It’s now looking to expand after landing a $400,000 Callaghan Innovation matching R&D loan (now under the Ministry of Business, Innovation and Employment) plus $3.8 million via a seed capital raise.
The raise was backed by Australasian venture capital (VC) firm Blackbird, which took an 18% stake, supported by Rowan Simpson (10%) and Pushpay co-founder Eliot Crowther (5%).
Simpson – the number three employee at Trade Me who went on to become an early backer of Xero and Vend – literally wrote the book on early-stage tech investment with his recent effort How to be Wrong: A crash course in start-up success.
See the video above for some of his tips and blunders or here for his behind-the-scenes take on Trade Me’s $750m sale.
Wakelin bonded with Simpson after cold-calling him for advice.
The former Deliveroo engineering manager co-founded Sterling with Ludwig Wendzich, who has formerly held senior front-end software design roles with Apple and Vend.
The inspiration for the start-up came from their partners. “My wife is a financial controller. Ludwig’s wife is a management accountant,” Wakelin said.
“They are 170 IQ people, but they were copying and pasting things between systems and painstakingly categorising massive Excel spreadsheets.”
Wakelin and Wendzich used generative AI (GenAI) to build a prototype to automate such mundane tasks, using their partners as guinea pigs.
The new funds will be used to boost staff from seven to 10 and to expand from New Zealand and Australia to the UK and US.
What about AI’s propensity to hallucinate or get things wrong?
“We have this thing we call marshmallow on a steel skeleton,” Wakelin says.
“If I message you and say, ‘Chris, I need your receipts for that trip to Cancun’ and you email back and say, ‘I’m just getting on the plane, I’ll be back in two days,’ then I want the AI to understand and send you a reminder in two days.
“But for actually putting the receipts into the ledger, you don’t use the AI for that part. That’s your steel skeleton. You use old-school deterministic code.”
All of the accounting software players are touting in-house AI features these days, but Wakelin says their agents only work inside one general ledger (GL), while through acquisitions or other factors, many of his clients have ended up with more than one GL.
One customer is using both Xero and MYOB Acumatica.
Sterling is designed to manage workflows across multiple programs and draw data from multiple sources, including ERPs (enterprise resource planning software) and accountants’ inboxes. Anything ambiguous gets surfaced to a human.
“Every finance team is experimenting with AI right now, but a co-pilot only works while you’re at the keyboard. Sterling is the autopilot – it keeps working when your laptop is closed and you’re asleep,” Wakelin said.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
