Investment Notes: Matilda
Why AfterWork Ventures are proud to back Matilda as they simplify, digitise and destress the visa application process
After divorce, moving home is cited - and universally regarded - as life’s biggest stressor. Moving countries is another beast entirely. And the first step in that process is often the most stressful: a visa application. It’s a complicated process, with lengthy delays, unclear expectations and ambiguous outcomes. And the stakes couldn't be higher. Entire lives hang in the balance waiting for an answer that can change the trajectory of a life. On the applicant's side, the process is confusing, stressful, lengthy and expensive. Migration agents, who purport to make the process better, have done little to remove these headaches and continue to offer service that is manual, clunky, opaque and transactional.
When two AfterWork community members introduced us to the Matilda Migration concept, we quickly shared their enthusiasm and recognised the opportunity to disrupt the underserved migration agency market in a meaningful, tech forward way. AfterWork is delighted to join Matilda on the journey as it sets out to digitise and transform the migration experience. We have led their pre-seed round, alongsideWollemi Capital, Everywhere VC, Co-Ventures and Startmate. Since launching a month ago, Matilda have helped secure 7 visas, with an additional 18 initial consults lined up, and garnered interest from 5 businesses needing multiple visas, on an ongoing basis.
What we loved about the opportunity
Australia’s migration agency market is large, underserved, and ripe for disruption
A large market size has to be the starting point for any VC backed business. Yet Australia offers few domestic opportunities that meet the necessary scale for investors. There are a few known exceptions, (like mortgages and pet food) and we believe Matilda will prove migration to be another. Australia is a strong migration destination and punches well above its weight for the number of visas processed. Each year, Australia grants almost 3m applications, which is 5x more visas than America on a per capita basis1.
The market is large, but also poorly served. Applying for a visa is a highly stressful and gruelling process. The lives of applicants, and their families, get put on hold trying to navigate complexities, ambiguities and paperwork. There are hundreds of visa types, conflicting information on blogs and impenetrable government websites to sift through. Migration agencies are supposed to be there to help, but their services leave much to be desired. NPS is notoriously low and 33% of Australia’s approximately 5k migration agents have complaints filed against them2.
In our recent AI-powered service exploratory, we discussed the characteristics that make for the best kind of market dynamics and create the right opportunity for a new tech-forward entrant to enter and make a meaningful dent. Market fragmentation, localised distribution and lack of high quality service create ideal conditions for consolidation for a player like Matilda.
“Immigration is one of those classic, ugly, regulated markets where all the suppliers are mostly making a great living for themselves, and thus there has been very little incentive to innovate. As a result, the industry has been very stagnant over the decades and it remains quite archaic. Generally speaking, compared to what consumers have to expect in the modern age, the service levels are very poor, so there is a big opportunity to level-up the experience"
Co-founder, Damian Png
Gen AI is heralding a new era of AI-powered software businesses
Timing wise, there is a clear ‘why now’ for Matilda. The advent of AI has paved the way for new types of business. Rather than SaaS, that gave us the tools to do the work ourselves; we’re seeing a rise in businesses that are selling entire outcomes. This is made possible thanks to the rapid developments in AI.
Amongst other factors, we recently discussed the potential for AI to fundamentally reshape the unit economics for services businesses. We hypothesised the basic playbook for this might look like:
Control the flow of information, in order to
Efficiently automate workflows through structured data and repeatable processes, leading to
A lower cost to serve and more scalable backends, and
A superior experience and the right to command a higher price point.
Mapping this onto the Matilda experience, we feel they’re set up to succeed. Visa processing is a fundamentally administrative task, with the role of migration agents traditionally focused on helping identify and gather relevant and often disparate data from clients (such as personal information, employment history, or relationship memories), before hand-holding them through the convoluted visa application process.
Whilst some of the process (namely repetitive, manual workflows) have long been ripe picking for digitisation; advances in Gen AI have unlocked higher levels of automation in situations that may have been ambiguous (like helping employees articulate the unique skill sets they bring to Australia) or in acting as co-pilots where a more human approach is required.
Delivered together, these features help what looks like a services business on the outside, look more like a technology led business. This is not a distant reality; we’ve already seen the US digital visa processor Boundless, who focus on improving the visa application process for families, embed technological developments into their process. They have delivered a superior experience, powered by AI, and to great market reception.
AfterWork Community members, with a proven track record
Co-founders Damian Png and Niamh Mooney are a powerhouse duo with experience perfectly matched for Matilda.
We have had the privilege of watching Damian grow in his career as an AfterWork community member of more than 5 years. During this time, he has gained leadership experience across product, commercial, and strategy functions in portfolio companies and in the broader startup ecosystem and we have been eagerly awaiting the right opportunity to back him in his own endeavour. We’re especially excited that Matilda is a problem close to his own heart, coming from an immigrant family.
Similarly, we have had a front row seat to watch Niamh develop the perfect skill-set required to grow the type of brand we believe Matilda will become. She began her career as a lawyer, a necessity when tackling a problem like migration before growing Eucalyptus’s third company, Software, into an instantly recognisable Australian brand.
Challenges We Saw
Will the business model (i.e. margins) look like a tech business or a service business?
To be an attractive venture investment, healthy margins need to be evident and achievable. Typically, in a service business the price point is higher at a lower margin as you are paying for a human to manually do a job in its entirety. Conversely, product businesses can sell the same piece of software over and over again; they make a higher margin, but sell at a lower price point so that a user can do the job themselves.
But what if a service business could sell an outcome (rather than yet another software tool to add to a users’ workload) and continue to solve a customer's problem in its entirety in a more efficient manner, without sacrificing all of its margin? That’s what we believe Matilda will be able to do by putting the visa application process on rails and using AI strategically.
Matilda is automating many of the repetitive tasks involved in a visa application allowing them to serve many clients more efficiently and effectively, resulting in an improved customer experience with margins that will start to look more like a product rather than service business. They will reserve moments of human interaction for key touch points along the customer journey, creating a better experience for migrants in such a stressful time of their lives.
Is there a way to reach customers at scale?
With efficiency solved for via automation, the next outstanding question we had was around scale. Matilda has entered a cottage industry, where ambitions are low and the competition is fragmented, tech-avoidant and yet to harness the power of brand, customer experience and digital marketing.
Here, we recognised the expertise Niamh brought to the table; and her hands on experience building a desirable brand and designing a memorable customer experience. At the helm of Skin Software, Niamh created a brand from scratch, built on trust and getting the outcomes right for customers. Niamh has mastered the playbook to build a reputable digital brand; understanding key levers to drive trust, establish credibility, build loyalty and foster word of mouth. While this playbook is often put to work in categories like wellness, fitness and fashion, it has not been extended to migration. And arguably the affiliation you have with a company that helps you achieve a life goal of moving to another country has the power to be much stronger than the vitamins you buy! Niamh, Damian and the AfterWork team, believe in the power of brand to create a positive, remarkable experience at one of the most stressful junctures in people’s lives - and the unlock in NPS that follows.
“We’ve identified key similarities between the migration-tech and health-tech sectors, both are professional services with experts as gatekeepers of information. Much of the process can be automated by providing the right information, at the right time, and setting up the system so that the Registered Migration Agent is operating at the top of their scope of practice.” Niamh Mooney, founder
“When considering our acquisition strategy, each visa is a unique product because the target customer is entirely different and we’ll reach each through different channels. SEO and Search will be key channels but so too will word-of-mouth so an attractive referral program is high on our list of growth levers”
Questions we had for the team
This has been demonstrated in the US, will Australia be any different?
Boundless have served over 100,000 families across 10 visa classes, experienced 245% growth in the last three years and were named one of the fastest growing companies in America by Inc. Magazine in 20243. They have proven the business model and that there is money to be made by digitising and improving the visa application experience.
After investigating the success of Boundless Immigration in the US, we hunted for analogues between the American and Australian markets. Through interviews with immigration agents, in both countries, we discovered the technical process, procedural complexity and propensity to using a third party were similar.
These favourable conditions pave the way for a business like Matilda to enter the market. And they aren’t always present. For example, despite also having high visa processing volumes, Germany is a challenging market. Here, migration service providers are much less common and most applicants choose to self-serve. This is partly because the process outlined by the government is relatively straightforward, and also because of the multiple not-for-profits who assist with the application process, particularly with refugee visas.
How we built conviction
As a team, we have had the good fortune of knowing Damo and Niamh in both professional capacities, and as AfterWork community members. Not only are they proven strategic powerhouses, they know how to get things done. Consistently, we have seen them execute, rise to challenges and collaborate effectively. They are very much known entities! We have fundamental confidence in their ability to put real money through the business and overcome execution risk. We share their vision to improve the migration experience, starting with visas and believe the market is large enough, and conditions ripe enough, for their success.
https://www.boundless.com/blog/boundless-inc-5000-list/