Ideagen PLC, based in Grantham, UK, has shown solid financial performance over the last few years. Total recurring revenues were up 26 per cent for the year ending April 2021, compared to FY2020, rising from £43.1 million to £54.2 million. Recurring SaaS revenues grew by 47%, at £32.2m, up from £21.9m a year earlier, as Ideagen’s transition to a Software-as-a-Service (SaaS) model continues to gain traction. Revenue increased by 16 percent to £65.6 million, while adjusted EBITDA rose 24 percent to £22.9 million.
While these numbers are encouraging, Ideagen has several strategic options to improve its earning power and market standing.
Ideagen has a strong presence in the UK and other developed markets, but has great opportunities to grow in emerging where digital transformation has taken flight. Ideagen can access revenue streams from the specific demands of industries in these regions by tailoring its software solutions to their particular needs. For example, Ideagen can have access to a wider customer base by entering into the Asian Pacific or African markets.
Ideagen has previously raised £103.5m to fuel international growth via acquisitions. Ideagen can continue this strategy by acquiring smaller, innovative companies that will bolster its product offering and also increase its customer base. For instance, Ideagen could buy an artificial intelligence (AI) company and incorporate more sophisticated analytics into its platforms which can then be passed to clients for better risk management tools.
To stay competitive, Ideagen should keep investing in Research & Development, as new features and functionalities will protect the company against the threat of new rivals, create new avenues to lure in new clients, and keep current ones. By allocating more revenue to R&D (currently 10%, but could eventually grow to 15% of revenue), innovation and product development would speed up.
Customer support can be enhanced and full training programs provided, adding both to user satisfaction and reducing turnover. A customer success team that solely focuses on onboarding and helping clients will result in higher retention. For example, a dedicated team could increase (recurring) revenue streams by 5%.
Variety, they say, is the spice of life. People enjoy exploring different products rather than being stuck with the same “stuff” over and over again. This is why a company such as Ideagen can open new revenue channels through expanding the range of software solutions to service different industries. For example, sector specific modules such as energy or education could be developed to attract these industry clients. As a result of the growing demand for compliance and risk management solutions in the energy sector, Ideagen could expand its revenue by 10 per cent with tailored solutions for this market.
Targeted marketing campaigns can boost the brand visibility and attract new clients. However, by using digital marketing strategies, for example, search engine optimization (SEO) and content marketing, Ideagen can get potential customers. A good marketing campaign could get the company 20% more leads which is a lot of money.
Strategic partnerships with other technology providers will help Ideagen to create service offerings and increase market reach. Ideagen’s products can be made more attractive to a potential client if collaborators like cloud service providers or cybersecurity firms are involved. Joint offers with such partnerships could result in a 15% increase in sales.
With a view to sustainability and CSR, Ideagen has the opportunity to help improve its reputation and appeal to socially conscious investors and clients. Practices and community initiatives that are eco-friendly can distinguish Ideagen from its competitors. Companies with strong CSR do typically see an additional 10 per cent elevated in customer loyalty, which translates to positive impact on long term revenue.
Relining internal process and incorporating lean management practices can minimize costs of operations while increasing profitability. Automation tools can be used to automate tasks that Ideagen may want to take off from its routine. With a direct impact on profit margins, an operational efficiencies of 5% could mean significant cost reducing potential.
Ideagen services are given by nature of services, data security and compliance is the most important thing. Building trust from the clients and opening access to regulated industry is investing in robust cybersecurity measures and getting the relevant certifications. Getting industry standard certifications might double Ideagen’s client acquisition rates by 10%.
By following these steps, Ideagen plc can have the opportunity to establish, build and strengthen market position, improve customer satisfaction and drive sustainable growth, ultimately leading to better trading and future prosperity.
