Shopbox to Become a Publicly Traded Company
- 23.02.2021 08:05 pm
After seeing colleagues going public, the Danish Fintech Shopbox considers making the same move. Shopbox expects extensive growth in its turnover, and the company is striving to become the dominant player in the payments market in a few years time. “We have the numbers to back it up,” says Christian Zigler, Co-founder and Chairman of the Board at Shopbox.
The Danish Fintech Shopbox considers becoming a publicly traded company. This is what Co-founder and Chairman of the Board, Christian Zigler, is telling FinansWatch.
“At the moment we experience a great interest in listed companies, and a lot of companies at First North are doing very well. At Shopbox we have been looking at the possibilities for listing Shopbox. Compared to other listed companies we believe that we have sufficient capital to become listed,” says Christian Zigler.
The IT-company Valeur has its first trading day this monday when the stock-exchange opens at 9 am. Thus, FOM Technologies and Penneo went public in summer 2020, and according to the consulting company Keystones, the average return for First North stock exchange listings was at 98% in 2020.
Shopbox offers a point-of-sale (POS) solution to merchants. That is, a solution which is used when customers are paying for goods and services. This solution can be used online and in the physical stores, and the POS market is growing rapidly - both in the north and the rest of the world.
Christian Zigler sees it as a big plus that almost all danish citizens have bought goods or services in a store, meaning they know what a cash register is. He says: “Shopbox is a concept that everyone can understand. Thus, everyone can see that there is a need for new digital solutions in the stores and in the payments market in general. All people have been in a store or know somebody who has been in a store - and it is obvious to everyone that something is changing.”
High growth ambitions
When listing a company, the stock price and thus the value of the company - valuation - is absolutely crucial.
“Our valuation is going to be relatively high, because we have the right product, the right people and a strong economy in our company. But it always depends on what the market is willing to pay. Our expectation is that Shopbox’ valuation will be around 150-200 million DKK, meaning that we will raise around 30-40 million DKK,” says Christian Zigler.
Shopbox is yet to announce their final account for 2020, but Zigler says that the company has a turnover of around 4.5 million DKK, and a negative result of around 5 million DKK.
These figures are almost the same as those of Valeur - a company that deals with artificial intelligence and not payments. Valeur had a turnover of 4.8 million DKK in 2020 and a negative operating profit of nearly 6 million DKK.
Valeur is expecting a turnover of approx. 18 million DKK in 2021. The company is listed on the stock exchange at an initial market value of just around 300 million DKK. This means that investors are paying 60 DKK for a one DKK realized turnover.
Besides coming from different industries there is another significant difference in the numbers of Shopbox and Valeur. Shopbox’ turnover is increasing, which is also expected in the current year. Shopbox expects a top-line of approx. 15 million DKK.
However, the top-line of 15 million DKK is only indicative. Currently the company is looking at acquiring other companies from the same industry. Also, the funds that Shopbox is looking to raise will be used for further growth. Besides acquiring other companies the company is looking to enter new partnerships.
“We want to acquire competing companies, who have a customer base but are not able to keep up in different areas such as product development or marketing. Right now we are looking at our first acquisition case, which we hopefully will finish soon,” says Zigler.
A potential acquisition will be added directly to the company’s top-line, and new partnerships will help increase its turnover.
“If we raised 30-40 million DKK by listing Shopbox, we would definitely raise our turnover expectations. But we find that challenging to do this year, because we are planning to hire a lot of new people. 2022 will be the year where we will acquire multiple companies, and in the end of year 2023 our goal is to have a minimum of 10.000 stores, who will pay an average of 750 DKK per month,” says Zigler.
10.000 stores with a monthly turnover of 750 DKK each makes 7.5 million DKK to Shopbox each month. This means Shopbox will make a turnover of 90 million DKK annually.
The dominant player in the north
However, listing a company is not cost-free. It is a difficult decision, because it is difficult to unlist a company again. It is a costly affair as advisers and accountants have to go through the entire company. Also, being a listed company means there are different rules to follow - rules you do not have to apply to if you are not listed.
However, Zigler is not that concerned about a thorough due diligence.
“It isn’t cost-free to raise money the traditional way either. The broker has to get paid. But there are ways you can go public which are not that costly. We have a strong business and positive numbers. Therefore it is not necessarily more expensive to raise money by going public compared to other ways of raising money,” says Zigler.
He explains that they already considered listing Shopbox a year ago. But they put the idea on hold, as they needed a more experienced management at Shopbox. This became a reality by hiring Andreas B. Iversen, who previously worked at the consulting company Charlie Tango and In2Media. He has great experience managing hundreds of employees.
“We have a better reason to consider listing Shopbox now. And our numbers show that we are growing. We know how much it costs to acquire each new customer ”, says Zigler.
Going public takes around 3-12 months. The management at Shopbox expects that a potential listing will happen relatively quickly.
Zigler believes that now is a particularly good time to strike.
“It needs to happen fast, because in the next 2-3 years a dominant player will be created in the north, and we want to be that player. We need to raise more capital and listing Shopbox can be a great way to do so,” says Christian Zigler.