Irish fintech Fenergo continues to benefit from the Covid crisis with revenue rising 17 per cent in the year to the end of March 2021 as more financial institutions focused on digital transformation during the pandemic.
The company, which became one of only a handful of Irish tech unicorns last year when it achieved a $1 billion-plus (€880 million) valuation, also reported a breakeven operating result as its edges closer to profitability.
Speaking to The Irish Times, co-founder and chief executive Marc Murphy said he expected the company to record "modest profitability" in the coming years, with the primary focus on reinvesting revenue to further grow the business.
“We’ve basically signed up for a four-year sprint in which the focus is transforming the business into a pure software-as-a-service [Saas] company,” he said.
Fenergo reported €91.3 million in revenue, a gross profit increase of 20 per cent to €52.1 million, and software licence growth of 22.3 per cent to €41.1 million during the financial year ending March 2021.
Mr Murphy said the company had seen a continued rise in revenue since then and had expectations of a strong 12 months ahead.
French private-equity group Astorg joined forces with London-based Bridgepoint last year to buy out stakes in Fenergo previously owned by Insight Venture Partners and DXC in a deal valued by industry sources at $600 million. That gave the fintech a market valuation of $1.165 billion.
Founded in 2008, Fenergo develops software for financial institutions that helps them with issues such as regulatory compliance and managing client data. In recent years it has also expanded into new sectors such as asset and wealth management.
The company works with more than 300 of the largest banks and insurers in the world, such as ABN Amro, Aviva, Bank of China, Danske Bank, Credit Suisse, UBS, Santander and State Street.
Mr Murphy said Fenergo has seen a surge in new business since the pandemic with more than 40 new client bookings, including from DNB Bank, Mizuho, Aztec Financial, Bank ABC and Anglo Gulf Trade Bank. It has also just signed the number one Nordics bank and a well-known asset servicing firm based in Luxemburg.
“More financial institutions have been focused on moving to the cloud since the Covid crisis hit. It really accelerated their need to transform,” he said.
Fenergo employs about 850 people and is recruiting for a further 100 roles currently.
“We’re an Irish-headquartered company operating globally and what we have is an amazing proposition for employees. We are fighting with US multinationals for staff but, unlike them, the decisions made by the company are made here, rather than in San Francisco or wherever,” Mr Murphy said.