MenuCard IPO at AktieTorget – Stockholm main priority for 2017
The subscription period has begun prior to the listing on Swedish stock exchange AktieTorget. With 200 restaurants and 100 business partners, it's time for MenuCard to change gears to maintain its lead in the market.
"We have no competitor with the same offer as ours. That momentum we need to seize.", says MenuCard CEO Kim Lykke Sommer.
Copenhagen-based MenuCard have chosen Sweden, and AktieTorget, as a venue for their business. As Denmark lacks in stock exchanges for corporation under development, MenuCard’s neighbouring country is more attractive with its multiple options. First North Nasdaq was also high up on the list of potential platforms, but based on the information and advice MenuCard received, the choice fell on AktieTorget. Moreover, the Swedish restaurant culture is a favorable factor for MenuCard.
"In Sweden, it is customary to eat out at lunch as well as dinner. Denmark is different in that aspect. There is usually a small kitchen and a cafeteria at the workplace where employees eat lunch.", says CEO Kim Lykke Sommer.
The subscription period for MenuCard has begun and will run until December the 22nd. The subscription price is SEK 4.50 with an issuing volume of SEK 20.4 million before listing expenses. 15.4 million of the offer, or 76 percent, is already guaranteed. The company is valued at just under SEK 22 million before completed new issue of shares and the first day of trading is scheduled to January the 23rd, 2017.
The company offers an app-based service for, mainly, companies and their employees. In MenuCard’s app, the user finds all restaurants with which the company collaborates. This provides opportunities for discounts, reservation as well as payment through a self-developed payment platform.
"Our payment platform is similar to the Swedish Swish service", says the CEO, "which means we have full control over the payment and no charges go to banks or technology providers. It was launched in late 2015 and has been an important step to become even more user-friendly."
“Requests of Stockholm”
In the beginning, back in 2011, the company targeted private consumers. The ability for individuals to use the app remain, but nowadays almost all activities focuses on business to business (B2B) with full establishment in Copenhagen and initial agreements with restaurants in the Swedish cities Malmö and Lund. Danish citizens can download the app and take advantage of all offerings through a monthly charge of DKK 49. MenuCard has agreements with over 200 restaurants in Denmark and around 100 companies, many with operations in several countries, but by the end of 2017 the estimation is to have 4-500 restaurants. Through a percentage-based transaction fee, the company charge for their services. The restaurants income is incorporated by, mainly, by more customers, but also through marketing offered by MenuCard in the form of e.g. newsletters and a Concierge, or group service.
As of yet the company has not generated a positive cash flow; profit after tax for January-September this year was DKK 3.9 million. But MenuCard has a goal of break-even, which is by the end of the second quarter of 2018. And the ability to reach the financial target have increased significantly, according to Kim Lykke Sommer.
"Our agreements extend through restaurants from Michelin level to simple sushi places. Companies we co-operate with are names like Nordea, Danske Bank and Telia. Because they operate in several of the Nordic countries, they have requested from us to launch in Stockholm, among other cities. So to summarize: In January 2014, we had no major customers or famous restaurants behind us and we managed to establish ourselves anyway. By now it is much easier to get through the door and generate interest, both from companies and restaurants. Furthermore, Sweden and the Stockholm restaurant culture is even more in line with our business than Copenhagen."
The Swedish capital is the first step for MenuCards expansion plan in 2017. After the IPO in January, the CEO is determined to raise the right resources to establish the business in Stockholm; and the process could be swift given good conditions. In the long term, the goal is to operate globally, but the CEO says that the company must demonstrate success in Scandinavia before moving on to Europe or the United States.
"Major cities like London are a completely different ball game than Copenhagen in Denmark and Stockholm in Sweden; besides that there are around 10 times more in revenue than in the Nordic capitals, the technical prerequisite is different. Nordic countries have been at the forefront of app-based offers and mobile payment solutions. London and other big cities are lingering still on traditional way with coupons or two-for-one pamphlets. When the market is ready for us, we will be ready for them." said Kim Lykke Sommer.
Competitors absent
Currently, the company has an office in Copenhagen alone with 12 employees. But CEO envisions presence in other cities/countries in order to provide opportunities for local support and network agreements with restaurants and companies. So far, MenuCard has not found any direct competitors, i.e. companies like them with focus on B2B. The key to success, according to the CEO, is to maintain that upper hand. MenuCard has to be able to scale up easily and shift into a higher gear.
"The better we become, the harder it is for a competitor to take away our market share. But to succeed, maintain and expand our position, we need the right product range of both companies and restaurants."
Another success factor for MenuCard, according to Kim Lykke Sommer, is the company’s discreet and flexible payment method.
"We structure and organize an otherwise unstructured factor in the industry. It's not nice to have to produce vouchers or invoices in front of customers or other guests at the restaurant; our payment method is unobtrusive and pleasant."
/Emelie Lundgren
emelie.lundgren@cisionpromoted.se
Fact IPO (SEK)
Stock exchange list: AktieTorget
Subscription period: Initiated, December 8-22 2016
Subscription price: SEK 4.50
Minimum subscription: 1,000 shares
Issue volume: SEK 20.4 million
Company valuation pre-money: SEK 21.9 million
Guaranteed share: 76 percent / 15.4 million
Estimated first day of trade: January 23rd, 2017
