• Xero’s Melio deal proved payments are the prize
• Lessn raised big-time from serious backers
• Early days yet but traction is kicking in

 

Special Report: As Xero writes a $3.9 billion cheque for Melio, eyes turn to the next potential rising star in the B2B payments space.

When Xero announced in June it was buying US-based payments platform Melio for a staggering $US2.5 billion (around $3.9bn), the deal received plenty of attention.

It was a bold, strategic swing at finally cracking the US market after years of trying.

And the message was clear – the future of small business software lies in owning the money flow, not just the books.

Melio, despite still being unprofitable, had traction.

With $30 billion in payments flowing through its platform and a slick integration into accounting software, it became essential plumbing for small businesses.

And for Xero, which had spent the better part of a decade laying groundwork in the US with limited success, Melio was the missing piece.

Now, investors are asking: who’s next?

 

Heavyweight backers

That question could well lead us back home – to the Sydney-based Lessn – a fast-scaling B2B payments platform some are quietly calling Australia’s Melio.

Lessn recently confirmed it had raised more than $1 million from a tight-knit crew of heavyweight investors.

We’re talking serious pedigree here, including: Michael Masterman (the man behind Element Zero and Twiggy-linked ventures), Dean Swan (ex-Monday.com Asia Pacific), Brendon Cook (founder of oOh! Media), and Ian Lennie (Zepto Payments founder), just to name a few.

It wasn’t a public raise, and it didn’t need to be. But it was heavily oversubscribed.

“We’re backed by investors who understand what it takes to grow a FinTech at scale – and they believe in where Lessn is going,” said founder and Chief Growth Officer, David Grossman.

“This capital gets us to cash-flow positive and lets us keep building with focus.

“We’re staying lean, staying fast, and staying laser-focused on delivering value to our customers.”

 

So, what’s the fuss about?

Lessn isn’t trying to reinvent accounting software.

Instead, the platform wraps around it – plugging into platforms like Xero, MYOB and QuickBooks, then takes care of the grunt work using automation.

Once it’s connected, Lessn gets to work: moving money, handling payments, approvals, scheduling and reconciliation – all the clunky admin that tends to pile up on finance teams.

It routes everything through a secure digital wallet, acting as a kind of orchestration layer between accounting and actual payment execution.

It strips out the mess of ABA files and awkward card workarounds, and gives finance teams better visibility and control.

Even suppliers who don’t take cards can still be paid by card. For accounts teams, it’s less chaos. For bookkeepers and small businesses, it’s one less thing to wrestle with.

And it’s not just SMEs.

Lessn’s platform is being picked up by tradies, construction firms and property managers, all of whom have long been stuck in admin-heavy processes.

It’s also helping businesses handle everything from COGS and FX payments to everyday expenses with a single system.

The roadmap is expanding fast, too.

With the fresh capital, Lessn says it will be fuelling its hiring, shipping new features, and strengthening its product moat in a fast-moving payments ecosystem.

 

Early days, real moves

Lessn’s month-on-month growth is currently sitting at around 30%, with users processing an average of $85,000 each per month through the platform.

Those numbers may sound modest in Melio terms, but it’s worth remembering where Melio started… and how quickly things can accelerate once product-market fit locks in.

Behind the scenes, the team is clearly fired up.

“Lessn solves real problems for our customers in an inventive way, which is what inspired me to join the team – in what has been the most exciting move of my career,” said Annie Porter, the company’s account management and sales support lead.

“Watching David defeat every single obstacle at a relentless pace is where the team derives their determination and belief in Lessn’s future.”

Of course, it still has a way to go before hitting Melio’s $30 billion run-rate or attracting global M&A suitors.

But the company is keeping things tight, building real customer traction and solving the kinds of problems most businesses still quietly put up with.

Whether it ends up as Australia’s next billion-dollar fintech or not, the runway looks long and the wind is at its back.

 

This article was developed in collaboration with Lessn, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.