Atlassian duo hit new heights

Mike Cannon-Brookes and Scott Farquhar are now worth $25bn each, thanks to bumper pandemic demand for their software.

Atlassian’s quarterly results have bolstered the wealth of founding duo Mike Cannon-Brookes and Scott Farquhar, who are now worth an eye-watering $25bn each thanks to bumper Covid-related demand for their cloud collaboration software.

Atlassian’s shares soared by 13 per cent after hours to $US302 ($408) on Thursday US time, after the company posted stronger-than-expected projections for the fiscal first quarter. It also reported fourth-quarter revenue of $US560m, an increase of 30 per cent year-over-year.

The company is now worth about $90bn, giving Mr Farquhar and Mr Cannon-Brookes – who have held on to a majority stake of the company they founded – an on-paper wealth of $25bn each.

The pair were ranked as Australia’s third and fourth richest people in The List: Australia’s Richest 250 in February 2021.

“Our fourth quarter was a ripper of a quarter – as we Aussies say – as we added over 23,000 new customers, grew subscription revenue 50 per cent year-over-year, and continued to see cloud momentum build,” Mr Cannon-Brookes said of the results.

“We are incredibly proud of our resilience and execution during fiscal 2021. We continued to innovate with five new products built on top of our cloud platform, surpassed 200,000 customers and $2bn in revenue, and added over 1,500 new Atlassians to the team.”

The team-collaboration and productivity software company expects revenue around $US575m to $US590m, up from the $US459.5m it reported in the year-earlier quarter and ahead of analysts‘ consensus projections of $US539.1m.

It said it expects first-quarter earnings around 9-10c per share, or 38-39c per share on an adjusted basis. Analysts are targeting an adjusted EPS of 30c.

In the June quarter, Atlassian topped analysts’ earnings and revenue projections as well.

The duo famously met while studying at the University of NSW and were catapulted into the ranks of the wealthiest people in Australia after Atlassian was listed on the NASDAQ exchange in the US in 2015.

Their software is used by over 230,000 companies globally, who use its tools to collaborate on projects and teamwork.

Mr Cannon-Brookes now has a string of green energy-focused investments and a stake in the ASX-listed fintech Tyro Payments, and has also put money in dozens of start-ups via his Grok Ventures. He also has a penchant for Sydney luxury property, owning more than $250m worth of houses, ranging from Australia’s most expensive mansion – Fairwater at Point Piper, which cost $100m in 2018 – to other holdings in Sydney’s northern and eastern suburbs and the NSW Southern Highlands.

Meanwhile Mr Farquhar’s Skip Capital has more than $50m spread across at least a dozen start-ups, including leading funding rounds in the workplace safety app Safety Culture and the fintech Airwallex. He also spent $71m on the historic mansion estate Elaine in Sydney in 2017.

In December, Mr Cannon-Brookes became a minority owner of US basketball team Utah Jazz after joining a consortium that purchased it for $US1.66bn.

Mike Cannon-Brookes (baseball cap) and fellow founder of Atlassian, Scott Farquhar pictured together in their Sydney HQ

“It starts off as bullshitting in the pub, like ‘hey this would be cool’,” Mr Cannon-Brookes told The Australian in an interview about the purchase.

“Then a few years later, fast forward to one random Tuesday morning I get a call that ‘hey bro, this is happening. I’m calling to see if you want in or not’. And I’m like ‘f. k yeah, OK. Wait, I’d better check with the wife. Otherwise, f. k yeah. I’m in.’

“It’s three good friends, all sharing a passion for basketball, all have quite good business minds and ability to do things from outside the mainstream.”

Multiple fast-growth Australian technology start-ups have already sprung from Atlassian’s ranks, including customer feedback company Dovetail, search start-up Sajari and workplace communications provider Pyn. These companies were all started by ex-Atlassian employees and are part of a growing halo effect the company is having on the industry.

“I couldn’t be more proud,” Mr Farquhar said in an interview for The List: Australia’s Richest 250. “And I would love Atlassian to be the 10th biggest tech company in Australia. That would be a great outcome. That’s success to me.”

Additional reporting: John Stensholt, Dow Jones Newswires