Glint is a London-based fintech start-up that offers a new angle on money and payments. According to TechCrunch, the company’s central idea is that the value of account-holder funds would be linked to the price of gold.

Gold is considered to be a better long-term store of value and has often been viewed as a safe haven in times of uncertainty. There is also an active and well-developed market in gold. The Glint management team is obviously looking to use technology and a considerable amount of experience in the gold markets to provide a frictionless way for account holders to store and spend money, effectively using gold as an alternative company.

Glint (glintpay.com) has raised £3.1m from Bray Capital and several individual investors with considerable relevant experience, including Haruko Fukuda, ex-CEO of the Gold Council, and other notable doyens of the asset management business. Jason Cozens, the Glint CEO has earlier set up three companies including a website trading physical gold and COO Ben Davies has 17 years of experience in commodity markets and precious metals investment. The company has secured authorisation from the FCA and is set to launch by year-end.

Aspiring IoT service provider Telit has just suffered another blow as the Board announce the “resignation” of Oozi Cats, the CEO. After publishing results for a tough first half, which saw revenue up 7% but EBITDA down 31%, the company has now revealed that their (now former) CEO had not disclosed an indictment issued against him.

The background to this indictment looks particularly murky, with The Times reporting possible links with a 1990s wire fraud. This latest news adds to a recent history of a large placing in May, some share sales by Mr. Cats and speculation about the company’s financial position. The Board has now acted swiftly, installing the CFO as interim CEO and announcing its intention to add three NEDs to strengthen the Board. The company also refuted the speculation about Telit’s financial position, its distributors and an earlier involvement with a company that went into insolvency in 2013.

Unfortunately, the news flow around Telit is more appropriate for a Netflix blockbuster than an AIM-listed company. The Board will hope that this is the end of it and that there isn’t a sequel on the way.

Bangalore-based mid-tier offshore services ‘unusual suspect’ Sonata Software kicked off its new FY with somewhat mixed results. Headline revenues in Q1 FY18 (to 30th June) declined by 7% compared to the prior quarter, to Rs634.5m (~$98m), though 4% higher yoy. However, EBITDA margin improved to 10.2%, almost two points higher qoq, though lower on a yoy basis.

Sonata’s domestic products and services business, which accounts for around two-thirds of revenues but less than a quarter of profit, continued to drag growth, whereas its international IT services activities grew 8% yoy and 4% qoq, generating a 23.6% EBITDA margin.

As I said last time (see Sonata hits (some of) the high notes), the challenge is very much ahead of Sonata if it is to make any real breakthrough in the UK market. These are still very early days in its latest push.

There has been a lot of movement among the Top 20 providers of Business Process Services (BPS) in the past year, reflecting the huge level of disruption that is taking place across the market. 

The over-arching dynamic is the rapidly changing shape of the leading BPS suppliers to become leaner, more agile businesses. This is in response to the way customers are buying services – smaller, discrete, often single process deals, with automation and digital technologies, such as Robotic Process Automation (RPA) and artificial intelligence (AI) at front and centre. Brexit is also having a negative impact in areas like financial services and investments.

The overall effect of these market changes is downward pressure on spend. However for many BPS suppliers this transition remains extremely painful as customers unbundle large deals at renewal, and force their incumbent providers to take significant price cuts to retain business.

Subscribers to TechMarketView's BusinessProcessViews research services can read the full analysis of who's hot and who's not, and why, in our new report UK BPS Supplier Ranking 2017.

If you are not yet a BusinessProcessViews subscriber, please contact Deb Seth (dseth@techmarketview.com) to find out how you can access the research.  

I have written about Rovio - and their Angry Birds - almost since they started in 2009. Most of my comments have not been flattering. One hit wonders is one example. But as Rovio reported falling revenues and major job layoffs, it didn’t seem too unfair.

However, maybe I was a tiny bit cruel when I wrote off Rovio’s ambition to ‘rival Disney’. Last year the Angry Birds Movie hit cinemas and was a success. So much so that Rovio today announced that H1 revenues had doubled to Euro152.6m with profits (before all the bad stuff) up 4x at Euro 41.8m. Most of the increase came from increased revenues from its games - boosted by the movie. But they also reported movie revenues for the first time. A movie sequel is planned with Columbia pictures in 2019.

Our little ones were enchanted with Peppa Pig and their visits to Peppa Pig Land. The brand really did have legs - one brand delivering revenues in a host of ways from movies to soft toys. A recent visit to DisneyWorld shows that characters like Mickey Mouse and Donald Duck can last a century if nurtured correctly.

Now Rovio is said to be planning an IPO - maybe as early as next month. Valuations of c$2b have been rumoured - making founding investor Kaj Hed a billionaire. Rovio may indeed be a ‘One hit wonder’ but if they can continue to nurture just that one brand, there is no reason why they can’t be successful long into the future.

Today’s Times has an interesting article ‘Europe halts funding for British tech firms’. Basically Oliver Wright’s article says that the European Investment Fund, which invested c£500m in UK tech start-ups last year, effectively stopped new investments once Article 50 was triggered. Given that the EIF was the largest source of such UK investments, this clearly matters. A string of VCs - Seedcamp, Episodel, BGF Ventures and others - were quoted in the article backing the story. The BVCA is calling on the UK Govt to step in as a replacement source of funding.

Over the last ten years, the UK has moved to become THE place to setup a new tech business. Indeed, the UK has attracted more investment and produced more unicorns than any other European country. Silicon valley got to its lead position (now on the wane I would suggest) because it created an ecosystem or hub. Start-ups thrive when all the things they need - like investors, access to funds, M&A experts, universities, analysts, access to skilled staff (many from outside the UK), development centres of large (often non-UK companies)  etc - come together in one place. A lot of work from individuals, companies and HMGovt, had really shown success. Indeed, having been in the UK tech industry for 50 years now, I have never seen it so buoyant as of late.

It would be a tragedy if BREXIT stopped all that in its tracks. As many of the interested parties - in particular the VCs/PE houses - are avid HotViews readers, I would be very interested in your views. Indeed, is the story in The Times true in your experience? And what should we now do to correct the situation? Email me on rholway@techmarketview.com. 

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Pulsant, which is owned by Oak Hill and Scottish Equity Partners, has acquired start-up cloud integrator, LayerV. It’s a canny move by Pulsant and one that sees it gain some important cloud advisory and technology integration capabilities. Terms of the deal were not disclosed.

LayerV is a UK company (c30 people) with about two-thirds of its staff (techies) based in Lithuania. The remaining employees are mostly customer facing (including experienced and sought after Amazon Web Services consultants) and are based in the UK.

Pulsant has been focusing its public cloud partnerships (which sit alongside its own private and public cloud capabilities) around Microsoft Azure, so adding this AWS capability is the first important synergy we see. LayerV has also developed its own managed compliance platform, which can be wrapped around any type of cloud. This is important in industries such as Financial Services and Public Sector where customers need to tightly control their data. All in, this is a very tidy acquisition and a real coup for Pulsant, expanding the cloud integration capabilities it can take to both new customers and its existing cloud/hosting/colocation base.

The companies have worked together as partners giving LayerV, which was starting to consider external funding, a chance to get to know Pulsant’s culture and the cross-sale/growth opportunities in joining the company. There is huge competition to acquire start-ups with key technology capability to enable cloud migration, so Pulsant has done well to bring in LayerV. Other recent examples include Cloudreach (acquired by Blackstone– see Cloudreach acquisition reflects important market changes), which is now on a mission to buy up those that can help it achieve cloud migration at scale.

Pulsant has also just given us a first reading of its latest accounts for the year ending December 2016. The company’s top line has leapt following the acquisition of Onyx last year. On a pro-forma basis, the growth was a commendable 7% to £77.4m. EBITDA (before exceptional items and management adjustments) was up 8% to £21.1m. The addition of the relatively small LayerV will do little to move the needle on the top line this year, but we see great potential going forward.

Little British Battler (LLB), SharpCloud Software has formed a partnership arrangement with Babcock International to bring its visual collaboration tools to businesses working in regulated and mission critical environments.

SharpCloud provides a visual communication platform for enterprise businesses, which allows users to collaborate through interactive and non-linear presentations. These presentations can incorporate images and videos, as well as documents such as PowerPoint presentations and Excel spreadsheets. It can be accessed via public cloud on Microsoft Azure or hosted on-premise or in private cloud.

To date, its customers have used SharpCloud to run innovation and strategy workshops, risk and project portfolio management, and product roadmaps. It has gathered some marquee customers since it launched in 2008, including Conoco Phillips, Fujitsu and Transport for London.

The problem for SharpCloud is that it’s playing in a highly competitive space. There are big companies in each area that SharpCloud plays—from presentation tools such as Prezi and Microsoft Sway, project management tools such Trello and Wrike, to team collaboration tools like Slack and Atlassian’s Confluence.

As we mentioned in our sixth LBB report back in 2015 (see Little British Battlers – The Sixth Sense), international partnership is key to SharpCloud’s future success in this competitive landscape. It has already forged partnerships with CGI, T-Systems, Chaucer Group and Kitewire. Developing a new partnership with a FTSE 100 business like Babcock is good news. The new arrangement should help SharpCloud establish a position in highly complex, regulated and mission critical environments such as the defence, energy, marine and air sectors. 

Bolton NHS Foundation Trust has become the latest trust in the north of England to select Allscripts’ Sunrise Electronic Health Record (EHR). The contract, which is reportedly valued at £30m, was signed earlier this week and will see Bolton go liive with the first phase of a new integrated patient record system in 2019.

Bolton is an integrated care organisation and the Trust serves patients from both Royal Bolton Hospital and more than 20 health centres and clinics, as well as offering services such as district nursing. Allscripts’ EHR is marketed as connecting people, places and data across ‘an open, connected Community of Health’ and this capability will have been attractive to Bolton as it strives to enhance its integrated care proposition. Indeed, Phillipa Winter, CIO at Bolton NHS Foundation Trust, explained that “with this new technology, [the trust] will be able to establish a frictionless care process, making it easier for our clinicians to access a single, comprehensive view of the patient’s health record.”

The win with Bolton further establishes US-HQ'd Allscripts in the UK market and augments its presence in this corner of England. A number of trusts in and around Manchester and Liverpool have now adopted Allscripts’ Sunrise as their EHR. At the centre of the cluster is Salford Royal NHS Foundation Trust - one of the NHS’ ‘global digital exemplars’ (see Public Sector Opportunities Bulletin February 2017 for more) and Allscripts’ NHS reference site. The other NHS Foundation Trusts that have chosen Allscripts are Liverpool Heart and Chest Hospital; Wrightington, Wigan and Leigh and the University Hospital of South Manchester, which went live in 2016.

Allscripts’ growing track record in the UK and strong presence in the region will also have been important considerations for Bolton during the tender process. A cluster of trusts using the same integrated patient record system in a region makes a lot of sense – indeed it should have been the outcome of the now infamous National Programme for IT in the NHS (NPfIT) – and we expect this pattern to be replicated in and around some digital exemplars in other areas of England.  

To see where Allscripts ranks alongside other players in the NHS IT market PublicSectorViews subscribers should see TechMarketView’s recently published UK Public Sector SITS Supplier Rankings 2017 report.

Embattled AIM-listed e-procurement player CloudBuy has made some modest progress since its decision to radically reduce its cost base earlier this year (see here).  

In H1, revenues actually rose, albeit by 4% to £819k. Operating losses meanwhile were trimmed to ---£1.3m vs. -£2.3m last time. Hardly cause for celebration, but at least things are heading in the right direction right now. Looking ahead, losses are expected to reduce further in H2, through growth in revenue and cost reductions already implemented.

CloudBuy is now pinning all of its hopes to its relationship with NHS Shared Business Service (NHS SBS), the joint venture between the Department of Health and Sopra Steria.

CloudBuy operates the PHBChoices procurement platform, which is designed to support the role out of personal health budgets (PHBs) for patients over the next few years. PHBChoices is apparently making positive progress with 25% of clinical commissioning groups (CCGs) either contracted or in advanced discussions.

There is potential for this offering to be taken up at scale. CloudBuy sees £7bn of NHS spend to go through PHBs by 2020/21, with 100,000 budget holders. NHS SBS has identified significant efficiencies and savings – with each CCG staff member able to support 5x the number of PHBs, and freeing up additional cash savings of around 25%.

Let’s hope that CloudBuy has a very good relationship with Sopra Steria, which, as the lead partner at NHS SBS, stands to benefit significantly if things take off here.

ai Corporation(ai) has made consistent progress since we first met them late last year during our ninth Little British Battler programme. Their activities in the provision of fraud protection and payments processing software are generating c.40% revenue growth and their progress towards profitability is on track. In addition, the company is reinforcing senior management, recruiting a CFO, as it broadens market reach and increases the proportion of revenue from services.

The company’s latest move reflects its confidence in its understanding of the fraud environment, machine learning capability and fraud management portfolio to eliminate fraudulent activity. The innovation is to offer its capabilities using an outcome-based business model so that customers can outsource their complete fraud management function to ai. The company will deploy its services via the cloud, using a sophisticated rules engine and its RiskNet fraud detection software to identify anomalies. The customer will agree a straightforward fraud measurement methodology with ai and will pay according to the level of fraud identified and eliminated.

Unsurprisingly, the first customer to use this model is a large oil company, looking to benefit from ai’s view of fraud on a global basis and being open to this type of contract which is more readily used in this sector. Many companies, for example in financial services, are still reluctant to embrace the outcome-based approach due to uncertainty over the actual spend, concern over data access and stove-piped management responsibilities.

Payment fraud is a growing problem, requiring a global and responsive approach. Many customers will want to hand fraud management over to experts, looking for a win-win business model. ai Corporation has the confidence and capabilities to offer this model. Expect to hear a lot more about this interesting Little British Battler.

There has been much excitement on the newswires about Microsoft’s acquisition – announced yesterday – of Cycle Computing.Terms of the deal were not disclosed. And, as a private company, we don’t have any financial information for Cycle. Moreover, the view that this acquisition represents a coup for Microsoft is not even wholly based on Cycle’s Big Compute and Cloud HPC capabilities; although that’s clearly a big element, Microsoft was already a Cycle Computing partner so was already utilising its orchestration software. It’s more about the fact that Microsoft has acquired the opportunity to poach some customers from AWS and Google.

Cycle Computing was founded 12 years ago. Founder and CEO Jason Stowe states they started up the company with an $8000 credit card. In 2016, it raised $1m in debt financing. The company’s flagship product is CycleCloud. It focuses on helping organisations orchestrate high performance computing jobs and large data workloads in the cloud. It has some impressive references/use cases which show how it has “helped customers fight cancer & other diseases, design faster rockets, build better hard drives, create better solar panels, and manage risk for peoples’ retirements.” Stowe states the company has been growing at 2.7x every 12 months.

Microsoft’s latest financial results revealed rapid cloud growth. In Q417 (to end June), one of the big drivers of that growth was Azure (revenue up 97% although still no revenue number was revealed (see Cloud growth improves Microsoft’s challenger position). It has already become more credible as competition for AWS for public cloud and for Google Cloud Platform (GCP) (see Azure stack: where Microsoft’s private hybrid cloud platform sits in the UK cloud services ecosystem) . This acquisition will help accelerate that progress by increasing its attractiveness for HPC projects, which are increasingly prevalent outside the scientific and research communities. There are, of course, other products on the market that do the same job as Cycle. And Microsoft will continue to support Cycle Computing clients using AWS and Google Cloud (according to ZDNet). But future version releases will be Azure focused; there’s no doubt that Microsoft has a window of opportunity to take on some AWS and Google customers as it encourages them to move to Microsoft’s cloud.

We have seen several examples of late whereby larger vendors are buying up ‘clever’ start-ups to build out their capabilities in getting enterprises into the cloud faster and enabling cloud at scale (see Pulsant buys LayerV to deepen cloud integration and Cloudreach buys stake in Cloudamize). As with Pulsant/LayerV, getting to know a potential buyer through a partnership means a start-up is much more likely to agree to be acquired via a trade sale.

According to the Unite union, RBS is planning to cut almost 900 IT jobs, as it removes 40% of permanent IT posts in London, culling an additional 200+contractors. Jobs will be moved to other UK sites, but significantly to India, where RBS already employ 12,500 people (according to Unite) and to Poland.

Overall, RBS management has set a tough target for operating cost reduction, looking for a £2bn cut from its 2016 level to £6.4bn by 2020. H1 2017 delivered the best part of £500m in cuts, with the majority coming from “non-core” businesses (including presumably the Williams & Glyn mess). Looking ahead, a greater proportion of savings will come out of the core bank.

RBS took out 700 IT systems and applications in the first half, aiming to simplify the extremely complex system stack and make it appropriate for the business going forward. Much of the new technology is at the front-end of the business, such as the shiny new chatbots, but the legacy problems of clunky and expensive back-end systems will persist for a long time yet.

Every bank is working hard to reduce the cost of “running the bank” to free up budget to invest in new systems and improve agility, with the aim of shoring up returns for shareholders. Another recent example is HSBC’s shifting 840 IT jobs out of the UK.

Bank IT chiefs have a massive IT agenda, such as introducing Cloud, are still reluctant to cede control of projects to SITS suppliers. The cost of London staff has also risen sharply. As a consequence, they are prepared to run the risk of greater workflow management problems, poorer user experience and further reductions in responsiveness by re-locating jobs into lower cost centres to cut headline costs.

School Lettings Solutions (SLS) has raised £440k from the Greater Manchester Loan Fund (GMLF). The Bolton-based business provides a lettings management service for schools and colleges to hire out their facilities to local community groups.

Founded in 2012, SLS has partnered with more than 20 national sport and arts organisations and is managing the lettings for approximately 125 schools in the UK. It has a good pipeline for growth and is currently in discussion with over 100 additional education establishments.  

GMLF, which is managed by Maven Capital Partners, was set up by the Association of Greater Manchester Authorities and provides finance of between £100,000 and £500,000 to businesses in the Greater Manchester region. SLS will use the investment from GMLF to help drive its expansion into new schools and develop a new facilities booking system.

Many schools have fantastic facilities, such as sports halls, playing fields, tennis courts, theatres and swimming pools, that could be used by the local community in the evenings, weekends and during school holidays. Most schools manage the letting of these facilities themselves, but if outsourcing this process can raise additional funds and reduce the administrative burden on school staff, then many will jump at the opportunity to do so.

CGI has long been active in supporting the banks in their Trade Finance business and has a comprehensive global trade solution in its Trade360 proposition. For two years it has been investigating how blockchain could “future-proof” this proposition and generate real savings for participating banks by authenticating trade documents and Letters of Credit more efficiently through an automated solution. Earlier this year a McKinsey report suggested that Trade Finance was second only to Cross-border Payments in terms of the extent of savings enabled by blockchain use, with some US$14-17bn of savings being possible within three years.

Last week, a consortium of eleven banks announced a prototype application on R3’s distributed ledger platform Corda, which has been built specifically to meet the privacy and security standards of the financial services industry. CGI is acting as trade finance technology partner for this project.

Trade Finance has been the focus of a lot of blockchain development, with several major SITS suppliers being active. IBM for example has launched a system to support Maersk’s container business and is working with a consortium of seven European banks. TCS also prioritising this area.

Blockchain represents a major step forward in digitalising an unwieldy, slow and expensive process. As SITS suppliers like CGI gain experience in trade finance, particularly in concert with client banks, consortia and fintechs, they will open up more opportunities and develop new business models to improve the transparency of the physical supply chain, for example by using the Internet of Things to monitor cargoes and provide better audit trails.

And just a thought – shouldn’t the UK government be investigating blockchain as a way to provide a modern trade management system as we leave the EU?

We look forward to welcoming well over two hundred CXOs from the world of UK tech and beyond to our flagship event, An Evening with TechMarketView, in October. The 2017 event is held in association with Sage and will take place at the Royal Institute of British Architects (RIBA) in Portland Place, London on Thursday 5th October, commencing at 6:30 pm with welcome drinks.

This will be followed by an hour of valuable foresight from the TechMarketView analyst team on the prospects for tech suppliers in the UK market in 2018 and beyond, especially in the context of ‘Unlocking the Intelligence’, our theme which embraces the transformational potential afforded by digital technologies such as artificial intelligence, machine learning and cognitive computing.

We would then like to welcome you to a drinks reception ahead of a sumptuous three-course dinner. During the evening, there will be plenty of opportunity for networking with other ‘movers and shakers’ in UK tech.

The Evening with TechMarketView has been a sell-out for the last four years so book early to secure your place. 

We hope you can join the TechMarketView team, and of course our esteemed chairman Richard Holway MBE and managing partner, Anthony Miller, at what so many executives tell us is the one industry event they simply can’t afford to miss!

For full details and to book your place visit tx2Events here or contact event coordinator Tina Compton at tx2Events (tina.compton@tx2events.com).

Great news for Atos. The company has achieved what it set out to do when it initially signed its digital transformation partner contract with University College London Hospitals NHS Foundation Trust (see Atos furthers push into health with UCLH): it has extended the contract to an additional organisation. The new client is Barnet, Enfield, Haringey (BEH) Mental Health Trust under a contract with an initial term of five years. There is an option to extend the contract by a further seven years, which would align the contract end date with the maximum term of the original deal.

Atos will deliver architecture, end user technology, service desk, private cloud data services, information security and SIAM. As is an increasingly popular model, the contract requires Atos to make savings in the “foundation” (or legacy) ICT to fund the digital transformation roadmap of the organisation. No value is given for this extension; the original deal with UCLH, signed in January this year, was valued at £130m for the core services alone, with digital transformation initiatives being paid for on a project-by-project basis.

Atos continues to demonstrate that it is winning projects with significant digital transformation elements, as well as adding smaller deals that are offering the ability to demonstrate more advanced digital technologies (see Atos UK: An evolving business). We wait to see if it adds further North Central London health partners into the fold; the North Central London landscape consists of five Clinical Commissioning Groups (CCGs), five local authorities, and 12 acute, community, mental health and specialist providers, who recently put in place a shared digital roadmap. The more Atos serves, the better chance Atos UK&I Senior Vice President for Health and Public Sector, Philip Chalmers (pictured left signing the deal) will have to demonstrate his vision of an “accountable care organisation with responsibility for the commissioning and provision of care from cradle to grave” via increased collaboration and innovation across the area.

Google has acquired AI image processing firm, AIMatter. AIMatter, which was founded in Belarus, is the creator of the rather fun Fabby, which is a video and photo editing app. Google's interest is in the clever stuff behind the scenes; the app uses a neural network-based AI platform to process images on phones. The technology allows a user's face, for example, to be separated from the background, meaning both can be edited. The effect is rather like the filters in Snapchat. At the start of 2017, AIMatter attracted $2m in funding from Haxus Venture Fund.

Google has not said how it will use the technology, but these types of filters are certainly very popular on social media. Perhaps Google will use it alongside some of its other machine learning capabilities, or maybe it was just keen to welcome a clever bunch of developers into its fold.

AIM-listed, Idox plc has acquired the electoral software and services specialist, Halarose Holdings, for a total consideration of £5.0m, comprising £3.5m in cash and £1.5m in shares.

Halarose has been a key supplier in local government electoral services since 1998. It provides a range of electoral software solutions to local authorities across the UK, covering registration, postal and electronic voting, canvassing and online training for polling station staff. It has 76 customers on its books, including major local authorities such as Birmingham, Leeds, Lothian and Lanarkshire. In its last financial (year ended 31 May 2017), Halarose achieved revenues of £3.3m and EBITDA of £1.1m.

Idox, supplies information management solutions to the public sector and highly regulated industries. It already has an established electoral management business, Idox Elections, which sits within its Public Sector Software division. Its election services contributed £2.3m revenue in H1 FY17. This was significantly down on H1 FY16 (£4.1m), reflecting a decrease in election activity during the first half of the year, but with the UK General Election taking place in the second half of Idox’s financial year we expect to see performance improve markedly in H2 FY17.

Halarose will be integrated into Idox Elections, creating a significantly larger elections business. Idox states that revenue and cost synergies are expected to enhance Idox's earnings in the first full year of ownership. Synergies will be achieved through the consolidation of office space and supporting a single suite of products.

Idox is focused on expanding its public sector business both in the UK and internationally, and it sees opportunities to expand its election services across Europe. The acquisition provides it with a more comprehensive product offering and significantly increases its market position. It should also be able to improve organic growth by offering a now enhanced suite of products and services to its existing customers.