CodeLab Capital AS (CODE) Earnings Call Transcript & Summary

Hello, everyone, and welcome to PatientSky's Q2 2021 Investment Presentation here in Oslo, September 1. Please be aware and read the disclaimer and forward-looking statements, read the content and respect it. Today's presenters, beside me, we have Kristian Ikast and me myself. My name is Jesper Melin Ganc-Petersen, I'm a Chairman of the company, I'm one of the cofounders back from 2014. I'm a serial entrepreneur, worked in many boards during the years. I'm educated doctor and military background for 12 years from the Military Academy in Denmark. I think it's very important to take a step back. I know there have been a confusion that's also reflected in the share price. What is the company? And what do we want to achieve? In 2014, we get together a bunch of people, great tech guys, who wanted to achieve something big and changing lives by delivering great technology to people. That's also reflecting in our vision and vision statement, and we still have that vision statement in the company. We also agreed on a mission statement, and it's still the same. And the founders are still -- the cofounders are still in the company and delivering and contributing to the overall mission and vision every day. We want to deliver revolutionary and innovative e-health platforms, empowering partners, patients and professionals across borders to provide new, better, faster and cheaper patient care in the future. When you start work together and want to achieve one big thing, it's very important to have one priority. The prioritization and priority for this company have been building a platform to help other software vendors to deliver health care applications to users and to software providers to treat patients. When you don't know each other, it's also very important to set up a rule of engagement and core value set, so you know what it's expected from you and expected -- what you can expect from the team around you. It's still the same values. And it's very, very important that we built and we have built from 5 to 6 people in 2024 -- 2014 to where we are today, with 170 employees, same values, and we expect exactly the same thing of all team members. We saw very early on that we needed to be fearless to be able to come in a position to innovate and create great products. But also at the same time, the task was very hard and we saw that. It was a great big task we want to achieve. So it's very important that we also -- we saw we needed to be humble. We expect from all team members with no exception that they are engaged in what they're doing. They act professional. They think innovative. And they show responsibility for what they are doing. We also work with a 3P model in PatientSky, where the person actually has to stick to the core values and live up to the core values. They also need to show passion for what they're doing and also know -- also need to create power in actually do things instead of only talk about doing things. That's the main reason why the Board decided not to support Johan Zetterström as a CEO in this company anymore. So who is the new guy? I met Kristian Ikast 2 years ago on a small tiny restaurant here in Oslo. The meeting was planned to -- for only 1 hour. But late that evening, we have spent many hours together discussing what it takes to build a great company, what it takes to build a great team, what is leadership. And we shared exactly the same vision. So we agreed on -- that we needed to work together going forward. And when the opportunity came to offer Kristian the position at the Board, I was very glad that he joined. We shared the exactly same vision on what a good leader is and that is leading by example. Your employees, they do what you do and not what you say and tell them to do. So Kristian, please introduce yourself and welcome.

Thank you very much, Jesper. And I'm very happy to be here today at PatientSky presented also now as the CEO. I come from Denmark, live in Denmark today with my family, my wife and 2 kids. Before I come here, I have worked in bigger international companies across the globe. I have worked in 48 different countries. I have lived on 3 continents. I have never had the pleasure of working with South America but else will cover. I joined, on that background, PatientSky's Board as a Board member last year, so have been part of the organization since. But my main motivation for actually joining PatientSky is that I see PatientSky as one of the most innovative companies in Scandinavia. I have a firm belief in the strategy we have set out. And I will do my utmost to ensure that we together deliver on the potential on the international growth we have in this company. I'm aware that this is a big task we have ahead of us. But I would say, since I joined the company, I only met extremely dedicated and extremely skilled colleagues around the whole organization. So I'm 100% sure together with this ambitious shareholders, ambitious Board that we can deliver on our strategy, changing lives. I can fully identify myself with the vision, the mission and, as Jesper said, the values, which is a key part of driving a business when you're going through a change management process of developing organization for international footprint. I think I'm blessed, and I think we're all blessed to work for a company that creates an improved products for a sector, who is actually changing lives. I think we have a huge opportunity with our platform to create the foundation international to change many more lives. Luckily, you could say the market actually also tells us this. By McKinsey's source here, we can see that actually the health tech market -- the digital health market has potential to reach USD 600 billion by 2024. If we take only the platform addressable market, it is foreseen to be USD 90 billion to USD 120 billion. That's huge numbers, but is all still a whose growth there. If we look at the growth in health care data generated is a 36% compound annual growth rate. The growth in health apps on App Store and Google Play has a 21% compound annual growth rate. Some little points down in it shows some extreme numbers. The telehealth care users in February 2021 compared to pre-COVID are 38x higher. I know that's been motivated by the COVID, but we also definitely see that the whole industry is going more in this direction. And we still believe that we have a lot of help to offer to the industry. An example we could be taken here, we could take many other examples, 70% of all hospitals in the U.S. still uses fax and post for patient records. And we also, as a company, had experienced disinterest to change the market. When we open up for partners to sign up for a platform, we have 30 partners. That's 30 partners signing up within the first 2 to 3 weeks. Why did they do that? They did that because we can reduce R&D costs with up to 85%. We increased the traffic. We shortened their time to market, and we made it much easier for them to scale. But understanding the domain coming into aboard of a company like this, has been a big task. So I think actually it will be helpful for all of us to actually get introduction and a learning in what is actually the domain about. Jesper, will you take care of that?

Yes. I think it's a big question, right? What is the platform? And if you go into the nitty-gritty details and take a deep dive in what the domain, it will take many hours and days. We know that because we actually did it, right? But to have a macro overview of the platform, what is the platform and how to deliver platform and what is the value for the, I would say, end user in this perspective, could be quite useful. So our platform is actually representing the generic part of the application. So that will say the platform represents all the things you need to do every time you want to build something, right? So we -- in our offering, we have a platform we can provide to partners where we can let partners actually set up their own hosting environment. They can monetize -- sorry, monitoring their application. They can debug the software -- the source code. And most important, it's a local data store. So you always know and you know all the time where data is located, right? And you can also do your own release processes. The infrastructure as a service can be delivered -- the platform, in general, can be delivered in 2 ways. You can deliver the platform in private -- as a private cloud, where the platform actually is located behind the customer's firewall or you can deliver the cloud -- deliver the platform as a public cloud outside the firewall. On top of the hosting part, you will have the service and tools, and that's all the generic things you need to have and build every time you want to have -- want to build some kind of software. And in our case, we have tailor-made our services and tools for the health care sector. If you compare that to [indiscernible] and those guys, they are more general -- they have a more general approach. And we also saw that Google turned down their health care offering last week because it's a quite hard task to build. On top of that, again, we have an application store, which contain all the modules we have built during the years. Why that? Because we actually built to identify the needs for the boiler plate underneath, so we can build applications on top. So we took our own medicine, you can say. And that's, as you say, represent 85%. And why do we say 85% is, of course, because we see that we can deliver much faster. And the investment cost, our R&D cost to new applications is reduced by 85% compared to what we have done in the past. On top of that, you have the, I would say, platform end user buying this platform as a service and the tailor-made boiler plate for health care sector. You will get a lot of things out of the box. You are faster to market, and you have reduced R&D cost, and it will give you some tailwind, right, as you go. I also think to answer that question, it's also important to understand this business and how we identified all the micro services in our boiler plate because it's pretty hard. We started in 2014 with a blank piece of paper and ended up with having a platform with 120 micro services tailor-made for health care. You can't sit there from the start and identify all these services. You need to identify the services from the outside in, right? And that gave us some struggle, especially when people don't know if we are a SaaS company or a platform company. And sometimes we get bad reviews from the SaaS end users. So I hope this will clarify how we actually use the SaaS users to identify the needs on the platform. Because we have always prioritized to develop the generic platform functionalities first, right, ready for reuse in future applications before delivering the functionality -- functional features requested by the SaaS user. So in the start, the SaaS user saw us like a big slow elephant, right? And now we are a fast-moving innovative business because we see our key employees, and that's the key problem right now, it's only the key employees that actually can build software much faster than they could in the past. That's what we need to talk about and understand and that's actually the key challenge in the company at the moment. We need to get that more, I would say, public understandable the domain, right? We will come back to that one. So we see actually -- we see it as a good investment. We know the churn have been a bit high in the process. We see also that when we convert, and Stian will come back to that later in the presentation, but we see is actually that the churn is pretty low when people are on the cloud solution now, but in the transition from on-prem to cloud, it's where we need to improve, but that's a challenge for the whole sector, right? So the whole sector -- e-health sector, there's so much legacy systems out there, and we have built the systems for consolidation, right? So it's just a matter of time before you will see the same behavior in other companies and also peers to PatientSky. So we have invested quite heavily in the platform, and it doesn't make sense to do that for only reach out for the SaaS business in Norway and for health care. But the reason why we did, what we did was actually the incredible market potential and also because we have a dream of delivering a local structured open data platform to actually -- to fulfill our mission. We know and believe that no vendor can build it today without having the same platform development approach strategy. You need to build it from the outside in, defining the needs for boilerplate. You need to eat your own medicine for many years over a long period, no matter who you are, how much money you have available for actually build the same thing as we have. We know it because we built it. I mean we are running application today with around 5 million patients. We can handle around 1 million general commits, that 1 million patient visits a day, right? And we can migrate data in a much faster speed than anyone else. So we can migrate data, I would say, 3 to 4 clinics a day on daytime. And that was a hard task for us to solve, and we know when the rest of the sector will face the same problem, I believe some of them at least will call us for help. So why has the company not delivered the PaaS yet, Kristian, that's a good question, right?

I think that's a fantastic question. I think we are discussing here. We have actually built everything it requires to deliver. But we have also done that. In Norway, we have more than 15 unique partners using the platform today. With the experience we have gained from these 15 partners on the platform version 1.0, so to call it, the Board realized there was too high barriers to partners to understand and utilize the potential of the platform. The difficult onboarding process also consume too much key employees' time as Jesper just explained. That is distracting us from fixing the key challenges we have and the scaling of the organization and training new staff. So now we need to go back and actually make sure that we have the team ready to actually scale on and keep moving forward without having to stop up in the process. So that's also why we've decided to actually pause contractual negotiation with potential new partners and downgrade revenue guidance for 2021, as we did before the summer holidays. I think it's very important to say we actually had physically contractual negotiations with partners, which we went back to and said that we needed to stop it because we wanted to be able to onboard them in the right process. So that's also what explained today. But what do we do now, Jesper, to make sure we can actually do that?

Yes. So we paused it, right? And yes, to understand why and what we want to do, we need to show you guys some slides, quite technical, on our Q2 presentation. But I hope it will clarify some of your questions. So if we look at the platform, remember, I told you guys that we define the needs for micro services and improvements on the platform out from the outside in. So over the years, we have built, I would say, a spider web. And today, it's our challenge, right? Because the source code is actually separated in micro services. So that's not spaghetti code. And -- but the spider web is actually now what we need to solve and what we need to structure. But the beauty of that is actually that's the MVP for the product catalog -- the product, right? Because now we have already -- we know all the dependencies. But the problem is that if you want to fix an application on the top, you need to talk to the key employees that know the map and know the fully domain. And it's very hard to onboard just like you said, Kristian, right, it's very hard to onboard new people. So we have developed the product or the company has developed the product catalog, a single point of entry for the partner where we collect everything a partner needs to one his application and to do what he needs to do. So that's the partner management where you can do admin, you can do admin on your users and your software. You can configure your own software through the partner management, but also some of the blocks where we can publish the functionality from both applications, services and tools. So we have a published service insight. But we also have a subscription service where everybody else for the rest of the world actually can subscribe to our service and start using and utilize the platform, so we now distribute the platform and open up a bigger market. To be able to do that, we need to map and remove all the, I would say, dependencies in the spider net down to the product catalog, where we can do better testing and where we have overview. So every time where we do changes in the services, we can have a process and a communication process and business process to inform all of the partners, who actually use that specific service or feature. But that will also open up for the business opportunity to have a stepwise launch strategy, as I see it, right, because the big -- a big question here is that do we -- how long will it take, right? So at the moment, I think we -- all of us have to go and do our homework and say, we know we have all the services. We know we have the product. So what do we want to offer to the market, step 1, 2 and 3 right? So I hope that was clarifying. And here you are, Kristian.

Thank you very much. Welcome Stian Husvaeg, our CFO, seen before. But let me just clarify one thing, and I hope that's clear for everybody. We have 100% focus. We are a platform company. We have always been. The platform is the central evolution of our products and our partners. Right now, we're working on the platform product catalog as the foundation for international growth and onboarding efficient of partners. So as Jesper said, we will partly release that to the market to be commercial ready, starting from start of 2022. So just take a page, I know you've seen before, why our platform are a key differentiator? I think Jesper put a very goodly. We are customized to our sector. We have actually a platform ourselves hosting, but we also have the micro services built up to actually make the product efficient. And now it says 80-plus here, I think exactly, as Jesper said, we are around 120 services today and counting. We are making the services that makes it easier for our partners to develop their products on top. So 85% as Jesper showed is premade, but it also makes the risk and the security of our -- the risk less and the security higher than we host our own data. We host in the right format. Yes, but for us to actually be able to deliver on this, we have decided that we want to work in 4 business units with group functions supporting these 4 business units. I think you've all seen this one before, but let me just put a couple of words on this. We are actually creating 4 different sub-companies with our own legal entities. We have own commercial departments, technical department, product departments, et cetera, et cetera. So for the SaaS -- sorry, the platform, that is, of course, the foundation of everything we do. And the SaaS and the VAS and the APP is working on top of that. Let me just put a couple of words on the VAS business unit, so we're all on the same page. The VAS business unit is value-added services. We use the value-added services to do international standard modules that we can distribute across, both when we open up a new country, we have a strong foundation but also to external parties. The APP, we want to take that international. We have today 2.4 million downloads in Norway alone, and we think we have a bigger potential to actually go out into that market. The SaaS business unit will have different tasks. They have 3 tasks actually. They have to run and operate the markets we're in today, run and operate markets that we'll have in the future, but also all time going out, finding new markets for joint ventures, M&A and building up from scratch. Let me just put a couple of more words on this. So that means our overall strategy is to scale and create value for patients and is as following: Platform is the foundation of everything we do. So we make a contract between our VAS, our SaaS and APP towards our platform. Our platform will also go through the market and find external partners. But let's just take an example here. If I take, for example, the SaaS journey, what does the SaaS business units actually focus? They could focus on creating new markets, the VAS make new products to the international market. The SaaS have been doing the market customization in the countries, but they also looking for joint venture opportunities, so we can partner up with the players in the market, but also acquisitions -- international acquisitions. We're focused on the international acquisitions. I think that's important to say. We want to develop the new partnerships and to develop the companies. And the potential end game for us can be threefold. It could be a moneymaker market that's running strong and actually is efficient for us supporting the market, changing lives. We can also take one of the sub-legal entities into an IPO or we can also do a third. We can do spin-off, actually selling off parts of our company to make sure we have the snowball effect always creating our own partners and going to next places in the market. One of the things is just for sure. Everything we will sell off in the future will be kept as a platform partner. There's a precondition for us to do what we do. So we always have the platform income. And this is for us to actually follow on a purpose to be the preferred, structured, and open e-health platform globally. Let's put a couple of numbers on this. So Stian, can you maybe just enlighten us a bit?

Yes. Thank you, Kristian. Let's make this overall strategy a bit more concrete, and we can look at what we're doing in SaaS Norway. So what we've been doing is acquiring on-prem legacy systems. And from experience, we're able to acquire them for 3 to 5x revenue. When we acquire them, we're able to utilize the PatientSky platform and the SaaS solution we built on top of that to migrate these clinics to the cloud. By doing this, we're able to more than double the revenue from the acquired customers. In addition to just doubling the revenue, we're creating higher-quality SaaS revenues by upselling and increasing prices. And we see this also generating higher value because this has scale, so we have higher margins. But we also have pricing power in the long term. And for example, in this scenario, we're able to invest NOK 300 million to NOK 500 million and create a company that's valued closer to NOK 2 billion. And as Kristian mentioned, we'll keep the platform revenues from this partner that we build and create and that will represent quite a nice value contribution to PatientSky. And if we just dig into how the SaaS business in Norway looks like today. Because if we look at it as a consolidated company, we have a lot of other cost items on top of that. So just the SaaS business, in 2021, we expect 35% EBITDA margins. And we also see that moving everything to one source code, which means closing down the legacy systems should give us a potential of 50% to 60% EBITDA margin. This is, of course, before they pay for the value that the platform delivers, which could range from 15% to 25% of revenues, depending on the commercial contracts and the services consumed.

Thank you very much, Stian. So for this to actually be able to realize this, we need, of course, to hire new colleagues. We are aware that we make 4 business units with stand-alone businesses. We need to have a lot of people in. So we are right now hiring 80 new colleagues to our organization to making sure that we can actually build and share the knowledge, as Jesper talked about earlier, to keep developing our organization. We have split out the APP for venture funding and partnerships. We will also split out the SaaS to ready to execute on our strategy to initiate a review of the strategy alternatives for our SaaS business. Such review will comprise reorganization of the business segment into a separate unit and may result in a sales of majority stake in the business segment, an IPO or continuation of executing of this segment's business strategy. But at the same time, we are really aware of that our key competencies -- our key resources this organization. So we will also initiate an option program for our key employees. So we are on this journey together. But we will also use that to attract the best talent out in the industry. And right now, we can say we are working on very closely to closing in the CFO positions to name just one of them. So Stian, can you maybe enlighten us how is the business performing as of today?

Yes. Thank you, Kristian. Before moving into the financial performance, it's worth reiterating that today, we're mainly a SaaS company on the revenue side. But on the cost side, we're carrying NOK 350 million investments that we made in the platform because of the huge potential that Kristian and Jesper has outlined today. We're also growing the organization from 170 to 250. And this isn't to operate a SaaS company, is to build a platform company. So when we walk through the financials now, it's important to bear that in mind. But still, we continue to show robust financial performance quarter-over-quarter. We grew revenue above 50% year-over-year. If you look quarter-over-quarter, it was fairly flat. But more importantly, we grew recurring revenue above 4%, and we expect this to continue to grow in the second half of 2021. We see that churn remained low, and the net retention ratio was a healthy 102%. And this does reinforce that the MVP on the platform is ready and is functioning. For the outlook for the fall 2021, we see that we continue to be in line with the revenue and EBITDA guidance that we provided in July. And as I mentioned now a couple of times, we're primarily a SaaS business today with 90% recurring revenue, which is actually higher than some of our peers listed on the Oslo Stock Exchange. The growth is coming from recurring revenue, and we see the decline in projects, which is also going to continue in the second half as we increase the focus or continue to have focus on recurring revenue over projects and consulting income. If you look at the customer breakdown, we had good growth in clinics and enterprise customers. Enterprise customers grew 90% from Q1 to Q2, and we see a similar trend now into Q3. And the SaaS journey is still early innings in Norway. We see we still have above 60% on-prem EHR customers to upgrade to the cloud. In addition, it's worth noting that we keep growing the overall user base. So we're not just upgrading. We're also growing the pie. If you look on the right-hand side, you can see the revenue per customer. We split that into cloud and on-prem. And you can see that on-prem is slightly higher than the cloud today. And the reason is because of the mix, we have 70% GPs on our on-prem system. And we know GPs, they have more users and a higher price point. So over time, we expect the revenue per customer to gradually increase as the mix on the cloud converges to what we have on-prem and on-prem customers are reduced, but also we are able to upsell more modules and increase prices. When it comes to the on-prem, we'll continue to increase prices slightly year-over-year to centralize these customers to move to the cloud. And as I have mentioned, churn was low in Q2. It was 1.4% on revenue. And on customer churn, it was slightly higher, which shows that the customers that do churn tend to be lower value customers for us. You can also see the cloud churn is low relative to the on-prem churn. And a big reason for the revenue guidance on the SaaS part was the received churn for the second half of 2022, which is coming from on-prem because we had our first legacy system that we closed in July, and we also increased prices on another legacy system. Both these actions are completely in line with our strategy of getting as many of the customers on to our cloud solutions. The MRR continued to show robust year-over-year growth, growing at 44%. We're also adding modules, and this increased 55% year-over-year. Coming back to results. As we said, these are in line with what we expected and in line with the full year 2021 guidance. A few highlights worth noting is that the COGS in percent of revenue increased slightly, which is explained here. Salary expenses were NOK 9 million lower than in Q1, and this is mostly an effect from vacation pay in Norway, which eliminates one month of salary. The capitalization of R&D and salary was similar to Q1. We saw OpEx increase slightly compared to Q1. This is mainly due to increased marketing, but also because we're splitting into business units, and that takes some costs. The adjusted EBITDA for Q2 was NOK 15.5 million or 30% EBITDA margin. We're also today publishing a more detailed breakdown of our revenue to help our investors understand the underlying business better and be able to track our progress in more detail. We have a breakdown of revenue by type, which we've shown earlier by customer, also a split between cloud and on-prem products. Worth noting here is we also sell some of our cloud products integrated into on-prem over time to increase the revenue there. We also show a split of recurring revenue, where you can see the EHR licenses and the good growth that we have on add-ons.

Thank you very much, Stian. So just to sum up on all the things we talked about today, we know it's been extensive we talked about. But why did we downgrade PaaS before summer? We did because we paused onboarding of partners. We wanted to improve our onboarding, our platform catalog, explained earlier. We want to be ready for the international scale, and we wanted to reduce future time to market. We are going out of 2021 with our annual recurring revenue of NOK 210 million. We see this quarter compared to same quarter last year, growth of 51%, but also what were extremely happy to communicate is that we have a very, very healthy and high quality of revenue with a recurring revenue percentage of 90% and, as Stian indicated, higher than many of our peers in the market. We see a quarter-on-quarter recurring organic growth on 4%. So that will take us to around on mathematics 5% to 16% in a full year. We are pushing that number to get to the 20%. And why are we pushing that number to 20% because we are tapping into a huge potential market of the global market in 2024 of USD 600 billion. Just for the platform alone is a USD 90 million to USD 120 billion market in the same time frame. And there's a huge growth in the health care data generated with a 36% compound annual growth rate. And we think we have one of the very easy one pointer to communicate, we can actually lower the development cost by 85% by having actually developed all the layers that Jesper showed earlier. I hope that gave some clarities, but there are still some questions coming in. So I think we can take a Q&A session now. Stian, will you take this one?

Yes. Let's just see what questions have come in, if you give me 1 second. So the first question is, can you elaborate on the ongoing goals of entering new markets?

Thank you very much, Stian. Yes, that's, of course, I think when we go back and start developing our product catalog that we have to kind of reset the execution of this plan. We have done a full market mapping. We know the markets that we can approach but the way we do it right now, we focus on actually making sure that we have the products ready to go to the market, then we make sure we have the organization ready, and then we build up the commercial plan. So we'll come back with more details on it right now because the first thing we need to make sure is to say what are the party releases coming first during the start of next year, and then we can communicate how we're going to approach which market. I hope that was the answer.

Perfect. And there's a question here on [indiscernible] half of your revenues but are valued above NOK 4 billion, while you're valued below NOK 1 billion. Can you please elaborate on your thoughts around that?

I think it's not our -- I would say, it's not up to us to comment on other companies. But in general, we can say that, yes, that company has 50% of the revenue and the valuation is NOK 4 billion. The key differentiator for us is that we -- I think we had seen a hit on the share price because we are in the middle of the transformation from on-prem and to cloud. And we have the platform, and we know we can do it. You talk about the 2.5. I think it maybe it's even higher, maybe it's 3x, right? We can manage to do. But if you don't have the platform, you would be stuck with your legacy companies, if you don't have a platform or have a platform as a service to actually to do that. So that's the only thing I think we can say and everybody will come to a position where you know and you need to act and remove your patients -- remove your customers and take out synergies.

And then there's a question here on the platform revenues. When do we expect to generate platform revenues?

Yes. That's a good question. I think that we will see revenue will come during next year. But until now, we need to have a proper plan. I will present that on the next Q3 report, right? That was what we had read on. So that's basically the story.

And then there's a question on total revenue over the past 2 quarters have been flattish. When do you expect to see uptick of total revenue quarter-on-quarter? And what we can say there is on Q3, you'll have a summer month. So your consumption-based income will be slightly lower, of course, because everybody is on vacation. And we'll see a nice overall level uptick in Q4. But if you look underlying on the recurring revenue on our license, that will continue the growth that we've seen so far, and we expect that going forward as well. Then there's a question about Finland. How has the development in Finland progressed? And when do you expect to start seeing revenue outside of Norway?

Yes. I can take that one. So the reason we actually entered Finland was, of course, of the SaaS business. We wanted to start and let this Finnish SaaS users defining their needs on the platform. What surprised us was actually that we had the boilerplate. So the team over there was actually -- is actually quiet into the details on the platform. So the very big question, should we find a partner to run that business over there or should we -- and then use the employees and staffing up the PaaS part, so we can get quicker to market rate. So that would be a decision for the company to take during the next month or 2. But I think if we should continue with Finland, I think we can see a breakeven scenario in 2023, 2024, right? But that's basically a strategic decision to make there.

And then there's a question on why do you think Apple and Google closed down their health platforms? And why do you think PatientSky will be able to succeed?

I think we have answered that question, right, to go and do a tailor-made boilerplate for the health care sector is a pretty hard task. So what we have done during the last 7.5 years and a lot of people have asked us why it takes a long time. But I mean, it's got them health care, right? So you need to understand the domain before you can build the application. And why they did that? Maybe I don't know, actually, but I know it's a hard task. So maybe that's why.

Yes. And then there's a question here about the share price has fallen so far this year by 61%. What steps are management now taking?

But I think the steps we'll take is, of course, that we will get a house in order to say so and communicate very clearly what we are doing. That's also why I'm communicating very straight up where we need to get the product catalog in the right position, then we build the organization, then we come into commercial plan. And we would like to communicate that very openly when we have the plan ready and then keep actually delivering on what we promise. I think that's the main thing we'll do, have a focus on developing a fantastic company and then make sure we communicate that when time is right.

But I also think what we have shown you guys today is that the value is actually in the company already. I think it's a confusion of what -- as the company, what do we want to achieve, right? And when Kristian says, we want to do a proper plan that's actually what do we want to release of the platform that is ready, right? That's the strategy.

And then there's a question here on the timing of the 80 new hires that we're planning to do.

Yes. But that's, of course, a huge number to bring into organization, being 170 people right now. So this is a timing that will come over the next year. We hope in our planning that we could get done with this hiring during this year. But obviously, all know that this market is extremely competitive for good talent, also why we are going out and looking for a new option program to also attract talent on this program. But for us, it's all about bringing in the right people at the right time. So we're now structuring very much how many people we need to actually deliver on -- once the product is already. So we'll see over the next year's time that we'll come to 80 people in and that's the way I would see it right now.

Yes. And then we're taking one final question, and that's how the investments in R&D development going forward? And that kind of underlines what Kristian just said now that we're hiring in people. And those will mainly be related to the platform and developing the platform for international scaling. That's where most of our R&D is coming in. So we expect R&D to increase when we are staffing up and getting the platform ready for commercial scaling next year.

Yes. And it will also be visualized on the Q3 presentation. We are working with separate P&L slide per business unit. So it will be much easier to see where the costs are located right? That's last question?

Yes.

Then I would like to thank everyone for joining this market update. I hope this gave an insight to us as a PaaS company. I hope it gave insight to our good financial performance now and also to be highlighting, it's in line with what we communicated earlier. We have full faith in and are fully committed to deliver on external potential we see in this company. And we want to go on to be the preferred structured and open e-health platform globally. Thank you very much for joining.

Thank you.