following is a Google translation from Swedish:
"2021 has been intense and exciting. We have laid the foundation for Vopy's format, offering, revenue model and organization. Now we are ready for 2022 where we scale up staffing, users and revenue. Here I tell you about the status of the business today and how we create the conditions for a rapid growth journey in the coming years.
TTM - a growth strategy
Time To Market (TTM) is Vopy's most important goal in the short term. The market for embedded finance is growing and changing very fast. Today, there is no dominant supplier, most possible competitors are smaller start-up companies or companies with a focus solely on individual functions. With its broad offering and focus on high volumes, Vopy has a number of unique factors that strengthen the company's competitiveness in the short and long term.
The competitive situation is favorable in the short term, where there is an "open window" for Vopy to act within. With good financing of the business, we can in a short time reach large volumes and position ourselves right in the market to become a "Category Captain" in embedded finance. We will now continue to grow as fast as we can in order to secure our growth strategy.
Our assessment is that approximately SEK 200 million will be required in 2022 to finance a secured position as "Category Captain". With this capital, we have the opportunity to become a global and central player in embedded finance. We would do well even with less capital, but then risk becoming a local niche player with clearly poorer growth potential.
The capital we raise in 2022 will primarily be used to recruit more employees. 1 year ago we were 5 people. Today we employ 25 people. At the end of 2022, we need to be about 95 people to be able to deliver against the demand we see that we will have then. About 35% will work with development, about 45% with delivery / market / sales (Customer Success) and the remaining 20% with compliance, product development, finance, HR, management.
We are fully focused on helping our customers succeed with our products. To create solutions that their users really want and want to continue using. To help them launch their new offering to their users, to package messages and content, to provide support and everything else required, so that our customers can successfully establish a new range of financial services to their users. We know what we need to do to become a "Category Captain" and we see very great growth opportunities in that position.
Financing of the business
Vopy needs, as I described earlier, about SEK 200 million in 2022 to be able to realize its TTM strategy. The sooner we get there the faster we can grow in the market. During December 2021, we completed a first issue of SEK 20 million aimed at qualified investors. The issue took place at a pre-money valuation of SEK 572 million or SEK 2.95 / share.
Early in 2022, we will take the next step. We will then, via a public issue, raise approximately SEK 40 million for a higher valuation as a result of completed customer agreements and started customer deliveries. Here, too, we turn to qualified investors where the minimum subscription commitment will be approximately SEK 1 million. We will inform more about this issue via our website when it becomes relevant.
As previously communicated, we aim to list Vopy on a Swedish marketplace and through an IPO issue an additional approximately SEK 160 million to the public. Since the summer of 2021, we have, together with various advisers, worked to prepare the company for a listed environment.
Valuation of the company's IP
In addition to the patents we hold (one of which is pending), we have also invested many millions in the development of our technical platform. It includes specific solutions such as AI based KYC and Market Place that automatically match borrowers with lenders.
Through the merger of Conax Group AB and Vopy AB in the spring of 2021, goodwill values arose in our general ledger, as well as a need to inventory and value our combined IP assets.
In October 2021, the assignment went to Bergenstråhle & Partners, a full-service agency specializing in the management and valuation of intangible assets. In addition to the valuation of the IP asset itself, a valuation of the company as a whole was also made. That valuation describes how the value of the company and its IP develops over time, based entirely on the fact that we comply with the forecasts we have submitted to Bergenstråhle & Partners as a basis.
Of a total valuation for the company today of SEK 5.49 billion, the pure IP valuation consists of SEK 1.03 billion. We see the high valuation as proof of our potential and approach our lofty business goals with humility - and with great determination.
Sale
Sometime in the spring, we began to receive positive signals from the market. New companies contacted us with an interest in our services. This has continued at an ever-increasing pace during the autumn. Today we are in the fortunate situation that sales are not a problem, we now have a long list of ongoing sales processes. We have about 15 customers where we agree on the business terms and where we work for agreements to be written. In addition, we have 5 customers with signed agreements where we are now planning for delivery start.
Actual income arises with some delay. We will have operating starts already during Q1 2022, but we do not believe revenues from these will arise until Q2 2022.
Development, delivery and recruitment
The change of the central suppliers, which we communicated in previous CEO letters, has taken longer than we initially estimated. In addition, a key supplier has not been able to deliver critical functions as promised, which has led to further delays.
Deliveries have not started yet and we have a clear picture of the few steps that remain. Based on the autumn's experiences, we are now planning for the start of delivery during Q1 2022. Later than we wanted, but within the framework of our budget and our working models.
We are a software company, parts of what we develop have not been done by anyone before. We work focused with our customers to start deliveries to their users. We know that there are always bumps and obstacles to deal with on the road, which is not uncommon in our industry. We disapprove of delays, but in the long run they make us better and they are to some extent expected.
The unexpectedly high demand has led to a lack of resources regarding business law, implementation project managers and resources for operations and future support. In short, today we do not have time to meet the demand we have. A dear problem perhaps, but at the same time a very real problem that we strive to solve through major recruitment efforts. At the same time, the capital injection our planned issue entails is necessary to finance the expanded organization.
To handle our rapidly increasing need for resources, we have chosen to work with two different recruitment companies. These complement each other and add an efficient influx of candidates at the pace we need. Some positions are more demanding to fill, which is why we budget there with a longer process time than others.
Expectations for 2022
Vopy's activity has been very high in 2021 and will continue to do so in 2022. We will continue to update our shareholders on an ongoing basis, perhaps not exactly every month but always when major business events take place.
During Q1, we are primarily looking forward to delivery starts, continued recruitment of roles as project manager (implementations), sales, legal, CFO, CSO and a couple of development resources. We also welcome our new Head of Compliance, Anilla Lone Brännström (starting January 3) and our Customer Implementation Manager, Thomas Schiffer (starting February 1) to Vopy.
To finance the rapid growth of the team, we also expect to begin the next round of funding in Q1.
In 2022, it is a matter of shifting up resources and organization at the same rate as the need for delivery increases. We must reach a critical mass of end users as soon as possible, this leads to increased knowledge of the market and steadily increasing revenues. In parallel, we are working on our IPO process and I believe that at the end of 2022 we have set up the company to be able to create very strong customer growth.
Finally, I would like to wish all shareholders a rewarding 2022 and thank you for the trust you give us.
For further information, please contact:
Joakim Forssell, CEO of Vopy AB (publ.)
+46 72 308 58 35
About Vopy
Vopy is a Swedish fintech company with the vision of becoming a world-leading technology supplier in embedded-finance solutions. Through Vopy's cloud-based infrastructure, companies can offer their customers instant, secure and free transactions as well as debit cards, financing solutions and loyalty programs.
Vopy's solutions are part of creating the financial services of the future. Everything from large global companies to smaller start-ups can use Vopy's solutions to offer their customers financial services - without major investments. The head office is in Stockholm and Vopy is also established in Norway, Canada, Ukraine and India."
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