Investors
Market
Easor is a Finnish software company that provides SMEs, as well as accountants and accounting firms, with an integrated financial management software package.
The market for software services offered to SMEs and accounting firms is defensive in nature, as accounting and external reporting are statutory obligations. In addition, the use of electronic processes has become mandatory throughout the EU, such as e-invoicing standards, e-archiving, the digitalisation of VAT reporting and information security requirements for invoicing software.
Easor operates in Finland, Sweden and Spain. Localisation of the software has begun in Italy.
The degree of digitalization varies by target market
The digitalisation of financial management in the target markets is at different stages. We estimate that the degree of digitalisation in Finnish financial management is very high. We estimate that the degree of digitalisation in the Swedish market is high, but slightly lower than in Finland. For example, many Swedish companies still send their invoices to accounting firms by email.
In Spain and Italy, we estimate that the degree of digitalisation of the markets is currently low, which is typical of Central European countries. According to our estimates, accounting firms do not take advantage of the benefits of digitalisation in their operations, and continue to operate using traditional, paper-based practices. According to our estimates, the market lacks a comprehensive system that would support the digitalisation of companies and accounting firms. This deficiency has prevented the comprehensive utilisation of digitalisation in financial management.
We expect digitalisation to grow in the coming years as regulations tighten. Low digitalisation, traditional financial management practices, expected regulatory changes and the significant size of the market make Spain and Italy attractive destinations for Easor.
Finland
Financial management market size: approx. 1.5 EUR billion
Digitalization rate: Very high
Spain
Financial management market size: approx. 10.0 EUR billion
Digitalization rate: Low
Sweden
Financial management market size: approx. 2.2 EUR billion
Digitalization rate: High
Italy
Financial management market size: approx. 12.0 EUR billion
Digitalization rate: Low
The presented views on the degree of digitalization in financial administration are based on the company's own estimates and represent the size of the financial management market size. The market size of financial administration software varies between 10–40%.
Market trends and drivers
Digitalisation of financial management
The accounting services market is undergoing a development in which digitalisation is changing the services, processes, competence requirements and division of labour in customer relationships of accounting firms. Cloud-based accounting software is constantly growing in popularity due to its efficiency, security and ease of use. The software also reduces costs and automation reduces the workload.
According to our view, working methods in the European accounting services market are quite traditional, and therefore, there is a high need for investment. In addition, customer preferences are also shifting towards digital services that offer ease of use, speed and real-time interaction. We observe that entrepreneurs are increasingly interested in developing their operating models, streamlining their processes and reducing the time spent on routine tasks. In addition, we see that software choices are typically long-term and changing them later is challenging.
Regulatory amendments
Growing legislative pressures related to money laundering and GDPR, among other things, are creating new needs for financial management and accounting services. These regulations include the Payment Services Directive (EU) 2015/2366 (“PSD2”), which requires the opening of banking interfaces throughout the EU, enabling the integration of banking services into the service offering of accounting firms, as well as national legislation on e-invoicing and e-receipts.
National legislation is also guided by the European Union’s green transition. The goal of the EU’s green transition strategy is to make the EU climate neutral by 2050, and the digitalisation of financial management supports this goal through, among other things, paperless operations, energy savings, efficiency and the enabling of digital reporting.
In Spain, for example, preparations are underway for the Verifactu legislation, which will make electronic invoicing mandatory in 2027. The Verifactu regulation will standardise the format, structure and technical requirements of electronic invoicing data. The main objectives of the regulation are to combat fraud and tax evasion, promote the digitalisation of businesses, especially SMEs, and prevent the use of software that enables parallel accounting. Following Verifactu, new Crea y Crece legislation (Ley 18/2022) is expected, which will oblige companies to send einvoices in business-to-business (“B2B”) transactions and to give-up paper invoicing entirely18. Talenom’s management estimates that this law, which is expected to come into force in 2028, will open up additional sales opportunities among Easor’s established customer base.
The rise in popularity of entrepreneurship
According to our estimate, entrepreneurship is becoming a way for increasingly more people to employ themselves. In addition, the ongoing transformation of work is leading continuously more people to work more than one job or to engage in part-time entrepreneurship. At the same time, the nature of work is increasingly shifting towards platform economy work through entrepreneurship. As salaried work changes into entrepreneurship, the need for financial management services is also growing.
Typically, entrepreneurs need financial management software and an advisor. According to our estimate, only a small proportion of SMEs want to handle their accounting independently. Finns, Spaniards and Italians in particular want to outsource their tax affairs and ensure that their practices are compliant with the legislation, which increases demand for software that provides real-time tax updates and tools for error checking, as well as expert support. According to our observations, it is more typical for entrepreneurs in Sweden to purchase only an accounting software and otherwise manage their financial administration independently, even though the majority of entrepreneurs in Sweden also outsource their financial administration to accounting firms.
