Fortnox AB (publ)

Forum. My name is Josephine Seder and I will be your host today. Unfortunately, none of our analysts could be here today, so this time I will also take on the role as moderator. Our guest in the studio is, of course, Fortnac CEO Tommy Eklund. This stream will be about an hour long. The first part is dedicated to the quarterly results, which will be presented by Tommy. This will be followed by a question and answer session. You can submit your questions to Tommy anytime during the stream using the chat. Here is Tommy Eklund with 2024's first quarter results. Hi there.

So welcome to the session. So let's start this so that we can focus on Q&A. As I always do, I keep it kind of short and then we'll focus on your questions. So quarter one in numbers. Again, a very stable net ads of customers, 20,000 compared to 15,000 quarter one, 2023. So a really good net ads in the quarter, despite the macro environment. And also our customers continuing to increase the usage of the platform, the ARPC, which is the average revenue per company in the platform. It increased with eight Swedish kronor. So that also a stable growth, which means that our customers are using more and more of our products in the platform. So both numbers stable in the quarter. Growth, as we have reported, we have an impact on the growth connected to the macro environment, but it's kind of stable. So we see no positive signs. So it's not changing, but there is no negative signs either. So it's pretty much on the same level. So the impact is pretty much on the same level as it has been now quarter three, quarter four and quarter one. So we don't get anything for free, but we're getting there. So 26% in growth is a stable quarter despite the macro environment. And again, a really solid scalability regarding EBIT. So now we're delivering over 40% in a quarter one, which we have never done before. So this is the highest EBIT margin that we have had in a quarter one. So again, the business is showing scalability in all aspects. Yes, so if you just dig into the numbers and look back a bit, this is actually the highest net ads regarding customers that we have ever had, 20,000. About 2.6 of them came from BoardEaser, so they had about 6,000 customers. And in the Fort Knox environment, that became 2.6 because we had some customers already in the platform. So a really solid number, especially with the headwinds we have in fewer started companies and also bankruptcies. So a really good quarter in all aspects. And as I said, our customers are increasing the usage of our platform. So they're increasing the number of products that they're using or number of seats, which is shown in the ARPC. So again, an increased ARPC, which is showing that we're continuously delivering customer value. And this is a good measuring of how valuable our platform is since our customers are increasing the usage of the platform. In this context, we are a bit ahead of our plan. As some of you might know, the five-year target on the ARPC is 300. That was originally 150 when we started the business plan period. We have the goal of doubling the ARPC during the five-year business plan period. Now we're delivering a bit better than what we have in the business plan 2025. Yeah, as I comment, you know, 26 percent is a really good quarter, but we definitely are impacted by the macro environment, something that we have been now quarter three, quarter four and quarter one. We especially see it in the marketplace segment, which we have seen, especially in the oferta business, but we are impacted in all segments, I would say. And also, for instance, since it's fewer started companies, also the lager-belag business is impacted, and that has also impact, not only net ads, it also has impact on the revenue. So, really good quarter, but of course there are some obvious headwinds in the growth of the net sales. But a solid EBIT anyway. And again, you know that we're always working with the combination of EBIT and growth. So when EBIT, if growth goes down, EBIT should go up. So that's, you know, the rule of Fort Knox. The international definition is rule of 40. And as you might know, we have our own definition, which is rule of Fort Knox, which is rule of 60. So when you add EBIT and net growth, we have an internal target on an annual basis we want that to be healthy over 60. So this was another quarter that we healthy delivered at so we were capable of having good balance between EBIT and growth. As we normally do in these presentations, there are some fun facts from the platform. We released our new product Fortnox Insight, which we have developed now for two or three years. So it's a really important product going forward because it gives so much customer value. to our customers. And now when we're officially releasing the product, it's actually 20% of all accountants that are using the product on a monthly basis. So quite a big usage, although the product is fairly new. and we are delivering we are developing uh new products for the micro segments so it's basic versions of our other products which is addressable the micro segment which is zero to four employees so and now those products are starting to to pick up so in the quarter the basic payroll which is the The payroll product addressing the micro segment, it actually grew with 45%. So also those products are picking up right now. And usage is really important for us in general. We know that engagement and usage in the platform, even if it's not always connected to subscriptions, increased usage and engagement always drives revenue over time. And then it's important in the app usage is, of course, important for our long-term strategy. And in March, it was actually over 300,000 unique users only in the app in March. So quite an impressive number now. And a couple of product and business highlights from the quarter. As I said, we released the Insight product. It's something that we have worked on for two, three years now. So our AI team has worked on taking advantage of all the data that we have in the platform and giving back insights and guidance on what you should do to improve your business. It's a product that has been developed together with accountants. And now we're comfortable that, yes, we're delivering the product to the whole market right now. And the business model is that so accountants can work and of course, customers can work with insights as well. But if you want to share an insight, then that receiver. So if it's an entrepreneur, they need to have access to the bookkeeping. bookkeeping product. So that's the business model. So now it's really easy to share insights with whoever is interested in it. But of course, it's often accountants that share insights with the entrepreneur, and then the entrepreneur needs to have access to the bookkeeping product. So I think that will give a lot of customer value and a strategic product that we have worked on for quite some time. And we also officially released assignment agreements, which is, of course, an interesting product for our accountants because you always need an assignment agreement to work with a client. And it's something that you, you know, it's an administrative burden and it's kind of, you know, it's a lot of manual things to get that information inside the platform. Now it's very efficient. to just distribute that digital and all of the data that you need from the assignment agreement is automatically transferred to the Fortnox platform. And also a very positive side effect. Again, we're working with onboarding more and more users. So when you're distributing an assignment agreement like this, then you're also on board the entrepreneur, which is important because we know that, again, increased engagement from all different stakeholders when you run a company is important for the success of the company. And of course, out of the Fort Knox context, that also has a big impact on the ARPC. So increased usage and a lot of value for the accountants. So kind of a small product, but really a lot of customer value in it. Yeah, so we did an acquisition during the period in quarter one. So this is a product that we had or a company that we have gotten to know for quite some time now. And we have sold their products white labeled to our customers for quite some time now. And we really like the team behind BoardEaser and their products are superior. And it's products that it's areas that Fort Knox hasn't been that strong in before, because this is something that you normally need when you are a bit bigger. So this is the needs of, you know, consolidation, board portal and report and analysis is things that you normally need. have greater needs for when you become a bigger company. So this is a really good strategic fit product-wise because it's something that we haven't been that strong before. And it's a really good team. They are superior in what they're doing. And it's also important for our strategy to go for the mid-market, to go upwards and to offer value also to bigger organizations. Then these types of products are crucial to get there. So strategic and a really good team. Recurring invoicing, it's something that we have now released in the quarter. So if you have recurring things that you need to invoice, for instance, rents or subscriptions or things like that, now it's really easy to do that in the invoicing product. And we have also, when we released that, it's pre-installed. So when you're doing... Recurring invoicing now, the default is to also use invoicing service and the payment checkout. So now we're combining our invoicing capabilities with invoicing service, finance services and payments. so when you're doing this everything is automatically done so it's really easy for our customers when they have recurring invoicing they can do that one time and then we do everything for them so we're distributing invoicing we're doing reminders we're offering payments to their customers so it's it's another example where we're taking the position that we have in the platform and just doing it better for everyone and also capturing more and more of the usage and the money flow So last but not least, only a few seats left. So I encourage you to sign up for the Capital Market Day in May 23rd. So with that, thank you.

Great. That concludes the first part of the stream, and we'll now move on to the question and answer section. Don't forget, you can still submit your questions in the chat, and we're going to move on to the first question. And it's a long one, so be prepared. As Småföretagarnas bästa vän, or the small business owner's best friend, Fort Knox has gained substantial market share by offering modern software at an attractive price point. However, as far as I understand, your pricing on factoring roughly aligns with competitors, despite Fort Knox having a more efficient solution. Would it make sense to offer a more attractive price point to drive usage?

We're working with the price point all the time, so it's not something that is decided and we're never changing that. So this is an example where we're working with price on a continuous basis. And then the question about factoring. Yes, it is factoring, but it's more like the way that we have developed that product. It's more like, I don't know, a payment solution because we have visibility on both sides of the invoice. So yes, it's a financial product, but it's more like a payment product. And what price that should be, we'll see going forward. But right now, I don't see that our customers are not choosing the product because of price, because it's a lot of customer value. So it's really easy to use and the price is on a healthy level. So I don't see that price is a problem in that product right now. But yes, as you're referring to, we're delivering it much more efficient than any other vendors. So of course, you can work with price when you are in that position.

Great. Another comment. Could you please comment a little bit more on the low cash flow?

Yes, so... We're using the money for... We acquired Board Easter and we're also using the money for our financial services, but that, I guess, is quite obvious in the report. But then we also have an Easter impact, so it's roughly about 40-50 million that is tied to that we ended the quarter with Easter, and that's pretty much around 40-50 million.

All right. And next question is, we're seeing here in quarter one what we saw in quarter three when it comes to calendar effects impacting working capital and free cash flows. Are there any differences for quarter two when it comes to the reversal of those negative effects?

Yeah, it will be a bit smaller because it was a long weekend, because this was the Easter impact. So the impact was even bigger than just the weekend. It was the Easter impact. So yes, it will be a bit lower, but I actually think that also quarter one ends on the weekend. So I guess the biggest impact on just that number will be in quarter three, I think.

All right. The growth in the loan book here in quarter one was very high at 133 million crowns sequentially. Can you talk a little bit more about what you expect here going forward and what it is that drove this high growth?

Yeah, it's the factoring solution that I talked about. It's getting more and more popular. It is a really good product. And as we have shown now for quite some time, it doesn't impact our losses. So I think that the way that we have developed the product is really good. So it's a lot of customer value and we're being able to scale that now. So yes, I want that to grow. That's one of our areas that we're going for. Hopefully it will continue to grow because it's a really good product for our customers and for us it's a good product to have in the portfolio. So all in all, a really good product and yes, I want it to grow going forward as well.

Another thing that's grown recently is the number of new employees. Comment a little bit on that, the high number of new ones.

Yeah, we did acquire board easers, so that's almost 40 people, 37 people. So of course, that lifts up the number of people a bit. But we also hired a bit more than what we have done the recent quarter, because we just saw an opportunity to do that. The market for hiring people is really good right now. And I guess the macro environment will change. So this is also a preparation for the macro environment to change going forward. So you shouldn't read too much into it. It's a quarter and we don't follow, you know, net ads regarding people quarter by quarter. So don't read too much into it. But yes, we hired a bit more than we done what we have done the last quarters and we also acquired a company. So yes, we have more new colleagues than what we normally have in a quarter.

Yeah. There's another comment or a question about our hiring. It appears you're hiring slightly more people and incremental margins suggest this is mainly in financial services. Is there any particular reason or new product that makes us step up our game in these areas?

In general, the majority of all people that we're hiring are on the tech side. We are a tech company. We're investing in our product at our core. So that's where we're hiring. And then, of course, we're hiring people in the other areas as well. But the majority of the hiring are on the tech side, and that's our focus.

Nice. The next comment is a little congrats to good results. There was a high net recruitment once again. Will this continue during quarter two and the rest of the year, or will it slow down? And what are the key focus areas for these new employees?

Yes, again, the tech side, that's our focus. We continue to invest in our platform. I think that builds the most value for Fortnox as a company, but that also builds the most value for our customers. So we will continue to invest in the platform. But again, you shouldn't read too much into how many people were hiring a specific quarter. So we're not guiding any different what we have done before. This is just, you know, normal business. And, you know, it's quarter by quarter. It can vary a bit quarter by quarter, but don't read too much into it.

All right. Then moving on to BoardEaser a little bit. Was there any one-off items that you did not split out in your EBIT related to the BoardEaser acquisition?

uh it was about two million in the um as a transaction cost so that's a one-timer that you can remove if you want to adjust ebit we don't adjust ebit as you know so that is something that you can do if you want to do adjusted ebit and then of course that it we also have a negative impact on ebit in march so it's a small uplift on the on the revenue growth, but it's a small negative impact on EBIT in March.

The next question is, shares are taking a beat on FCF weakness today. Why are you not taking steps to make this an off-balance business and change the business model dynamics to mimic core Fort Knox?

I don't know. It could happen. We'll see.

We'll see. How much of the 13% quarter-on-quarter growth in ARR is driven by price increases, roughly?

We don't report that. So that is not a number that we have shared. So we'll see if we'll come back to that. But right now, we have not shared the impact that we have had on price. But I can say, since I hear also rumors about price increase, the impact on price is the same in 2022 and 2023. And according to our prognosis, the impact that we will have on price on 2024 will be on the same level that we have had now two years back. So it will be on the same level. And I think that any outsider that is guessing the impact, they think it's bigger than it is.

All right. Anything in particular that stands out in terms of drivers to the strong customer growth here in quarter one, excluding the 3K coming from M&A?

I think it's, you know, I've said it now many quarters in a row that there are definitely headwinds regarding the net ads. So I think that we're showing that we're taking market share and also that we're showing that the underlying business is delivering much better now than what we have done previous years, because, you know, Being on the level that we have done previously or even better as we are now in the environment that we are right now, that's quite impressive. So we're clearly taking market share, but also showing that the underlying business is delivering better right now.

All right. Then moving on to current events, if you want to put it that way. How has the recent short report in Financial or the Financial Times criticism impacted the way you think about explaining your business? Is there something you will address more on the way MCMD to remove uncertainty?

If there are any uncertainties, of course, we would like to explain that. We don't, on purpose, try to be something that is hard to understand. Of course, we're listening to all feedbacks, but I think that we also explained a couple of things during the annual general meeting two weeks ago, where I actually live showed that number of businesses in Sweden are right now 1.7 million. And it's quite easy for any outsider to just go online. You can go on any government site and you can just, you know, it's three, four clicks and you can see that the current number of businesses in Sweden is about 1.7 million. And I guess that was the most worrying in the report. So I think that we have cleared that out. But of course, you always need to, you know, listen in to feedback and become better and better. So I think that, yes, we will become better and better at explaining the business if it's something that is hard to understand, of course.

And then coming back to the business, the card launch momentum. Expect tailwinds from Swedish government abolishment of requirement to store physical receipts. Yes or no?

Yes, we think that that will have a positive impact on the card. And that will happen... after quarter two. So yes, that's good for the business. And we also have something that is important for us. We have not developed the approval process connected to the card yet. So it has just been officially released for entrepreneurs, because if we When we are releasing it to accountants, we need a more advanced approval flow connected to the card because it's an expense management solution. And then when an accountant are supposed to When an accountant needs to be involved, then you need more advanced solutions for expense management. So that's why we have developed that. And that will be released in quarter two. So during after quarter two, it will be released to accountants. So I think there are actually some positives in the business card. So both the regulations regarding the digital receipts, but also the features that we need to be able to deliver to the accountants. The accountants are really the receivers of the business cards, although the end user are the clients. Of course, the biggest value are, of course, the accountants. So it would be a good release in quarter two, I think.

All right. The next question is, what have been the drivers for the customer growth? If we exclude board ether, the customer growth is very strong. Has your strategy changed with regards to customer growth?

Yes, I think I want to say it changed. I said that we have reported better and better ways of adding net ads. So two things, you know, we are investing in. We are investing in our own website. So we're becoming better and better. So it becomes more and more natural for entrepreneurs nowadays to start your business directly in the Fort Knox platform. So, you know, more and more entrepreneurs comes into the Fort Knox platform. They can read on how it is to run a business. They can easily start a business within two hours. It's really easy. And we help them to get going. So we have a lot of services also connected where we're helping entrepreneurs to get going. So I think that that becomes the natural way of starting your entrepreneur journey is the Fort Knox website. So I think that is driving now. We're becoming better and better. And of course, that is driving NetAds. But also the accountants. We have heavily invested in becoming better and better at explaining to accountants how much more efficient they could be by adding all their clients. So that was not obvious before. before you maybe added just a few of your clients because you thought that you know yeah i can have a few in fort knox and then i can have a few outside fort knox but now when you're using our workflow management system so that's like a crm system or workflow management system for clients so that it's accountants that can manage their clients in a very efficient way But to gain all that efficiency, you also need to add all your clients. And that is something that we're helping them with more and more. So the whole quarter three and quarter four, we had so many training courses with accountants where we actually explained to them, this is how it works. And we actually helped them to onboard all their clients. And of course, it's kind of a long-term investment, but I think it's starting to pay off now. So it becomes more and more natural for for accountants to add all their clients not just half of them for instance and of course that also adds to the net ads so both distribution channels both the indirect through accountants and our websites becomes better and better i think that is showing now in the net ads

All right. For any new viewers that are out there, don't forget you can send in your questions in the chat. They are rolling in, but here's your opportunity to ask them. Moving on to organic growth. Can you break it down between one, new customers, two, upselling, and three, price?

Yeah, so that's kind of three buckets that we have. So the impact from price is very limited in quarter four because the new price difference that we have done for this year has no impact in this quarter. So the impact that we have on price in quarter four is the price change or price adjustment that we did in 2023, which is in quarter four very limited. Slim to none impact on price in quarter four. So then we have two other buckets left, you know, increase from new customers and upselling capabilities. And we have had this in our business plan for quite some time now that during this business plan period, we plan to have 50 percent of the growth coming from new customers and 50 percent of the growth should come from existing customers and that is something that we actually have delivered on now for three and a half years and that was also the case in quarter one so pretty roughly said 50 percent of the growth comes from from new customers and roughly 50 percent of the growth come from existing customers and in quarter four limited or slim to none impact on price just in quarter four Or a quarter one, sorry, quarter one.

Can you see that any specific module has increased in popularity in quarter one relative to quarter four last year?

yeah in quarter one as i said in general these basic products are starting to get there so they are definitely impacting the revenue now so although they are kind of small so in absolute numbers they don't impact that much but you know with the growth rate they they have now they will have bigger and bigger impact going forward And I would say also, of course, the finance services. They are growing more than what we have on group level right now. So they are definitely contributing to the growth right now. And it's been an investment area that I've talked about many times before. We think that it's a huge value for entrepreneurs, you know, financial services. If we can deliver those to the SME sector, that is a really, really important thing for them because, you know, When you are an entrepreneur, what you really want is guidance and insights on what you should do to improve your business. And it's something that we released actually this quarter, this insight product, which is, you know, AI driven and is really, really good for the entrepreneurs. And besides that, it's cash flow. And our financial services are actually something that we're, you know, a cash flow product where we're automatically helping them with their cash flow and they don't need to care about it. So it's a lot of customer value for it. And I think that is shown in numbers now. So that is why that product is growing now. It's a lot of customer value on it. And the way that we have developed that product, I think is quite unique. And I think that we're showing that even if that financial services normally don't scale as a SaaS, software business. We're actually showing that we're getting there now, you know, so I guess it will not be, you know, the gross margin will be not exactly as if you have a pure software SaaS business, but we're getting there. It's very high gross margin and it's a really good, fast-growing, scalable business that we have added to the portfolio.

Nice. Could you specifically give an update on your progress with your payment services and the Fortnox card specifically?

Yes. Yes. So I think that I have comment on the card right now. But for anyone that missed it, you know, it's a business card. You can order it for free. So you can order either a plastic card or a virtual card for all your employees. So, again, you know, it's a product that is really good and it's for free. And you can just take a picture on your receipt. And with the new law now coming up, you don't need to store the receipt. So you can just take a picture on that. And then we digitally store that. And that is all you need regarding your history. So that digital copy of your receipt is enough. So you don't need to keep the physical receipt anymore, which is a game changer for that product. So it's really good. So it's for free and you just take a picture on it and that is connected with the AI bookkeeping capabilities so that then we automatically do bookkeeping based on that receipt. So, of course, you know, it's a really good product. And if you take also place that into the accountants world, of course, for accountants, normally you get... know physical receipts which can be really old and you need to do that manual so it's it's a lot of work for accountants now you know that is put on the entrepreneur they just use the card and they get a notice from the fortnox app take a picture of that and then it's booked so it's stored and book keeps and what we also gain is that then we get all transactions and in real time, and when we get transactions in real time, we can do real-time bookkeeping based on those transactions. So even if our real-time bookkeeping capabilities are really good now, we cannot do that if the data is old. So that is also an important way for us to also get expenses in the platform in real time. So it's a strategic product in that sense, and a lot of customer value, of course, in that product as well. And the business model is that since everything is for free, we earn money on transactions. So right now we take 1% our share in the transaction cost or 1%. So that's our earnings, 1% on the expenses that our customers have. So that's the business model regarding the car. And yes, payments. We said that after quarter one, I got a question of payments, and then we said that, yes, payments will probably be the year, 2024 will be the payment year at Fort Knox. So yes, we are investing in payments. We think that that is something that our customers would benefit from. So it's piloting now. it's different parts. So it's, um, it's together with all the other products. So we have already released the payment capabilities for the consumer side. So that's the checkout that I talked about, uh, uh before with the recurring invoices so now the recurring invoices is connected to invoicing service which is also connected to the checkout so when you are a consumer or i would say a small company because if you are a small company you tend to pay or act as a consumer so that checkout payment capabilities is for consumers, but I would say also small companies. And what we are piloting now is the ability to pay everything else when you are a company. So that's your payroll. You can do your pay slips there. You can do supplier invoices in the platform. You can pay your tax in the platform. So everything that you need to pay, you can automatically do that in the platform. And we're adding all the different pay rails that you need. So you can pay in any way that you want, and you can pay everything that you want in the platform. So, of course, that's going to be a game changer. But we have not revealed any release date. But it's in pilot now, and it looks quite promising.

All right. Then regarding customer intake in the quarter, what is the mix between micro companies, small companies and larger companies?

We're not changing the dynamics in the platform that much. So it's a fair share of all those. But of course, the sole traders are in numbers so much more than the others. So of course, in numbers, there are more sole traders than others. And then the small companies are in numbers more than the big companies. So I would say that we're taking a fairly... The market share that we have already now, we're not substantially changing that. So we're adding now customers in pretty much the same pace in all different segments as we have historically done. So we're not fundamentally changing that. It's pretty much the same that we have had.

All right. Then how do you plan to capitalize on private individuals as a customer group? You have invested a lot of time here in recent years.

Yeah, it could definitely be an upside going forward. We don't have that in the business cases because we want to be a bit cautious regarding that. Because what we're doing now is actually trying to drive indirect revenue. So we want all the different touch points on consumers, for instance, the Oferta platform, when a consumer pays an invoice, when a consumer gets a payslip. when you're doing your tax declarations in the platform. All of that is something that you do as a consumer or a private person. But right now, we're not charging the private person. But I guess over time, the value for using the platform also for private persons will probably be so big so yeah we can start to charge but right now that is not our main driver we are a business to business company but when our customers that is businesses have touch points to private persons we want that experience to be really good because that is driving the business to business revenue so that's the main driver right now but i agree with you that over time of course we will also deliver value direct to private persons but right now that's not our focus

All right. Then we had a round of list price increases announced in March. Has there been any feedback? And if so, what has it been?

Yeah, the feedback has been none, actually. And again, I think that that's because the prices are so low, to be honest. And I think that will be also something that if you have heard me talk before, you have heard me talk about that. We don't want to do general price increases. We think that we can do so much more by just doing price optimization because we think that we're delivering so much more value than what we're actually charging our customers in certain parts of the platform. So by becoming better and better at optimizing price and connecting price with value, we think that would be the main driver for increasing ARPC regarding price going forward. And I think that what we did last year 2022 was just you know we increased everything pretty much on the same level and we also did difference between three and 12 months which we didn't have before so it was just a general price increase and then we became a bit smarter 2023 so we're not increasing all products we increase the product that we have developed more in that than we have what we have done with other products And I think that what we did now was even better. So, yes, we increased the subscription on a couple of products, but the most of the things that were done were actually just moving around things so that we, in a better way, connected price with value. And I think that is also why no customer is reacting on it. And to be honest, for instance, invoicing, which was one of the biggest race we did, was like 20 Swedish kronor. so it's 20 swedish kronor it's two dollars it's two dollars a month that was the biggest increase that we did so you know it's not a big number anyway so so but that was still a big race for us so so we're coming from a really low price point so so yeah that was the price

All right. An unnamed competitor has recently announced a promotion where they offer to buy out the remaining contracts of Fort Knox customers. And this is a local Swedish competitor. Have you seen any notable changes in the competitive environment so far this year?

No.

Easy peasy, simple answer, no. Can you comment a bit on your AI investment and when can we expect some effects of those numbers from those investments?

I think you already see it. We have done that for several years now. We don't talk that much about it because it's kind of trendy right now, but we have done that for many years. And a lot of our capabilities are already AI-driven, and we are increasing our investment in that area now quarter by quarter, and it looks really promising. So our customers are already gaining from that, to be honest, and we are in a really good position because we have so much data, so much integration, so much usage. And we are really good at taking advantage of the data, and we are really good at keeping the data secure and safe and structured, which is the base of all AI capabilities. So I think that we are in a really good position going forward. And again, if I should promote something, I think that you should come to the CMD, where we will talk about more of the things that we have done around AI.

Are we monetizing on this already, or how far away do you think that is?

Yeah, exactly. We are monetizing on that. So that is already happening. And as I said, the insight product is entirely AI driven. So we are already doing that. The factoring product that we have is all AI driven now. And we would never be able to deliver so much value and so much scalability in a financial service if it weren't for the AI driven capabilities that we have done there. We're taking advantage of a bunch of data points to figure out the credit risks on all invoices in the platform. So it's quite impressive now with all the money that is flowing, all the invoices that are flowing in the platform. We're taking advantage of more and more data points now to figuring out the credit risks on all invoices in the platform. And I think that we communicated now was the last number, like 800 billion invoices. that is customer invoiced in the platform. So it's a huge number. That's like 15% of GDP that is customer invoiced in the platform. And we can now, in real time, put a number that is the price that you should pay for an invoice regarding credit risk. That is something that we now can do in real time based on a bunch of data points. And, you know, since the platform is learning itself, we're becoming better and better and better. And also with the payments that we have, then we also have the answer because when you're training AIs, the most important thing is to have the right answer. And since we know if an invoice was paid and if it was paid on time or if it was overdue, that also will have an impact going forward on how our credit assess different invoices and different customers. So we have structured data and we have the answers. And with that, it gives us really good capabilities to improve, for instance, AI credit scoring.

All right, keeping going with AI. Do you have any plans to roll out generative AI features like chatbots?

Yes, I think that we will have that.

Again, short, sweet, to the point. You mentioned previously, and you mentioned previously this year as well, that this should be the year for pengar. How is that going?

I think that we're showing that we're getting there. Of course, we have just started. It's still just a fraction of our customers that is using these services. But, you know, it's growing more than what all the other segments are doing on group level. So I think that we're showing that, you know, those investments has been really good and we're getting there, you know. I want to do so much more, of course. But I think both revenue-wise, you know, we're getting there, but also scalability that we're showing that we can actually also deliver financial services scalable, which is, you know, the DNA of Fortnox is scalability. So it's important for us to not just start to add products where we cannot keep the margin. But I think that even with a complex product like a financial service product, even on those products, we can show scalability because we are so good on the tech side. Alright.

Again, quite a long double question here. How do you understand the ARPC number of 276 in light of the dampening macro effect? We can start there.

Yeah, it's a good question because it would probably be higher if it weren't for the macro environment. So, yes, there are some obvious headwinds there. So since the ARPC is net revenue divided with number of customers, yes, net revenue is a big portion of ARPC. And the net revenue, we have negative impact on the net revenue right now. we don't see that it's bigger than what it had been in quarter four and quarter three, but it's there. It's on a lower level, but it's not better either. So it's not worse, it's not better. It's pretty much on the same level. So yes, we're quite sure that the net revenue would have been better if it weren't for the macro environment. And I guess the macro environment will eventually change.

All right. And then the second part of that question was, and how do you understand the ARPC number? As I'm back of Bokio that ended its free model and Billogram shifts of customers to you, have that had any effect?

Yeah, those small vendors, they don't have that much customers. So it doesn't impact that much, actually. But of course, I think in general, I think it's good that all players have a sustainable business model so that all players, you know, play with the same rules, so to say. So in that sense, I think it's good that all players have a sustainable business model. But other than that, those players are kind of small, so it doesn't have that much impact, to be honest.

All right. We're starting to get sort of to the end, but we have a few more questions that we're going to squeeze in. The next one is, how do you plan to give more information about the upcoming business plan for Insights and Fort Knox Company Card in connection with the Capital Market Day?

yes since those products are fairly new and we haven't talked about them that much so that will definitely be present there so you will all hear us talk about it both the product managers me talk about it the product area managers and you will also have the ability to start to you know feel the product and we will demo the product so i encourage you all to go here because it's you know strategic important product for us so i think you know I think you will get a better understanding of the possibilities of those products when you're participating in the CMD. So I encourage you to do that.

All right. And next question is about M&A opportunities. How many are you looking at?

Yeah, so it's I think I said that some time before, so it's not a secret. I think that we looked at two, three hundred companies last year, more than what we did the previous years. And that is because the environment has changed a bit. So it's better for the buyer than it was like two, three years ago. So yes, there are definitely opportunities out there. We're not guiding regarding number of acquisitions per quarter because it's not important for us to go for a specific number. It's so much more important that it becomes the right one. So we're in no rush. We don't need to buy buy net growth. So to acquire growth, I think that that's not better than any other growth. So I think that if we're finding a company that we think is really good people, like the BoardEaser case, it's a really good team and they have a superior product and it's something, a capability that we don't have and customers are asking for it. yes then we of course we have 50 development teams right now we can develop everything in-house if we want but it's about priority i want my teams the current 50 development teams to focus on the core products to continue to deliver customer value because that's our core and it's really good to have the capability to broaden our offers when customers are asking for more things like We have the app market. It's almost 500 apps right now in the app market that takes care of a bunch of different customer needs that are too specific for us to develop in the core product. So that market is really good to take care of all those corner cases. So it's really easy. You can buy products from us and then you can buy apps for your specific needs if you have something that we haven't developed. So we have our own development teams, we have partnerships and corporations, we have the apps, and we have the M&A capabilities. And it's really good for us to have different ways of broadening our our portfolio so that we don't need to develop everything in-house so that's why i think it's good to have that capability then we're not pushing that so we don't need to have that but it's a good way to sometimes go faster to the market when we're finding a really good product or really good team that we think can contribute to the fortnox platform

All right. Then we have actually arrived at the last question, unless someone out there thinks of a question in the next three minutes or so. Since macro for Fort Knox is seen in marketplace as you describe it, talk about how growth paced throughout the quarter.

Yeah, so yes, again, growth. Yes, I think that all parts of the business are impacted by the macro environment. But of course, a couple of areas are impacted more. So for instance, the marketplaces, especially on the consumer side, so that's private persons doing home renovations, which is a vertical indoor Ferta platform. It's definitely lower than it was like two years ago, because it's not that many people that are doing home renovation that it was two years ago. So that's definitely an impact. The lagerbolag business definitely has an impact. Lagerbolag business is when customers are buying companies from us that we have pre-started for them. And since it's fewer started companies in Sweden, that also has an impact on that. Then in general, the financial activity in the platform is lower than you would expect from a macro environment that is on the high side, so to say. So for instance, there are fewer invoices in the platform, both customer invoices and supplier invoices. So the activity in general has an impact on the transactional based revenue, but it also has an impact on the subscription because it could be fewer users and since a lot of the subscription revenue is per seat and per product. And if it's fewer seats in the platform, that also has a negative impact on the ARPC. So it's a little bit of everything in the platform, but there are a couple of things that are more impacted than others.

We did actually get one more question. Okay. Because what would an investor forum stream be without new market questions? This one is about the Norwegian market that you touched upon a short time ago. Is there any short comments here? Is the Norwegian market approaching? And are you allocating some tech investment to a potential Norwegian entry?

No, not right now. We're focusing on Sweden. I think the business case in Sweden is still very, very early stages. So we have a bunch of growth left to do there. So I don't see that we have saturated the market in any aspects in Sweden. And if you just look at all the opportunities we have, I think that we should focus on them. So right now, my top priority and focus is Sweden.

All right. And that's that. That is what we have time for today. Those are the questions that have come in. Thank you, Tommy, for being here and for answering the question. Of course, thank you to everyone that's watched this stream. Our next Investor Forum will be on July 12th at 10 a.m. Central European Summer Time. Hope to see you then.