Flare Acquisition: Key Details, Impact, and What Comes Next

MYOB's acquisition of Flare marks a significant step in the business management platform's evolution. By integrating Flare's workplace financial services, MYOB aims to offer comprehensive solutions for small and medium-sized enterprises (SMEs). This strategic move is set to enhance MYOB's capabilities, providing SMEs with advanced tools for payroll, benefits, and employee management.

What Is Flare?

Founded in 2015, Flare offers free HR software specializing in onboarding and employee benefits. Its core products include digital onboarding solutions, a comprehensive benefits program, and novated leasing options through Flare Cars. Unique selling points include the platform's free usage, mobile app accessibility, and significant employee savings of over $12,000 annually. Additionally, Flare's customizable solutions and seamless integration with over 30 leading Australian HR systems set it apart in the market.

Who Acquired Flare?

MYOB is a leading provider of business software solutions, offering tools that automate and streamline various business processes. Key products include Solo by MYOB for sole operators, MYOB Business Lite and Pro for small to medium businesses, and advanced solutions like MYOB Business AccountRight Plus and Premier. The company also provides ERP software for larger enterprises and specialized solutions for accountants and bookkeepers. Recognized for its ease of use and comprehensive features, MYOB holds a strong market position in the industry.

When Was Flare Acquired?

MYOB acquired Flare on September 13, 2022. This acquisition occurred during a period marked by a significant skills shortage in Australia, with more job vacancies than unemployed individuals. The timing aligns with MYOB's strategic efforts to enhance its service offerings and support SMEs in attracting and retaining talent through comprehensive employee benefits and digitized onboarding solutions. This move is part of MYOB's broader strategy to expand its capabilities and deepen its market presence.

Why Was Flare Acquired?

• Market Expansion: The acquisition of Flare allows MYOB to expand its market presence beyond traditional accounting services to include comprehensive workplace financial services and benefits solutions. This strategic move aims to make these services accessible to any employer in Australia, thereby broadening MYOB's customer base and market reach.
• Technology Integration: The integration of Flare’s onboarding and superannuation services within the MYOB platform, as well as the planned enhancements to Flare’s existing integrations, represent significant technology integration efforts. These integrations are designed to provide a seamless and comprehensive experience for MYOB’s customers, enhancing their payroll and HR capabilities.
• Competitive Advantage: The acquisition provides MYOB with a competitive advantage by combining its existing payroll capabilities with Flare’s pay and benefits services. This creates a unique people management platform that offers significant value to business owners, helping them manage their businesses more efficiently and attract top talent. The ability to offer comprehensive employee benefits and digitized onboarding experiences to SMEs, which were typically available only to larger businesses, further strengthens MYOB’s competitive position in the market.

Acquisition Terms

• Acquisition Price: The acquisition price was not publicly disclosed.
• Payment Method: The payment method was not specified.
• Key Conditions or Agreements:
  • Flare will continue to operate as a standalone business.
  • The initial focus will be on enhancing the existing integrations between Flare and MYOB.
  • The acquisition aims to provide SMEs with comprehensive employee benefits and digitized onboarding experiences.
  • The acquisition is part of MYOB’s strategy to connect with businesses in new and deeper ways, offering solutions that drive value within their processes.

Impact on Flare

The acquisition of Flare by MYOB has led to several operational changes, although Flare will continue to operate as a standalone business. The primary focus is on enhancing existing integrations with MYOB, including the development of Flare’s pay and benefits app, digital wallet for payroll, and novated car leasing. This strategic move aims to fast-track Flare’s ambition to become a comprehensive workplace financial services and benefits solution, leveraging MYOB’s substantial position in the employee network to offer new features and services.

Employee and customer reactions to the acquisition have been generally positive. MYOB’s CEO, Greg Ellis, emphasized the potential to create a unique people management platform that adds significant value to business owners. Flare’s co-founder and co-CEO, James Windon, highlighted the high demand for comprehensive employee benefits and digitized onboarding experiences, especially in the context of Australia’s digital skills shortage. This acquisition is seen as a step towards leveling the playing field for SMEs by providing them with tools typically accessible only to larger businesses.

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