Divio Technologies AB (publ)

Hello and welcome to today's webcast, Divio Technologies, which will present the company's report for the first quarter of 2023. Joining us for the presentation is our CEO John Levin and CFO Fredrik Wallmark. And with that said, I'll hand over the floor to you.

Thank you very much. It's a pleasure to be here. My name is John Levin and I'm joined by Fredrik Wallmark. Before we start, I just wanted to say sorry if the audio quality is a bit poor and that we don't have In Bilge, where the whole company is located on time events and strategy days. In southern Germany, and we are among different mountains, so it's a bit of a bad sign here. I don't know if it's going to be such a bad sign when we plan. So you get an overview of it. I'm going to try to speak clearly. Jo Levin heter jag som sagt, och jag har varit vd i Bilge i tre år. Och jag tycker det är jätteroligt och har en bakgrund inom olika teknikbolag, både stå- in small and large companies, and have worked both as an entrepreneur in some companies and as an entrepreneur in other companies, and are burning for sales in, above all, technology-related companies. That's exactly where we are. And it's really fun. And with me, as I said, is Fredrik Wallmark, my internet CFO. Hi.

I've been with you for almost a year. And I have a background in various different SaaS companies such as CFO, media and career from people who have fled.

But let's get started. A short introduction. Everyone doesn't know who we are, so I can't tell you what we do. In a pretty simple way. But first, a little background. Didio is an old web agency from 2005. We started in Switzerland. as a classic web agency and worked with various web projects for our customer accounts. Most of them were goal-related. We have a CTO who loves to automate everything that can be automated, repetitive and so on. Since we had a lot of services in our customer accounts, goal solutions, especially in the US, he started to build on the solution. som underlättar just hantering och underhåll av projekten. Sedan har vi kommit fram till att den här tjänsten var så bra att vi fick göra en egen räkning så att de andra borde med liknande utmaningar börja. Så vi började en resa med konvertering från konsultbolag till produktbolag. För att göra det så behövde vi ta in pengar We were Swedish based in Sweden, and we didn't invest that much in the company at that time. But we got the advice to apply to Sweden, but we didn't have the money. So we did that, and we got a lot of money from the company. We also got a lot of money from Nasdaq, which we also got, and that's the same company that I joined. And that's where we are now, with TN. Vi är ett produktbolag, vi har lite konsulttjänster, men det är mer relativt, vi ligger mer i anskapet till våra produkter. Idag har vi någonstans mellan 500-600 betalande kunder. Merparten av kunderna är små, de betalar någonstans 5-10-50 dollar per månad. Vi har en subscription-modell, så man använder våra tjänster varje månad. Men sen har vi då ett 30-tal större kunder, det är en primära fokus. Och de betalar någonstans på runt 3 000 dollar i månaden, 60 000 till 70 000 dollar i månaden. Så det är bra intäkter. Men det är framförallt den kundgruppen som vi fokuserar på. And why are we there? Most companies that choose to go from their own servers in a very warm server-scoop in the morning have expectations that this will be very simple, it will be smooth and it does not require much handling when you go up in the morning. But it is not that simple. It still requires that you know exactly what you are doing and it is easy to go up in the same environment We need to add security services and more and new applications and services, so it eventually becomes a rather complex story that must be maintained by people who have no idea. And this can also often be a burden. We need to take very senior developers who, instead of just being developers, we can use them for operations, maintenance of their goals. and make sure that the application is secure and that they are up and running. So we have then decided to make this very simple, carefree, especially for developers. They should work with what they are best at and find the most fun and have tools that meet their requirements. We are such a company, so we take care of the design of the structure and structure it up. all the services that are under there in a structured way, so that it works very smoothly and if something happens, we take care of what happens. And in a way, it frees up both costs and you get more stable services and you can set your own available resources. And the advantage of being a platform is partly that you have cost savings, but also that you can manage your costs. All of them are not interested. Most of them, of course, want to save costs, but maybe not in their favor to predict costs and to know that they are not going to explode the avalanche. You can prognosticate and budget and have control over costs. Then there is also the fact that today, if you do not use a service like ours, but develop directly towards and use directly towards, for example, Ida Bresk, when you are going to set up new regions and they will launch new web applications and so on, there is a lot of manual manual handling. It is also here that the fault is built in, which makes it unstable and can go down. With our platform, it is almost automated. This makes it much faster and it also reduces the risk. And then there is also this with security, which is very important, of course, and it used to be a lot of banks and finance and other financial companies that had higher requirements for security compliance. Now it's starting to become more for everyone due to the fact that security risks and so on increase. IWS and the various morning suppliers, they take care of the security itself, but they don't have the responsibility for the lack of security. built into the slarved web application. And there we add the day. A year ago, we also added the ICCP. It's easy to show that it never fails. So this is very important. Then it's also an important factor. It's going incredibly fast in this world. All of our goal developers, they develop their new services, change very, very quickly. And as a company, keep an eye on it. Svårt att se till att vi vet vad som händer på marknaden. Vår plattform är kompatibel med alla förändringar som sker. För en kund som Fidelity, vad det här betyder, det är dels att man slipper lägga väldigt dyrt i våra resurser. Många år tidigare hade de varit 15 personer. Idag har de allt fler som är resten av vår plattform. But then there are a lot of other things that are very important. For example, security. They can calmly take us back and know that we have a system code. We know how to identify everything and how safe it can be. If a problem arises or something happens, no matter what, it can always happen. If a problem arises, they know that we catch them and solve most of it before it happens. Mycket av det som händer så hinner vi lösa det innan de märker det. Mycket av det är automatiserat. De kan släppa en del av den pressen man har, speciellt när man ansvarar för de här tjänsterna. En annan sak är att det är svårt att hitta kompetens och expertis inom de här områdena. There they can also lean back. They can get our support. We also have a 24-7 support. They can ask us basically anything that is related to this. And we can answer. And we also manage all contact with IWS and their support. So they don't need to have 10 different supports that they handle. But we manage all the support when it comes to the young volunteers. And then it's also important for them not to get lost in the solution. They know it's easy. I'll tell you a little bit about what we do.

Fredrik, you can tell us a little bit about Antares. Yes, we are a SaaS company where we combine both software and infrastructure. Since the product is developed, it is extremely affordable to add new customers. We have a low churn. Our product is very sticky, so that The customers have signed up and entered our solution. And we also receive payments in advance. Working capital. And the figures for Q1. The sales increased by 19%. For Q1, we traded at 4.7 million. In Q2, we traded at 3.9 million. Of which the revenue was 4.4 million. och förra året 3,3% ungefär i linje med 1%. Inte så mycket på personal services i det här kvartalet, men total omsättning av 9 miljoner. Kostnader följer med lite grann uppåt. Det är då för att vi har lite pengar som vi kan ta med och vi börjar accelerera med vår tillväxtresa och ta på oss lite mer personal för att stötta oss både inom försäljning och inom utveckling. And that is that EBITDA has gone down and our EBITDA is a little weaker this year. The MRR is at 138,000 US dollars at the end of the quarter, where it was 135,000. A weak increase, with the cash flow filled with 9 million. So what has happened during the quarter is that we have received a lot of money on our emissions and we have We see a strong increase in the number of needs and the offer we now have is a new service. And we have a strong team with both sales and resources. We are also testing our new offer more than ever before.

If we look at the status of where we are right now, we started with a new sales strategy. We have made a couple of sales strategy changes during the year. We believe that we will continue to develop and improve. We have found the right recipe and we continue on that strategy. It partly looks like we're not dragging these giant dragons that we've made. We will continue to work on them, but significantly more on smaller companies with a greater need for our services. Above all, they can't buy themselves free. They have more to do with being able to get a good service for a reasonable price and being able to lock down important developments and small infrastructures. So for them, it's important, and they can't even sit internally with a physical feeling. So we continue to work on it, and above all, they have a short lead time. And that's what we do, and we have also widened the option. Earlier, we have widened our offer, so we take care of the funds. Earlier, we were looking for funds that were ready with this. They could sit with hundreds of web applications that are completely perfect to put up in the field. . . . . . . . . ... ... ... ... ... ... ... ... good pitch. We have also done a whole lot of work this year where we have changed a little bit in our story. We have made it clearer now that we actually implement it and solve it. We have made some changes in how we demonstrate our product. All of this together makes us have a really good sense of sales. Then we also included bra person. Vi har haft många säljare men jag har nämnt tidigare att det är svårt att hitta duktiga säljare. Nu har vi ett bra säljgäng som är förstärkt också av två stycken konsulter, Anders och Erik. Så vi har ett bra team. Jag fokuserar också mycket på försäljning. Det kunde inte göras mycket tidigare. Jag la alldeles för mycket tid på rapportering och så vidare. CFO Anders kunde göra rapportering. Men nu har jag med mig Fredrik som hjälper mig att avlasta sig av väldigt mycket mer We also have, as mentioned earlier, a collaboration with AWS. We had to go through a couple of certifications, and we are currently in the process of establishing that collaboration. So it's also very interesting, or it will open up very soon. So it's really fun. We're working on new markets, new collaborations. So we have a lot happening in the company that makes us take a good step forward. We set very ambitious goals and we follow that plan from the start. Ja, vi kan väl hoppa över till lite mer om siffror, så vi får hoppa in här.

Ja, och finansiell status då är att vi tog in pengar av 10 miljoner. Vi är väldigt nöjda med den deltagarnivån som var på våran. De pengarna har vi nu börjat använda för att investera i vår säljorganisation. Vi har ett pågående statspartnerskap. if that makes sense, with AWS, Amazon Web Services, which has started a new region in Switzerland, where we are their launch partner, where we have to invest to get something out of that collaboration. But also, we have our product testing class, both when it comes to features that customers ask, the customers that we are in dialogue with would like to see in us. Still from our M2 of Unix, we And with that, I think we're done with our drawing of the figures and so on, and we'll see if we have any more questions.

Yes. Thank you very much for the presentation. I think we'll jump straight to the question time. You have talked a lot about your new offering and you have even sold it to an existing customer. How does it work and do you think it will take off again?

Yes, absolutely. It really does. And it is so. As I told you a little earlier, we made it a bit unnecessary for us. We were very rigid in how we We absolutely did not want to focus on our platform and product. We did not want to spend so much time on consulting. We have to do a little more now to help the customers in this broader area where we help them make sure that their web applications are in the right shape and ready to be moved to our platform tomorrow. And of course it takes a little more time. We get paid for it, absolutely. So there is no danger in that way. But it does make a little more sense. But at the same time, it is incredibly different to communicate with customers. We notice that this will become a clear part of our offer. And that is what they are working on, among many others. And that makes the infrastructure process so much easier. We can guide them, we can help them, we take full responsibility, we advise them and find the best solution for them. They do not need to be so initiated. And at the same time, we also need to build a very strong trust, to be able to have enormous trust in both those who are decision-makers, but not least those who work through the hands and the initiative. So, it was a long answer.

It's no problem. It's no problem. Follow-up answers are just great. If we look a little more at the offer, will the margin be overhauled with this new offer?

Yes, to a certain extent, you can see it as a cost of sales. Since it will require resources to offer customers this type of onboarding. So initially, yes, but we see it more as an investment in that there are customers that we will onboard that will then be with us for a long time. So it will not increase in the same way as we add customers, but it will increase in the same way. So partly right, but in the long term, I don't think it will increase.

We will add the number of businesses that we do endlessly. It is worth it that we have to spend a little more time, but we get the businesses in, so it is up to them to decide. So that's really it. And we pay for that service. But of course we eat, but we have to pay for it, so we eat a little of the margin. Then we have a very good margin, so we have a chance to eat a little.

You mentioned a little bit about the guarantees here before, but with the completion of the guarantees, how much money will you get in then?

Then we get in, it's somewhere between 4.5 and 5 million kronor, you see.

If we look at the last question, how is the cooperation with AVS Region Sweden going?

It's going well. It has taken a little longer than we had planned to be certified. It's a fairly extensive work to do. As I mentioned earlier, it's a tick in the box. We just have to do it. It was one of the only things we needed to do. fixa till eller utveckla det och så vidare. Det tar lite längre tid, men vi är precis klara med det nu. Vi har redan fått händelserna i förväg, så vi har redan inlett samarbetet. Vi har ett par kampanjer som vi har planerat tillsammans med WS i Schweiz, där de är drivande. Det går bra. Det står här i startgrupperna fortfarande. Vi vill verkligen sätta fart. Vi kan inte riktigt bli Vi kan inte riktigt ta... Vi har dialog i gång, men vi kan inte riktigt komma vidare om det här är klart. Vi måste bara bli av med den. Sen är det full gång. Planen är den där. Vi har flera dialoger och kampanjer på gång tillsammans med den. Det går bra. Det kommer också vara en jätteviktig del av vår säljstrategi under framförallt rösten. Vi har också varit tydlig med att Vi hade inga förväntningar på att det skulle leda till genererande affärer.

Men då får jag tacka för att ni presenterade det här idag. Och tack för att ni svarade på våra frågor. Och tack till alla tittare som har kollat.

Ja, tack. Stort tack till alla.