Trifork as a European wide brand
The mission of Trifork is to build a strong and lasting company that will create innovative solutions and products. We like to change the world by means of Software and we like to evolve and grow our company. The main source for growing and evolving is to find the best talent among young engineers and to find customers that we can innovate with. We believe in long and lasting partnerships with our customers.
We have a strong brand in Denmark and in the Netherlands. We are rather new in the US, UK, Germany, Switzerland and Sweden and we need to build presence and our brand. We are also growing and building our brand in Poland and Hungary. In this sense we are established in the markets where we want to be for now and we will focus our energy on getting stronger where we are.
First of all its important to us that each office runs successfully and this is priority one. Priority two, but very important too is to see the offices working together. We have already in 2013 seen work won by offices working together and we expect to see more of that in 2014.
Thinking software development
First of all Trifork is a software company and we think software when we see a challenge. There are so many things software can do for us. Often Trifork has played a major role in bringing a new innovative solution to the market. Solutions that change the way we live and interact with each other. In 2013 we helped one of our most important customers with an innovative new payment technology where anyone with a smartphone could easily transfer money from one person to another. A new solution like this actually changes the way people do business with each other and how they interact with one another. Recently the smart phone chat program “Whatsapp” was sold to Facebook for a huge sum of money. This chat app gains more than a million users a day and it changes how people interact. It seems like a simple app but it’s never simple to get 1 million new customers every day! One of the secrets for this success is the technology that its built on. The technology is called “Erlang” and Erlang Solutions Ltd. (a Trifork company) is the leading independent driver behind the evolution of this technology. Erlang Solutions initially helped Whatsapp to get started on this technology and the use of Erlang in this case is the answer to the question of how an organization of only 50 people could be sold to Facebook for USD 19 Billion.
These are just two examples where Trifork was thinking software where the world was able to see very impressive solutions.
For us it’s very simple. First we discover which technologies have a future. Secondly we help our customers to take advantage of these new technologies. Finally we merge our experiences, know-how and market knowledge and develop products that our customers need. These three processes are each seen as a value stream for our business. The figure on the next page shows how it all fits together.
The three processes in the figure are marked with an orange ring:
- Agile: Organizing conferences and training Customer innovation: Innovating new solutions with our customers Product development: Developing innovative products .As seen from the figure, one activity gives input to the next. For us, it works as an ecosystem and the parties involved in these activities are the following marked with a black ring.
- Customers: The customers come to our conferences and courses and we provide our know-how, training and services to them. We also offer our software products to them.
- Talent and experts: To grow our organization we need new talented young engineers and we need the advice from thought leaders around the world.
- Partners: It’s very important to Trifork to work with partners to obtain specific know-how or to get access to new innovative products that we might resell or use in customer projects.
In the following each of the processes is explained in more detail.
Since 1996 we have organized conferences and training. From the beginning we did it for several reasons. First of all we benefit from having a close relationship with the people in the world who invent the methods and technologies everyone in the software world uses every day. When you are close to the source of inventions and you get the reasoning for why things are made the way they are, it gives you a head start in regard to your competition. Secondly, we are driven by our passion to make the world a better place. By working smarter and using the right tools and technologies we make better software. When inviting our customers to learn from our conferences we increase the impact of doing things better. At our conferences and training we also meet new partners and new talent to hire. Yearly we have hundreds of young students helping us out with our conferences and some of them will start working for us. In this sense the conferences act as a marketing and branding activity. We also try to make the training and conference business into a profitable business. However in 2013 we invested so much in this area that we had to accept a loss. The most important outcome of this process is that we identify the new trends in our industry.
The customers who attend our conferences and training are typical software engineers from all areas of the software industry.
The partners we meet often end up being business partners in the sense that we use and resell their technology. It can also be that we decide to invest or buy a stake in that partner’s business which subsequently contributes to growing Trifork.
An example of a clear trend from 2013 is the importance of the notion “Internet of things”. It’s something we have been talking about for years but in 2013 Trifork started to build solutions that make it possible for small things like sensors and controllers to be connected in large systems. One obvious use is home automation where the functions of the home can be monitored and remote controlled from smart phones. Imagine that you have a personal profile on your smart phone and when you enter a room or a building the profile will give you access, adjust the light, adjust the temperature and play your music etc. Only the imagination sets the limits for what can be done.
In 2014 we will see the first smart shopping systems where smartphones, ordering and payment systems will merge together. Imagine that your shopping list will guide you through your shopping mall in an easy way and when you exit the shop you just have to accept the payment and you walk out.
PROJECT – Customer Innovation
Having identified trends at our conferences, we start working with our customers to innovate new solutions as mentioned in the two previous examples. We work with the leading branded customers and often they are market leaders in their field. These brands want to stay in the lead and they need an innovation partner like Trifork. Most of our customers have been customers for years and we believe in staying loyal and close to a customer and doing everything possible to help them to be successful. It is the dynamic and trust between them and us that creates new ideas and new solutions. Working very close is key to us. We prefer to use ‘agile’ and ‘lean’ methods to improve learning so we can adapt to changes in the business environment or changing technologies.
The customers for this business area can be banks, governments, agencies or leading industrial manufacturers. An example of this is when Trifork helped the University of Amsterdam by building a self-service website. Another example is when we worked with Danske Bank implementing Mobile Pay. A third example from 2013 was the implementation and creation of an electronic examination system for Cantons of Switzerland, where we worked for Swisscom. These are just a few examples of projects and solutions we have created for our customers.
In the following chapters we have listed two new case stories that describe in greater detail what we do. On our website we have listed a number of recent case stories of projects we have done.
PRODUCT – Development and sales
The third process and value stream is product development and business, related to partner products. An example of a product we started developing years ago is “Panteos” which is a system to administer mortgages for the real estate market. Typical customers are banks and credit facility organizations. With Panteos we have a leading position in Denmark and we continue to improve the product so our customers have the most efficient and modern system to work with.
The most recent product is based on our very successful project with Danske Bank – Mobile Pay. Trifork has the rights to sell and deliver this mobile payment product internationally. Trifork is in positive negotiations with several banks outside the Nordic region in regard to implement a mobile payment solution in new markets.
The idea to build a product usually comes either from one of our engineers or from working with our customers. When we have come across common patterns in customer projects we have suggested that our customers buy a license for one of our products, instead of doing a custom build solution which is much more expensive.
A stronger focus on our product business has the potential to improve our EBITDA margin. It makes our overall business more scalable. Furthermore, it gives stability to our company in the sense that receiving support or license fees on products is a stable accumulating income. The dynamic between product business and project business also makes it easier to outbalance peaks in resource requirements in one or the other business unit.
How we will continue to expand
Our ambition is to grow 15-25% annually, measured on revenue.
In short we see growth coming from three areas:
Organic growth of existing business units
Organic Growth Of Existing Business Units
All the offices will continue to grow organically. The growth rate per business unit is on average higher than 10-15% annually. When a business unit exceeds 50-100 people we will divide it into two units. This makes it easier to control and perfect the way we manage and lead a business unit. With time we have become very good at managing a unit of approximately 50 people. Also, for us as employees we all started and were attracted to a unit of this size where everyone knew each other. Furthermore, our experience has taught us that the fastest growth rate comes from a relatively small unit.
Growth from acquisitions has an obvious negative impact on cash flow and it involves risks and financing issues. On the other hand it is a very good way to enter a new market and learn about a foreign culture in a very effective way, thereby giving its growth a quick boost.
We will primarily look at acquisitions from a product perspective. Trifork has offices around Europe and a sales force that likes to have a selection of products to present to customers. Therefore we can offer a small product company a boost in business by becoming a part of the Trifork group.
As the Trifork Brand grows stronger we see an opportunity in building a Franchising business. In large cities in Europe where we already have offices we see an interest from customers and young entrepreneurs in building smaller entities in the surrounding cities. In 2014 we will setup a few test offices and if everything goes well we plan to have 10-15 offices over the next 2-4 years.