capital raise may also choose to take profits.