Danish software company MapsPeople today announced it has commenced an initial public offering and a listing on Nasdaq First North Premier where it plans to raise DKK 85 million. The company’s ambition is to be the global leader in digital indoor navigation for large venues such as corporate offices, hospitals, airports, and more.
MapsPeople has developed unique software that makes it possible to integrate digital maps in applications. This allows MapsPeople clients to integrate the software in their own interactive wayfinding solutions, equipping shoppers in malls, travelers in airports, and patients in hospitals with digital indoor navigation, making it easy for them to find their way inside large buildings just as we navigate the great outdoors with outdoor navigation apps.
MapsPeople is a Software-as-a-Service company. With its proprietary indoor navigation platform, MapsIndoors, the company has had a heavy focus on increasing the annual recurring revenue - also known as ARR - for the past five years. Today, more than 90% of the company’s revenue comes from subscriptions.
As a SaaS company, MapsPeople will continue to grow very strongly - stronger than it is possible with the company’s own funds - which is why its strategy is based on the inflow of external capital. Following a capital injection from The Danish Growth Fund (Vækstfonden) in December 2017, MapsPeople started growing rapidly, and in June 2020, additional capital was provided by 40 private investors. Now, it is time to seek yet more capital to unleash the full global potential.
In addition to the European market, MapsPeople focuses on the US, where it established an office in Austin, Texas three years ago. Part of the proceeds from the listing will be used to develop the company’s sales through partners and to establish an office in Asia next year. Another part of the proceeds will be used to increase the use of artificial intelligence in MapsPeople’s solutions. This will ensure a better user experience for MapsIndoors users as well as optimize the company’s internal production.
MapsPeople expects the majority of growth on its proprietary indoor navigation platform, but also sees many opportunities in outdoor navigation, which the company also provides through the sale of Google Maps licenses. MapsPeople has been an official Google Maps Partner since 2009. Today, the company is one of only 30 Google Maps Premier Partners in the world and Google Maps’ lighthouse in the Nordics.
“MapsPeople generates two revenue streams. Both are subscription based and have shown consistent and very impressive results over several years. When we talk to existing and potential investors, this is a huge asset,” says CEO of MapsPeople, Michael Gram.
“The largest stream is MapsIndoors where we help our customers guide their employees and visitors around large and complex venues like stadiums and airports and where we have already signed with a number of prominent customers including some of the largest organizations in the world within banking, telecom, the pharmaceutical industry, and online networking. MapsIndoors is the company’s fastest growing business area and the goal is to continue with 90-125% in annual growth and thus significantly increase the subscription base - or ARR - in both 2021 and 2022,” explains Gram who expects the next major business area to be within retail, in order to guide consumers directly to the items they are looking for.
“The second stream is outdoor navigation and the sale of Google Maps licenses and here the annual growth is approximately 20%. In 2020, we achieved earnings of DKK 12.4 million from a gross turnover of DKK 65 million. In the future, earnings from Google Maps could conservatively estimated drop to about half due to an announced change in the agreement with Google,” says Gram who explains that the sale of Google Maps licenses has been an important revenue stream in the previous years. However, this business area is expected to drop from approximately 16% in 2021 to about six percent of the subscription base in 2023 due to the rapid growth of MapsIndoors.
He is happy that The Danish Growth Fund has promised to inject additional capital into MapsPeople in connection with the listing.
“We chose to invest in MapsPeople in 2017 because we saw an exciting company with a competent management team and a convincing business model as well as a plan for it to be rolled out. Now, we are choosing to inject even more capital into MapsPeople because we still believe very much in MapsPeople,” says CEO at The Danish Growth Fund, Rolf Kjærgaard, in connection with the upcoming listing of MapsPeople.
Michael Gram firmly believes that indoor navigation will be just as natural on our smartphones in the future as outdoor maps and navigation are today.
“Everyone knows what it is like to be lost in a building, an airport, a station, or in a hospital. Here, our solutions will become a natural part of everyday life,” says Gram.
MapsIndoors is an indoor navigation platform that customers and partners can integrate into their own applications, websites, and information kiosks. Today, the platform is sold both via direct and channel-based sales, but it is moving more and more towards channel-based sales where more than half of the revenue is coming from today.
The channel-based sales especially happen through so-called OEM partners where the business model is based on close contact with a partner who then expands MapsPeople’s solution as an integrated part of their product. It takes longer to grow this way, but it ensures a much larger volume which is why the company focuses on this area.
With the platform strategy MapsPeople’s solutions are integrated deep into their partner’s own product, ensuring a great lifetime value.
For further information, please contact
Michael Gram, CEO, MapsPeople, +45 53 74 09 00
Lars Brammer, Chairman of the Board, +45 28 44 68 04
Jesper Skaarup Vestergaard, Partner, Corporate Finance, Grant Thornton, +45 31 79 90 00
Morten Jeppesen, CEO, Press Connect, +45 53 85 07 70