Davey can’t talk about the discussions with Westpac or other parties, but he says that external action has helped bolster confidence in the business.
“When we look at some of the discussion going on around Tyro at the moment it’s because people do look at us, and they look at our technology and I look at that DNA, and they say ‘well, that’s an organisation that is a challenger, that has got great products, it’s got great service, it’s got a great team’. And we just need to capture a little bit more of that.”
Davey is doing his bit to generate momentum too.
A week after his appointment, Davey announced he would cut $11 million from the company’s cost base, with $5 million of costs to go in the 2023 financial year.
The good news trifecta
Much of this came through staff cuts, which were completed in the space of a few weeks. About 10 per cent of jobs at the group went.
The cost cuts and rebounding economic activity – particularly in Tyro’s crucial hospitality vertical – also allowed Davey to upgrade Tyro’s guidance for earnings and transaction volumes.
Davey completed his trifecta of good news by confirming launch dates for a trio of new products, including the new Tyro Pro terminal and the Tyro Go mobile terminal.
Davey says the cost-cutting program focused on non-revenue generating areas, with the tech team largely protected.
This speaks to Davey’s view that the business needs to get away from being seen as a fintech and recapture some of the tech halo it earned thanks to its roots as a company set up by former Cisco engineers who believed they’d found a way to make payments more innovative.
“I think the narrative around Tyro has probably started to see it as more of a financial service provider rather than a tech company. What I’m focused on doing is making sure that we recapture some of that spark that I think has held Tyro in such good stead over the last decade or so and allowed us to really differentiate from our traditional competitors.”
Davey, who spent a decade a NAB including five years in tech roles, knew Tyro well and viewed it as a classic disrupter. With the bruising process of cutting 10 per cent of staff now done, he wants the refocused business to start thinking hard about what its payment platform can do for customers.
“I actually feel that with a leaner, more focused organisation, your opportunities to be able to drive innovation are far greater.
“What we need to be able to do is to maintain the cost base we currently have while continuing the growth path that we’ve seen over the last few years. It’s about maintaining what we have but continuing to grow and invest.”
While some analysts have been critical of Tyro’s expansion into banking through cashflow lending, Davey sees this as a valuable add-on to a broader suite of payment services.
He sees potential for Tyro to move beyond just card-based payments and into areas such as account-to-account based payments, and emerging payment types that are being made possible under the National Payments Platform.
Whether these innovations are made under Tyro’s current publicly listed model, or for another owner entirely, remains to be seen.
