|Weekly News Roundup|
|1. One of Sweden’s oldest and largest SaaS companies is still growing fast – Breakit|
Fortnox – a business platform that offers products and services in areas such as accounting, invoicing, financing, and human resources – now boasts a market capitalization of almost 29 billion SEK. The company is reporting revenues of 416 million SEK for the third quarter, reflecting a growth of 25 percent compared to the same period last year, according to the latest report.
“It’s worth noting that the growth rate is slightly lower than it has been earlier this year. The company grew by 32 percent during the first half of the year. [The operating income] … corresponds to a margin of 45 percent.”
2. Meta confirms: Subscriptions are coming to Europe – Press Release
Starting in November, users in the EU will need to have a paid subscription to enjoy an ad-free experience on Facebook and Instagram. Meta, the parent company, is now confirming the information that began circulating a month ago.
“People in [the EU] will be able to subscribe for a fee to use our products without ads. Depending on where you purchase it will cost €9.99/month on the web or €12.99/month on iOS and Android.”
3. Spotify posts third-quarter profit, beats earnings – Axios
Spotify’s operating profit of 34 million dollars in the third quarter of this year marked the streaming service’s first profitable quarter since 2021. The summer price hikes have improved profit margins without impacting user growth, which exceeded Wall Street’s expectations, as reported by Axios.
“User growth increases combined with price hikes and advertising improvements helped the company beat Wall Street expectations on its top line, posting revenues of $3.56 billion for the quarter, according to its most recent earnings report out Tuesday.”
4. This tech subscription service wants to keep devices out of the landfill – Techcrunch
Circular, backed by Y Combinator, is a service that offers consumers in Singapore and Australia subscriptions to high-end electronics, like iPhones. Not only does it want to help people get devices at lower prices, but also keep them in circulation for as long as possible and out of the landfill.
“Circular’s team notes that the tech subscription model is popular in Europe, where one company, Grover, raised $330 million in 2022. But the model is still new in APAC and Circular hopes to lean into its position as a first mover in the region. The startup says it has grown 3X in the last 12 months and plans to grow 3X more in Singapore and Australia over the next year.”
5. Google considers subscription business models for its new AI offerings – Business Insider
Google’s CEO Sundar Pichai has suggested the company could embrace subscription business models for some of its new AI products.
“This is a big deal for a company that still generates most of its revenue and profit from advertising. Wall Street is nervous about any big changes to Google Search because Search ads are so lucrative.”
6. Ourliving acquires Boappa – expected to significantly increase SaaS revenues – Placera
OurLiving AB acquires Boappa, an app for housing cooperatives, from the Swedish state-owned SBAB for one krona, free of debt. When SBAB entered Boappa two years ago, the price tag was 64 million SEK.
“The addition is expected to significantly increase OurLiving’s SaaS revenues in the current fiscal year and have a positive impact on cash flow.”
Weekly Analysis Roundup
1. 70 companies and 22 rising stars – here is Breakit’s breakdown of SaaS in Sweden 2023 – Breakit
The Swedish SaaS industry is bigger than ever, and so is Breakit’s annual report of it. “Now, we can finally unveil this year’s hottest SaaS companies”, writes Breakit.
“In addition, we are publishing a list of 22 Rising Stars. These are companies that aren’t large enough to make it onto the main list but are, in our opinion, interesting players to keep an eye on in the industry.”
2. Streaming is more expensive than ever – and it’s only going up from here – The Verge
Netflix is at an all-time high. Disney is cracking down on password sharing. And Apple TV Plus has doubled its prices. Will the streaming squeeze ever end?, asks The Verge.
“Is there an upper bound where it’s going to get too expensive and people will just stop subscribing? Of course,” Paul Erickson, the principal at Erickson Strategy & Insights, tells The Verge. “But I think that we’re a long way from that.”