The story of the Romanian software manufacturer who wants to

The story of the Romanian software manufacturer who wants to

More and more technology companies are interested in developing with funding obtained after listing on the stock exchange. Case study: Softbinator Technologies.

“The purpose of the listing is to continue the accelerated growth of the company and make it a major player in the global software development services market,” said Daniel Ilinca, 33, founder of Softbinator Technologies, a local software developer that -announced in the second half of August the intention of listing on the AeRO market of the Bucharest Stock Exchange (BVB).

Prior to the actual listing, which would take place by the end of the year at the latest, the company will make a private placement, offering investors a 10% stake in the sale. The company hopes to attract about 6 million lei (1.2 million euros), which would bring its market value to about 60 million lei (12.4 million euros).

Founded in 2017 by Daniel Ilinca, Softbinator has a team of 100 software developers, whose solutions are used by companies in the US, Europe (UK, Germany, Romania), the Middle East (Israel) and Asia (Singapore). Customers are companies in sectors such as automotive, education, lifestyle, healthcare, electronic payments, gaming and banking.

Last year, Softbinator Technologies recorded a turnover of 12.3 million lei and a net profit of 2.6 million lei. In the first half of 2021, sales amounted to 7.78 million lei, up 43% compared to the same period last year, and net profit rose 18% to 1.39 million lei. For the whole year, the company estimates revenues of 17.3 million lei and a profit of 3.4 million lei.

To the USA and Israel

Softbinator currently has teams in Bucharest and Constanța and intends to use the capital attracted from BVB investors to expand its international presence, including by opening offices in the US and Israel. “About 95% of revenue comes from overseas contracts,” says Daniel Ilinca, adding that after listing, the Softbinator team will bet on an annual business growth rate of 70% over the next four years.

“I believe that the Romanian software industry is growing rapidly, with Softbinator Technologies addressing a global market, with a focus on cutting-edge technologies such as blockchain and AI (artificial intelligence, no.)”, Says Andrei Pitiș, minority investor and Chairman of the Board of Directors of Softbinator. In a discussion last year with ., Pitiș said that he wants to encourage the companies in which he enters as a minority shareholder to orient their operations to foreign markets, which are much more receptive to the latest technologies.

One of the areas in which Ilinca sees an accelerated growth is that of telemedicine, but the entrepreneur confesses that he is now also interested in the e-commerce segment. “We are developing solutions with an Israeli customer through which you can take products from one side and sell them on the other without holding stocks,” explains Daniel Ilinca. The entrepreneur states that these solutions are similar to those of online retail giants such as Amazon, Alibaba or eBay.

Step by step

The story of Softbinator began in 2011, when Daniel Ilinca, then a recent graduate of Mathematics and Computer Science at the University of Bucharest, founded the company with a partner, Radu Amariei. “The first thought with Softbinator was to build a kind of online recruitment platform for the IT environment,” says the entrepreneur now. He saw the platform as a tool by which employers would find the employee profile that suited their business, while giving the potential employee the opportunity to choose the place where they thought they would feel most comfortable.

Later, Ilinca and Amariei thought of building a kind of software community around this platform. They even organized an event attended by several programmers who shared their experience with each other. It was then that the two partners decided to turn the platform into an NGO through which employees in the local software industry could interact with each other. This entity is still active at the moment, and from the position of NGO it has organized so far 153 events of the software community, being led by Radu Amariei.

In parallel, Ilinca set up a new company, this time with an American partner, Jason Fisher. Thus, in 2013, Cornerstone Technologies appeared. “I was 25 years old and I wanted to build software development companies from scratch,” says the entrepreneur. Cornerstone is a classic story of an IT startup, started in an apartment where Ilinca would live for a while. The company developed quite quickly, expanding to Constanța and Brașov.

Then, in 2017, a new entity, Cornerstone Holdings, appeared within Cornerstone Technologies. It conducted operations similar to those of Cornerstone Technologies, from which Daniel Ilinca would emerge in 2019. A year later, Cornerstone Holdings rebranded into Softbinator Technologies, the company that Daniel Ilinca now wants to list on the stock exchange.

Investing in talent

The entrepreneur says that the first step in consolidating the new entity was to attract talented programmers, and the community he set up was a first-hand source. Today, some of the Softbinator Technologies employees teach at the Faculty of Mathematics and Computer Science at the University of Bucharest, for which Ilinca provided the equipment for a laboratory.

In fact, he feels connected to the university area and on the grounds that during his studies he was the president of the college student organization, where he also did a lot of volunteering. “From volunteering I learned to do business. In this type of activity you want to do great things with few funds and then you learn to manage all the resources very well “, explains the entrepreneur, who states that during his studies he encountered many situations that he had to solve, regardless of their difficulty. .

He does not hide the fact that after college he organized all kinds of student events, but he also outsourced and developed a game for Facebook, for which he received the first financial reward, 5,000 lei.

Half of the money went to the purchase of two servers in Germany, being from the beginning interested in operating in foreign markets. Out of the remaining 2,500 lei, he decided to go out to a luxury restaurant with the team of programmers he coordinated at the time. The consumption was almost 1,000 lei. He was left with only 1,500 lei from the first capitalized project, but he did not regret it and continued to focus on the development of new products that would ensure the necessary income to grow the business. And he didn’t fail.

IT figures

The local software market is estimated at about 8.2 billion euros, according to a KeysFin analysis.

STATISTICS. The share of the entire IT sector in the country’s economy was 6.1% of gross domestic product in 2019 and 7.1% in the first half of 2020. DIMENSION. In 2019, more than 24,000 software companies were active in Romania, of which 22,600 micro-enterprises, 1,100 small companies, 328 medium-sized companies and 20 large companies. TOP 10. The top ten companies in the software industry accumulated in 2019 total business of about 1.3 billion euros, representing 17.6% of the market.