Right. Okay. Apologies for that. Thanks, Karen. Thanks all for joining us this morning. We'd like to run through an update, and most of you will have read, as it published last week, the capital raise information as part of the update. We do want to run through that with you, give you a little bit of detail, context, and then keep as much time as we can for open Q&A. We welcome all of your questions. Please feel free to put them into the chat as we go. We are recording this, and it will be posted to our investor hub. Obviously, Karen Gilmour, our CFO, on my right-hand side, and I'm Trent Lund, your CEO.
Morning.
Good morning, all. Let's jump in. We'll start with company performance and outlook and talk a little bit about the capital raising and the intention behind it. I'll dive straight in. I suppose just for those who are new on the call, really just a reminder, we are a Regtech company, so regulation technology, effectively meaning regulated transactions, particularly around super. We focus on compliance from hire all the way through to retire. Superannuation is the market we've really started our position in. We're delighted with the position that that's in right now. Obviously, that is because it gave us the greatest reach to customers in the market. In particular, payroll and HR professionals who are our target audience. Purpose of the business, making compliance effortless.
The more complex compliance gets out there, the more relevant we are, the harder our job is, obviously, the more required we are by the market. We trade off one unified platform. As we grow and expand into other segments, you will see our cost benefits really start to play there. If I just roll through, a reminder to people and really an understanding of our business. We do talk a lot about super because that is the here and now of our business, because really our business evolves across four segments. The main segment today is super. We believe there's a very large addressable market, and we've already seen fairly substantive success there. Six out of 10 of the largest funds use our software in one way or another today. We are also growing in our footprint, in particular through our MUFG partnership.
That reach, we have a little over five million contracted users right now, a long way towards our seven million target. Of course, getting them on board, getting them transacting and paying their super is the critical juncture we're at right now. That said, we don't see super stopping at that end. We do see growth. We see growth across other funds. We also see growth as we move into the decumulation phase. Actually, there's been a lot of reporting on that lately in the AFR, started work. There's been a fair bit of conjecture and conversation, actually Wrkr is very well poised with helping and working with the funds as people move out into decumulation away from accumulation using the same technology we provide for them. The other segments are critical for us as we move into pay.
Wage payment, disbursements, Single Touch Payroll, and through the acquisition of PaidRight, paychecks and pay compliance management. All of those we actually have fairly substantive experience in. It is really bringing the customer base on first with super to be able to provide those products. Then credentials being the latter segment, we see that as a more lucrative segment, but it really benefits from having infrastructure that is robust, secure and trusted, as opposed to how it's dealt with today, which is through many, many small providers dealing with PII information. That's not as secure. The long-term strategy, of course, is direct to the consumer. Engaging a consumer in their data around their credentials, around their pay and around their super, it opens up a door for benefits, helping them navigate their health and wealth into the future. Right now, we're grounded in the present.
I'll let Karen talk a little bit about the performance to date, and then we'll jump into the ramping up of users and also the capital raise.
Thanks, Trent, and good morning to everyone. Thanks for joining. I just wanted to jump into the quarterly results. The year finished really strong. We had a very strong year in terms of quarter in terms of cash receipts. That was really driven by seeing the funds come in from all the development and implementation that we as Wrkr have done across the MUFG funds. Obviously, we are starting to onboard across AustralianSuper and Rest. The quarter also saw us bring on four smaller boutique funds, which gave us NESS Super, LegalSuper on time. It was great to see that all happen without incident. Start to get those people onboarding. Additionally, we had some good cash receipts for our annual license fees across our platform as a service customers and also with MUFG. There's a competitive license fees.
That's what really drove the Q4 cash receipt up AUD 2.5 million from the prior quarter. That obviously gave us a neutral operating cash position. We've spoken about the fact that we've invested quite a lot of resource into making sure that the implementation goes well across the funds. That's included data migration projects, that's included Hypercare support, that's included release management on our feature development, further transcription in platform and onboarding, improved the security posture. There's a lot of fraud in the industry around payments, generally, making sure that that is a product so we can be in sync for signals in the market, make sure they're protected there. Also went live with Payday Super on 1 July, that came with feature development in terms of the way that SuperStream changes happened, and also introducing NPP payment method, PayID.
There was a lot going on in the quarter. It was really great to see the team working together, achieving the go-live with Payday Super. That leads me into the full year. Cash receipts of AUD 18.2 million, our best year on record. Increasing from AUD 9.9 million in FY 2025, quite an impressive increase in cash receipts. As I said, a lot of that is implementation and development work. Underlying that is approximately AUD 10 million of ARR that we'll be taking into FY 2027. The Rest is made up of that development percentage. Now we're just really looking forward to getting all of the employers onboarded, that they start making contributions, which we're definitely seeing, and start to now increasing our ARR throughout the year.
In terms of our cost base, we ended up with a negative operating profit of AUD 1.6 million over the year, really due to the reasons that I mentioned before, and making sure that we have got the resource to make this a successful implementation and contract year for our partner funds. We've made quite a lot of investment in the platform as well in the year, AUD 8 million of capital investment. Really, we're seeing some amazing features in the platform. Onboarding is taking no time at all for people to get their first contribution made once they're onboarded and they've gone through those AML and KYC checks. They're getting excellent feedback. Really good experience as well. We'll see that stabilize into the first half of this year. There's always with any platform, continual feature developments.
We're also focusing on the PaidRight integration, just making sure that we can have full with tax increments maps available once we've got enough employers with us. It can make that more important a little bit more to move forward. Stabilizing cost base, seeing that ongoing investment continue, but shifting into a more what's the next horizon around paid. If you can get from there, that would help us the way further. Yeah, that can open any questions. If there's at the end, I'll hand it back to Trent.
Great. Thank you, Karen. I want to talk about the numbers and the flow on of customers. Just a couple of things to explain on that other slide, is our controlled onboarding ramp as it tracks. Just want to give our shareholders some context here. A couple of elements. Number one, although we built data migration in, and we've built with the funds, that was a large investment as well as tight fraud controls. That has increased our cost, but actually it has made for a much smoother transition. There are two factors that have been at play. Just so everybody has context here. Number one is we put very tight fraud controls into the system. As a simple example, you can't take a photo of yourself of a photo of a photo.
Our technology can see that and understand it, we red flag you and block you from being able to come on and make claims. That increased friction, good result, has put us in a very unique field of zero dollar fraud. That's enormous when you consider the amount of advertising, marketing, and awareness that went on by the funds to bring people toward either Rest Pay or Aussie Pay or Aussie Solution, or the other big four. While we're really happy with that, we were able to use that control period to now reduce that friction by around 90%, without actually increasing any risk. We continue to monitor. That is one of our highest, most critical programs. That's an excellent result, right? It means you put friction in the system, it slows users down.
The other side of that consequence is AustralianSuper and Rest have had major transformations of their contact center, taking their contact centers in-house. That means when you put friction, you provide lots of phone calls for them to have to deal with. They have stabilized how many invites go out to users to ensure that they have the capacity to handle those calls. Where we sit this week, just to give you an indication, the highest invite list for customers, three weeks ago, four weeks ago, would be 10,000 businesses. We now go out to market this week, one of the funds alone had 46,000 businesses. That gives you an indication of their level of confidence of their ability to bring customers on very, very quickly without unnecessary friction. What did that mean?
It really meant we brought customers on at a slower pace than we would have liked. That impacts the total ARPU per user this year because many users will be on for three months less than we would have typically liked, three months less transaction. That's a bit of a background on the controlled ramp. I think it was well-balanced. We're really happy with the position that puts us in. As we now see, the jump has been quite significant, and I'll jump through those numbers a little bit with you. Across the clearing house, we've contracted about 4.4 million users across the funds. We also have our own users on top of that are growing at quite a fast pace, our 600,000. It looks to be close to 700,000 by the time we migrate them on. About 111,000 organizations.
We have set a target ourselves of 250,000 organizations. Where have the months been? At the 20th of each month, most recent data we can pull for you. We had about 6,000 organizations on. They loaded their users, about a million users, and then sat quite still, didn't make any processing. They went through and cleaned their data and got their data ready. 221,000 users. Total contributions processed, about AUD 100 million. That's May. Moving into June, 18,000 organizations uploaded themselves onto the system by the 20th. That added about another 590,000 tax file numbers, unique tax file numbers. Actually lots of small businesses in that hump. 404,000 paid their super. That's ahead of paid super. Not surprising, given small businesses will try and delay, we think, a little bit longer.
Hit June, as at a week ago, we're now 35,000 businesses, 1.9 million, 720,000, and about AUD 1.36 billion in monies that have processed over the clearing house. The ramp-up is actually quite significant. We see that total number for the year, just to give you an idea, processing around about AUD 20 billion. AUD 1.3 billion at the 20th of the first month, thereabout. We see that growth rate pretty high. It's stabilizing. At the moment, it's about AUD 50 million of transaction every day. In terms of users, and this is the number that really matters, for the last week, we've seen the uptick stabilize at about 30,000 users per day. That's 30,000 tax file numbers per day. We believe that will maintain at least over the next quarter, but likely drop off as we move to the tail end of customers.
Give you an indication, our major funds have now deadlines in place. The Small Business Clearing House that's used by Rest and the boutique fund moves to read-only at the end of July, into August. AustralianSuper complete their migrations at the end of October. We expect we'll keep the systems live and help support them for an extra month of lagged customers. On the most part, they are driving forward now with ambition because they feel incredibly confident on where they're at in the platform. What does that mean for the revenue? Let's just talk about that. The gray along the bottom here, the AUD 18 million that was achieved last year, of that total revenue, what was ARR, license-based revenue, is sitting at around AUD 9.9 million. We expect that to go organically. It's already growing.
We expect it to finish the year closer to AUD 11 million. For those who've been around the business for a while, these are our license contracts with the other funds, ART, and so on. ART, Commonwealth Super Corporation, IOOF, as well as the ClickSuper revenues. The green line is our revenue line because revenue lags our onboarding of members because our ARPU of AUD 7 takes a full year to achieve. If we take the bottom line, the brown, the yellowish brownish color, that rate is 15,000 users a day. If we were to maintain 15,000 users per day, the end of this financial year, we would be sitting at around AUD 37 million of total ARR. That means FY 2028 starts on a minimum base of AUD 37 million, right, of ARR revenue, because we've really moved out of consulting and lumpy revenues now.
Obviously, if we can maintain the 30,000- 35,000, we will achieve all of our contracts, and have ourselves above the AUD 40 million, and our revenue line will be much higher, earlier and ahead of schedule at April. It means we'll have capacity and be hunting for more funds to bring more users on board for the platform. The numbers that you see in front of you are really the MUFG contract on top of our existing license contracts. Revenue, the green line, does lag the ARR. The ARR is an exit rate, so it's the average of the last three months. Annualized revenue, license revenue, that builds forward. We get that forever into the future until these contracts are no longer in place. Actually overall, really healthy position to be in for the company.
I can bring this chart back up when we get to the Q&A, if that's helpful for people. One question that was raised, I'll just head off here, could our revenue be higher in the year? Yeah, absolutely. We don't have business targets at that line. We are pushing for business targets higher. We want to set expectations because there are two things here that we don't have visibility of where I sit in front of you today, and that's the quality of users. How many users are coming on a weekly and fortnightly versus monthly transaction base? We won't have full visibility of that until about midway through next month. The second thing that drives variance, obviously, is there is a lag of payment.
Traditionally, it's about at the end of the month, we bill, we then get paid 30 days later, although traditionally, we've seen payment at the 60-day mark, which means cash is about 90 days beyond the, hence the green line, beyond the brown line. That's very much the focus for the year. We feel actually it's incredibly strong position, which leads into the capital raise conversation. We had quite a lengthy debate in the business around the need for cash or not. I'll talk to that in a bit of detail just so you can understand the conversations and decisions that we took and took seriously. Where are we? Effectively, our confidence, we are looking to be incredibly confident when all eyes are on Wrkr. Where are we right now? We are still in a sales process for four funds, on top of the existing fund.
Obviously, two outside of MUFG, the two obvious candidates within MUFG. We felt that being close to our cash reserves was not the right thing going into that space, we actually felt it made us vulnerable as a business around payments and payment terms. We want to be in a position of negotiating strength with our partners, and also with our upcoming funds. In effect, we're not in a position where we're negotiating on price because our price discount has been set by AustralianSuper bringing the volume they bought to MUFG. That was really what was important to us. Confidence in front of prospect funds, confidence in front of AustralianSuper and Rest who are having to make the call to turn off and hard switch from their prior system. What does that mean? It means no going back.
That's really good for our business, we need to be rock solid for that. Also, we've acquired PaidRight. We have assets already in play in paying credentials, we want to get on with it and scaling, we don't want to be recurring that for 12 months, because we know that there is build to be done, and the revenue will significantly lag build. If we want FY 2028 to have all of the growth engines in play, we really felt we had a need to be in that capital position. What that meant was, as you will have all read, we took the decision to go and take a placement of AUD 10 million. We chose a placement on the basis of speed and cost to execute. We didn't want this to be a lag or a distraction on the business. Look, lots of conjecture.
I'll talk a little bit about it from a market perspective. In this market where there is uncertainty around capital gains, tax rulings, where we look like we're spending money ahead of the uptake of users and look come raise, look like we're likely to raise, we just felt it was doing damage to the share price, share price stability, and the interest in our stock. That was certainly one external element. We also felt the markets themselves are quite vulnerable at the moment. We've seen the discussion on SaaSmageddon. The reality is, we use a SaaS pricing model, but we are a regulated transaction-based business. We're not vulnerable to the concerns of SaaS companies. Also AI, which cannot be used on the data that we use, but actually can be used to fast-track new products and services into market.
We see it as a distinct advantage, not a threat. That said, you've got to explain that to a market that is fickle. We've seen most SaaS companies come down, as far as around the 50% mark. That really drove our decision to say, "Be prudent and be on the front foot." Give you an insight, the debate really came down, to be honest, between ego and commerciality. If we backed my ego, we would run and thread the needle. We would have managed our cost line. We would have gone into 2027 in a very good position.
Good advice from the Board and good healthy discussion, to be in a position in November to need to raise, I think it would've been a difficult position for me to look my investors in the eyes and say, "We backed my ego as opposed to good common sense." We've made the decision to raise now and be in a healthy position to move forward. We believe that's going to pay dividends for us. The final bit is, we've spoken about the why we're raising, just where does the money go? Obviously, we're still going to spend very cautiously from here until we can see this current run rate of 30,000 continue. If that continues, then we are free and clear on our core business. Customer onboarding and revenue generation is the number one focus still.
Payroll integration, we continue to work in the payroll integration. Obviously, we had 18 existing from the ClickSuper world that we've been able to migrate. We've actually gone far deeper with both SAP and with Workday. We feel that provides us a healthy opportunity. In particular, they serve a lot of customers that are not with our existing funds. The third, obviously, product innovation needs to continue in this business. We want the asset of PaidRight to be yielding dividends. This is not a, "Well done, you've won Super," and that's the end of the value of this company. Super is one segment. We want to be prepared to grow into the other. Working capital is key and obviously the capital raising as well. That really is the summary of it. I would say, a couple of insights before we jump in.
Program's been an amazing success. I won't disclose the numbers, but our fees are a fraction of what has been spent by the major super funds in building out this transformation program to use our software and take ownership of their call center that they totally experienced for employers. They are proud, and anyone who's driven past a billboard in Melbourne or Sydney would know it, because you've seen AustralianSuper advertising it on billboards, which is pretty new. They haven't been in a position to be doing that for a long time. Rest Pay, we're finding it difficult to beat them on digital marketing right now because they're investing so heavily out there, and being successful, which is fantastic for us. Customers are proud, our clients are proud. There was a collective caution as we went through the rollout. We are very confident we're through that.
I think the 46,000 invites, the turnoff dates of their existing clearing houses is a clear answer to that. The friction, while I'm glad we did it, we had to train our software to understand the fraud detection, and now we're still at zero, but with low friction. I think that puts us in very good stead. A fantastic quarter, even though we extended Hypercare. That is a positive for the business. Very strong ramp since July. That tells us even though the ATO may not be fining aggressively out there in the market for Payday Super, there are enough organizations that are making the move.
We should also keep in mind that the concern for an organization is about cashflow management of paying super early, not the cost of multiple transactions, because that bill is being picked up by the funds because they pay the transaction fee to Wrkr. Management are bullish. We're really excited about where the company is going to. Yet, we feel a lot more confident running the start of the year with about AUD 20 million in the bank, for sure. We think that makes us a stronger partner, particularly as we continue to navigate and work with MUFG on bringing on the last couple of funds. The opportunities sitting in front of us are excellent right now. That's where I would leave it for you, but please fire off with questions.
We'd love to hear what you're interested in, we'll, as you know, you know us by now, we'll answer straight. Is the mic thing going on or not?
Hey, Trent. Hi, Karen. I've got a few questions, but I'll kick off with one.
Michael, are you talking? Hang on, mate. I can't hear you. I've got you muted. One second, mate.
Can you hear me now?
It's not good at all. I'm going to unmute you all, so you'll have to go one at a
How about now? Can you hear me now? No. I can hear. Any luck here? No. Okay.
Sorry, we're moving AMU.
I can go in the chat.
You can shoot me to see it.
I'm sorry.
Steve's moving. We're not great at tech.
Thanks, Gareth. Thank you. You have muted yourself, Karen
Thanks. Unmuting.
Can you hear us now? Great. John, what's the outlook for investment, spend in FY 2027 and the associated project? A good question, John. The spend at the moment, we expect about the same profile of capitalization, but if I keep it really brief, we've set a ceiling on our cost base, so the cost base, including PaidRight, sits at AUD 32 million. While we'll run a small buffer, up and down over the year, the net position for the year is forecasting set to remain at AUD 32 million. If you assume our current revenue run rate, obviously the revenue or cash received will run under that AUD 32 million position. We would be obviously looking to target either the AUD 24 million line that you saw. There is an AUD 8 million, roughly, expected for capitalization this year in project.
That is predominantly geared for these latter projects, and that was payroll integration and PaidRight. That sets us really in a position we would be expecting EBITDA positive, through this year when you take into account capitalization. For major projects, we have no acquisition planned at this stage. We think we're bit off and up. We want to make sure that we are positive revenue in position before any more bolt-on acquisitions. That said, the investment of Pay comes on the same platform, so we don't expect to be adding an entire build . It's fairly small. The ARR chart, can you comment on where you think the rev might land between the minimum rev base? Look, I don't want to set the wrong expectations or forecast here. Obviously, everybody likes a line they could jump over.
We are targeting, though, for or just below AUD 28, subject to timing. For our business, we're engineering towards that, feel good about that. It could be better if we get a much faster take-up. We've got the switching over of the inter-fund gateway, which happens in November. If that happens, in the correct timing that the current project plan is at, then we'll actually be in better shape. If that's delayed, there'll be a lag on the second leg of transactions. Hence the conservative figure, but we are expecting to go well above that. Certainly AUD 28.
Yeah, I think just adding to that, the conservative position that we show in the chart in the green line is the AUD 24 million revenue figure. The dotted lines are really that ARR. We're looking at the ramp-up rate at the moment in terms of how many users are being onboarded per day. Depending on how we see that continue or slow down, will really depend on where that exit ARR rate at the end of the year, will drive the revenue that we've entered into FY 2028 with. The longer it takes, the less ARR we build up over the year. The shorter that it takes, I think that signals the better that ARR acquisition will be.
Second question on the respective, Cam. In the shorter, so FY 2028, we see AUD 50 million being the ARR, so the annualized contracted revenue through the segment. We can see Pay being an equal segment, particularly with the PaidRight asset as well as wages, Single Touch Payroll, and other reporting, that we have the natural data flows for. It will take longer to build to that AUD 50 million, but it won't take a large cost base because the core product development will be far, far less than what the super platform has been. Just as an example, complexity in our platform are things like complex org. When someone like Guzman y Gomez comes on and they have many, many different stores with different ownership of the stores, different payment rights and approvals inside between group ownership versus singular ownership, we've had to accommodate for all of that.
It makes our system very, very robust. When you add wage payment, we don't need to make any changes to those elements. At that end, we think there is a similar opportunity but won't be as near- term in the mop-up. I think there will be more M&A to achieve that, the mop-up of credentials. It's a more lucrative segment. We think AUD 50 million is a sensible target. Rule of thumb, each segment in our business only exists as a segment because we believe it is a AUD 50 million ARR potential segment. There is enough TAM, there is enough relevance in our product. We'll get faster as we grow those off the same base. Hopefully that answers for you, Michael.
Yeah. Can you hear me?
There we go. Gotcha.
Cash costs are running at AUD 36 million. What's coming out if you're saying it's a AUD 32 million ceiling?
Switching your speakers. Sorry, Hayden, do you mind repeating the question, please?
I was just saying cash costs from last quarter was running at AUD 36 million. If you're saying we're going to be AUD 32 million for next year, what's coming out if CapEx is staying the same?
We've had quite a lot of cost in terms of the data migration piece of work in the year. That's been quite a material component, using subcontractors for that. That will actually save us once that piece has come off, around AUD 2.5 million in the year. Additionally, we're pretty much at capacity apart from this answers John Burgess's question as well, in terms of resources. In order to scale up the resourcing quite quickly, we did engage recruiters. Obviously, when you've brought on about 40 employees in a year, not all were through recruiters, but we did have quite a high recruitment cost that will come off as well. They're the kind of key material things that are coming off. We've also got some additional resource at the moment around our Hypercare.
We have a team of what we call our worker bees, who are amazing customer success people who are helping with the transition and onboarding our Wrkr Direct and ClickSuper transition customers. That is a scalable team, which will also come off as the transition progresses. We've got some key areas of cost savings into FY 2027.
Program management is the other side, Hayden, as well, where once we're through the actual program implementation, we're into a steady state support. It's less a high-cost programmatic approach and more of a meeting SLAs, reporting on SLAs. Because we're operating all the models at the same time, we already have those skills on board. That's been our biggest challenge of running three business models at the same time.
Yeah. Okay. Sure. One more, if you don't mind, and then I'll just hop back into the queue. Based on those metrics that you gave, even the contributions, it looks like you're running ahead even on that low onboarding outcome. And it's a pretty broad range of outcomes on rev as well. It's probably like AUD 24 million-AUD 40 million. I guess why go AUD 24 million given things are still looking like they're ticking up and what's the AUD 40 million predicated on?
I think it's important to understand the chart. The dotted lines are ARR exit rate, not trying to forecast revenues in the year. It's really looking at what that exit rate is on FY 2027 based on the different scenarios. The AUD 24 million green line, solid line, is really just managing the expectation around what is the conservative view just to give our investors and market the position that the business can clearly see ahead of them without understanding exactly what the onboarding rate will continue at, given that it is somewhat out of our control. The key things that mitigate that obviously are the closure of the SCH Online clearing house, which is targeted for October, and the turnoff and complete switch from AustralianSuper from their previous clearing house in November, latest December.
There's some mitigants to that, we really just wanted to make sure that starting the year we are talking to everyone about, yes, where is this conservative position, having a look at what those different scenarios that we'll see play out, which we'll be able to provide quarterly updates as to how that's tracking as we see the data come in.
Just conservative, because if I use AUD 37 exit and compare that to AUD 50 exit, you should book AUD 31 million in 2027 versus AUD 24. It's not that anything's going wrong, because as I said, it sounds like it's picking up. It's more just as you said before, just a lack of visibility. Just expectation-wise?
Correct.
I g ot it?
Yeah.
You got it. Look, we're really bullish, but I think in fairness to our investor community and where the share price is at right now, we felt let's set really conservative hurdles and continue to outperform them. Also acknowledge there are some things we just don't have visibility of or control. As at last week, AustralianSuper sends out 46,000 invites this week. Anything could pause that, pause it by a week or two weeks. We want to make sure we're across it. At this stage, they go, and there's no reason to delay, but it's a step we don't control. I think we just have learnt in dealing with the funds, we also deal with the funds through MUFG at times.
We want to make sure that all of the decisions and all of our confidence is also baked in what we can't control when some move a little slower than maybe we move as a business.
Yep.
John, just to pick up on your one. Yes, the 32, then we take the capitalized investment-
As a part of that.
as a part of that.
I think there's another question there as well. How many FTEs currently, and is this full capacity? One, we just had a new starter today actually, who is going to be our Payments and Data Reconciliations Manager. Obviously, as the funds scale, that role is very key. We wanted a dedicated resource around that. That also feeds into our next growth phase around pay. He'll be working with the product teams and working closely with them about what that strategy looks like as well.
Right. I was going to say, I think the reality is there will be circa another five to six people we can see as experts that the business We're stretched and don't have them. There are other areas in the business where we've now evolved the business quite well and have moved on from. There'll be a conversation around either repatriation of the right people internally or starting to see some change to that total headcount. We've got that 100+ people. We've got a couple of people who move on, find the right next stage in their career. We don't automatically replace. We're kind of picking our positions well, and we're very conscious of keeping to that 32 cap line. It's a KPI of the management team. That said, you'll still see us putting ads out.
We still want the best talent we can get in the market. As we bring on new funds, we've got the capacity right now, we would shift some of that capacity, obviously, directly into helping onboard those funds. There was a question on the funds, if we just go back, the four funds. Obviously, we are very keen on concluding and bringing on Cbus and Hostplus. That would fulfill the MUFG platform. It's healthy for both our businesses because They are dealing with one technology interface into Aaspire. They've had very good feedback from their existing funds. We've had great feedback when we've presented the full solution. Westpac is in and providing to those two right now. We keep a watch on that, whether they're going to invest heavily in their platform and compete head-to-head.
The reality is their biggest client in AustralianSuper is now with us. We think that's a pretty fair barometer of what is likely, assuming funds are looking for the same competitive proposition that they sought. I don't know how to tell you that I feel good about that area. The other funds, we're actually seeing direct reach out. I think we've been in market now long enough to be seen and seen as a trusted provider. There's good feedback and good. It's a very tight industry. People move around, which is great. We are getting the net benefit of that now. People who were our clients before popping up in other funds. That said, this next 6 months to 12 months is going to really create a different type of noise.
That is when AustralianSuper and Rest are growing their default member base because of the quality of software they're putting in front of their clients. That's the test. When they achieve that, we have delivered more than what was ever expected. It forces other funds to really look towards us as the model to move to. I'm not backwards in having those conversations either in the market. Either we're growing more funds or we're helping our current funds grow. They're all users on our platform to me. That's the brutal truth.
PaidRight. Any update on the PaidRight integration as well? Question from Michael.
Yeah. PaidRight are going well. Look, we set them a pretty tough task, which was, don't let our people destabilize you or vice versa, even though there's enormous excitement about the coming together of the two knowledge sets. We asked them to stick to what we call four on four. They were AUD 4 million cost base, AUD 4 million revenue. We felt comfortable enough to part ways with their CEO who had helped navigate through the transition. We achieved those results early. They hit the numbers we wanted, and the team are growing well. That said, we have already started a project. This is where AI comes into play. A lot of people are unaware, the bulk of the market, not just those on Small Business Clearing House, there are tens of thousands of businesses not using payrolls in this country, who need help.
They need something very simple. Through PaidRight and through our system, we are starting to build out a solution into that space to allow companies to both calculate their pay and do it correctly. Also then generate the SAFF file into Wrkr, generate the STP file, generate the payment file into Wages. Targeting small business, which is a massive sector. That is the first early area where we've been able to navigate together. Actually, the funds have fed back to us. They're pretty keen on seeing that evolve because they have a larger customer base than we originally thought in the small business area. Hold your horses on that one in terms of, we're not baking in any revenue expectation, that is where we are doing our building.
Yes, we are heavily leveraging AI around the various user interfaces and experience, but not AI around the data itself. We have a built-in AI, a homegrown model inside PaidRight, which allows us to vet and assess whether someone's paid correctly. That's been the journey with them. We're trying not to bite off too much and not let them get too excited about that when we still want our AUD 4 million. They've done that in spades. We're happy, but this year we move in to create new features that will be on the Wrkr platform and transition out of that AUD 4 million, just change the shape of it. More ARR, less services, more partners. That's the work being done for this year. Setting expectations again low, but that said, we're pretty excited with the trajectory right now.
When will PaidRight ARR be visible enough to be reported separate so investors can see its own progress? It'll be reported on this year, as we go and grow. It'll be wrapped, though, into the broader Pay segment. There's a merging of some of the products there for the wage payment, back payment, and the likes. You'll get good visibility into that. I did mention in a recent call, the main job is for Wrkr to be driving referrals into PaidRight. Actually, it's already driven two referrals into Wrkr, which has been fantastic. We owe them right now. They were two quite substantive companies that they've opened the door for us on for our standard solution, which is excellent. Any comments regarding exposure in Hong Kong? Just to maybe close out on a couple of these questions.
No exposure, but we're in Hong Kong. We've got some choices to make. We make a reasonable piece of license on Hong Kong. It sits inside that AUD 10 million ARR. We're going to make a call at some point. Do we get up and grow and really be aggressive in Hong Kong, or just stay behind the scenes supporting MUFG? They've only rolled it out to HSBC. That same solution has several other opportunities we see in the market. I just think the spread we have today is quite large without taking on extra costs. When you go into another geography, there is no way of avoiding extra costs. You need critical mass of people. Right now it costs us very little to support with reasonable revenue. We're going to just keep the foot and the eye on that market.
I want to win in Australia and conclude the Australian business before we look into the other geographies. I'm really happy with what it contributes. I'll take a AUD 500,000 for low to no cost. I just don't want to go. You've got to invest to grow up there, and we just don't want to at the moment. Good to have the options. What about the future market cap predictions? Couldn't tell you, Luke. We don't predict on future market cap. For what it's worth, I'm incredibly bullish on this business. Joe and I aren't sellers. Those who know me know my aspirations and where I want to take it to. I can see a really clear path. I think we're paying the price for current market conditions, and questions on is it real? We're burning cash without people seeing the revenue.
I think, as people see the revenue come on this year and the customers come on, I think we go back and upwards from where we were, is my sense. My job now is to make sure that we're sharing that information with everybody, and we're pretty excited that we're actually in a position as at today, we track it daily. I've got green ticks across the screen. We are expecting on a monthly basis, we're in a good, healthy position, and we can see where we're tracking to that graph that you saw before. I think that's pleasant because this is not a great news real business. To add a super fund, they're few and far between. It's about adding the members and that's what we want to spend the time educating the market on now.
Just got another question here. Any update on gross margin exiting FY 2027 at your targeted ARR? Regardless of where that ARR is, we're always targeting a gross margin of about 80%. That's kind of consistent- with the industry and what those costs to sell are for a SaaS technology company. That's where we will continue to target, regardless of where that targeted ARR finishes.
Perfect. I think that kind of closes us on time. We've recorded it, so I'll definitely put it up. As always, feel free to use our investor hub online, fire off questions. I look at the business where it is sitting today. This is the most confident I have ever been in this business. We're in really good shape. I wish you could come in and take a visit into the offices, and I think our AGM will be based here in the Sydney office, and hopefully people get a chance to just see what's going on in the engine room here. Our investors should be as proud as AustralianSuper, and Rest, and the other funds are with the decision to go with Wrkr. Thank you again for your time. Again, always reach out. Thank you.
Thank you.