Stock Exchange Digital Workforce, which develops digital coworkers, plans to list in Helsinki – The company is backed by Supercell and Wolt’s investor Lifeline

Software robotics The company Digital Workforce Services is planning to be listed on the First North marketplace of the Helsinki Stock Exchange.

The company wants to raise approximately EUR 20 million in gross assets through the IPO. In addition, some of its shareholders intend to sell their shares in connection with the listing.

The company intends to use the funds to support its international growth strategy and to finance potential acquisitions, as well as technology investments.

The most significant owners of Digital Workforce are its founding trio and private equity investors Capman and Lifeline Ventures, which became owners in 2017, as well as the sale of the medical center Dextrra. Leena Niemistö.

The company will be the new listing on the Helsinki Stock Exchange on the 13th of autumn and the 25th of the whole year. In addition to the stock market boom, Digital Workforce is part of the exit boom for European venture capitalists.

According to data collected by Pitchbook, European private equity investors sold around € 110 billion in holdings in January-September. The previous peak year was 2018, when the number of exits reached EUR 40 billion. The majority of exits have taken place through listings.

Lifeline Ventures private equity firm Timo Ahopelto is the Chairman of the Board of Directors and states that he will continue in the position after a possible IPO. The fund is not selling its shares in the IPO. This is not an exit for Lifeline.

“We are a long-term owner of the company. It is not a question of investors financing in the IPO, but this is a way for the company to raise growth capital, ”says Ahopelto.

This is the first time in the history of Lifeline Ventures that a growth company in its portfolio will be listed on a stock exchange. It is special in a way, because the fund has invested in many of Finland’s toughest growth companies. However, many of them have ended up in foreign ownership through an acquisition.

Lifeline Ventures is a private equity company investing in early-stage startups that started operations in 2012. It has a total of EUR 235 million in assets under management in its four funds. The latest fund was a EUR 130 million fund launched in 2019.

Its most successful investments to date have included the gaming company Supercell, the marketing technology developer Smartly.io, the smartphone maintenance company Swappie, the restaurant technology company Wolt and the smart ring developer Oura.

If investors don’t sell, what is the need to go public – compared to the company raising more capital from international venture capitalists, for example?

When shares are publicly traded, they are easier to reward employees and use in the form of stock options to engage employees. Another reason is the position of a listed company.

“Software robotics solutions are strategic solutions in the banking and financial sector. The agreements are multi-year deals, and the public company is a more reliable partner in it, ”Ahopelto explains.

Digital Workforce is a service company that designs, implements and maintains software robots, or digital workers, that perform manual data processing processes. Products increase the efficiency of customers’ business, reduce costs and improve quality.

“A digital worker is a type built from code that includes software robotics, artificial intelligence algorithms, and operates in a cloud service,” says the company’s CEO and co-founder. Mika Vainio-Mattila.

The company’s business is divided into expert services and services charged on a continuous basis. Just over half of the turnover is currently billed.

“The digital worker platform scales from zero to one hundred. The maintenance service we provide to our customers ensures that digital employees remain in working order, so to speak. ”

The digital employee platform resembles the services of SaaS companies favored by investors on the Helsinki Stock Exchange, but Digital Workforce is not a software house.

Like the SaaS companies, the margin in higher invoicing services is higher than in expert services. Vainio-Mattila says that improving the company’s profitability is based on increasing the share of continuous invoicing services in net sales.

Alun originally, Digital Workforce was a cleaner software consultant who helped clients deploy software robots as a consultant. Now, about half of its business consists of managing software robotics solutions and technology in cloud services as a continuing business.

More typically, Lifeline invests in clean technology companies, so investing in Digital Workforce was an exception.

“We had thought that we would like to invest in something that reduces the costs of Finnish healthcare. And the very next week, these guys came to visit and told me that their first group of clients is healthcare. It makes no sense for doctors and nurses to copy data from one system to another. That is why we invested, ”says Lifelinen Ahopelto.

Digital Workforce the goal is to increase its turnover to one hundred million euros by the end of 2026 from last year’s 19 million euros.

At the same time, the company’s adjusted EBITDA margin should increase to “clearly positive” from its current deficit. Over the next five years, the company will prioritize growth rather than improve profitability.

Research firm Forrester predicts that the software robotics services market will grow from $ 9.5 billion this year to $ 12.0 billion in 2023. The market will grow at an annual rate of 20 percent.

Digital Workforce operates in eight countries and has customers in approximately 200 primarily large organizations. The company aims to accelerate growth, especially in the United States and the United Kingdom. In these markets, customers are actively seeking cloud service solutions.

“In our growth strategy, great emphasis is placed on entering large new markets. There is huge potential for new customers in the United States, ”says Vainio-Mattila, President and CEO.

In the Nordic countries, the company also plans to grow with existing customers. Nordic customers are at the forefront of introducing digital workers.

“We develop new stuff in the Nordic countries and then take it to the world,” says Vainio-Mattila.

According to Vainio-Mattila, what sets Digital Workforce apart from its competitors is that others do not have the same wide range of services.