Productivity software brings opportunities for investment

Productivity software brings opportunities for investment

By: Damien
08 Dec, 2021
Productivity software is a growing market around the world, and Irish companies are leading the way with plenty of potential for acquisitions and growth in 2022.

There will be a new name in the software sector in Ireland early next year when ClickUp opens its European headquarters in Dublin.

US-based ClickUp, which develops and provides software to provide a platform for improved productivity, has made the move to Dublin as part of the company’s ambitious expansion plans. ClickUp has recently raised $400 million (€354 million) in Series C funding, bringing the company’s total funding to $535 million and valuing it at a $4 billion. The funding is said to be the largest Series C funding round to date in the workplace productivity market. ClickUp’s new offices in Dublin will create 200 jobs over the next two years and recruitment has already started for a range of roles.

The company says it selected Ireland because of its thriving technology community, its depth of talent and the belief it would provide the best springboard for ClickUp’s continued growth in Europe. The company’s new European HQ will provide a localised experience to the more than 275,000 European teams already using ClickUp.

ClickUp replaces individual workplace productivity tools with a single platform that includes project management, document collaboration, spreadsheets, chat and goals.

“When we announced our funding last month [November], we promised ambitious expansion plans, and this is exactly what we’re delivering,” says Mark Stoddard, Head of International Operations at ClickUp. “We have been impressed by the deep expertise and great supply of multilingual tech talent in and around Dublin, and we see our European office as playing a vital role in ClickUp’s continued global expansion. We’re excited to bring ClickUp to Ireland and provide a diverse range of jobs, while adding to the already world-class tech community.”

Productivity breeds productivity



ClickUp is one of a number of fast-growing productivity software providers in Ireland. The sector in Ireland – and around the world – is developing quickly as businesses look to these platforms to help streamline communication and improve efficiency. The COVID-19 pandemic has helped to boost the popularity of solutions such as this as it helps staff working in various locations to collaborate and communicate effectively and securely with each other.

Ireland has long been known as a global hub for software developers since the 1970s and many of the biggest companies in the sector have a base in the country. In addition, there are a plethora of small- to medium-sized businesses in the sector and start-ups. Indeed, many of the productivity software providers began as start-ups a few years ago.

Overall, there are some 900 software companies across Ireland, employing more than 24,000 people. Ireland is the second biggest exporter of software in the world, accounting for €16 billion worth each year, according to IDA Ireland (www.idaireland.ie).

Acquisitions



Productivity software providers have proved attractive to international acquirers over the course of 2021. For instance, in May, Bluecrux, a Belgian company that provides process and technology solutions in planning, operations and transformation, acquired Galway-based PlanDomino, which is involved in QC lab planning. [plandomino.com/bluecrux-acquired-plandomino/]

The deal consolidated BINOCS, Bluecrux’ software as a service (SaaS) application for QC and R&D lab operations scheduling, position as market leader.

QC and R&D scheduling are in increasing demand due to the savings and efficiency gains labs can find. At the time of the deal, Greg Heaslip, founder and CEO of PlanDomino said that joining the BINOCS team was “pushing the fast-forward button” for the business. “By joining forces and bringing the software engineering teams together, we will be able to deliver our ‘lab-of-the-future’ vision faster,” he said.

Investment



Productivity software suppliers have also been successfully raising funds in 2021. In July, Cork-based Teamwork completed its first external fundraising round, securing an investment of $70 million (€59.2 million) from technology growth capital firm Bregal Milestone. [www.teamwork.com/files/Teamwork_Press_Release.pdf]

Teamwork, which has offices in five countries and 270 employees, was founded in 2007 by Peter Coppinger and Daniel Mackey. Following the deal, Teamwork is working closely with Bregal Milestone’s in-house value creation team, Milestone Performance Partners, to further accelerate Teamwork’s growth and invest in various product development initiatives globally.

“We’re excited to use Bregal Milestone’s investment to fuel growth and innovation on our platform while remaining focused on creating the best possible experience for our customers,” said Mackey.

Ian Kwok, principal of Bregal Milestone, said: “Against the backdrop of rapid adoption of remote working and the increased demand for better workforce collaboration, Teamwork is well positioned to continue its successful track record and generate accelerated growth. Our strategic investment will significantly accelerate Teamwork’s ambition to become the world’s leading project management SaaS platform for client services companies.”

Why invest in Irish productivity software businesses



There are plenty of reasons to invest in productivity software businesses in Ireland. As mentioned, Ireland is recognised as a global leader in software development, which means there is a thriving infrastructure in place to support such businesses.

Also, as ClickUp’s Stoddard said, one of the major reasons for the business choosing Ireland for its European HQ was the availability of a large pool of tech talent. Universities across Ireland have tech-based courses – and many also collaborate with business on developing software – so there are highly qualified people entering the labour market each year to boost that number.

Ireland is also an ideal location as a European hub because of its membership of the European Union. As a member, it is part of the single market, which means it has frictionless trade with the 26 other countries in the bloc, including major software buyers such as Germany and France. Part of the pull for international businesses is that Ireland is the only country in the EU that has English as its first language.

Indeed, many UK-based businesses are now looking to Ireland as a base to ensure they have access to the single market, having found the barriers put in place since the UK’s exit from the EU are a significant burden, both financially and administratively.

Future prospects



As mentioned, the pandemic has provided a significant boost to the productivity software sector in Ireland, and the sector is set for further growth for the foreseeable future. As more businesses adopt flexible or hybrid working practices that sees employees working in the office, at home or any place with a decent wifi connection, solutions such as those provided by the companies mentioned above will become more popular and often become viewed as business critical once they are installed.

In addition, as more businesses digitalise their practices, employers will become more aware of the efficiency and productivity savings they can bring and will invest in them.

This means there should be plenty of opportunities for investors to make acquisitions or invest in innovative businesses in Ireland in the coming years. As many productivity software providers begin life as a start-up, it is likely that some will seek outside investment or a strategic acquisition to enable them to get to the next stage of growth, be that further development of a product or international expansion.

With growth predicted, investing in a productivity software business has a good chance of providing a healthy return, although as with all technologies, not every solution is guaranteed to succeed in a competitive market.

Advice



If you are interested in investing in, acquiring or establishing a new productivity software business in Ireland, then it is crucial to get the right advice.

Malone & Co Accountants https://www.maloneaccountants.ie/ can assist on all the relevant aspects from setting up a company to providing diligence services as part of any transactions. We work with many well known international brands and there are many advantages to establishing a software business in Ireland.
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