Online dispute resolution platform Immediation was placed in voluntary administration last week, seven months after the startup’s founder and CEO departed amid a $2.8 million capital injection.
Joanne Dunn and David McGrath from FTI Consulting were appointed administrators to 3 Australian entities: Immediation Pty Ltd (the head company), Immediation Platform, and Disputech IP Holdco, on October 26
The appointment does not include the NZ, UK and US entities within the group.
Dunn, the senior MD of corporate finance & restructuring at FTI Consulting said they were now seeking expressions of interest for a recapitalisation of those entities or a sale of their assets, with indicative offers due by next Wednesday, November 8.
Immediation had raised around $19 million in investment and grant funding since March 2017.
Barrister and founder Laura Keily launched the platform in September 2019 having $1.8 million to that point from boutique investment firm SG Hiscock, corporate broker Patersons Securities and advisory firm Alto Capital.
The platform was created to take commercial disputes out of the courts and make their resolution simpler and more cost-effective, claiming to save up to 98% of the cost of going to court via fixed fee online mediation.
At launch Keily said Immediation is backed by a panel of 90 independent legal experts and dispute resolution specialists to help resolve commercial disputes online.
It appeared to be a success, with more than 10,000 cases dealt with and more than 16,000 registered users. In May last year, having launched the Sport and Recreation Complaints and Mediation Service (SRCMS) in New Zealand in 2021 collaboration with the NZ government, Immediation created a similar resolution service in Australia, the Independent Sport Complaints Mediation Service (ISCMS).
During the Covid lockdowns, the Victorian Civil and Administrative Tribunal (VCAT) enlisted Immediation to run virtual mediation and hearing sessions online.
Forbes Asia listed the startup in its 100 to watch. There was a $3.75 million Series A in late 2020 led by Melbourne billionaire Alex Waislitz’s Thorney Investment Group, which then backed a $3.6 million raise for US expansion two years ago. Wunala Capital and Perennial Private Investments were also on the cap table.
In October 2021 Keily reported that revenue had grown 6-fold over the previous 12 months with user growth increase up 2,000%. Christine Christian became company chair, with Afterpay’s Elana Rubin, and Rampersand founding partner Jim Cassidy on the advisory board.
Then in August last year, another $5 million flowed in from a consortium of institutional and private investors, after operations began in the US, UK, and Asia over the previous six months.
“To secure this new funding in this market is a huge endorsement of our rapid expansion into new markets, leading technology and business plan,” Keily said at the time.
But just six months later in mid-March 2023, the company’s difficulties emerged amid news of a $2.8 million “capital infusion…. to ensure Immediation’s commercial momentum”.
Founder Laura Keily departed the CEO role “to pursue other endeavours”, replaced by the CFO, while Chrysalis Advisory founder Nick Northcott and early investor and director until 2021 returning to the board, alongside another previous director, Jason Marinko.
“Investors reaffirmed their confidence in Immediation’s business plan and growth trajectory” the company said at the time revealing the changes.
The legaltech’s future now rests in the hands of a potential buyer.