PITCH DECK - SGS JSC

PITCH DECK

Scalable Global Solutions JSC

2022

ilustracija departments 1

SCALABLE GLOBAL SOLUTIONS JSC

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Scalable Global Solutions is a Croatian-based startup that enables international small and medium-sized businesses to create and manage their own teams and departments in Croatia without opening an entity.


We make it easy to implement, employ, pay, support & manage teams and departments.


By creating DaaS [Department as a Solution], our clients solve four key issues:​

BUSSINES GROWTH

OPERATIONAL COST REDUCTION UP TO 50%

FINDING AND KEEPING EMPLOYEES

EFFICIENCY INCREASE BY 15%

HQ: Zagreb, Croatia

Industry: Future of Work, Business Solutions, HR, SaaS, BPO, Managed Office Space

Number of employees: 50-100

Fundraising stage: Seed

Looking to raise: €2.3M

Use of funds: Accelerate sales, grow channel partnership, software R&D and marketing outreach.

MISSION

______

 

Our focus is to drive, create and Optimises our client´s impact in their market by creating a Department as a complete solution for their business growth.

VISION

______

 

To become the global DaaS provider.​
We are introducing a new concept to clients that enables them to become more successful and competitive.
Their success is our success! ​

CHALLENGE

______

 

The global SME sector desperately needs cost-cutting, process optimisation, and finding talent.

This has forced 96% of all companies in Europe to adapt and rethink their business strategy. 

THE ISSUE

______

The global SME sector desperately needs cost-saving, process optimisation, and finding talent.

This has forced 96% of all companies in Europe to adapt and rethink their business strategy.

 

Target market companies face problems such as:

DRIVING EFFICIENCY

  1. Not using stateofthe-art processes 
  2. The value chain can be improved 
  3. Too many things are donein-house 
  4. 61% operational costs increase since 2019 

WINNING TOP TALENT

  1. Finding the right people 
  2. Getting talent at all 
  3. 50% increased market shortage of competent and skilled employees in 2022 

DRIVING EFFECTIVENESS 

    1. No Business Process Optimisation implemented 
    2. Not doing more with less management 
    3. 58% increase in employment cost in the last decade 

Lack of competent and skilled labour is the key challenge to 25% of small and medium businesses in 2020 – the number is close to 50% in 2022.

 

Having a highly-skilled employee base is crucial for innovation.

SOLUTION

______

 

DaaS The Future of Employment

With DaaS, we enable clients to build and manage their remote teams and whole departments in our offices in Croatia.

The game-changing solution is that our clients:​

 

Get access to a worldwide talent pool​

Handpick who they want to hire​

Do not need to create a subsidiary​

Can easily manage their new team and department with our SGS ONE software​

MARKET POTENTIAL

______

Total Addressable Market [TAM]                                                                                                                                                                                                    € billion

LATAM 62,40
USA 157,00
ASIA 189,20
CENTRAL EUROPE & GCC 221,41
Total 630

TAM Global Potential

Total 630€ billion

  • CE & GCC 221,41€ billion
  • ASIA 189,20€ billion
  • USA 157,00€ billion
  • LATAM 62,40€ billion

SAM Europe Potential

Total 114,21€ billion

  • DE 33,02€ billion
  • AT 5,19€ billion
  • CH 5,99€ billion
  • UK 23,40€ billion
  • BENELUX 12,36€ billion
  • SCAND 11,23€ billion
  • FR 23,02€ billion

Servicable Available Market [SAM]

DE 33,02
AT 5,19
CH 5,99
UK 23,40
BENELUX 12,36
SCAND 11,23
FR 23,02
Total 114,21

Investments in technologies supporting Future of Work initiatives will exceed $1 trillion worldwide by 2024 with a robust 17% CAGR over the five-year forecast period.“

MARKET FACTS by PWC Q4 2018

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Company Challenge – Execution & Operations capability & delivery location needs to change. Companies’ Workforce, Business, and Department processes are not set up efficiently

If someone can do something better than yourself, that under no circumstances do it yourself.

John Chambers, 1998

EXECUTIVE LEVEL FEEDBACK

93%

We Understand

Recognise the need to make strategic changes in OPERATIONS, BACK OFFICE & HR, focusing on optimising the processes & reduce costs

61%

We are Aware

Feel that departments are not prepared to capitalise on transformational changes.

32%

We ask someone who knows

They considered alternative strategies and started to look into BPO solutions. DaaS would be the perfect solution to their problem.

SUCCESS FORMULA (Unique Selling Point)

____________

 

  • DaaS is an industry agnostic solution, covering 8 core corporate segments.​

  • The client retains 100% control over their team and their day-to-day activities.​

  • By having an employed team in Croatia, the client ends up with a 50% more affordable department than in Central, Northern or Western Europe.

  • DaaS is an industry agnostic solution, covering 8 core corporate segments.​

  • The client retains 100% control over their team and day-to-day activities.​

ECONOMIC ADVANTAGE

 

  • Scalable Global Solutions is a pioneer in what it offers on the market.

  • More significant vendors do not focus on smaller businesses (96% of the total market): We Do.

  • Better than outsourcing, our solution gives the client exactly what they want: Control.

  • Unlike other feature-rich software, our  SGS ONE platform offers simplicity, and ease-of-use in managing your teams.

HOW DOES DaaS WORK?

______

 

HIRING AND ONBOARDING PROCESS

sgs

1. Client Requirements Plan

  • Candidate specifications
  • Number of employees
  • Level of expertise
  • Language skills
  • Additional skills
sgs

2. SGS Recruitment Process

  • Global search for local placement
  • Recruitment network in the CEE region and globally
  • Filter candidates that match the job description
sgs

3. Client Selection

  • Interview
  • Evaluate
  • Decide
sgs

4. SGS Integration

  • Employing the candidates
  • Payroll and local law compliance
  • Dedicate office space and equipment
  • Whole department = one monthly invoice
sgs

5. Client Integration

  • New hires integrated as clients’ employees
  • New team is ready and set to work
  • Exclusively managed by the client

DIFFERENCE: DaaS VS OUTSOURCING
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Functions & Features

DaaS

Outsourcing

Ability to build your own department filled with selected team members

Ability to change and replace team members

Ability to define the Work and Job profiles

Ability to interview the team members

Ability to select the staff

Business communication conflict

Low

High

Command over Intellectual property

Complete Control

Completely Independent

Confidentiality and Security Risk

Cost Reduction

Cultural Focus

Dedicated Office

Complete Control about the Procedures

Complete control about the process

Complete control of the department

Complete control of the people

Hidden Costs

Innovation Influence and adaptability

Loss of Control

Benefit & Quality comparison chart – DaaS vs Outsourcing

  • 6.5% - Outsourcing
  • 93.5% - DaaS
Managed Office Service

New Hire Potential Incubator

Customizable facility

Poor Quality of Service

Potential for conflict

Quality Control

Quality of work

High

Low

Tailor-made Solution

Things Get Lost in Translation

Time Zone

Transparency

EMPLOYER OF RECORD (EOR)

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SGS, as the Employer of Record, enables foreign companies to quickly and compliantly commence operations in Croatia, without creating a local entity.

 

  • Once the client has found their new team, SGS takes care of everything, from hiring, onboarding, and HR administration, to legal and tax compliance
  • The client’s employees are technically on SGS payroll, but they are exclusively working for the client’s company.
  • Effortless payroll management – one invoice for your whole team. SGS handles the taxes, health and pension contributions.

SGS ONE

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A practical CRM solution that shapes and supports every department

 

Project reporting, hiring process overview, creating sales lead list

The SGS ONE can do it

 

  • sgsEasy implementation & navigation

  • Entirely cloud-based, available also on mobile

  • The perfect, lite alternative to other complex systems on the market

SGS ONE, in particular, adapts to the demands of the clients’ departments and numerous sub-services across our eight key solutions

It is written in our SOURCE-CODE and is ready for deployment in the clients’ subdomain in 2 weeks.

 

SGS ONE – the new cloud solution to optimise your business.

WHY CROATIA

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  • Excellent strategic geographical position with proximity to major European cities

  • Fully integrated into the European Union – Attractive place to work and live

  • Access to a multilingual market

  • High quality of life with low Costs of Living mean more affordable but equally skilled talent

  • IT Hotspot – The IT industry is becoming one of the propelling forces of the Croatian Economy

  • A country with a population of 4M is home to several Industry 4.0 Unicorns such as Rimac, Infobip and Nanobit.

  • Favourable corporate taxation system

FIRST TO MARKET

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logo

BPO VENDORS

CRM VENDORS

RPO VENDORS

OFFICE VENDORS

accenture sgs sgs sgs sgs sgs sgs sgs sgs sgs sgs sgs

SERVICE

CRM Vendor

BPO Provider

RPO Provider

Office Provider

 –

Dedicated staff/ not outsourced

Resource selected by the client

Resourcefully integrated

The client fully manages the service.

Virtual Dedicated workforce

Exchange of staff by client

Reduction of Operational Cost

Dedicated Office space for the client

 –

 –

 –

 –

Shared Office space for the client

 –

 –

 –

 –

 –

 –

 –

Office space for the client

Fast implementation

Complex to negotiate

Complex to implement

MILESTONES

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Signed three clients in 2021

44% quarterly revenue growth since Dec 2021

Raised €1.6M to date

Launched Channel Partner Network

Web redesign with multi-language support

  Reach the Break Even point

  Sign three more clients by the end of Q3 2022

  Grow team to 85 people by the end of the year

  Achieve revenue of €2,5 million by the end of year

EXIT TEASER 1

REVENUE MODEL

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1) Direct Sale – Dedicated and experienced sales managers identify and directly approach suitable SMEs in assigned regions. The expected profit margins per deal range from 35%-42%.

2) Channel Partnership –Value-Added Resellers (VARs) present a vital part of our organisation as they sell our solutions to a broader market.

3) SGS ONE enterprise software license – CRM software licences – SaaS subscription model.

The average contract initial deal size is ~€150k per year.

Our largest client is currently employing 12 people, with the plan to ramp up the team to 30 by Dec 2022. That single client would then be worth €1.2 million deal, per year.

This opens then the possibility of cross-selling and creating other  DaaS solutions for this client.

FINANCIAL METRICS

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Customer Acquisition Cost (CAC)

€5,573 per client

Monthly Recurring Revenue (MRR)

€40,000+

Average Monthly Revenue Growth Rate (MoM)

44%

Burn Rate

€65,000

Average Net Profitability per Client

35%

CLIENT CASE STUDY (36-MONTH CONTRACT)

______

 

Customer Acquisition Cost (CAC)

€5,573

Net Profitability

42%

Quarterly Revenue

2022 Q1

2022 Q2

2022 Q3+Q4

Number of client Employees

7

12

30

Amount in €

88,200

220,500

793,800

 

Annual Recurring Revenue

2022

2023

2024

Number of client Employees

30

60

90

Amount in €

1,102,500

2,866,500

4,630,500

FINANCIAL FORECAST

______

 

 

P&L (€)

2022

2023

2024

2025

Planned Revenue from Services

8.807.500*

36.655.000

69.273.050

111.336.861

Software Revenue

295.216*

906.367

2.560.788

6.689.183

Chanel Program Revenue

1.761.500*

14.662.000

27.709.220

44.534.744

Total Revenue

10.864.216*

52.223.367

99.543.058

162.560.788

Total Cost

-5.400.950*

-8.989.990

-29.000.000

-49.000.000

EBITDA

5.463.266*

43.233.376

70.543.058

113.560.788

* depends on the realized investment round

RISK AND MITIGATIONS

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Risk

Mitigation

Strategic – Ineffective pricing, marketing, or distribution strategy poses a significant strategic risk. By providing a comprehensive, well-thought-out and long-term business plan, SGS has a vision of the future business. According to the market changes, SGS is adjusting its current path to achieve the long-term business plan goals
Legal – Proper documentation, the legal composition of the business, legitimate licenses, protection of the intellectual property rights, presence of shareholders’ agreement as to the cornerstone of any business, and abiding by all the necessary laws and regulations. Due to dynamic changes in the regulations environment, SGS has rewritten all of the necessary legal documents and is keeping them updated with the help of three external lawyers. We also have proper professional legal and accounting (tax) support, with whom we have an exceptional relationship.
Operational – Stability of the internal management structure. Company stability is established by employing experienced professionals. In addition, by following internal processes and procedures, everyone who joins the company and undergoes the internal training will quickly grasp how the company functions and become a vital part of the company.
Financial – The business plan should be realistic about how much money will be needed to break even and how much will be returned to investors in the coming years.. By optimising costs, investing in people, and following the business plan strategy, we are transparently utilising realised funds and our revenue to achieve set goals. Our Break-Even point will be in Q4 2022
Market entry – The selection of inappropriate pricing, marketing, or distribution strategy is a significant potential risk. In addition, cultural differences, administrative differences and economic differences are also present. Doing proper market research before entering a country or a region is the most crucial part—secondly, direct client approach or via Channel partner.
COVID-19 – The COVID-19 situation changed or affected every company in the world to a certain degree and how business is done. In our case, it delayed sales, operations, marketing and R&D. Specifically, in sales, due to business uncertainty, customers who had already decided to go with us cancelled that decision. SGS internally handled COVID-19 by optimising costs and implementing remote work. Externally, COVID-19 became an accelerator and the most effective marketing campaign in a long time, which immensely multiplied the market potential. In addition, it shifted the conservative audience mindset as they started exploring options for optimising their business, finding new employees, and reducing expenses.

THE TEAM

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Markus Borlinghaus

Founder & CEO


Inventor of DaaS
Has decades of experience in Corporate Leadership and working at executive level positions in Cisco Systems, Juniper Networks, Microsoft, Xerox and ATI.

Has co-build two startups: Peribit Networks (sold to Juniper Networks) and Whale Communications (sold to Microsoft) 

Kristina Šmidt Grancarić

Head of Sales


She oversees all revenue-generating activities, including sales, channel partnerships and development, and customer experience.

She has 20 years of international work experience in Engineering, DIY and Fashion Retail in the D/A/CH region. 

Marko Dubroja

Investment Account Manager


Marko is an accomplished and agile startup enthusiast, leading the Investment Team. With practical industry experience, ranging from gaming to quality assurance, and a Masters’ degree in finance from VERN University, he has the “out-of-the-box” mentality to achieve his team and company goals. Marko excels at cross-department projects, organises brainstorming sessions and has helped secure critical investments for the company.

Marijana Dobrovolec

Head of Marketing


Marijana worked in various sectors, from the textile, garment, and general retail for 20 years.

She specialises in digital and operational marketing, with a wide span of B2B – B2C and technical skills, such as building and managing webshops, CRMs and multiple kinds of websites in its backend and frontend.

INVESTMENT OFFERING

________________________

Scalable Global Solutions is looking for a €2,300,000 capital raise in exchange for 18% equity (regular shares)

PRE-MONEY VALUATION:………€10.845.000
NUMBER OF SHARES:……………………. 140.000
LEGAL FORM:…………….. Joint Stock Company

Exit steps new UPDATES

DISTRIBUTION OF FUNDS

______

The raised funds will enable us to establish SGS as the leading DaaS player in Europe.

Working Capital

40%

Operational expenses such as rent, software maintenance and salaries.

Sales Team Expansion

8,33%

Hiring experienced sales talent to cover more ground and close more deals, will bring us closer to the break-even point (Q4 2022)

Staffing and Recruiting

8,33%

Establish a functional recruitment matrix across the CEE and SEE region

Further Channel Program Development

21,67%

Find new business partners and Account Managers across Europe

R&D for SGS ONE

11,67%

Creating the SGS ONE 2.0, developing new modules, UI enhancement

Marketing

10%

Digital Marketing Campaigns, Display Marketing and PPC Marketing

BENEFITS FOR THE INVESTORS

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Cash-out options of shares in later fundraising rounds

 

Success Fee – for every new investor the existing shareholder brings on board, we reward it with a success fee

 

Potential Exit for 2029+ with targeted returns of 25x-38x

EXIT STRATEGY

______

 

We have envisioned the following exit scenarios:

 

Merger

Acquisition

 IPO

 

We believe that a Merger or Acquisition by an industry-leading BPO and HR company is feasible at a stage when we have developed a significant market presence.

 

CONTACT US FOR MORE INFORMATION,

LET'S WORK TOGETHER!



 


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    SCALABLE GLOBAL SOLUTIONS JSC


    Ulica grada Vukovara 284
    Zagreb, HR-10000, Croatia
    +385 1 353 5930
    +49 151 7262 4766
    business@sgs-daas.com

    OPEN: Monday – Friday: 8am – 5pm, CEST

    GET STARTED
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    FOR MORE INFORMATION

    PLEASE CONTACT US


      GDPR Consent
      By submitting this form, you agree that we may use this information in accordance with our Data protection policy.