GLOBAL B U S I N E S S
VOLUME 5, ISSUE 7
•
F I N A N C E
B U S I N E S S
•
S E C T O R
N E W S
I N S I G H T
BLUEBEAM ACQUIRES PROJECT ATLAS
Groundbreaking SAAS solution for the construction industry
SKILLS SHORTAGE
PERMIRA
ANNOUNCES
DESIGNATED CEO for the company to be formed from
TOP FEAR FOR UK FINANCIAL SERVICES
CISCO’s SPVSS Business
AQUILA CAPITAL
£8.8M IS GRANTED TO
ENTERS FINNISH WIND ENERGY MARKET
SMEs to trial innovative smart meter tech
WWW.GBUSINESSINSIGHT.COM
ISSUE 07 | 1
ISSUE 07 | 2
ISSUE 07 | 3
CONTENTS 12 20 38 46 54 69 72
a hawk in doves clothing Graham Bishiop
Skills shortage
Top fear for UK financial services.
51
italian political uncertainty could impact international investors.
78 86 96
dunedin invests in £44million funding of GPS in UK’s 3rd largest Fin-Tech financing this year.
the dak group announces
sale of American Van Equipment to Safe Fleet.
hsbc strategy update
positive for credit investors
matr raises £4.75m
VOLUME 5 ISSUE 7
for AI teaching platform
acquila capital
enters Finnish Wind Energy Market with 14.4MW project.
mhealth for diabetes and heart
Failure will revolutionise the cardiometabolic market.
£8.8m is granted to smes
WWW.GBUSINESSINSIGHT.COM
to trial innovative smart meter tech
emerging cryptocurrency point-of-sale
FOLLOW US @ GBUSINESSINSIGHT
tech finally solving the mass market Bitcoin blockade.
42
23
nylacast named
as one of Leicestershire’s Top 200 companies.
thornton tomasetti
to acquire MMI Engineering
77 ISSUE 07 | 4
IPSOFT LAUNCHES
The AI Industry’s first off-theshelf AI solutions for banking, insurance, healtchcare and more
ISSUE 07 | 5
M&A WATCH
PERMIRA ANNOUNCES DESIGNATED CEO FOR THE COMPANY TO BE FORMED FROM CISCO’S SPVSS BUSINESS
Dr. Abe Peled, Senior Adviser to Permira and incoming Chairman of the new company, said, “I am thrilled and looking forward to be working again with Yves, upon the closing of the transaction. Yves is well known to many of the company’s major customers and is well positioned to ensure a smooth transition for Cisco’s service provider customers who will also become the new company’s video customers. Furthermore, Yves will bring a wealth of experience, industry relationships and strategic vision to deliver on the significant opportunities we see for the new business.” “We look forward to supporting Yves and the team as they build on Cisco’s innovations and investments in the Pay-TV industry and create a standalone company focused on developing next generation technology for its customers throughout the world,” said Ryan Lanpher, a Principal of Permira’s Technology team.
Permira, the global private equity firm, today announced the appointment of Yves Padrines as incoming Chief Executive Officer for the new company to be formed from Cisco’s Service Provider Video Software Solutions business, effective upon closing of the transaction. Yves Padrines will join from Cisco, whereas Vice-President of Global Service Provider for Europe, Middle East, Africa and Russia, he was responsible for all Cisco products and services business for major telecommunications, mobile and cable operators, broadcasters and media companies as well as cloud and managed service providers. He has also held general management and senior executive roles during his previous tenure at NDS from 2004-2012. Before joining NDS, Yves served in various capacities in sales, product management, finance and management consulting with large international companies in the media and technology industries. “I am delighted and looking forward to working again with Dr. Abe Peled and Permira on this unique opportunity to help the company’s major DTH and Cable service provider customers embrace IP distribution to complement and expand consumer choice and convenience, as well as the company’s Telco customers and new entrants to Pay-TV take advantage of the new IP enabled
yves padrines
distribution opportunities,” said Mr. Padrines. “At this pivotal time in the industry, the new company will build on Cisco’s SPVSS business, strong customer relationships and technology innovation to deliver an exciting next chapter for our industry, and I look
ceo of permira
forward to being part of it.”
ISSUE 07 | 6
ISSUE 07 | 7
BUSINESS
INSIGHT
TRICENTIS SOLUTION EXPANDS, PROVIDING SELF-SERVICE ACCESS TO GDPR-COMPLIANT TEST DATA FROM PRODUCTION ENVIRONMENTS - INCLUSIND SAP
Tricentis, the leader in Continuous Testing, announced the acquisition of Q-Up: a test data management platform architected to provide secure, reliable, and compliant test data on-demand. With a business-friendly, self-service interface and a lightweight provisioning agent, test data access is reduced from weeks to seconds. With GDPR now in effect, the business risk associated with using production data for software testing has become prohibitive. Organizations are suddenly realizing that TDM must become a critical component of a complete data privacy and security policy. “For years, companies have been obtaining test data by extracting data from production environments,” explained Q-Up Managing Director Andreas Günther. “GDPR will finally put an end to this approach by requiring extracted production data to be masked deterministically and irreversibly. This may be a blessing in disguise, because simply extracting data from production does not deliver data that’s optimized for the purpose of testing. Since organizations are already being forced to re-examine their TDM processes, now’s the perfect time to bring their overall TDM strategy in line with the demands of modern delivery processes.” “To ensure that these new requirements don’t impede software delivery speed, we’re expanding our solution with fast, intuitive ways for testers to add GDPR-compliant test data to their tests—either through extraction and masking or synthetic test generation,” added Wolfgang Platz, Tricentis founder and Chief Strategy Officer. “We’ve long recognized that TDM is a linchpin for Continuous Testing. Now, we’re expanding the Tricentis Continuous Testing Platform with a unique and innovative approach to providing secure test data.” Tricentis’ enhanced TDM capabilities give users multiple options for the design, generation, and management of test data. This allows users to select the best strategy for their architecture, development phase, and/or release cadence. For example, users might want to start by rapidly configuring “smoke tests” that closely mirror production data, then later use synthetic test data generation to increase test coverage and complete negative testing prior to delivery.
ISSUE 07 | 8
This announcement coincides with the SAP SAPPHIRE NOW conference, where Tricentis is showcasing how these new TDM capabilities advance SAP test automation. As organizations adopt modern SAP platforms such as SAP S/4HANA to enable digital transformation, testing must also be modernized. This transition to Continuous Testing requires a new and more strategic approach to TDM. Testers need rapid access to test data across a broad array of SAP solutions and integrated systems, while management needs confidence that test data is always used, stored, or processed as outlined in their organization’s data security and privacy policies. In addition to the upcoming TDM talks at SAP SAPPHIRE, Tricentis is also hosting a webinar to introduce the testing community to the test data management capabilities. This webinar is scheduled for June 14.
About Tricentis With the industry’s No. 1 Continuous Testing platform, Tricentis is recognized for reinventing software testing for DevOps. Through risk-based testing, scriptless end-to-end test automation, and the industry’s most extensive technology support, Tricentis breaks through the barriers experienced with conventional software testing methods. Our innovative technologies simplify testing for even the most complex enterprise applications—transforming testing from a roadblock to a catalyst for innovation. The result is accelerated innovation, improved cost efficiency, and reduced business risk. Tricentis is the only vendor to achieve “leader” status in all three top analyst reports. This honor is based on our technical leadership and a Global 2000 customer base of over 800+ companies. These customers rely on Tricentis to achieve and sustain test automation rates of over 90 percent—increasing risk coverage while accelerating testing to keep pace with Agile and DevOps.
ISSUE 07 | 9
ISSUE 07 | 10
ISSUE 07 | 11
BUSINESS
A HAWK IN DOVES CLOTHING Graham Bishop, Investment Director
Last week saw a swathe of key central bank meetings from the European Central Bank, Federal Reserve and Bank of Japan . The ECB announced the amount of money it intends on printing each month – quantitative easing - would be reduced to zero by the end of 2018. Thereafter it plans on keeping the balance sheet the same. This was widely expected by financial markets. What wasn’t expected was ECB President Mario Draghi’s comment on interest rates, which he would be held at zero until the summer of 2019 (just before Draghi’s term as president ends in October). Monetary policy in Europe is extremely stimulative and is likely to remain so for the foreseeable future. The context is that the ECB is extremely wary of making a policy error having in the past hiked rates twice shortly before major economic events – in 2008 just before the financial crisis and in 2011 just before the European crisis.
The ECB wasn’t the only central bank to announce a policy change. Earlier this week, the Fed increased rates by 25 basis points, the second hike this year. The indication from the Fed’s ‘Dot Plot’ - a projection of where Fed policy members expect interest rates to be each year - was for no additional rate hikes over this hiking cycle, but the timing of them was moved forward, with now more near-term hikes expected. So far this cycle the Fed has hiked rates seven times – once in 2015, once in 2016, three times in 2017 and twice in 2018 (so far). The Dot Plot suggests there are six more rate rises to go, so on that basis they are just over half way. Our analysis suggests that Fed policy is close to neutral, i.e. soon to enter into restrictive territory. At the same time, the Fed is reducing the size of the balance sheet through quantitative tightening. A move into restrictive territory is not the end of the world, but is something to be mindful of. It becomes a problem when policy moves into very restrictive territory. The analogy we are fond of using involves a frog in water. If you put a frog in boiling water, it will jump out. If you put a frog in cold water and then gently heat it up, it will stay there and will ultimately perish. The tipping point is when policy becomes overly restrictive, i.e. the water starts to boil! When that happens with Fed policy is debatable, but we don’t think it will be this year, our view is more likely the second half of 2019. In Japan, there was little news from the BoJ meeting. However, in this case ‘no news is good news’ as the BoJ is comfortable maintaining yield curve control with ongoing stimulus. All eyes will now be on the Bank of England this week with the Monetary Policy Committee meeting taking place on 21 June. No action on rates is expected, with Brexit uncertainty continuing to play a big role in influencing the Monetary Policy Committee’s judgement. Next week we also have the annual ECB Forum in Sintra, Portugal. It will be attended by Mario Draghi, Haruhiko Kuroda, Governor, Bank of Japan and Jerome H. Powell, Chairman, Board of Governors of the Fed, amongst others, so it’s quite possible that some further policy tweaks are hinted at.
In our opinion, Draghi’s statement was a masterstroke, communicating a hawkish ambition while simultaneously sounding dovish. The market reaction was lower bond yields, a weaker euro and a rally in equities – in other words a great outcome given the message. While these market moves may not persist indefinitely, the ECB has laid out the future path for monetary policy over the coming year, giving the markets one less thing to worry about. This should be positive for risk appetite.
GRAHAM BISHOP INVESTMENT DIRECTOR
ISSUE 07 | 12
INSIGHT
ISSUE 07 | 13
BUSINESS
GLOBAL BUSINESS & COMMUNICATIONS CONSULTANCY STERLING MEDIA SHORTLISTED FOR BEST PR FIRM OF THE YEAR AT 2018 UK-INDIA AWARDS The global business and communications consultancy Sterling Media has been shortlisted for the coveted PR Firm of the Year at the annual UK-India Awards 2018, which brings together and celebrates the innovative and path-breaking individuals and organizations that are making a significant impact on the strong global partnership between the UK and India. The winners of the UK-India Awards will be announced at a glittering ceremony in London taking place on 22nd June 2018, hosted by Bollywood actor Vivek Oberoi. The award ceremony is set to bring together over 400 senior leaders from the world of business, politics, diplomacy, arts & culture, and the social sector. Previous speakers include the likes of Foreign Secretary Boris Johnson, Indian Cabinet Minister Piyush Ghopal and the Indian High Commissioner, His Excellency Y.K. Sinha. The award-winning consultancy are nominated alongside a host of leading international development schemes, social impact funds, world-leading British cultural institutions and representative bodies for tech and digital clusters around the UK. Headquartered in London with offices in India and Dubai, Sterling Media was founded in 1995 with a mission to drive innovation by bringing brands closer to their purpose in more meaningful ways. The company represents SME’s, FTSE 100 companies including billion-dollar hedge funds, disruptors, innovators, high profile celebrities, influencers, governments and major organisations such as the United Nations across several industry sectors.
INSIGHT
Manoj Ladwa, the British Indian entrepreneur and political strategist, Founder of UK-India Week and Editor of Winning Partnership: India-UK Relations Beyond Brexit, said: “The UK-India Awards is an event celebrating the bond between the UK and India and the remarkable people building on this winning partnership with innovation and creativity. Together, the UK and India have a great global role to fulfil. The UK-India Awards will also celebrate the organisations and individuals contributing to the UK-India partnership’s leading, transformational impact on the world. They are exploring new territory, bringing new opportunities and meanings to our global partnership.” Prime Minister Theresa May addressed the audience at last year’s Awards ceremony in a video message. She said: “This splendid event celebrates the best in UK-India relations and there is much to celebrate. Thank you for enriching the UK-India relationship in so many ways. In only its second year, the Awards ceremony takes place during the inaugural UK-India Week, running 18th-22nd June. UK-India Week celebrates the strong partnership between the UK and India and is a catalyst for promoting opportunities for future collaboration. It features the 5th annual UK-India Leadership Conclave (20th-21st June), a landmark event for identifying ways to grow and transform the strategic partnership between ‘Brexit Britain and Global India’.” In only its second year, the awards ceremony takes place during the inaugural UK-India Week, running between the 18th-22nd June. UK-India Week celebrates the strong partnership between the UK and India and is a catalyst for promoting opportunities for future collaboration. It features the 5th annual UK-India Leadership Conclave (20th-21st June), a landmark event for identifying ways to grow and transform the strategic partnership between ‘Brexit Britain and Global India’.
Sterling Media has been shortlisted for its position as a result of its standing as one of the first communications agencies in the UK to drive thought-leadership strategies for Indian narratives across politics, culture, social advocacy, thus contributing to the development of the UK-India corridor. Some of the breakthrough campaigns spearheaded by Sterling Media includes: • Managing the re-launch of Heinz India with the pan-India strategy for Complan. •Being recognised as the first communications company internationally to take Indian cinema global. From elevating the profiles of leading talent such as Akshay Kumar to Amitabh Bachchan through to raising awareness of major productions such as 3 Idiots and Dangal, Sterling Media has been a pivotal vehicle for magnifying the Bollywood depiction on the global stage. • Launching the marquee and quintessential British brand Aston Martin in India. • Leading the global communications for the 2018 Commonwealth Business Forum as part of the biennial Commonwealth Heads of Governments Meeting in London this year. Natasha Mudhar, the company’s Global CEO, was also appointed to the Advisory Board at the Commonwealth Enterprise and Investment Council (CWEIC), which seeks to connect and expand the partnership within the Commonwealth 53 nations, which Includes India, the largest Commonwealth nation. Speaking about Sterling Media’s nomination, Global CEO Natasha Mudhar said: “We are honored to have been nominated for such a prestigious accolade in the form of the PR Firm of the Year at the UK-India Awards. In a year which has been replete with impactful developments in the ever-expanding relationship between the two countries, Sterling Media is incredibly proud to be recognised amongst some truly great individuals and organisations who contribute towards heralding a new era of partnerships between two great nations. Sterling Media strongly believe in the potential for India to become one of the pillars of global trade and diplomacy, and we are committed to enabling this exciting period of transition. Over the last few years, we have also seen a phenomenal synergy between UK and India audiences, allowing for a nexus of cross-cultural understating. By focusing on deepening the ties between both countries, we can facilitate a mutually beneficial bilateral relationship, transcoding physical distances and mental blockades.”
The conclave will see a range of panels, including the Social Impact Roundtable, chaired by Manoj Badale, Chairman of the British Asian Trust. Taking place on Thursday 21st June, Natasha Mudhar has been invited to join the panel, given Sterling Media’s expertise in leading major social advocacy campaigns on behalf of the United Nations, celebrities, governments and NGOs. • Natasha is the India Director for filmmaker Richard Curtis’ “Project Everyone” which aims to popularize the United Nations’ Sustainable Development Goals to end global poverty; • She led the Africa and India strategy for Jamie Oliver’s Food Revolution Day campaign to tackle double nutrition burdens; • A menstrual hygiene awareness advocate, Natasha runs campaigns to tackle the taboo and stigma associated with menstruation; • Natasha was part of the team to launch Sabin Vaccine Institute’s Hathipaon Mukht Bharat campaign with the Ministry of Health and Family Welfare, a mass drug administration program which targeted over 450mn Indian citizens to eliminate Filaria in India by 2020.
MANOJ LADWA
NATASHA MUDHAR
ENTREPRENEUR AND POLITICAL STRATEGIST
GLOBAL CEO
ISSUE 07 | 14
During the panel, Natasha will also highlight the power of popular culture for social good via platforms such as films including Pad Man and Toilet Ek Prem Katha as well as the remake of the Spice Girls’ song Wannabe for the #WhatIReallyReallyWant campaign,promoting girl and woman empowerment. Other panels include The Future of Creativity and the Media, chaired by Bollywood actor Vivek Oberoi, Global Britain Meets Global India featuring Sir Vince Cable MP and Rt Hon Priti Patel MP and Building Modern Economies - Smart Cities, Smarter People.
ISSUE 07 ISSUET 09 || 15 15
BUSINESS
ARRO MONEY ‘GOT SOLE’ WITH NEW MULTI-PLATFORM SOLE TRADER ACCOUNT
Arro Money – a product of Marq Millions – has widened its account offering with a business solution created specifically for sole traders. The fast-growing provider of personal and business accounts used its experience supporting SMEs and start-ups, combined with its unique insight into the challenges faced by sole traders, to create an account catered to the needs of freelancers. For too long sole traders have been excluded from the financial services ecosystem, due to being denied a business account at high street banks. This segregation may result due to no fault of the business owner and instead be based on inconsistent income or business size. This has led to many having to inadequately manage their finance through a personal account, which can cause a variety of issues when it comes to tax, compliance, overall money management and reporting. Now applicants won’t have to face long and inconvenient queues associated with high street banks, instead with Arro Money, applicants can gain an account in a matter of minutes – significantly quicker than high street banks. Those wanting to open an account will merely provide a proof of ID and a letter to verify their address, Arro Money’s 25 separate algorithms do the rest to verify the applicant. As the organisation does not offer credit, users do not have to go through lengthy credit checks which often result in users being denied access to a traditional bank account. Instead, sole traders will benefit from access to an instant account number and sort code. Arro Money’s multi-device platform means that business users are not limited to ‘mobile only’ banking. Instead, this multi-platform approach will allow them to monitor each and every penny on any device - saving sole traders hours of administration and empower them to get on with what means the most. Talking about this unique service offering for sole traders, Mahmood Ali Kamran, Operations Director at Marq Millions, said: “Seeing how sole traders have been underserviced for many years we wanted to create a financial services offering that worked specifically for them. We believe everyone should have access to appropriate financial services that meet their needs. By providing solutions that enable sole traders to grow their business we’re actively supporting not only these businesses but also the economy as a whole.”
ASTER PARTICIPATES IN $60 MILLION FUNDRAISING BY CLAROTY, THE LEADER IN INDUSTRIAL CYBERSECURITY
Aster has announced its participation in Claroty’s $60 million fundraising. With Temasek acting as lead investor, this round of funding will allow the Israeli startup, leader in industrial cybersecurity, to strengthen its international presence and position itself as the key player in the sector. A unique approach to industrial cybersecurity The number and complexity of cyber threats have grown exponentially in recent years: a business is targeted by a cyberattack every 40 seconds. In response to these ever more sophisticated attacks, Claroty, established in 2014 as part of Team8, Israeli’s leading cybersecurity think tank, has developed solutions for securing industrial control systems that protect critical infrastructures from outside attacks. Aster, a specialist in the digital transformation of the energy and industrial sectors, based its investment decision on Claroty’s ability to roll out its solutions on a massive scale by adapting to the different protocols of industrial control systems. Its extensive expertise in operational technology and capacity for making information readily understandable are key advantages when it comes to supporting multinational clients in their quest to protect themselves from cyber threats. “Claroty is radically changing the way we can improve traditional industrial networks. With its remarkable team and deep expertise in cybersecurity, the company is a perfect fit for Aster’s model,” said Fabio Lancellotti, Partner at Aster. A founding team coming from the highest levels of global security Claroty’s three cofounders, Amir Zilberstein (cofounder of Gita Technologies and Waterfall Security Solutions), Benny Porat (security researcher at NorthBit) and Galina Antova (global head of industrial security services at Siemens), joined forces to develop a global solution for securing and optimizing industrial control networks. “Claroty seeks out partners that share its desire to better protect the industrial environment from cyberattacks. We are thrilled to welcome Aster, that shares our vision, among our investors in this next phase of Claroty’s development,” said Amir Zilberstein, CEO of Claroty. Aster, a venture capital company that bets on Israel Aster has been active in Tel Aviv for many years, applying both its funding and business hub approaches at the local level. It seeks to facilitate exchanges between Israeli startups and its industrial partners to open a door for the latter to Europe and North America, its other geographic markets. Adi Yefet, who has been leading Aster’s office in Tel Aviv since September 2017, said: “We see real potential in Israeli startups, notably in the sectors of industry, energy and mobility. As a member of the business hub team, I promote an open innovation approach to showcase the most promising Israeli companies. We help them build momentum by creating opportunities for them to connect with our sponsors’ networks and markets and to secure funding from Aster.”
Arro Money’s sole trader accounts will be charged at £10 per month and offer all the benefits associated with a traditional bank account. The accounts will be a particular draw to business owners conducting international commerce with foreign account charges set at as little as 3p, a drastic change to traditional, high street account charges. The Arro Money product has gone from strength to strength in the last six months, with the business launching a greater choice of service levels on the personal accounts. Furthermore, Arro Money’s parent company, Marq Millions Ltd, has seen dramatic development with a number of employees joining the team in order to handle the growing demand. This business expansion has led the company to move to a larger, new headquarters.
ISSUE 07 | 16
INSIGHT
ISSUE 07 | 17
BUSINESS
INSIGHT
BE DESIGN REVEALS SECRETS TO SUCCESS FOR FIVE YEARS ANNIVERSARY
FIVE years ago, BE Design was founded by three directors with more than 60 years of combined experience and a passion to offer truly multi-disciplinary expertise and design excellence within the built environment.
EDWARD BONHAM CARTER AND MERRYN SOMERSET WEBB to become Non-Executive Directors of Netwealth
In that time Anna Tsartsari, Simon Powell and Stephen Oakden have grown a team of 30 architects, civil and structural engineers delivering high-quality projects across key sectors. The multi-award-winning practice - which operates across the UK, Europe and internationally - celebrated its five-year milestone with an exclusive event in London attended by staff, clients, contractors and suppliers where the secrets of its success was revealed. Simon Powell, director at BE Design said: “At BE Design we are passionate about our industry and have developed five ingredients which have been key to our success. We focus on our people, our clients, our values, our technological infrastructure and on working hard.”
SIMON POWELL DIRECTOR AT BE DESIGN
“It’s this simple approach that has helped us to develop a strong portfolio of work across our key sectors. Our clients tell us they value the in-house expertise we have across architectural, civil and structural disciplines. Because the BE Design family work in project and client centric teams in a single office, we can be more responsive to our clients’ needs. Our aim is always to be exceptional, exciting our clients so that they are delighted and inspired with our service.” Now with an impressive portfolio featuring Rushden Lakes retail development in Northamptonshire, Olympic Park regeneration and the Bear Grylls Adventure theme park at NEC in Birmingham – to name only a few - the practice plans to more than double the size of its team in three years and help more clients achieve their built environment aspirations.
CHARLOTTE RANSOM
Stephen Oakden director at BE Design said the hard work and commitment of the team at BE Design was testament to what had been achieved in such a short space of time. “We’re proud to orchestrate projects on behalf of clients to help them achieve their goals. I want to thank everyone who has supported BE Design in reaching this important milestone, our people, our suppliers and our clients,” he said. “Our transparent approach harnesses trust with clients and, as a result, we are now working with the same clients on new projects. It’s a very exciting time for the practice as we’re delivering more projects further afield in Germany, Spain and Italy, together with delivering more large-scale projects across the UK. We very much look forward to growing our family of experts in line with our portfolio of work.”
CHIEF EXECUTIVE OF NETWEALTH
Netwealth Investments Ltd, the discretionary wealth manager launched in May 2016, announced today that Edward Bonham Carter, Vice Chairman of Jupiter Fund Management plc, and Merryn Somerset Webb, FT Columnist and editor-in-chief of MoneyWeek are to join the company as non-executive directors, effective today. Charlotte Ransom, Chief Executive of Netwealth, said: “I am delighted that Edward and Merryn are joining us at this stage. Edward has been working in the investment industry for over thirty five years and has extensive knowledge of the fund management market. Merryn, who has acted as advisor to the firm since launch, is one of the best-known commentators on personal finance and has deep insight into the UK’s financial consumers. Both appointments bring a breadth of experience and perspective which will add significantly to Netwealth as we expand our reach in the UK.” Edward said: “I am looking forward to working more closely with Netwealth. They have a compelling business model which I believe delivers on the key requirements for a modern wealth manager”. Merryn, commenting on her appointment, said: “The wealth management industry continues to be beleaguered by high costs and inefficient models. Netwealth offers a highly credible alternative to the traditional providers.” Edward and Merryn join Michael Hartweg, the co-founder of Leonteq, as non-executive directors. The other board members are Netwealth co-founders Charlotte Ransom, Chief Executive Officer, and Thomas Salter, Chief Operating Officer.
ISSUE 07 | 18
ISSUE 07 | 19
BUSINESS
SKILLS SHORTAGE top fear for uk financial services
Half (49%) of senior leaders in the financial services sector see finding skilled candidates as the biggest worry over the next twelve months, new research from Robert Half Financial Services has revealed. The survey highlighted the key concerns – both external and internal – facing the industry, including the impact of tightened regulation controls, new business processes, and training and development for employees. The financial services industry faces a number of unique challenges, from the rise of challenger banks and the need to improve customer service, to digital transformation and impact of new regulations such as MiFID II and GDPR. In the face of these challenges, financial services leaders have identified the skills shortage as their greatest fear, demonstrating the importance of attracting and retaining talented employees. “Process, regulatory and geopolitical change are creating the perfect storm for the financial services sector to develop and grow,” said Matt Weston, UK Managing Director at Robert Half. “In a time of uncertainty, banks and other financial services firms need to be confident they can access the skills they need to help them through this current period of change and beyond”.
RANK 1 2 3 4 5 6 7 8 9 10
TOP 10 CONCERNS IN FINANCIAL SERVICES Finding the necessary talent/skills Tightened regulatory controls Implementation new business processes Training and development of existing employees Bank recapitalisation Market instability Finding growth opportunities Cyber-security Staff retention Fintech/new technologies
Other worries included tightened regulatory controls (cited by 42% of respondents), implementing new business processes (35%), market instability, bank recapitalisation, and training and developing existing employees (all 32%). The research revealed that new technologies such as Blockchain and automation are less of a worry, with many optimistic about their potential – only 13% and 6% fear their impact respectively. “With only a finite number of skilled professionals, providing current staff with the means to grow and develop new skills provides tangible benefits to the business as a whole, including plugging skills gaps. Staff provided with such opportunities are more motivated, productive and loyal which has a positive impact on any organisation.” “Additionally, while operating in a period of change or market instability adopting a flexible recruitment strategy can offer great benefits. Where current skills gaps do exist, hiring in temporary or contract professionals to fill those gaps allows for added value, greater flexibility and controls”, concluded Weston.
ISSUE 07 | 20
ISSUE 07 | 21
% 49% 42% 35% 32% 32% 32% 30% 28% 27% 26%
INSIGHT
BUSINESS
INSIGHT
NYLACAST NAMED AS ONE OF LEICESTERSHIRE’S TOP 200 COMPANIES
LEICESTER HEADQUARTERED ENGINEERING FIRM NYLACAST HAVE BEEN RANKED FOR A THIRD consecutive year as one of the top companies in the region, amongst market leading brands including Next, Walkers, Caterpillar and Leicester City Football Club. Established in Leicester for over 50 years, Nylacast, a manufacturer of engineered polymers and products has grown from strength to strength. Following recent investment in 120,000 square foot of premises, Nylacast today operates from two state of the art sites in Thurmaston, including its world class headquarters centric to Leicester. The engineering firm also has manufacturing and distribution facilities located in key locations to service a worldwide market place, this includes USA, South Africa and China. Employing over 430 members of staff, Nylacast have a focus on the development of its technology, people and communities. The engineering company runs a dedicated training academy delivering award winning apprenticeship and graduate programmes, nurturing talent from local schools and colleges and taking students on a journey to becoming qualified, graduated engineers. The global demand for Nylacast’s unique materials technology sees the company working on iconic projects ranging from the Queensferry Crossing to the world’s largest ship, Shell Prelude, in addition to providing safety critical components for over 70 million vehicles worldwide. Over 70% of product manufactured in Leicester, UK, is exported to over 47 countries. Nylacast group CEO Mussa Mahomed commented; “Leicester is a high achieving city. Being listed amongst the top 200 companies in the region makes us very proud of our Leicestershire heritage when it has never been a better time to promote local trade and British export. We look forward to further excelling our performance and operations both in the city and the global marketplace.” The Leicestershire Top 200 List was meticulously compiled by a team of academics at De Montfort University’s Business School which took into account both the financial facts and numbers of the companies along with their local operations or presence in Leicester. Nylacast, winners of the British Engineering Excellence Award have also been placed in the Sunday Times HSBC International Track 200, ranked as one of Britain’s mid-market private companies with the fastest-growing international sales.
ISSUE 07 | 22
ISSUE 07 | 23
BUSINESS
OFFSHORE TAX EVADERS FACE
UK taxpayers who fail to disclose offshore income or gains, either by failing to notify HMRC of their chargeability to UK tax, failing to deliver a tax return or by submission of an incorrect tax return will face imprisonment and swinging penalties say leading accounting, tax and advisory practice Blick Rothenberg.
INSIGHT
IMPRISONMENT AND ENORMOUS FINES
Gardner added: “The offence applies from the tax year 2017/18 which means that HMRC will begin to take action from 6 October 2018 because taxpayers have until 6 months after the end of the year of assessment in which to notify HMRC of their chargeability to tax which means the cut-off date for such notification is 5 October.” Gardner says: “Practitioners have perhaps been overly focused with the Requirement to Correct and Failure to Correct rules and overlooked earlier legislation in 2016 which brought in a new strict liability criminal offence for offshore tax evasion.” He added: “A preoccupation with the Requirement to Correct (“RTC”) rules is entirely understandable as the sanctions for failing to correct any inaccuracies in an individual’s tax affairs in relation to offshore matters by the 30 September 2018 deadline are severe; with penalties of up to 300% of the tax involved and a minimum penalty of 100% of the tax evaded. In addition, despite the drive to increase prosecutions it is likely that the majority of cases will still be dealt with on a civil basis so will involve the imposition of penalties.” Gary said: “It is not surprising that the earliest date that an offence can be committed coincides closely with both the deadline for the RTC and the first full automatic exchange of information by over a 100 countries under the Common Reporting Standard on 30 September 2018. The huge increase in information that CRS will deliver to HMRC will enable them to escalate their drive to stamp out offshore tax evasion.” Gardner advised: “Those with any doubt that their offshore tax affairs are all in order should without further hesitation ask their advisers to undertake a ‘health check’ to ensure that they not exposed to the sanctions associated with noncompliance.”
Gary Gardner, a partner at Blick Rothenberg said: “Individuals with offshore interests and their advisers should be aware that HMRC is committed to enforcing the new legislation introduced in FA 2016 in relation to undisclosed offshore income and gains in respect of which the maximum sanction is 6 months imprisonment”. The new rules were devised partly in response to the immense political, media and public pressure for HMRC to criminally investigate and secure convictions against tax evaders, with the focus on wealthy individuals, and are likely to drive a further increase in the number of criminal investigations relating to offshore tax evasion. Critically, the new rules do not distinguish between those who have intentionally misled HMRC and those who have merely “got it wrong” since the legislation is framed in such a way that the mere existence of undisclosed offshore income and gains is sufficient to enable the sanctions to bite. The prosecution does not have to prove that there was “mens rea” (a guilty mind). Despite the “strict liability” nature of the offence the taxpayer can put forward the defence that he had a reasonable excuse for the failures or inaccuracy. However the onus is squarely on the taxpayer to demonstrate this.
gary gardner partner at blick rothenberg
ISSUE 07 | 24
ISSUE 07 | 25
BUSINESS
INSIGHT
LOCAL SUBCONTRACTORS REQUIRED IN CARDIFF BY NATIONAL BUILDING CONTRACTOR SPELLER METCALFE Speller Metcalfe, one of the UK’s leading construction companies, are searching for local subcontractors to join their supply chain across Cardiff. The award-winning contractor will be hosting a ‘Meet the Buyer’ event in the city, in partnership with Constructionline, on 12th July 2018, at the Glamorgan County Cricket Club, Cardiff, CF11 9XR. Held from 8:30AM to 12PM, the event will offer breakfast and an introduction to Speller Metcalfe given by Martyn Osborne, Regional Director to the South West and Wales. Speller Metcalfe’s Buying Team will also be attending.
Lawson Conner expands AML offering to Cayman Islands
Leading global regulatory and compliance services provider, Lawson Conner has today announced the launch of its new outsourced anti-money laundering solutions offering for Cayman funds. Following the Cayman Islands Monetary Authority requirement to appoint an AML Compliance officer, Money Laundering Reporting Officer and a Deputy MLRO for Cayman domiciled funds, Lawson Conner has developed a comprehensive services offering, including the relevant appointments of regulatory experts, and the relevant compliance monitoring program. Commenting on the launch of the new offering, Andrew Frost, Executive Director at Lawson Conner, said: “The ongoing anti-money laundering compliance environment in the Cayman Islands continues to be a key issue for the financial services industry, particularly with the introduction of a raft of new legislation over the past six months. There are an increased number of funds looking to outsource their AML controls to a suitably qualified third-party provider – an effective and efficient way to ensure that all obligations are met. Our service offering comes at a critical time for many financial firms domiciled in the Cayman Islands and we look forward to working collaboratively with them to ensure that they meet all of their regulatory needs.”
Speller Metcalfe is interested in meeting a wide range of specialising subcontractors including, but not limited to, all aspects of doors and windows, cladding, flooring, concrete, building wraps, guttering, fire protection, solar heating, joinery, insulation, ceilings, roofing, asbestos removal, and many more. For full details of these, those wishing to attend are invited to see the ticket link page below. Tom Smith, Procurement Manager, commented: “We have some extremely exciting projects coming up and we are very much looking forward to meeting everyone who attends this event. “Speller Metcalfe is built upon family values, and a strong teamwork ethos; building blocks of our fantastic long-term relationships that we have with our current subcontractors. We love to provide events such as this one to connect with new subcontractors who we can continue to trust and rely on now and for years to come.”
About Constructionline Constructionline is one of the UK’s largest procurement and supply chain management services and was set up by BIS (formerly the Department of the Environment, Transport and the Regions) initially for public sector contracts. It has been running successfully for more than 16 years, providing market-leading third-party accreditation and risk management services to all clients. It is one of the largest buyer and supplier service organisations of its kind, helping buyers achieve compliance and returning regular income to BIS and the tax payer.
About Speller Metcalfe Speller Metcalfe is a family-owned business and national building contractor. The company was founded in 1995 by Steve Speller and Andy Metcalfe, experienced surveyors. Over two decades, it has grown to an annual turnover of £130 million, working on projects across the public and private sectors with values from £250,000 up to £40 million. They continue to be a market leader, passionate about innovation excellence in building striving to deliver skill and expertise.
ISSUE 07 | 26
ISSUE 07 | 27
FINANCE
GERMAN AND JAPANESE BANKS CONTINUE TO LAG IN GLOBAL EFFICIENCY RANKING
Efficiency laggards in Germany and Japan are weighing down incremental progress among banks in improving the global cost-toincome trend, an analysis from S&P Global Market Intelligence shows. Roughly two-thirds of the countries included in the analysis saw average cost-to-income ratios improve, leading the global ratio to fall for a fourth consecutive year to 52.93% from 53.97% in 2016. The ratio, which measures operating expense as a percentage of operating income, is used to gauge efficiency and productivity for banks. Lower ratios generally indicate higher efficiency, but a number of factors can affect the metric, including a bank’s business model and size. The economic, financial and regulatory environment of each country can also impact the ratios. Germany’s competitive banking industry had the worst weighted average cost-to-income ratio among the 64 countries included in the analysis, hitting 78.86% in 2017 following a 3.57-percentage-point year-over-year increase. Deutsche Bank AG, the country’s largest listed bank, recorded one of the world’s highest ratios, at 92.93%. The group was previously hit by high litigation costs to settle legacy misconduct cases, the heftiest of which was concluded at the end of 2016. Deutsche also faced rising operating expenses since it struggled a five-year restructuring plan in late 2015, as it aimed to revamp large parts of its IT infrastructure while also completing a merger of its retail banking units. The slumping performance of its corporate and investment bank, which still accounts for more than half of group revenues, has been the main drag on Deutsche’s profitability over the past few years. The group posted a revised €735 million loss in 2017, its third consecutive annual loss. Deutsche has readjusted its strategy to generate more stable revenue streams, focusing on retail banking, asset management and global transaction banking, while reducing the share of CIB. Resizing the CIB is expected to cut costs by €1 billion by the end of 2019 with the bulk of the reduction coming from job cuts. Earlier in 2018, Deutsche announced plans to cut about 7,000 jobs as part of a review of its equities sales and trading business, and is facing shareholder pressure to downsize or altogether exit its U.S. business. The group expects that the rebalancing of the revenue mix and the headcount reduction, among other steps, will help it reduce its overall cost-to-income ratio. In the medium term, Deutsche is aiming for a ratio of below 65% at both its retail banking and asset management arms. It has not set a specific target for CIB. Other German banks are facing their own challenges. Commerzbank AG, which is in the midst of its own restructuring, saw its cost-to-income ratio increase to 92.59% in 2017 from 79.24% a year earlier as it booked a 6.48% decline in operating income coupled with a 9.28% rise in expenses. Similarly, banks in Japan, many of which are still struggling from years of ultralow interest rates and other local challenges, recorded deteriorating ratios for the third straight year, with the average rising another 5.15 percentage points in 2017 to 63.60%. Mizuho Financial Group Inc. had one of the highest cost-to-income ratios among major Asian banks, at 68.45%. The Japanese bank has posted a drop in its annual gross profit in each of the past four years — including an 8.48% decline in its most recent fiscal year — while its operating expenses have continued to tick higher. Those performances come in stark contrast to the broader banking trend of incremental improvement in 2017.
ISSUE 07 | 28
Europe Despite the German performance, much of Europe saw improvement during the year — and some countries markedly so. The average for banks in Belgium improved by 15.54 percentage points, while in the U.K. and Portugal it declined by more than 9 percentage points. On the flip side, however, French banks saw their cost-to-income ratios worsen in 2017, with the average rising 7.54 percentage points to 74.41%. Among the country’s major banks, both Société Générale SA and Groupe BPCE had 2017 ratios at or above 70%. The biggest annual deterioration in the region, however, came from Ukraine, where the average ratio shot 10.29 percentage points higher to 59.69%.
Asia-Pacific
Regionally, banks in 10 of the 16 Asia-Pacific countries in the sample experienced year-over-year improvement. South Korea posted the biggest drop in the average cost-to-income ratio, improving 8.48 percentage points to 54.35% to effectively reverse the deterioration seen in 2016. Vietnam-based banks also booked notable efficiency gains, with the average ratio improving 4.92 percentage points to 51.72%. China continued to boast the region’s lowest average cost-to-income ratio, despite seeing a 1.15-percentage-point increase in 2017. The 206 Chinese banks included in the sample had an average ratio of 33.58%, compares to 32.44% the previous year.
US and Canada
In the U.S., the average cost-to-income ratio improved to 60.45% from 61.20% year over year, while Canada’s ticked up to 59.28% from 60.34%. Among the region’s 15 largest banks, Morgan Stanley had the highest cost-to-income ratio at 71.79%, while Capital One Financial Corp. had the lowest at 51.24%.
Latin America
Of the Latin American countries (along with Mexico) in the sample, all but two showed year-over-year improvement in their cost-toincome ratios — Peru and Colombia. Banks in Venezuela, which is battling an economic crisis marked by hyperinflation, experienced the biggest improvement, dropping to 40.93% from 52.33%. However, there is a wide gap among the country’s banks, with Banco Bicentenario del Pueblo de la Clase Obrera Mujer y Comunas Banco Univ CA posting a ratio of 79.13% for 2017, while Banco Occidental de Descuento Banco Universal C. A. had a 31.50% ratio.
Middle East and Africa
Some countries in the MEA region experienced large shifts in cost-to-income ratios in 2017. Most notably, Iraq, which in 2016 had one of the lowest ratios in the world, recorded one of the world’s highest following a sample-leading 51.48 percentage point increase to 74.38%. Algeria also saw a sizable jump of nearly 21 percentage points to 45.61%. Still, most of the 14 countries included in the sample improved their ratios, including Sudan and Angola, where the average ratio declined by roughly 13 percentage points.
ISSUE 07 | 29
FINANCE
DIGITAL THERAPY COMPANY HEALIOS RAISES £2.2M ($3M) IN THE LATEST FUNDING
PARAGONRS75PARTNERS INVESTS CRORE IN ESHAKTI E Shakti, a women’s fashion brand based in Chennai, Tuesday said it has raised 75 crore from Paragon Partners Growth Fund-I, a private equity fund focused on mid-market segments. Paragon Partners was founded by Siddharth Parekh and Sumeet Nindrajog in 2015. It invests primarily in consumer discretionary, financial services, infrastructure services (asset light), industrials and healthcare services. It has a corpus of $120 million and invests $10-20 million in firms. Founded by B.G. Krishnan, a first-generation entrepreneur, eShakti is one of the few international consumer brands from India that enjoys a leadership position in the US with presence in Australia and Canada also, a company statement said. “The investment from Paragon Partners is primarily needed for growth as we are building a multinational consumer brand with a global footprint. We are excited by the endorsement and opportunity that Paragon’s investment represents and we look forward to building on our history of strong growth based on a robust value proposition that gives us both scalability and a competitive advantage,” said Krishnan. So far, the firm has raised capital from venture capital investors including IDG Ventures, IvyCap and Infina Finance. “eShakti is one of the early movers in addressing an underserved need for make-to-order apparel for women in the western markets. With its disruptive operating model combined with superior quality of design, fabrics and speed of execution, eShakti has been able to build a strong and growing community of loyal customers in the US,” said Siddharth Parekh, co-founder and senior partner, Paragon Partners. This is Paragon Partners sixth investment from its maiden fund. “Given its lean operating model and strong technology back-end, eShakti can ramp up operations and scale quickly. Despite customized offerings, eShakti’s return rates are relatively low, further validating the robustness of the design and production processes,” said Sumeet Nindrajog, co-founder and senior partner, Paragon Partners. Paragon’s other investments include Maini Precision Products Ltd, Cravatex Brands and InCred. In September 2017, one of the fund’s early portfolio companies, Capacit’e Infraprojects Ltd, went public in an initial public offering that witnessed an oversubscription of 186 times.
ISSUE 07 | 30
Healios, the digital therapy company for mental health, has raised £2.2m ($3m) in its latest funding round, led by investors Albion Capital and Spice Capital. Founded in 2013, Healios empowers young patients and families affected by mental illness and neurodevelopmental conditions through combining the use of technology with specialised clinician expertise and evidence-based clinical tools. Utilising its unique digital platform, Healios enables the efficient delivery of family-centric care, delivering a revolutionary interactive experience across multiple family members. Its technology-driven approach increases both access to and engagement with therapy and enhancing the quality of care and outcomes for its users. Research from Mind found that 1 in 4 people in the UK now experience a mental health issue each year*. Healios is helping to meet the huge growth in the demand for mental healthcare, particularly for young people, driven by both a rise in cases and the increasing recognition that mental health treatment should be on a par with its physical equivalent. The use of family-centric care is considered gold standard for treatment of mental health in the young, but is currently hampered by the difficulty in logistics and accessing sufficient specialist therapists. Healios’ clinical platform facilitates psychological assessments, treatments, wellbeing monitoring and clinical time with qualified clinicians through video conferencing and interactive digital tools. The data shows that 80% of young people choose Healios over face-to-face clinical sessions. The ability for the platform to fit seamlessly into a digitallyfocused lifestyle and at the same time engage family members is a key differentiator from traditional therapy providers. The company is currently working with a many NHS trusts to reinvent the provision of mental health treatment so that it can be accessed quicker, and in both a flexible and inclusive way. The service is currently integrated into the NHS network, operating on a seven day basis to give patients an unprecedented treatment experience. The investment will be used to scale up the operations of the company, enable more widespread accessibility for NHS trusts and private organisations to use its online treatment platform, and further product development. Dr Andrew Elder, Partner and Head of Healthcare, Albion Capital, says: “Healios is a hugely exciting prospect, and offers a model that we believe can change the face of mental healthcare for millions of patients. Mental health cases in the NHS are rising dramatically and Healios not only provides a solution to meeting the demand, but also enhancing the service from both a personal and medical perspective. We look forward to working with the team to bring this extraordinary platform to many more families across the UK and beyond.” Richard Andrews, Founder and CEO, Healios, said: “Technology and digital tools are resetting our expectations of every interaction that we have, including the way we think about mental healthcare. Healios brings transformative technology to the forefront of the treatment experience to deliver excellent mental healthcare that is accessible anywhere. Demand for our services continues to grow significantly as families require flexible and convenient assessment, treatment, and support. This funding will allow us to expand strategically to increase access, innovate rapidly, and execute on our vision to help families in need around the world.” Maryline Kulawik, Managing Partner, Spice Capital, said: “We were completely convinced by the patient-centric telemedicine platform brought to the market by the Healios team. They have combined a unique state-of-art digital technology with a very deep knowledge of mental health issues to provide a flexible, effective and family-focused solution. They will help the community face the growing challenge of mental wellbeing and dramatically reduce delay in access to care. The platform will offer patients customised consultations from the comfort of their home and an acute data-driven monitoring of their condition. We are very excited to support the Healios team in this disruptive project with societal impact.”
SIDDHARTH PAREKH
richard andrews founder and ceo of healios
FOUNDER
ISSUE 07 09 | 31
FINANCE
2CHECKOUT’S 2018 DIGITAL COMMERCE BENCHMARK REFLECTS CONTINUOUS UPWARD TREND FOR SUBSCRIPTION-BASED SALES AND REGIONAL VARIATIONS IN PAYMENT PREFERENCES
2Checkout (formerly Avangate), a leader in eCommerce, payments and subscription billing solutions, today released its Q1 2018 benchmark report on Digital Commerce Trends in Software & Online Services Sales. The report shows that subscription-based purchases maintain a strong upward trend. Similar to previous years, consumers and businesses continue to prioritize security product purchases. The company’s Digital Commerce Benchmark follows trends in the global consumption of software and digital services, as reflected by purchases via 2Checkout’s Avangate digital monetization platform, highlighting fastgrowing regions and categories as well as uncovering the most popular payment methods worldwide. Key trends from the report include: Subscriptions-model dominates - The overwhelming shift to subscription commerce is even more evident when comparing data over time. In 2012, only about half (49%) of software sales were for subscription-based products and services, while a substantial 76 percent of sales in Q1 2018 have been for recurring-based purchases. The share of subscription-based products has been increasing steadily over the years, with 2017 witnessing a 75% level.
Movements amongst the top 10 Countries The United States continues to lead in global sales of software, SaaS and online services, accounting for half of sales worldwide, followed distantly by the UK and France. Germany claims the fourth spot, closely followed by Canada, similar to the 2017 ranking. Non-English-speaking countries account for a bit over 20 % of global software sales, on par with 2017 data. Revenue uplift sources for software sales – Continuing to show strength as an additional sales and marketing channel for the software industry, affiliate-generated sales account for 24 % of revenue for companies connected to 2Checkout’s Avangate affiliate network and actively using it, with promotions touching 33 % of revenues, cross-selling 5.5 % and upselling 7 %. Compared to 2017, promotions are used more intensively, showing this classic marketing tool still yields results.
“We’ve been tracking these digital commerce benchmarks for years now and it’s interesting to notice clear trends – such as the proliferation of subscriptions, the continued preference for local payments in many parts of the world, and the most sought-after software products and online services. As companies continue to expand into international markets, they need to be prepared to sell in the ways their end-customers want to buy, support a broad range of payment methods and business models, and sell through multiple channels and touchpoints in order to deliver exceptional user experiences. Understanding trends and buyer preferences is an important step in this direction,” said Erich Litch, 2Checkout’s Chief Revenue Officer. The Digital Commerce Benchmark is based on a sample of hundreds of thousands of worldwide transactions moving through 2Checkout’s Avangate platform between January 2017 and March 2018. 2Checkout continuously tracks fluctuations in sales, empowering software and digital goods providers worldwide to make smarter decisions. About 2Checkout (formerly Avangate) 2Checkout, a Francisco Partners portfolio company, is the digital commerce & payments provider that helps companies sell their products and services via multiple channels, acquire customers across multiple touch points, increase customer and revenue retention, leverage smarter payment options and subscription billing models, and maximize sales conversion rates. The company’s clients include ABBYY, Absolute, Bitdefender, FICO, HP Software, Kaspersky Lab, and many more companies across the globe.
Average order value stays strong - The global average order value for software, SaaS and online services in the first quarter of 2018 is $50, a slight increase from $48 the previous year. Regional variations in payment preferences - Visa and MasterCard continue to dominate in terms of payment methods, accounting for 68 percent of global online sales, followed by PayPal at 19 percent and American Express at 7 percent. This split emerges almost unchanged from the previous years, at global level and mirrored closely by United States, the largest software market. Other countries show stronger preferences for local payment methods such as iDEAL in the Netherlands (43 %), Alipay in China (42%), local credit cards in Brazil (28%) and Turkey (17%), Carte Bancaire in France (at 12 %) and JCB and Konbini in Japan (with 19.5 and 5 %, respectively). Security stays strong - Security and privacy products are the leading category in software products sold online, accounting for 38 percent of online sales. This represents a four-percentage point increase compared to 2017 data. Multimedia and design software (including audio-visual tools) follows at 21 %, and online services, including business and finance follow at 20 percent. Other categories tracked in the report include utilities, marketing tools, web tools, office tools and development tools.
ISSUE 07 | 32
ISSUE 07 | 33
INVESTMENT
ENCODED ANNOUNCES NEW SECURE CUSTOMER ENGAGEMENT PLATFORM New platform allows businesses to accept fast, secure payments via SMS from customers.
EUROPA CASHES OUT WITH SUPER-FAST NEW FINANCE
Encoded has announced the availability of its new customer engagement platform that enables contact centres to accept secure customer payments via SMS. An increasingly popular communications channel, using SMS makes it easier for customers to pay bills, helping to reduce debt and agent time chasing missed or non-payments. The new platform works with other Encoded payment services enabling a customer’s stored payment details to be accessed from any of the channels being used such as self-service IVR, agent assisted payments or online. Encoded’s platform has been designed to be PCI DSS and GDPR compliant, ensuring mobile and online security of customer payment data. It also incorporates Artificial Intelligence technology, simulating real agents to handle routine parts of the conversation. “Bots” autonomously engage in client conversations alerting agents only when the conversation falls out of the expected flow, allowing them to pick up with the full conversation history. This enables a small number of contact centre staff to handle a large number of customers. Businesses can also use SMS chat via Encoded’s platform to promote the use of online services, broadcast releases of their latest mobile App or invite clients to request the latest PDF download. It integrates with other messaging services including Facebook Messenger and Amazon’s Alexa virtual assistant. Robert Crutchington, Director of Encoded said; “At Encoded our solutions are designed to reduce contact centre costs by automating processes, offering new channels for fulfilment and transaction processing and increasing ways for agents to improve customer service.” “Enabling customers to pay securely using SMS ticks all of these boxes. Widely accepted as a non-intrusive, convenient method of communication, it is often preferred to emails or voice. It makes it easier for customers to pay and they don’t have to spend time waiting on the phone. It is also a cost effective way for businesses to take payments, saving agents time chasing late or non-payments.” The new secure customer engagement platform is already in use at one of Encoded’s big brand customers and is available immediately.
RICHARD LITCHFIELD DIRECTOR
Continuing with the rapid development of its bespoke in-house IT system Leonardo, Europa Worldwide Group has now launched an additional function which speeds up the electronic processing of supplier invoices – saving the business money and time. LeoFinance is one of the latest phases of the innovative logistics operator’s unique IT suite, which extends its Leonardo offering ever further. The next add-on to this function is LeoScanning, designed to streamline the electronic processing and handling of incoming supplier invoices. Previously, invoices were received on paper, distributed accordingly and then were physically approved. LeoScanning is now live across the business’s European road freight operations with all European partners transferred to the system. 40% of the total Group’s invoices received were posted into the system in the first month alone. IT Director at Europa, Richard Litchfield said LeoScanning had revolutionised the way the business processed financial documents, creating another advancement towards a paper free environment for the accounts department. He said: “Prior to introducing this function, our business like many others was paper-reliant. LeoScanning removes the physicality of processing invoices and replaces it with a slick and efficient system which saves us both time and money. On average we process around 10,000 invoices a month – and by switching to LeoScanning we are saving more than 500-man hours per month. LeoScanning analyses each invoice, recognising key information in order to direct it to the right person within the business for sign off, with improved visibility throughout the whole process. Our finance team can now locate an invoice at the click of a button – there is no searching through stacks of paper. Furthermore, if we are expecting a regular and agreed cost from a supplier, the system will process the invoice without any human interaction, which again saves us valuable time.” Finance Director at Europa, Rob Ross added: “For the finance team, Leo scanning is a great addition to the new LeoFinance system. It allows the purchase ledger team to process supplier invoices much more quickly and has meant we have not had to add additional clerks to the team.” Europa unleashed Leonardo in July 2016, a revolutionary decision to give the business ultimate control over its own IT systems in a drive to improve responsiveness, efficiency, productivity and scalability across its 11 UK sites. Two years later and the streamlined benefits of Leonardo are now apparent across all arms of the business, from the finance team to inside the Europa cab. Europa Worldwide Group is a specialist road, air & sea and warehouse operator which employs more than 750 staff across 11 sites in the UK and Hong Kong. It recently reported its financial results for year-end 31st December 2017 which showed the business to be in the strongest position in its 50-year history with turnover surpassing £144m, underlying net profit increased to £3.2m from £1.1m in 2016 and a very healthy increase in its net assets, which now stand at £6.8m compared to £3.7m in the preceding financial year.
ISSUE 07 | 34
ISSUE 07 | 35
INVESTMENT
FIX RADIO expanding into fix media
Tailored marketing to the construction industry after hugely successful first year. Fix Radio, currently known as the UK’s only dedicated radio station for tradespeople, is expanding to now offer full scale media marketing for the construction industry. The newly conceived ‘Fix Media’ comes after Fix Radio’s agreement to manage the running of Facebook group Tradesmen Banter, which has over 450,000 dedicated active followers. The aim of this is to be able to connect individually with some of their regular listeners. Having only just celebrated its first birthday, Fix Radio has gained a dedicated listenership of 35,000 and growing, attributable to the infamous ‘banter’ of former community radio DJs Trevor Smith and Ben Harmer, and Arsenal football announcer Paul Burrell. Fix Media will give advertisers and sponsors the opportunity to reach more tradespeople than just the radio listeners alone, as they will continue to offer their famous bacon butty construction site tours, now coupled with lead generation campaigns, video creation and of course access to their huge social media following. Fix Radio CEO Louis Timpany said: “This major expansion is a huge opportunity for us to connect with our audience more directly over social media, which is important to us, and also a major opportunity for sponsors and partners of the station. Not only will we continue to reach over 35,000 listeners via Fix Radio, but we’ll be in front of hundreds of thousands of tradespeople on Facebook, via videos and competitions – we’re hitting all touch points. “It’s a hugely ambitious move that puts us a unique position for marketeers looking to connect with tradespeople at work via the radio, during downtime via social media, and even before work with a bacon butty!” Tradesmen Banter currently shares funny photos and videos to engage tradespeople. The page will keep its name but will be re-branded with Fix Radio’s logos, with content to now be posted by Fix Media’s social media team, including new video and of course the notorious banter Trevor, Ben and Paul are known for. Ever quick off the mark, Fix Media is now working with over 25 current clients including Velux, CITB and Breedon Cement. The station has had to move from its original studio in Battersea to Angel, Islington to accommodate its expansion. It broadcasts on DAB across London as well as online and the Fix Radio app. The station has a two-day no-repeat music policy during the work day, daily construction industry news, and the most detailed weather forecast in London, in partnership with the Met Office. The famed Fix Radio ‘Butty Tour’ van visits 25+ building sites every week across London and the surrounding areas in an effort to connect on a one-to-one level with tradespeople. So far more than 30,000 butties have been distributed to tradespeople in return for allowing their radios to be re-tuned to Fix Radio.
ISSUE 07 | 36
ISSUE 07 | 37
INVESTMENT
DUNEDIN INVESTS IN £44 MILLION FUNDING OF GPS IN UK’S 3RDLARGEST FIN-TECH FINANCING THIS YEAR
Oliver Bevan, Partner at Dunedin, who will sit on the Board alongside Dougal Bennett, Partner, commented: “GPS is positively disrupting a multi-billion-pound industry and is well placed to continue leading the way following the rise of other highly successful fin-tech companies. We are really excited to be investing in GPS which represents a significant opportunity for Dunedin to utilise its experience in taking UK companies with a technological edge and enabling them to shine on the international stage. We will support the management team and founders to help GPS to become a truly global leader in this niche market.” Suresh Vaghjiani, Managing Director at GPS commented: “GPS has experienced exceptional growth over the last few years and we have always prided ourselves on the diverse fin-tech customer base that we service. This partnership with Dunedin will see GPS accelerate even further as innovative fin-tech companies increasingly require global issuing platforms as well as traditional financial institutions looking to compete with new entrants.” Tony Kerr, co-founder of GPS commented: “The partnership with Dunedin is another important milestone for GPS and we look forward to working with them to take the next step on our exciting growth path. The investment will give us extra firepower to facilitate continued growth, strengthen our offering and expand our global footprint.” The investment in GPS coincides with a high level of transactional activity for Dunedin and is the third financial services deal that it has completed in two years, following its investments in Kingsbridge and Alpha. Dunedin has also recently completed three successful exits - Blackrock, Alpha and Kee Safety generating a total return of £231 million for its investors within a three-month period. Dunedin is currently investing its £300 million Fund III. Jessica Hardy, Investment Manager, and Andrew Davidson, Assistant Director at Dunedin supported Oliver Bevan and Dougal Bennett on the deal.
Dunedin, the UK private equity house, today announced that it has invested in the £44 million funding of Global Processing Services, the global payments processor and tech powerhouse behind the most exciting digital banks, challenger banks, fin-techs and financial institutions. GPS is the market leader in issuer processing, enabling next generation payment technology with 100+ clients including Starling Bank, Revolut, Pockit, Volt Bank, Loot, Stocard, Glint, Osper and Curve. The deal is the UK’s 3rd largest fin-tech financing in 2018 and Dunedin will take a significant stake in the business. GPS was co-founded by entrepreneurs Tony Kerr & Craig Dewar and is led by a strong team comprising Joanne Dewar and Suresh Vaghjiani. The Company has circa 150 employees based in London and Newcastle. GPS provides a single, global integrated platform, GPS Apex, that powers and enables functionality of next generation Fin-tech payment companies. Dunedin has a proven track record of growing profitable UK companies and helping them to internationalise. It sees significant potential for GPS to expand into new international markets as well as develop its product portfolio.
ISSUE 07 | 38
ISSUE 07 | 39
INVESTMENT
TELEMOS CAPITAL COMPLETES FIRST UK INVESTMENT WITH CONTROLLING STAKE PURCHASE IN LOVEHONEY Telemos Capital, an evergreen investment company, has completed its acquisition of a majority stake in Lovehoney, a leading online retailer of sexual happiness products.The transaction is Telemos’ first investment in the UK. Financial details have not been disclosed. Established in Bath in 2002 by Richard Longhurst and Neal Slateford, Lovehoney is a market-leading pure e-commerce retailer, focusing on women and couples. Selling a mix of own label and third-party products Lovehoney has grown into an international success, delivering record sales in the region of £100 million for the year ended March 31, 2018. 60% of sales came from the UK, with the remainder from Europe, US and Australia, all of which have achieved significant growth in recent years. The business delivered strong compound annual sales growth of circa 30% in the last three years. In recognition of its achievements Lovehoney received the Queen’s Award for Enterprise in 2016. Telemos comprises a team of highly experienced investment professionals that combine the best of private equity and permanent growth capital. Telemos identifies and supports exceptional management teams in consumer goods and services, healthcare services and business services to help them realise their long-term objectives. As a flexible and nimble investor, Telemos’ distinct structure and expertise makes it a leading, new generation European private equity firm, looking to identify and unlock growth opportunities which may be overlooked by traditional investors. With the backing of Telemos, Lovehoney will accelerate its plans for international expansion, tapping into fragmented and underdeveloped markets and building on its strong consumer engagement. Lovehoney will invest in new technology and marketing, allowing the business to raise its profile in new geographies, and to continue to evolve its excellent customer service, online content, community and innovative new products. The partnership with Telemos illustrates the achievements of the Lovehoney management team which has consistently challenged the market while delivering innovative, high-quality products and exceptional top-line growth. Following the investment, Lovehoney cofounders Richard Longhurst and Neal Slateford will continue to lead day-to-day operations with Telemos’ Executive Chairman Philippe Jacobs and Chief Investment Officer Jacob Polny joining the Lovehoney board. Neal Slateford, Co-Founder of Lovehoney, said: “We’re excited to be partnering with Telemos as we continue our strategy to grow Lovehoney into the world’s leading sexual happiness retailer. This investment shows the strength of online retail and will allow us to break into new markets globally.” Richard Longhurst, Co-Founder of Lovehoney, said: “This is the culmination of 16 years of hard work by our brilliant teams in Bath and our offices worldwide. It has been a phenomenal journey for Neal and I and we’re beyond excited at our future plans for Lovehoney.” Philippe Jacobs, Executive Chairman of Telemos, commented: “We are delighted to have made this investment which demonstrates our differentiated thinking and approach. Richard and Neal have created a great company. We are excited to partner with founders with long-term growth aspirations and a desire for a flexible and nimble investor.” Jacob Polny, Chief Investment Officer of Telemos, added: “We were attracted to Lovehoney’s category leadership, the strong own brand portfolio and the combination of customer service, community and content that truly differentiates the proposition. We look forward to working with Lovehoney’s founders and management team to grow the business in the UK and internationally in the years to come.”
ISSUE 07 | 40
ISSUE 07 | 41
M&A WATCH
INTERNATIONAL ENGINEERING CONSULTANCY
THORNTON TOMASETTI TO ACQUIRE MMI ENGINEERING
Thornton Tomasetti is headquartered in New York and employs over 1,300 staff in 44 offices around the world. The firm is known for its expertise in providing safety solutions and risk analysis on everything from military platforms, critical infrastructure and tall buildings to industrial facilities, petrochemical plants plus automotive and airborne vehicles. Thornton Tomasetti will employ nearly 160 staff in the U.K upon completion of the proposed addition of MMI. The deal for MMI follows Thornton Tomasetti’s acquisition of security consultancy MFD, the Romsey- based specialist in the delivery of physical, operational and technical security services for the built environment, which was announced in May 2018. Following the MFD and MMI acquisitions, Thornton Tomasetti will be able to offer clients a full suite of risk management and technical security services with an expanded European presence from which to build upon its already impressive track record of collaboration with architects, building owners, developers and public agencies. Commenting on the transaction, Phillip Thompson, Thornton Tomasetti’s European Regional Leader, said; “MMI is a first-class business that brings with it a reputation for scientific rigour and engineering excellence. Their blue-chip customer base is testament to the work they undertake in helping some of the world’s leading companies and public bodies manage both manmade and natural hazards across a range of sectors. Coming hot on the heels of last month’s investment in MFD, this transaction further underlines our commitment to growing our presence in Europe and providing our clients with a full range of risk management and technical security services.” Commenting on the transaction, Najib Abboud, Thornton Tomasetti’s Weidlinger Applied Science Practice Leader, said; “The addition of MMI to the Thornton Tomasetti team will propel us to a new magnitude in the U.K., Australasia and the Far East while providing MMI with a broader platform from which to grow. Together, we will continue to provide best-in-class analysis, simulation and engineering design services, as well as multidisciplinary solutions to current and future challenges presented by man-made and natural hazards.”
Thornton Tomasetti, the international engineering consultancy, has agreed to acquire MMI Engineering, the technical consulting specialist focused on the risk management of man-made and natural hazards across the oil and gas, nuclear, utilities and infrastructure sectors. The deal is scheduled to close later this month. MMI is a leading consulting and engineering firm delivering solutions across the full project lifecycle for clients including Shell, BP, Chevron and Sellafield Limited as well as RWM, International Nuclear Services, Westinghouse, Thames Water and Airbus. MMI provides a key role in accident and incident investigations in the oil and gas industry. The firm’s personnel have worked with oil and gas operators on more than 30 incidents, including the Buncefield Oil Storage Depot incident and the gas release on Total’s Elgin offshore platform.Alongside this, MMI is also considered an expert in the field of seismic, blast and accidental loading assessments and is also skilled in nuclear asset management and integrity with key members of its team currently supporting the International Atomic Energy Agency. Headquartered in Warrington, United Kingdom, MMI employs 60 staff from a range of scientific and engineering backgrounds across offices in Aberdeen, York, Bristol and Ballymena in the U.K. along with its global offices in Perth, Australia and Houston, Texas.Currently owned by Geosyntec, an international environmental consultancy business, the business will be rebranded as MMI Thornton Tomasetti in the U.K. and Australia and will operate under the Thornton Tomasetti name in the U.S. upon completion of the deal, forming a key part of Thornton Tomasetti’s European operation and its Weidlinger Applied Science practice.MMI’s John Evans, Andy Nelson and Andrew Morrison will become part of Thornton Tomasetti’s European and Australian leadership team and will play a pivotal role in the integration process. Thornton Tomasetti’s Pawel Woelke will lead the business as Warrington office director, reporting into Phillip Thompson, Thornton Tomasetti’s European regional leader, and Najib Abboud, Weidlinger Applied Science practice leader.
THOMAS SCARANGELLO RAYMOND DADDAZIO CHAIRMAN AND CHIEF EXECUTIVE OF THORNTON TOMASETTI
07 | 42 ISSUE 09
CO-PRESIDENT OF THORNTON TOMASETTI
ISSUE 07 | 43
ROBERT DESCENZA CO-PRESIDENT OF THORNTON TOMASETTI
INVESTMENT
AGREEMENT BY TELEPERFORMANCE TO ACQUIRE INTELENET FROM BLACKSTONE Teleperformance, the worldwide leader in outsourced omnichannel customer experience management, today announced that it has entered into a definitive agreement to acquire Intelenet from Blackstone, a leading global alternative asset manager. Intelenet is a major global provider of high-end omnichannel customer experience management, back-office, human resources and financial & administration services. The company has more than 110 blue chip clients worldwide, mostly in the English-speaking market, India and the Middle East. Intelenet primarily serves the Banking, Financial Services and Insurance sector, as well as the travel, transport & accommodation, e-commerce, e-services, and healthcare sectors. Intelenet helps clients drive revenue growth, optimize operational efficiency, and reduce operational costs, while increasing end-customer satisfaction due to its integrated solutions: • Solutions design created by a large consulting force with a wide range of expertise, including more than 200 highly skilled data scientists and business & process consultants. • Digital integration based on robotic process automation technology. • Operational excellence, with 55,000 employees, working in over 40 delivery centers across India, the Philippines, the United Arab Emirates, Poland and Guatemala. Founded in 2000 and headquartered in Mumbai (India), Intelenet is managed by Bhupender Singh (IIM and IIT graduate), who was recognized as “CEO of the year” in 2018 at the ET Now HR Talent Management and Leadership Awards in India. Intelenet’s growth momentum is strongly positive. For the fiscal year ended March 31, 2018, the company posted revenue of US$449 million, up + 10% year on year, and EBITDA of US$83 million, representing 18.5% of revenue vs. 17.4% the previous year. For fiscal year 2019, the company forecasts significant additional revenue growth of at least + 10% and increased profitability. Daniel Julien, Chairman and Chief Executive Officer, Teleperformance, commented: “I am extremely pleased to welcome Bhupender and the Intelenet group to the Teleperformance family. We share the same management values, the same passion for service, and the same strategic vision. Intelenet’s strong integrated solutions and digital optimization capacities will immediately and significantly enhance Teleperformance’s offering. Intelenet’s amazing footprint in India is also an opportunity for Teleperformance to massively strengthen its presence in this key geography going forward. Thanks to the Intelenet acquisition, Teleperformance is poised to move quickly ahead with its 2018-2022 strategic plan. Moreover, upon closing this deal will be immediately accretive for Teleperformance shareholders, as it should have a positive impact of around + 10 % on the Group’s earnings per share in 2018 on a pro forma basis.” Amit Dixit, Senior Managing Director and Head of Private Equity India, Blackstone, said: “We have invested in Intelenet twice. The continued success of the company is a testament to the exceptional quality of the management team, the value delivered to its customers, and the deep engagement with Blackstone. We are excited with the transfer of ownership to an industry leading company, Teleperformance, because it ensures continuity for Intelenet’s management, employees and customers. In addition, it provides a platform to further accelerate growth by combining Intelenet’s intellectual property with Teleperformance’s global customer base. We offer our full support and best wishes for an exciting future.” The transaction is expected to close by September 30, 2018, subject to receipt of certain regulatory approvals and other customary closing conditions.
ISSUE 07 | 44
ISSUE 07 | 45
INVESTMENT
THE SALE DAK GROUP ANNOUNCES OF AMERICAN VAN EQUIPMENT TO SAFE FLEET
The DAK Group, a leading investment bank specializing in middle-market mergers and acquisitions worldwide, announces the sale of its client American Van Equipment, headquartered in Lakewood, NJ to Safe Fleet of Belton, MO. The DAK Group served as the exclusive investment banker and financial advisor to American Van, managing the entire divestiture process. “The owners of American Van have built an outstanding business. The sale to Safe Fleet offers American Van an excellent opportunity to continue to grow their vision, as well as an exceptional opportunity to monetize their life long investment.” stated Alan Scharfstein, President of The DAK Group. This transaction capitalizes on American Van’s leadership position in the direct to consumer manufacture and distribution of van and truck shelving, storage systems, and accessories. For over 40 years American Van has worked directly with contractors, businesses and fleet owners, providing practical storage solutions for vans and trucks. Starting in 1978 as a catalog company, then moving into E Commerce, customers have depended on their superior products and outstanding customer service. “Joining Safe Fleet is a tremendous growth opportunity for the American Van family of products and employees,” said Chuck Richter, President, American Van. Safe Fleet is a leading global provider of safety and productivity solutions for fleet vehicles. This acquisition solidifies Safe Fleet’s position within the Work Truck industry as the preeminent provider of safety and productivity solutions. The DAK Deal Team was led by Alan Sharfstein, President, along with Mike Richmond, Elyse Greenbaum and Melvyn Peters. John Aiello, Partner at Giordano, Halleran & Ciesla led the legal team along with Steve Dalton, Jeri Abrams, Kurt Anderson and Steve Shur.
ISSUE 07 | 46
ISSUE 07 | 47
M&A WATCH
NEWABLE LAUNCHES NEW CONSULTANCY TO DEVELOP EXPORT SALES FOR UK BUSINESSES
Newable, the one-stop shop for growing businesses, has today launched a specialist international trade consultancy to help small and mediumsized British companies develop their business in overseas markets. Newable has been a leading delivery partner for the Department for International Trade since 2005, and last year supported 9,400 businesses across the UK with their export drives – generating £2bn of new business for the UK economy. These include companies such as Griffon Hoverwork, a manufacturer of bespoke hovercraft, who now export to 41 countries around the globe, and Wright Shipyard, a ferry builder, who sold a £3m vessel into Austria last year. The launch of Newable’s Export Engine consultancy follows recent regional trade data, which showed that UK exports increased by more than 8% in March. The consultancy service will help companies overcome their specific challenges, whether this be helping them take their first strategic steps as an exporter, accelerating early successes or leveraging and scaling up existing export strengths. Chris Manson, Chief Executive, Newable, said: “We know that businesses working at the heart of the UK economy are ambitious and looking to grow. However they often lack technical expertise or don’t know how to go about making the right connections to unlock opportunities in overseas markets.” “Our consultants have extensive experience in international trade. We can therefore offer world-class advice and hands-on support. The result is that companies will get the confidence boost they need to take on the world and create a solid pipeline of sustainable and profitable export business.”
CHRIS MANSON
CHIEF EXECUTIVE AT NEWABLE
ISSUE 07 | 48
ISSUE 07 | 49
M&A WATCH
ITALIAN POLITICAL UNCERTAINTY COULD IMPACT INTERNATIONAL INVESTORS
GATTAI, MINOLI, AGOSTINELLI & PARTNERS ADVISOR TO BANKS IN BREVI’S RESTRUCTURING AND SALE TO SPANISH PRIVATE EQUITY FIRM PHI INDUSTRIAL
The Italian corporate and financial law firm Gattai, Minoli, Agostinelli & Partners advised the creditor banks in the restructuring of leading Italian childcare manufacturer Brevi S.R.L. pursuant to article 67 of the Italian bankruptcy law. The complex restructuring includes the acquisition of the entire capital of Brevi Milano S.p.A., a newly established vehicle holding Brevi’s assets and part of its bank debt, by Spanish private equity firm PHI Industrial. The Gattai, Minoli, Agostinelli & Partners team was led by partner Andrea Taurozzi and composed by associates Michele Ventura, Marcello Legrottaglie and Silvia Romano. PHI Industrial’s team led by Giovanni Masiero was advised by partner Mauro Battistella and associate Sara Porta of CMS Adonnino Ascoli & Cavasola Scamoni. Brevi was assisted by CMA Caffi, Maroncelli, Associati, with a team composed by partner Emanuele Cortesi and associate Matteo Ghilardi on the restructuring profiles; and by FTA Facchinetti Taverna e Associati, with partners Luca Taverna and Anita Facchinetti, on the M&A profiles. Giorgio Berta and Francesca Ghezzi of Berta, Nembrini, Colombini e Associati acted as financial advisor to the company. Fabio Tesei of Thymos Business & Consulting assisted the company in the search for an investor. Founded in November 2012, Gattai Minoli Agostinelli & Partners is a law firm specialising in Corporate and M&A, Banking & Finance, Tax, Restructuring, Real Estate, Employment, Intellectual Property and Dispute Resolution. With a team of over 80 lawyers – 24 of whom are partners – the Firm boasts a leading position in the private equity and corporate finance sectors.
ISSUE 07 | 50
Luca Raffellini, Vice President and Head of Financial Services at Frost & Sullivan, appraises the political situation in Italy to understand its impact on international markets in the past few weeks and in the future. The early March elections in Italy brought to power a set of political parties characterised by pronounced Eurosceptic sentiments. Just after the elections, international markets seemed surprisingly unresponsive, both to the political crisis and to Italy’s struggle to form a government. ‘No more. Now, as the long-term implications of the “contract of government” become clear,foreign investors have woken up, beyond the specialised circle of bank analysts, and are penalising Italian assets heavily’, said Raffellini. In the bond market, the spread (i.e., between the 10-year Italian treasury papers and the equivalent German bund) jumped to 300 points before coming back down. ‘However, while that’s high, it is not especially worrying because BTP yields are only one metric—a symptom, not a cause—and a useful indicator indeed, but it doesn’t tell us whether that reflects sovereign solvency, currency risk, concern about GDP growth, and so on. In any case, we are still far from the 600 points level of the last Euro crisis in 2011’, said Raffellini. Attention has been recently rekindled on the Euro and the dismaying possibility of Europe’s third-largest economy exiting the common currency one day. ‘A scenario in which Italy was to exit the Eurozone altogether is possible in theory but extremely unlikely in practice. For sure it has not been priced by the markets, in equities nor in bonds, and certainly not in forex’, said Raffellini. ‘From conversations with Frost & Sullivan’s clients, the prevalent investment thesis hinges on these assumptions: Brexit has shown how long it takes to disentangle from EU structures, therefore a return to the Lira would take a long time and prove so patently damaging, and that a government attempting a Euroexit would be voted out well before the process could be completed’.
About Frost & Sullivan For over five decades, Frost & Sullivan has become worldrenowned for its role in helping investors, corporate leaders and governments navigate economic changes and identify disruptive technologies, Mega Trends, new business models and companies to action, resulting in a continuous flow of growth opportunities to drive future success.
ISSUE 07 09 | 51
M&A WATCH
GIDE ADVISES
ONOMO GROUP ON THE ACQUISITION OF MOROCCAN HOTEL GROUP CANTOR
GLOBAL BANKING PLATFORM RAILSBANK WINS ‘BEST FINTECH STARTUP’ AT MONEYCONF
Gide’s Casablanca office assisted ONOMO group on the acquisition of a majority stake in Moroccan group Cantor Hotels.
UK startup Railsbank has been named winner of PITCH 2018 at MoneyConf, Web Summit’s fintech conference.
With this operation, ONOMO group adds six Moroccan hotels (with 740 rooms) to its portfolio. These hotels will be operated under the brand name Onomo Hotels, and will be positioned in the mid-range business hotel sector.
This year’s PITCH competition saw more than 100 entries from across the world. Railsbank was one of the top 21 startups to pitch in front of investors and media during the two-day fintech conference in Dublin.
ONOMO Hotels is an African group of three-star hotels for business clients. This transaction is an additional step for ONOMO on the African continent, with Casablanca serving as an operational hub. With more than twenty hotels in 2020, ONOMO Hotels aims to become the premier pan-African three-star hospitality platform.
Web Summit CEO & Co-founder, Paddy Cosgrave, announced Railsbank as PITCH 2018 winners after the company battled through three rounds. Railsbank is an open banking and compliance platform that will give companies access to global wholesale banking services.The UK startup was co-founded by Nigel Verdon, who previously set up money exchange and payments platform Currencycloud.
Gide Casablanca assisted Onomo group, with partner Simon Auquier and senior associates Chloé Joachim de Larivière and Loris Marghieri.Dentons Casablanca assisted Cantor Hotels and its shareholders.
Railsbank stood out in MoneyConf for its quality of pitching, its established relationships with banks and how it provides its platform with just five lines of code. Through its API, companies can access Railbank’s core platform alongside a range of wholesale financial services.
About Gide
Brad van Leeuwan, Head of Partner Network at Railsbank: “This is a major validation for our team and our partners. Winning PITCH at MoneyConf is going to help us not only get our message out there but hopefully get the product to market even faster.”
Gide is a premier international law firm and the first to have originated in France. Founded in Paris in 1920, the firm now operates from 14 offices throughout the world. It has 600 lawyers, drawn from 35 different nationalities. Gide offers some of the most respected specialists in each of the various sectors of national and international finance and business law. Present in Casablanca since 2003, Gide is one of the very first business law firms to have set up in Morocco. Since the union of its practices with Cuatrecasas, in November 2014, Gide Cuatrecasas Casablanca is today one of the few law firms in Morocco to be able to offer legal assistance covering all fields of Moroccan and international business and finance law.
ISSUE 07 | 52
Paddy Cosgrave, CEO & Co-founder of Web Summit and MoneyConf said: “It’s inspiring to see startups pitch to some of the most influential figures in fintech. Railsbank was a cut above the rest at MoneyConf this year and I’m really looking forward to seeing where they go in the future.” PITCH brings together the world’s leading early-stage startups for a live on-stage battle.
ISSUE 09 07 || 53 ISSUE
M&A WATCH
HSBC STRATEGY UPDATE: POSITIVE FOR CREDIT INVESTORS Recently-appointed CEO John Flint’s first strategy update was wide-ranging. Assuming normalising interest rates and synchronised economic growth, management are looking to drive increasing revenue and returns from areas of existing strength; turn around low-return businesses; improve the customer experience; increase competitiveness; and, via organisational simplification and investing in skills, make it easier to deliver for customers. “From a credit perspective, the updated priorities were reassuring as they do not point to a radical change in strategy. The bank now has a growth mindset but does not intend to increase its risk appetite or diminish its balance sheet strength. This is good news for debt investors,” said Pauline Lambert, executive director in the financial institutions team at Scope Ratings. “Taken in the round, maintaining its risk appetite while aiming to improve returns, continuing to cut costs and targeting a higher capital position are credit positive.” The >11% Return on Tangible Equity target is not materially different from the bank’s previous 10% ROE target, but HSBC will seek to achieve the new return target with a CET1 ratio at least 14% between 2018 and 2020. “While the bank has not met its return target over the last few years, the change in focus to growth rather than transformation provides better impetus for the target to be met,” Lambert said. A key plank of the new plan is USD 15-17bn of investment in growth and technology. About two-thirds will be for investments in new opportunities as well as core businesses to grow, improve customer service and defend competitive positions. The remaining third of investments will for improving productivity and core infrastructure and required regulatory programmes and service sustainability such as cyber security. The ability to keep up with technological change to meet changing customer behaviour and manage operational risks is an increasingly important consideration for banks. “While the bank emphasised the goal to embrace new technologies, the planned investment in this area and in technology more generally is difficult to assess as management did not provide a detailed breakdown,” said Lambert. In 2017, HSBC spent over USD 5bn on technology and between 2015-2017 over USD 2bn in digital investments.
US The US continues to be the largest exporter of client revenue to the group (client revenue from US-managed companies booked outside the US) and HSBC is a top five cross-border USD clearer. The CEO acknowledged that while the US business is profitable, returns are far from satisfactory. Management considers the new >6% RoTE target to be achievable over 2018-2020 but does not see this as a limit. From resolving legacy issues, the focus will now be on organic growth. “The CEO disclosed that there were many management discussions about the US business, with all options being considered, from making acquisitions to disposal. They concluded that because neither offered the same kind of value creation for shareholders it was better to turn around and grow the business,” said Lambert. The bank plans to grow in the US across all divisions: increasing the number of corporate customers served by Commercial Banking
UK The UK ring-fence is scheduled for completion in July, ahead of the 2019 deadline. As a consequence of the ring-fence, investors will have improved visibility over the quality of the UK operation. On the business front, HSBC wants to increase its share of the UK mortgage market and increase its commercial customer base. On the former, it has ground to make up: HSBC has a 14% share of UK deposits but only a 7% share of mortgages.
Summary of goals Business growth: • High single-digit annual revenue growth from Asia (building on the strength of the Hong Kong franchise and expanding in wealth management, including insurance and asset management) • Mid to high single-digit annual revenue growth from the international network (opportunities include global liquidity and cash management, trade finance and securities services) • Market share gains in eight markets where the bank is operating at scale as a universal bank (where it is considered a leading domestic bank with access to local growth opportunities): Hong Kong, UK, Mexico, Pearl River Delta, Singapore, Malaysia, UAE, Saudi Arabia • A number one ranking among international banks for the Belt and Road initiative • Completing establishment of the UK ring-fenced bank and gaining market share in UK mortgages and growing the commercial customer base • Gaining market share in transaction banking On ESG: • Better employee engagement • Continued progress towards the commitment to invest USD 100bn in sustainable finance by 2025 • An independently-assessed ‘outperformer’ ESG classification On performance: • An >11% RoTE by 2020 • A >6%RoTE for the US business by 2020 • Positive adjusted jaws in each year on a full-year basis • Redeploying capital into higher-return and capital efficient businesses • Managing RWA growth to 1%-2% annually to drive an improvement in reported revenues as a percentage of average RWAs from c.5.9% in 2017 to c.7% in 2020.
ISSUE 07 | 54
ISSUE 07 | 55
M&A WATCH
INVESCO ACQUIRES INTELLIFLO THE UK’S LEADING TECHNOLOGY PLATFORM FOR FINANCIAL ADVISORS
Invesco Ltd. has acquired Intelliflo, a market-leading UK provider of advisor-focused digital solutions. Since its inception in 2004, Intelliflo has experienced rapid growth and has become the No. 1 technology platform for financial advisors in the UK1, successfully supporting the business of approximately 30% of UK advisors. Intelliflo’s Intelligent Office software platform is the backbone of the UK wealth sector, assisting financial advisors across the full advice journey – including client relationship management, financial planning, client reporting, portfolio valuation and provision of advisor-led automated advice. “Invesco believes that financial advisors play an important role in enabling
ANDREW SCHLOSSBERG SENIOR MANAGING DIRECTOR AND HEAD OF EMEA
clients to reach their unique investment goals,” said Martin L. Flanagan, President and CEO of Invesco. “The UK continues to be a key market focus for Invesco. We fully recognize that digital solutions are increasingly important as we seek to improve the support we provide for advisors to help them and their clients achieve their desired investment outcomes.” “Invesco has a strong track record in the US, through our Jemstep digital advice business, of successfully partnering with and investing in technology experts to provide advisors with the innovative and flexible tools they need to develop their business, while maintaining an independent, open architecture approach,” said Colin Meadows, Senior Managing Director and Chief Administrative Officer for Invesco. “We look forward to seeing what Intelliflo can achieve for UK advisors with increased product investment.”
NICK EATOCK EXECUTIVE CHAIRMAN OF INTELLIFLO
“We are really excited by the promising future for our business and clients as part of Invesco’s global organization,” said Nick Eatock, Executive Chairman of Intelliflo. “This will allow us to significantly invest in our core technology to help advisers meet the rapidly evolving demands of providing advice in the 21st Century.” “Intelliflo is a truly innovative, market-leading technology provider,” said Andrew Schlossberg, Senior Managing Director and Head of EMEA for Invesco. “With a shared focus on supporting advisors in delivering great investment outcomes for clients, we are excited by the opportunities this acquisition offers for our financial advisor partners and clients in the UK.” “In a comparatively short space of time, we have built one of the UK’s largest pure-play Software as a Service businesses, and we now look forward to expanding our business, taking our market-leading technology into new markets across the globe,” said Hamish Purdey, Intelliflo CEO. “We will continue with our open architecture philosophy after the sale – it remains critically important to us that our financial advisor customers continue to be able to partner with the platforms, product providers, asset managers and software partners they choose.” The transaction has closed. Given that the transaction was not material to Invesco’s financial position, terms of the transaction were not disclosed. This transaction will not impact Invesco’s intention to resume share buybacks by yearend 2018, when the firm’s debt leverage is reduced to
MARTIN L. FLANAGAN
the previously announced targets. Evercore acted as financial adviser to Intelliflo.
PRESIDENT AND CEO OF INVESCO
ISSUE 07 | 56
ISSUE 07 | 57
M&A WATCH
MARK BARNETT DIVISIONAL PRESIDENT OF MASTERCARD IN THE UK
By integrating Vocalink technology, Mastercard Send will provide an unparalleled payment solution that offers greater choice and convenience to its customers, starting in the UK. Mastercard has chosen Starling Bank as its strategic partner for settlement services in the UK. Starling manages the funds that are to be disbursed before they are pushed to individual accounts via Faster Payments. Julian Sawyer, chief operating officer of Starling Bank, a leading challenger bank, said: “Starling Bank is the only provider of real-time access to faster payments in the UK. This partnership will open up new commercial and business opportunities for Mastercard clients as it enables them to make and receive payments instantly.” The first UK customer for the service will be Income Group, a payroll-focused payment provider that enables businesses to significantly improve the efficiency and reduce the costs associated with running a payroll by reducing the time taken to pay employees down from days to real-time.
MASTERCARD SEND TO LAUNCH IN THE UK OFFERING REAL-TIME PAYMENTS TO EVERY BANK ACCOUNT Mastercard today confirmed that it will soon launch Mastercard Send in the UK. Mastercard Send is a payment service that allows financial institutions, fintechs, digital customers and other businesses to send real-time payments to UK bank accounts and also to receive payments by the same means. Mastercard Send will connect to the Faster Payments network enabling a variety of use cases such as peer-to-peer payments and business-to-consumer disbursements. The new service follows Mastercard’s purchase of Vocalink in 2017, and embodies the Mastercard vision of a world, not only beyond cash, but beyond cards as well. This will enable a broad range of payment types including the latest generation of real-time account-based payments, while maintaining an unerring focus on delivering the best possible customer experiences.
ISSUE 07 | 58
“Mastercard Send will make payments much easier for users, and deliver better value to a diverse range of banks and businesses who regularly make disbursements. Existing direct-to-bank-account solutions – even those using Faster Payments – are often batch-based and hence less timely, giving businesses a real headache when it comes to disbursement of funds,” said Mark Barnett, divisional president of Mastercard in the UK. Income Group is a perfect example of an innovative new business that is looking to bring the benefits of real-time payments to a wide range of businesses and their employees. Income Group has developed a real-time payroll payment process that enables businesses to send their payroll payments ‘just in time’ rather than several days in advance, providing significant working capital benefits to these businesses. Mastercard Send will enable further innovation with a strong pipeline of businesses lined up to take advantage of the service later in 2018 and beyond. Ian Wheeler, CEO and co-founder at Income Group said: “We set out to reduce the time needed for traditional BACS payroll payments, and create a real-time alternative that was, above all, fairly priced. In looking for like-minded partners, we are delighted to be the first UK payment processer to integrate with Mastercard Send. Equally, working with Starling Bank as our settlement agent, we are proud that this vision is soon to be a reality and we can offer a real-time payroll payment service to UK businesses at a competitive price point.”
ISSUE 07 | 59
M&A WATCH
jan golaszewski partner
nick bullmore partner
Carey Olsen acts for Abraaj Holdings in successful petition to appoint PwC as joint provisional liquidators Offshore law firm Carey Olsen has successfully applied to have PwC appointed as joint provisional liquidators over Abraaj Holdings, the largest private equity investment group in the Middle East, amid opposition from certain creditors. Abraaj Holdings filed an application in the Grand Court of the Cayman Islands seeking the appointment of Simon Conway, Michael Jervis and Mo Farzadi of PwC as joint provisional liquidators. The Grand Court granted the Order following a contested hearing on the 18th June. The Carey Olsen team was led by Nick Bullmore on the corporate side and Jan Golaszewski and Peter Sherwood on the insolvency side. Tom Smith QC of South Square Chambers was instructed to appear at the hearing. The move has been made to protect the rights of the company’s stakeholders until a consensual restructuring of its debt obligations and the intended sale of its investment management business can be formulated and approved. Jan Golaszewski, head of Carey Olsen’s litigation and insolvency team in the Cayman Islands, said: “With the overlap between the transactional and contentious aspects, this is a complicated and very fast moving case, involving the coordination of lawyers and advisers across several disciplines and multiple time zones. A Court supervised restructuring programme is a positive outcome for our client. It gives Abraaj Holdings a sound structure to continue to look after the best interests of its stakeholders and creditors.” The instruction is a further high profile case for the leading offshore law firm that has been involved in a significant number of the major formal insolvency proceedings in the Cayman Islands in recent years . This includes acting for: PwC as the official liquidators of Ardon Maroon Asia Dragon Feeder Fund, KPMG as the provisional liquidators of Greens HoldingsLimited, Deloitte as the controllers of Beechwood Re, Ernst & Young as the voluntary liquidators of 47 Degrees North Capital Management Ltd and Grant Thornton as the official liquidators of Weavering Macro Fixed Income Fund Limited. Carey Olsen has one of the largest dispute resolution and insolvency practices in the offshore legal field, led by 18 partners across nine international offices. ISSUE 07 | 60
ISSUE 07 | 61
M&A WATCH
POLARIS INVESTS IN IT CONSULTANCY PRODATA CONSULT
The Group’s leading position in the Danish market and the positive development in the core business as well as the rapidly growing ‘NaaS’ business area will be sustained, while systems and processes will be strengthened with Polaris as a joint owner, allowing ProData Consult to claim a leading position in the North European market. ”We have more than doubled revenue in ProData Consult over the course of the last three years, and we have simultaneously been able to expand our business and improve client satisfaction to the highest level ever.We see great opportunities ahead in our markets based on our competent employees as well as robust processes and IT systems, ensuring the perfect match between our clients and consultants. We also see great prospects in our unique offering allowing Scandinavian companies to benefit from a highly competitive combination of excellent quality and scalability with our Polish ‘NaaS’ solution. We have had a good and thorough dialogue with Polaris and are looking forward to drawing on their extensive experience from similar growth companies in a partnership aiming to further professionalize the company and fully releasing the potential in the coming years,” says Søren Rode, CEO of ProData Consult. The market for IT services in the countries currently served by ProData Consult totals around DKK 100 billion with underlying annual growth rates of 3-5%. In this market, the Group operates within the areas of freelance consultancy services and ‘nearshoring’, which are currently seeing progress and furthermore contribute to reducing the company’s sensitivity to economic cycles. ProData Consult is thus well-positioned to leverage the increasing prevalence of the gig economy and the preference of highly qualified consultants for working freelance or through their own business. The partnership between ProData Consult and Polaris will generate the best foundation for pursuing the opportunities in the North European market and Poland with a view to ensure controlled and profitable growth in the coming years. ”We have been keeping an eye on ProData Consult’s strong development and their innovative approach to the market during a longer period, convincing us that the company has a large development potential. We will do our part to support the growth and generate an even stronger business by leveraging our experiences and strategic knowhow from other growth companies, focusing on systematizing sales and strengthening processes and systems,” says Jan Johan Kühl, Managing Partner at Polaris.
Polaris has entered into an agreement to acquire a majority shareholding in ProData Consult, Denmark’s leading independent IT consultancy focused on business and IT consultants. Over 15 years, ProData Consult has generated an average annual growth in excess of 20%, and the Group has activities in Denmark, Norway, Sweden, Poland, Germany and the Netherlands. The investment is the sixth in Polaris’ fund IV.
ProData Consult’s management continues, and the current ownership – comprised of leading employees and board members – as well as key employees will co-invest in the company alongside Polaris. The parties have agreed not to disclose the purchase price.
Following growth of more than 30% in 2017, ProData Consult reached revenue of DKK 910 million based on the company’s core business of providing high-end business and IT consultants to a series of acknowledged clients, in particular within financial services. ProData Consult’s successful Polish ‘nearshoring-as-a-service’ solution, which provides Scandinavian clients access to Polish IT consultants with strong specialist competencies, continued the strong development in 2017 with growth exceeding 40%.
ISSUE 07 | 62
ISSUE 07 | 63
M&A WATCH
OGIER ACTS ON NATIONAL ENERGY SERVICES REUNITED CORP’S US$ 1.1BILLION ACQUISITIONS
RCAPITAL COMPLETES HAT-TRICK OF DEALS IN A WEEK Rcapital, the private equity firm, has completed a hat-trick of deals across its investment portfolio. This includes the sale of Cluttons’ Middle East business based in Dubai to Savills. Rcapital bought the property consultancy in May 2017 and the sale concludes a key step in the growth strategy for Cluttons in the UK which will continue to focus on both the commercial and residential markets. Rcapital has also sold Coaching Academy which has been in the portfolio since November 2007 and is the longest established coach training organisation in Europe. It offers a range of externally accredited professional qualifications in Life Coaching, Business Coaching, Corporate Coaching, Educational Coaching and an accredited NLP Practitioner Programme. The business has been sold to Managing Director, Bev James, who has been with the business since 2008 and has helped grow and develop Coaching Academy, establishing it as one of the largest training organisation of its kind in the world. Rcapital has also completed the sale of Innervate Technology Solutions Limited, a business which was established when Rcapital acquired former US-owned subsidiary Ciber UK in June 2017. Following an intensive period of re-organisation and rebranding, this leading IT services and consulting specialist relaunched as Innervate Technology Solutions Limited in September 2017. Rcapital’s involvement, including the appointment of a Chairman and CFO to support management, provided stability and acted as a catalyst for change. In a very short period, the team transformed the business, creating a solid platform to achieve long-term growth. It has been sold to a well-respected and successful player in the technology space. Phil Emmerson, Chief Operating Officer of Rcapital said: “The deals announced today are testament to Rcapital’s philosophy of working closely with the management teams of businesses we invest in to help them navigate complex situations, helping them develop and secure long-term growth.”
Ogier has acted as British Virgin Islands counsel to NASDAQ listed National Energy Services Reunited Corp on its acquisition of Gulf Energy SAOC and National Petroleum Services. The acquisitions of both GES and NPS closed simultaneously on 6 June 2018 following payment of a purchase price comprising both cash and new equity in NESR to form a combined group with an aggregate market capitalization of approximately US$ 1.1 billion. GES and NPS are leading regional oilfield services companies offering a mix of drilling, completion and production services and equipment in the Middle East and North Africa Region. Following closing, NESR’s combined group is expected to create an industryleading provider of integrated energy services in the MENA region with primary operating locations in Dammam, Muscat and Dubai, with group headquarters in Houston, Texas. More than 3,000 people will be employed by the NESR group in more than a dozen countries.
phil emmerson chief operating officer of rcapital
NESR was formed as a special purpose acquisition company in January 2017 in the British Virgin Islands to acquire companies in the energy services sector, it subsequently raised around $229 million in an IPO in May 2017. Ogier also advised for NESR in respect of its IPO and has provided general British Virgin Islands advice since. The Ogier team was led by partner Michael Killourhy, and included senior associate Rebecca Clark and associate Laura Malpass. Commenting on Ogier’s involvement, Michael said: “This is our largest and most complex BVI SPAC acquisition to date and our first in the energy sector. Having the opportunity to work with a company and its management team from creation, through to a public offering and then on to a major acquisition in a relatively short period of time is tremendously exciting and almost unique to the SPAC world.”
ISSUE 07 | 64
ISSUE 07 | 65
M&A WATCH
SAXO PAYMENTS
BANKING CIRCLE VP OF MARKETING APPOINTED TO EXECUTIVE BOARD OF THE EUROPEAN WOMEN PAYMENTS NETWORK
Miranda McLean, VP of Marketing at ground-breaking financial utility, Saxo Payments Banking Circle since its launch, has been appointed to the Executive Board of the European Women Payments Network. The European Women Payments Network, is focused on championing the skills and expertise of women in the burgeoning FinTech and payments sectors. In particular, through mentorship, leadership programmes, networking events and workshops, EWPN is providing the opportunity for women to learn, network, share and celebrate their achievements. The appointment of Miranda McLean to the Executive Board signals the EWPN’s ambition to further extend its reach and influence throughout the European business community. ‘”The FinTech sector is, itself, breaking new ground and challenging the status quo”, explained Miranda McLean. “It therefore makes sense for those working in this sector to advocate diversity and inclusiveness – and for women to lead that cause.”
RISE IN INTEREST RATES LEAD REAL ESTATE CONCERN AMIDST POLITICAL TURMOIL Despite political turmoil in Italy and Iberia, and Brexit, political uncertainty didn’t appear in the top three threats to the real estate investment market, cited by real estate experts who participated in a poll at a seminar hosted by Intertrust in May 2018. 41% of respondents instead voted rising interest rates as the biggest threat to the asset class, followed by stretched valuations (31%) and competition for assets (25%). Jon Barratt, Head of Real Estate at Intertrust, said, “While political risk certainly persists and often dominates news headlines, our poll demonstrates that it’s by no means the top concern facing investors. Instead, economic and market factors hold much greater sway including high valuations, increased competition and the spectre of rising interest rates.” The survey found that 92% of respondents placed Italy as posing the highest level of risk, followed by the UK and Iberia. Jon Barratt, said, “Given recent events, it’s unsurprising that Italy topped the list for political risk. However, it’s notable that Brexit-based uncertainty still persists.”
ISSUE 07 | 66
“I am tremendously excited to have been appointed to the Executive Board and look forward to working with my colleagues to continue to extend the reach and influence of the EWPN.” Miranda McLean has built a considerable reputation for developing and executing successful marketing strategies for a wide range of financial services businesses over more than two decades. Starting her career at Thomson Financial, she has also held senior positions at Reuters, Standard and Poor, Lexis Nexis, Equifax and Ukash. In 2015 she was appointed by payments start-up, Saxo Payments, to create the brand identity and marketing strategy which has taken the cross border financial utility to a multi-million dollar business in less than three years. As a highly motivated marketer, Miranda believes barriers to opportunity only exist if vision is blinkered. She has committed to self-development and improvement at every stage of her career to build a wealth of experience in global and European brand development, execution and management. She aims to bring that enthusiasm and energy to her new role at EWPN. Martha Mghendi-Fisher, Founder of the European Women Payments Network added: “Since our formation in 2015, we have focused on building a strong network of women working in the sector who can share their experiences to help others to progress their careers. Now we want to take the Network to the next level of influence and Miranda McLean’s experience in the field of marketing will be invaluable to hone our messages and extend our reach.”
ISSUE 07 09 | 67
SECTOR WATCH: TECHNOLOGY
£8.8M IS GRANTED TO SMES TO TRIAL INNOVATIVE SMART METER TECH
As the UK’s domestic smart meter revolution transitions through its latest hurdle - The UK Government has awarded £8.8 million to small and medium size businesses to take control of their energy use through the use of smart meters. According to the government, there are more than 11 million smart meters in operation in homes and small businesses, however, there is a lack of products specifically aimed at SMEs to help them use that technology to take control of their energy use.The competition winners, which include tech giants Samsung and Toshiba, have been granted funds to develop such products. The Labrador - a smart energy tech innovator - would be keen to offer their perspective on the future potential of smart-meter integration across the UK’s business infrastructure; with a specific focus on how inherent challenges made evident through the much documented domestic roll-out need to be addressed on a much larger scale to avoid historical issues from re-occuring. With the requirement for smart information systems that give businesses real-time, tailored data on their energy use of the utmost importance - for example, Considerate Hoteliers is developing an energy management app for the SME hospitality market, which will provide users with information they can act on immediately to minimise operational efficiencies and reduce energy consumption - Jane would be keen to discuss how the entire initiative is dependent entirely on real-time data analysis.
ISSUE 07 | 68
ISSUE 07 | 69
SECTOR WATCH: TECHNOLOGY
KAJIMA COMMUNITY STRENGTHENS PROGRAMMING TEAM Kajima Community, which specialises in marketing and managing the community use of schools and other community centers across the UK, is pleased to announce the appointment of Albert van Jaarsveld as Lead Developer for BookingsPlus, its unique web-based booking and marketing system. Van Jaarsveld, will play a key role in expanding and building upon BookingsPlus’, Kajima’s scalable, cloud based SaaS platform, which assists schools and other centres in hiring out their facilities to the local community. In his new role he will be responsible for designing, building and maintaining the system’s code, including integrating data storage systems, identifying bottlenecks and bugs and devising solutions. BookingsPlus provides a web-based, total administration system, including a room booking tool, white- labeled website, automated invoicing, online payments system and automated communications. The service offers public sector bodies a way of using their existing assets to realize service efficiencies and generate fresh revenue, and is already being used by a range of other public sector estates including primary and secondary schools, academies, community venues and Local Authorities. Joining Kajima from communications software company Releasd, where he held the position of Ruby on Rails and Javascript/jQuery Contractor, van Jaarsveld brings with him seven years’ commercial programming experience. As a programmer he has been responsible for development and bug fixes (Ruby on Rails, jQuery and Greensock Draggable among others), and devops (AWS, Capistrano, Heroku). Prior to his role at Releasd, van Jaarsveld was a Ruby on Rails developer at EnglishUp, and an analyst programmer at Schoolblazer Ltd, where he worked on a number of IT projects involving the analysis, design, development and implementation of applications and their supporting infrastructure to increase their scope and effectiveness and improve the profitability of the business. In addition to his role as a developer, van Jaarsveld has three years’ experience as director and owner of online retail company Staark Limited, where he was responsible not only for developing the retail website but also managing and coordinating the wider team. Chris Smith, Head of Community, commented: “We are delighted to welcome Albert to the team. He brings with him a wealth of experience as an all- round, full stack developer, and has an excellent track record in building and maintaining projects from start to finish covering all stages across requirements gathering, planning, execution and testing. Albert’s experience makes him a real asset and we look forward to working with him to further develop BookingsPlus’s capabilities and continue helping schools and other centres get the most value from their underused assets by providing them with the functional, easy-to-use software to help them do so.” Albert van Jaarsveld, Lead Developer, commented: “I am very pleased to be joining Kajima, given the company’s exceptional reputation in the lettings and SaaS sector. The company’s exemplary, award-winning work developing their BookingsPlus and BookingsGuru software has made them an industry-leader and I look forward to helping the team build on its excellent reputation to secure more high profile, marketleading projects in these areas and expand their software’s capacity and reach.”
ISSUE 07 | 70
ISSUE 07 | 71
SECTOR WATCH: TECHNOLOGY
EMERGING CRYPTOCURRENCY POINT-OF-SALE TECH FINALLY SOLVING THE MASS MARKET BITCOIN BLOCKADE Almost a decade in the making since the inception of Bitcoin and with a current market-cap hovering around half a trillion dollars USD, Bitcoin, cryptocurrency and blockchain have become common to the tech savvy. While most people don’t understand how they work, Bitcoin and cryptocurrency are not only hot topic buzzwords, but they’ve created thousands of multi-millionaires. Even so, the vast majority of people in the mainstream have no interest or intent to embrace Bitcoin and, as such, it still has veritably no bearing on everyday life as one still can’t even pay for a cup of coffee with any cryptocurrency. In the last year alone, the cryptocurrency market cap has grown over ten-fold, and even taking into consideration “bubble-effects” of hype speculation, the fact remains that, since the inception of Bitcoin, the cryptocurrency market cap is following an exponential growth curve. Today this amounts today to over $150Bn, and various expert opinions estimate its future growth in the next 5-10 years to be in the trillions of dollars. With these kinds of numbers, it begs the question: With over $150 billon of cryptocurrency already in circulation, why can’t we yet pay for coffee or a slice pizza with crypto? Not only this, but why is cryptocurrency languishing in a tech world of its own, far removed from adoption by the regular consumer or average business? And why does it exist only in a digital space, largely accessible only to the techwise cryptocurrency investors? Perhaps the most fundamental question that everyone is asking—from economic pundits to families around the kitchen table— is will crypto will ever become common currency to be used by the average person to pay for their groceries, bills or the hair dresser? Or are Bitcoin and Altcoins just a fad, doomed to remain ensconced in a cult-like tech realm? While it’s clear that the only way for cryptocurrency to avoid falling into oblivion is by enabling its widespread adoption and acceptance as a “real” payment method, the reality is that the infrastructure and protocols have not been in place to foster this. In fact, there have been seemingly insurmountable obstacles faced by merchants across the board preventing them from accepting cryptocurrency as a viable form of payment. Four of those key reasons include the following:
1. High volatility promotes fiscal vulnerability Businesses are not cryptocurrency investors and, as such, they cannot be expected to accept risky payments that may lead to serious financial losses. Every business operates with supply costs, margins, etc. Therefore it would make little business sense to take on a risk of such magnitude by accepting crypto as payment for their goods and services. What if the local mechanic accepted Bitcoin for several large jobs and then Bitcoin value dropped 20%? This leaves these sort of business owners, whom have fixed overhead costs, in a vulnerable space where they take payments that fluctuate.
2. Technical know-how
OPEN BANKING TO BOOST UK ECONOMY BY 1BN
Generally speaking, retail operators and cashiers cannot be expected to possess the technical expertise needed in order to safely process a cryptocurrency transaction. This is clearly one of the largest problems preventing mainstream adoption, since dealing with cryptocurrency transactions does require a determined level of technical expertise for which it would be absurd to expect a critical mass of front-line service staff to possess. The fact is that any new person coming across even a simple Bitcoin address can be overwhelmed by its perceived complexity.
3. Brand Confusion The very word “crypto” suggests cryptic. Mix that in with all of the other various terms that are used including virtual currency, digital currency, alt coins, and Bitcoin, and it all creates confusion. It will be paramount for industry insiders to adopt consistent language to be consistently utilized in the mass market.
4. Uncertain regulatory environment Regulations regarding cryptocurrencies are still not even close to being set in stone. As concerning, these same regulations actually discourage the use of such currencies in a B2C environment, regarding them as an “unnecessary risk” that may lead to legal problems for any business down the road. Collectively, these four points above paint an ominous picture for the future of cryptocurrency. Not only relating to its progress and adoption, but also for its very survival in a very real scenario where an innovative payment technology fails to fulfil its potential. In fact, this isn’t the first technology to be introduced with the aim of creating a major cultural shift. Twenty-five years ago, fax communication was far more common and even preferred over email messages.
The Innovation Life Cycle Must Ensue In all forms of innovation, there is always a lag between the advent of the actual innovation and the time that the average intended user starts to adopt and employ the technology. As the “technology adoption life cycle” has well established, in order for people to adopt and use a new innovation, technological abstraction layers are needed to hide all of the complexity of the core product and make it unequivocally user friendly. Of course, this takes time and innovation of its own until all the layers have been developed and refined around the core product, which is the main reason why there is always a lag between innovation and mass adoption.
The Game Changer: Crypto-to-Fiat Point-of Sale Solution The tremendous amount of complexity associated with using Bitcoin and other cryptocurrencies in the real world financial marketplace, as exemplified by the four problems detailed above, has ushered in a new breed of leading-edge technology aimed at wholly solving the glut of mass market limitations. Emerging Point-of-Sale (POS) applications are finally permitting cryptocurrencies to be transacted as easy as a credit card payment, allowing small and large businesses alike to accept and instantly translate crypto into U.S. dollars, thus eradicating any risk and uncertainty. With this advancement, technical or crypto-specific know-how on the part of the consumer or the merchant is rendered unnecessary and businesses can readily convert crypto to real cash. Not only will this Point-of-Sale development quickly shift brand perceptions, but the regulatory environment will also eventually temper given the reduced volatility this POS technology proffers. Once this business-friendly solution is adopted as a viable transaction method, enabling consumers to very easily spend their crypto currency and retailers to charge and settle crypto payments in the business’ preferred currency—whether dollars, euros or other, technical proficiency will no longer be barrier and volatility will subside since businesses will continue to deal strictly in Fiat currency (government-issued legal tender), resolving any possible crypto-specific regulatory issues that are rendered a non-concern. Given its extrapolated impact, a POS innovation of this nature would be poised to unlock the full potential of the cryptocurrency industry and its utility in the real-world. A Crypto-to-Fiat business tailored POS solution will effectively allow for cryptocurrencies to penetrate the consumer market and truly disrupt day-to-day payments as we know them. The first business with a minimum viable product will be to cryptocurrency transactions what AOL was to email. Retailers today are accustomed to using Point-ofSale terminals for processing credit card payments, and are increasingly adopting new solutions in the space such as Square’s retail POS smartphone app, replacing bulky hardware with Android and iOS devices. In order for merchants to accept and adopt a Crypto-to-Fiat POS solution, it must be tailored in a manner that seamlessly accommodates the retailers current understanding and knowledge base, with a near zero effort or learning curve required to adopt the new solution. At the same time, the innovation must demonstrate its ability to drive new value, new customers and, ultimately, new profits by expanding its ability to process transactions—and at a fraction of standard costs. Such an end-to-end solution can truly catalyze cryptocurrency adoption, finally bringing Bitcoins and Altcoins to “Main Street” and crossing that crucial milestone for blockchain technology—and technology as a whole—to usher cryptocurrency into the modern world is a genuine, viable and enduring way.
ISSUE 07 | 72
ISSUE 07 | 73
SECTOR WATCH: TECHNOLOGY
CARBONEUM PARTNER WITH ICON FOR BLOCKCHAIN SOLUTIONS Ahead of next week’s ICO launch, Carboneum, the democratized social trading platform, are pleased to announce their partnership with ICON as their technical and strategic partner. Carboneum will utilize the ICON blockchain to build a democratized social trading platform called CoinRadars, which will assist with technical development and project expansion. Users of CoinRadars will be able to mirror crypto-trades made by a designated expert. Whenever the leader makes a trade, the user will automatically do so as well, allowing users to learn how to crypto-trade like an expert! Better still – should a user not profit by a trade via the platform, they won’t be charged a penny. Payment is only required in the event of a profitable trade – meaning users can experience and learn the art of crypto-trading without the worry of losing money. ICON is a decentralized network that is looking to bring blockchain communities together and hyper connect the world. The core engine that powers the ICON network is called loopchain and is currently being applied by real enterprises such as banks, security firms and hospitals.
The CoinRadars system will run on Carboneum tokens – 120,000,000 of which will be available for purchase during the ICO which launches on Monday 25th June. Social trading may not be a new concept – but whereas existing platforms are based upon centralized platforms, CoinRadars will be based upon blockchain technology, allowing for transparency and security that is missing from current social trading systems. This is where the partnership with ICON becomes so essential.
DARROIS VILLEY MAILLOT BROCHIER AND GIDE ADVISE ACCORHOTELS ON THE SALE OF 57.8% OF THE CAPITAL OF ACCORINVEST
Max Kortrakul Founder and CEO of Carboneum, says: “One of the key aspects of our project that sets us apart from existing social trading platforms, is our plans to build it on a decentralized network. This will enable users to learn from experts in a cost-effective, secure and transparent way. Therefore, our joining the ICON ecosystem is an important step in achieving our vision, and we are really pleased to be able to announce this partnership. ” Previously, the team behind Carboneum built Stockradars, Thailand’s leading online stock trading and analytical platform. Stockradars has over 680,000 app downloads, multiple local and regional brokerage partners and 76 version updates since launch.
Darrois Villey Maillot Brochier and Gide advise AccorHotels on the sale of 57.8% of the share capital of AccorInvest to sovereign funds, namely the Public Investment Fund and GIC, institutional investors, namely Crédit Agricole Assurances, Colony NorthStar and Amundi, and other private investors. AccorHotels will therefore hold 42.2% of the capital of AccorInvest, which will no longer be included in the Group’s consolidated financial statements as of 1 June 2018. As part of the transaction, AccorHotels and AccorInvest will maintain their close, longstanding relationship through very long-term partnership agreements. The DVMB team includes Marcus Billam, Jean-Baptiste de Martigny, partners, Ioana Nicolas, Alexandre Durand and Pierre Zejma for the M&A aspects, Vincent Agulhon, partner, and Zoé Attali for the tax aspects, Igor Simic, partner, and Elise Maillot for the antitrust aspects. The Gide team includes Frédéric Nouel and Didier Martin, partners, and Pierre-Adrien Vibert, Romain d’Innocente and Cléopha Thomann. Reed Smith is also involved on the tax aspects with Jean-Pierre Collet, partner, and Benoit Bernard, counsel. About Gide Gide is a premier international law firm and thae first to have originated in France. Founded in Paris in 1920, the firm now operates from 14 offices throughout the world. It has 550 lawyers, drawn from 35 different nationalities. Gide offers some of the most respected specialists in each of the various sectors of national and international finance and business law.
ISSUE 07 | 74
ISSUE ISSUE 09 07 || 75 75
ipsoft is the world leader in Enterprise AI and the home of Amelia, the industry’s most-human digital AI colleague. Amelia’s ability to
SECTOR WATCH: TECHNOLOGY
IPSOFT LAUNCHES THE AI INDUSTRY’S FIRST OFF-THE-SHELF AI
learn, interact and improve over time makes her the market’s only AI that can fully understand user needs and intentions.
SOLUTIONS FOR BANKING, INSURANCE, HEALTHCARE AND MORE
IPsoft, the leader in Enterprise AI, today announced the launch of Amelia City, an interactive, artificial intelligence laboratory that will showcase the evolution of AI together with the industry’s first available marketplace for off-theshelf AI solutions specifically designed for the banking, telecom, hospitality, insurance and healthcare industries, among others. Amelia is the world’s most human AI platform, able to relay empathy as well as transform entire processes at scale, from intelligent front office conversations to back office execution. With Amelia’s extensive experience and established track record of proven return on investments by many Fortune 500 companies, Amelia Marketplace is the first of its kind forum for procuring state-of-the-art AI solutions for any business or government organisation. All Amelia Marketplace solutions can be experienced at the Amelia City Lab, which spans the entire 20th floor at IPsoft’s headquarters located in downtown New York. Amelia City will demonstrate how Amelia, through automation, cognitive and emotional intelligence, and true machine learning, is benefiting enterprises and consumers alike. Guests will be able to interact with Amelia and experience how she as a digital colleague helps transform businesses. “We are proud to launch the first marketplace for advanced AI-solutions and with that, the opening of Amelia City,” said Chetan Dube, chief executive officer, IPsoft. “We have developed an amazing setting for people to experience artificial intelligence and see for themselves how it will be contributing to and changing business operations as well as how consumers will interact with technology. The Fourth Industrial Revolution is well underway, and Amelia is leading the charge. Amelia City will show everyone how.” Amelia Marketplace has industry specific roles for banking, insurance and healthcare as well as functional cross-industry roles for IT, Finance and HR. Amelia is pretrained to fulfil roles, like a real digital colleague. Amelia will get herself installed, customised to the client’s online look and feel, and is trained in a selected role. She can handle full processes like making payments or doing an insurance quote, end-to-end. More information can be found on Amelia’s ability to deliver return-on-investment at scale and how she learns specific industry roles at the Amelia Marketplace.
ISSUE 07 | 76
ISSUE 07 | 77
SECTOR WATCH: TECHNOLOGY
MATR RAISES £4.75M FOR AI TEACHING PLATFORM
Tom Hooper, Founder and CEO, Matr, says: “For the last four years we’ve worked really hard to demonstrate our global ambitions, delivering hundreds of thousands of hours of teaching from our global teaching community to tens of thousands of children. By partnering with new investors, and some of the world’s leading Learning Scientists at UCL, we are well positioned to accelerate our vision of creating a global community of online teachers and students, making effective one-to-one learning accessible to all.” Richard Lewis, Investment Director, Downing Ventures, says: “We are delighted to join the Albion UCL Technology Fund, Ananda Ventures and Nesta in this funding round. Matr has grown into the leading provider of online maths intervention programmes for Key Stage 2 pupils and we look forward to supporting the team as they expand their business further.”
Matr, the online teaching platform, has announced it has closed a £4.75 million Series A investment round led by the UCL Technology Fund and Downing Ventures, with follow on investment from Ananda and innovation charity Nesta, and Sherry Coutu joining as an angel investor. The company has now raised £8.25 million in funding. Following an initial focus on providing online teaching to support children in UK schools, via the company’s Third Space Learning brand, the new investment will be focused on developing the Matr platform to support families at home, catering to a global teaching and student base. The UCL Technology Fund is managed by Albion Capital in collaboration with UCL Business and is dedicated to bringing UCL’s world-class research in life and physical sciences to commercial reality. Matr is the fifth AI business the fund has invested in to date. Matr, founded by Tom Hooper in 2013, is an online teaching company which uses technology to train academic talent from around the world to deliver live, online tuition, making effective one-to-one learning affordable and accessible to all. The platform has already delivered over 500,000 one-to-one sessions to nearly 40,000 children across the UK from tutors based in India and Sri Lanka. In addition to the current round of funding, Matr has also announced a research and qualification partnership with UCL. Working with Rose Luckin, Professor of Learner Centred Design at UCL and an expert in AI in education, Matr is using its database of over 500,000 recordings of online teaching sessions to develop AI software to automate the training and development of a global community of online teachers. Using this innovation, UCL is aiming to develop a qualification, powered by analytics in the Matr platform, to establish a global standard in online teaching. Professor Luckin, who believes AI provides a unique opportunity to assess which teaching strategies are working and to individualise teaching, says: “What we are very interested in is using the right blend of human and artificial intelligence in the online classroom to identify the sweet spot where AI can augment the abilities of an online human teacher.” David Grimm, manager of the UCL Technology Fund at Albion Capital, says: “Matr has the potential, in collaboration with UCL, to set the standard for online teaching and achieve traction in global tutoring markets. Its plans to build an efficient AI system and use it to certify its teachers with a UCL qualification will set it apart in this unregulated market. This is an excellent opportunity to invest in a strong team, with a proven and clearly differentiated business model.”
ISSUE 07 | 78
ISSUE 07 | 79
SECTOR WATCH: TECHNOLOGY
BLUZELLE POACHES KEY EVANGELISTS FROM MYSQL AND MARIADB TO BUILD DATABASE DEVELOPER COMMUNITY Bluzelle, the decentralized database provider, has appointed Daniel Saito and Colin Charles as strategic advisors to oversee Bluzelle’s Open Source strategy and development. They are both well-known for their efforts in building out the MySQL and MariaDB database developer communities. In addition to these advisor appointments, a raft of new hires include Andrew Mastracci, Edward Bruck and Isabel Scroggin. These new hires reflect the company’s ongoing focus on building out its community of developers as it plans to release a new version of the product, which is named after Ada Lovelace, who is often cited as the first computer programmer. “We’re extremely pleased to bring on these new additions to the team. Daniel and Colin’s past success with building out the open source communities for MySQL and MariaDB is exactly what we want to build in our own community. With Andrew, Isabel and Ed, we have made our product development team even stronger,” said Pavel Bains, CEO and Co-Founder of Bluzelle. Daniel Saito joins Bluzelle as an advisor to oversee Open Source initiatives and implementation. Having previously been Representative Director for MySQL K.K. He joined MySQL in 2005 as one of its first employees in the APAC region, where he was tasked with educating and expanding the open source business for the MySQL database in APAC. He has played a pivotal role in several startups globally, and was also a cryptosecurity research engineer at NTT DoCoMo R&D. He is also an active developer and advisor for various cryptocurrencies. Colin Charles advises on open source implementation and best practices. He comes with a wealth of experience from MariaDB Corporation, where he had been the Chief Evangelist for MariaDB since 2009, with work ranging from speaking engagements to consultancy and engineering. In his role at MariaDB, he was responsible for almost single-handedly growth hacking the user base to 12 million users through constant evangelism. Colin was also an early employee at MySQL. Andrew Mastracci joins Bluzelle as Director, Product Development. In 2011, he co-founded Pertino Networks, which built distributed routing and switching fabric on public cloud infrastructure with simplified management systems for network configuration and policy, before raising $35m and seeing the business acquired by Cradlepoint. At Pertino Networks, Andrew was in charge of technical roadmaps for Software Defined WAN/Perimeter and Internet of Things. He holds a Bachelor of Engineering from the University of Victoria. Edward Bruck joins the Bluzelle team as Senior C++ Developer. He is a senior software developer with over 18 years experience of developing solutions within the complex, multi-layered ecosystem of networking. He was the first employee at Pertino Networks, which was acquired by Cradlepoint, and led the development of its Cloud VPN Product. Ed also worked at Packeteer & Blue Coat System (Symantec) in the WAN optimization and traffic detection market. Isabel Scroggin has been appointed to the position of Lead Researcher at Bluzelle. She holds a Master’s of Computer Science from Purdue as well as a Bachelor’s of Computer Science and a Bachelor’s of Mechanical Engineering from Rose-Hulman. Isabel has a wide breadth of knowledge in algorithms, data structures and distributed systems. Her professional experience includes ground support for NASA’s Jason-3 satellite and two summers at Amazon. “A key area we wanted to bolster was pure research. With so many changes in this space, Isabel’s background and accomplishments were something we could not pass up,” concluded Bains.
ISSUE 07 | 80
ISSUE 07 | 81
SECTOR WATCH: TECHNOLOGY
HAILO RAISES $12.5 MILLION SERIES A ROUND TO DEVELOP DEEP LEARNING PROCESSOR FOR EMBEDDED AI APPLICATIONS Hailo Raises $12.5 Million Series A Round to Develop Deep Learning Processor for Embedded AI Applications Hailo, a company developing a proprietary chip for deep learning on edge devices, today announced the completion of a $12.5 million Series A round. The company’s investors include Ourcrowd.com, Maniv Mobility, the Drive accelerator fund: Next Gear; as well as angel investors, Hailo Chairman Zohar Zisapel and Delek Motors CEO Gil Agmon. The company will use the funding to further develop its deep learning processor, which will deliver datacenter processing capacity to edge devices. This latest funding round brings the total raised to date by the Tel Aviv-based company to $16 million. Hailo’s breakthrough deep learning processor, whose initial samples are expected to enter the market in H1 2019, will be able to run embedded AI applications on edge devices that are installed in autonomous vehicles, drones, and smart home appliances such as personal assistants, smart cameras and smart TVs, alongside IoT, AR and VR platforms, wearables and security products. The Hailo processor radically reduces size, power and cost, making it suitable for local processing of high-resolution sensory data in real time. The automotive industry, which is one of Hailo’s key target markets, is undergoing a major disruption, rapidly adopting deep learning methods to enable advanced driver assistance systems and autonomous driving applications that require continuous sensing of surroundings. According to IC Insights, Integrated Circuits used in automobiles and other vehicles are expected to generate global sales of $42.9 billion in 2021, compared to $22.9 billion in 2016. Existing general-purpose processor infrastructure cannot efficiently run compute-intensive deep learning algorithms necessary for these applications. “The 70-year old architecture of existing processors is inadequate to meet today’s deep learning and AI processing needs,” says Orr Danon, Hailo CEO. “Hailo is revolutionizing the underlying architecture of the processor to boost deep learning processing by several orders of magnitude. We have completely redesigned the pillars of computer architecture – memory, control and compute – and the relations between them.” Zohar Zisapel, Hailo Chairman, added: “In the last few years, we are witnessing a revolution in the automotive industry with the quick entry of new players and technologies into the market. The product that Hailo is developing is expected to be a key component in this revolution in which artificial intelligence is one of the building blocks.” Hailo’s leadership team includes Orr Danon, CEO, Avi Baum, CTO, and Hadar Zeitlin, Chief Business Development Officer. Danon served in a top Israel Defense Forces technology unit and is a recipient of the Israel Defense Prize. Baum held several senior engineering management positions at Texas Instruments, including serving as CTO for the Wireless Connectivity Group. Zeitlin also served in the same IDF technology unit for nine years and was awarded the Chief of Staff Prize for technological excellence. Hailo’s development team leaders include senior hardware and software engineers, many of whom served in top technology units in the IDF and worked for companies like Intel, Broadcom and Mellanox. The company is currently collaborating with major players in the industry who are examining the use of its technology. Eli Nir, Senior Investment Partner at OurCrowd, stated: “We are convinced that the extensive need in the market, Hailo’s breakthrough technology and unique team will allow Hailo to bring the deep learning revolution to edge devices.” ISSUE 07 | 82
ISSUE 07 | 83
SECTOR WATCH: ENERGY
AGGREKO AND YOUNICOS COMBINE SOLAR-DIESEL HYBRID WITH BATTERY STORAGE AS A RENTAL SOLUTION
Battery storage integrator Younicos, together with its parent company Aggreko – the leading global provider of modular, mobile power – are launching a new microgridsas-a-service offer. Customers around the world can benefit from this new modular and mobile approach, combining low-cost renewables, in particular solar, with thermal generation and battery storage in one single contract with flexible conditions. An initial project, a copper and zinc mine in Eritrea, is now being equipped with a PV-plus-diesel hybrid system. This combination will reduce fuel costs by more than 10 percent, thanks to a power purchase agreement for the solar energy, with no upfront costs to the customer. Under the ten-year rental agreement, the mine will be powered by a 22 MW diesel plant and a 7.5 MW solar power resource.
Karim Wazni, Managing Director of Aggreko, said: “Microgrids-as-a-service is a win-win proposition. With this new offering, we enable our customers to reduce their electricity costs through the use of cheaper solar energy – without any compromise to their power reliability or security of supply. Integrating gridforming battery systems allow as much solar as is economically optimal to be deployed, without any technical limitations. What’s more, it also cuts fuel requirements by significantly improving thermal generation efficiency and replacing the need for backup. This lowers costs while reducing the impact on the environment by cutting emissions significantly. “ “We already offer plug-and-play battery solutions for rental periods of only a few months. Integrating storage capability with Aggreko’s existing hybrid solar-diesel offering doesn’t just combine two types of savings - it allows us to really leverage the different technologies, with each component being used more efficiently, while increasing overall resilience.” Integrated microgrid solutions will be available with rental durations as short as five years, enabling customers to test new technology and quickly adapt to a fast-evolving market, without the need for lengthy commitments. This modular offer is also flexible, and can be combined with other types of renewable generation, such as wind. Dan Ibbetson, Managing Director of Global Solutions, Aggreko said: “This unique, mobile and modular pay-as-you-go solution is a perfect example of the strengths of Aggreko and Younicos reinforcing each other. Aggreko’s proven ability to successfully deploy generation systems and other energy equipment globally is being combined with the Younicos team’s superior smart energy management software and experience to seamlessly integrate renewables with thermal generation and battery storage.” “We’re building a robust pipeline of hybrid projects as we work with customers to reduce power costs and environmental footprint, while ensuring energy security and stability of supply to meet long-term commercial objectives.” Younicos microgrid-as-a-service systems are now available throughout the world.
ISSUE 07 | 84
ISSUE 07 | 85
SECTOR WATCH: ENERGY
AQUILA CAPITAL ENTERS FINNISH WIND ENERGY MARKET WITH 14.4 MW PROJECT
Project benefits from twelve-year state-guaranteed feed-in tariff The plant in Kokkola was completed in March 2018 and is already connected to the Finnish electricity grid. “Ykspihlaja will profit in full from the state-guaranteed feed-in tariff for a period of twelve years, thus ensuring long-term profitability. This sustainability is extremely important to our investors,” explains Susanne Wermter, Head of Investment Management Energy & Infrastructure EMEA at Aquila Capital. The developer OX2 will continue to be responsible for the ongoing technical and commercial management of the wind farm. “We are pleased that we have the opportunity to realise what is now the fourth joint project with Aquila Capital. Above all we appreciate the reliability and long-term investment prospects associated with our partnership,” says Paul Stormoen, the managing director of the Swedish developer OX2. About OX2: OX2 is a leading provider of onshore wind energy plants in Scandinavia. Alongside partners and investors the Swedish company has been realising wind energy projects as a developer, financier and plant operator since 1991. The portfolio encompasses assets with a total power output of more than 2.000 MW. In addition to its commitment in the wind power sector, OX2 is also active in the fields of biogas and geothermal energy. About Aquila Capital: Aquila Capital develops alternative investment solutions for institutional investors worldwide. Founded in 2001 and owner-managed, the investment company considers itself a fiduciary for its clients and applies a holistic approach to managing customised real assets and financial assets.
ROMAN ROSSLENBROICH CEO OF AQUILA CAPITAL
The investment company Aquila Capital – a specialist in alternative investments – is acquiring the “Ykspihlaja” project, an onshore wind park close to the Finnish town of Kokkola. The wind farm has four Nordex N131 turbines with a capacity of 3.6 megawatts (MW) each.
investment by Aquila Capital in Finland. The project supplements the company’s extensive existing wind energy portfolio in Scandinavia. “The move in to the Finnish wind energy market is a logical step for us and an important element in our expansion strategy in the field of renewable energies – particularly in northern Europe. Thanks to its natural features and stable political framework, the region is key to the success of the Europe-wide energy transition,” says Roman Rosslenbroich, cofounder and CEO of Aquila Capital. The transaction follows just a few months after the acquisition of three Swedish wind energy projects with a total capacity of more than 580 MW, including one of the largest onshore wind projects in Europe.
The location has average wind speeds of 7.3 m/sec at the hub height of the turbines, thus allowing for a capacity factor of 41 percent. This is the first wind energy
ISSUE 07 | 86
ISSUE 07 | 87
SECTOR WATCH: CONSTRUCTION
BLUEBEAM ACQUIRES PROJECT ATLAS’ GROUNDBREAKING SAAS SOLUTION FOR THE CONSTRUCTION INDUSTRY Bluebeam, Inc., leading developer of innovative technology solutions for the architectural, engineering and construction industries, announced today that is has acquired substantially all of the assets of privately held Project Atlas, LLC. Founded in 2017 by construction industry veterans Todd Wynne and Joe Williams, Project Atlas created a digital mapping engine that uses geolocation instead of traditional folder structures to organise and visualise 2D plans and construction data. This location-based orientation allows design and construction professionals to create and search a seamless digital map of their project that contains plans, people, material, site photos and drone imagery, all within highly detailed, zoomable layers. “Bluebeam was founded on the idea that powerful AEC solutions should also be easy to use, capable of delivering the right information at the right time while improving the ability of all project partners to collaborate throughout the lifecycle of an entire project,” says Bluebeam CEO Jon Elliott.
ISSUE 07 | 88
We are incredibly excited to add Project Atlas to our portfolio of solutions to continue delivering on this promise. Project Atlas provides users an entirely new way to visually organise and unify location-based documents and data. This location-based methodology dramatically reduces the time it takes to find critical plans and information, empowering owners, architects, engineers, contractors and specialty contractors to access data in an immediately understandable way that will be especially beneficial in the field.” “The combination of Bluebeam’s project efficiency and collaboration tools coupled with Project Atlas’ ability to organise project information by location delivers the best set of complimentary productivity tools the industry has ever seen,” said Joe Williams, Project Atlas cofounder and Bluebeam VP of Product Management, Project Atlas. “It’s this combination of visualisation, collaboration and project documentation that our industry needs to make those last-minute decisions in the field, which are often the most critical and expensive decisions in a project,” adds Project Atlas co-founder and Bluebeam VP of Business Development and Partnerships Todd Wynne. “By working collaboratively using a visual map of a project, customers can understand projects in a familiar context and break down the barriers that often keep information from getting to the people who need it most.” Bluebeam looks forward to demonstrating workflows incorporating Project Atlas at the Bluebeam Extreme Conference, taking place 17–19 September in Austin, Texas (USA).
ISSUE 07 | 89
ISSUE 07 | 90
ISSUE 07 | 91
SECTOR WATCH: HEALTHCARE Healthcare innovators from across the West of England assembled in Swindon this month as part of a programme that aims to save the NHS millions by bringing the benefits of cutting-edge healthcare technology to patients faster. The four-day Health Innovation Programme for health professionals, hosted by SETsquared and the West of England Academic Health Science Network, provided 17 healthcare ventures with an intensive course in taking innovations to market.The programme, which is now into its fourth successful year, covered topics such as how to conduct effective market analysis, develop funding strategies and build a compelling business case for potential investors.
HEALTHCARE INNOVATORS GATHER IN SWINDON AIMING TO REVOLUTIONISE HEALTHCARE
The final day culminated with an opportunity for delegates to pitch to a panel of investors and healthcare experts. This was followed by a prize giving attended by MP for North Swindon, Justin Tomlinson. Justin Tomlinson MP, said: “I was delighted to attend the last day of the programme and to get an opportunity to speak to the participants and learn more about their pioneering ideas. Congratulations to SETsquared and the West of England Academic Health Science Network for continuing to deliver a course that goes from strength to strength and supports innovators who are looking to make a fantastic contribution to many different areas of health and social care.” Among the 17 innovators that took part this year was Dr Chen Mao Davies, founder of LatchAid, a breastfeeding support app that uses Augmented Reality to help new mothers learn and improve their latching-on skills. Dr Chen Mao Davies, founder of LatchAid, said: “When starting out in business there is so much you need to think about that often it is easy to get wrapped up in your idea and forget the other things needed to make it a success.” Getting the chance to speak to individuals experienced in launching and running a successful business was extremely helpful. I found the whole experience really invaluable.” Karen Brooks, Programme Director at SETsquared, said: “Once more the quality of innovators continues to impress. I’m delighted that after four years this world class training programme continues to make a real difference to healthcare entrepreneurs.” Lars Sundstrom, Innovation and Growth Director at West of England AHSN, added: “We’re delighted that through the Healthcare Innovation Programme we have been able to help create new partnerships between companies and healthcare providers. Some of the ideas we’ve seen today really do have the potential to change people’s lives and revolutionise areas of the healthcare industry.”
SETsquared, the world’s number one university business incubator, joined forces with two Academic Science Networks in 2014 to create a revolutionary new programme that could see more effective and better value healthcare technologies benefiting patients quicker than ever.
ISSUE 07 | 92
KAREN BROOKS
PROGRAMME DIRECTOR AT SETSQUARED
ISSUE 07 | 93
ISSUE 07 | 94
ISSUE 07 | 95
SECTOR WATCH: HEALTHCARE
MHEALTH FOR DIABETES AND HEART FAILURE WILL REVOLUTIONISE THE CARDIOMETABOLIC MARKET
“The entire cardiometabolic treatment paradigm is slowly shifting toward a ‘Therapy-as-a-Service Model’ with the integration of drug treatment with welldefined nutritional, behavioral and wellness programs, thus providing the patients with a holistic treatment,” noted Aarti Chitale, Global TransformationalHealth Senior Research Analyst at Frost & Sullivan.
aarti chitale
senior research analyst at frost & sullivan
Across the global cardiometabolic diseases landscape, the chronic heart failure and obesity segments show the strongest increase with a compound annual growth rate of 36.1 percent and 23.0 percent, respectively, during the forecast period of 2017 to 2022. Wellness programs are expected to be an integral part of cardiometabolic disease treatment, in collaboration with clinical therapies. New business models such as direct-to-consumer and telemonitoring services are supporting market players in reaching larger patient bases, especially across remote areas with inadequate treatment access.
Needs are not being met across the market due to a general lack of novel therapies, leading to increased collaborative drug development and commercialization activities. Leading players resort to mergers and acquisitions with smaller niche players, thereby attaining therapeutic expertise as well as geographic expansion. Pfizer’s recent collaboration with Wave Life Sciences is aimed at developing genetically-targeted therapies from Wave’s RNA interference capabilities for metabolic diseases.
Frost & Sullivan, in partnership with CMHC, has recently released its analysis,Cardiometabolic Diseases Market— Trends & Growth Opportunities, which highlights future trends, key regulatory and pricing changes, growth opportunities, and the impact of innovative therapeutic solutions on the overall market in the next few years.
Additionally, other key market participants such as Novartis are investing in evidence-based/ outcomes-based cost-benefit studies for highvalue drugs such as Entresto™ to establish the cost-effectiveness of these therapies. The adoption of value-based payment models closely aligns reimbursements to quality and overall outcomes of a treatment, thus reducing the economic burden on the patients, providers, and payers.
Future growth opportunities in the cardiometabolic market include: • Regenerative Medicine: Cell and gene therapies for heart failure and diabetes are set to transform the therapeutic landscape with novel treatment solutions; • Innovative Drug Delivery Solutions: A transition toward nanoparticles-based inhalable and subcutaneous drug delivery systems is anticipated; and • Digital Therapeutics: mHealth platforms for diabetes, obesity and heart failure management will revolutionize value-based care paradigms.
“While the cost of treatment has been an impeding issue across the market, industry players are increasingly adopting a value-based payment model by linking it to the therapeutic outcome of the drug, thereby addressing the challenges of higher drug costs and supporting a larger patient base,” observed Chitale.
ISSUE 07 | 96
ISSUE 07 | 97