Poste Italiane S.p.A. (PST) Earnings Call Transcript & Summary

Good morning, and thank you for joining us at the Poste Italiane workshop. We will discuss on how we are building on the foundations of the first phase of Deliver 2022, with a focus on innovation and customer experience across all business segments. So as I was mentioning, we will focus on operational updates and not on financial figures. So please keep this in mind when asking questions. There will be no new financial disclosure, and we will not provide you with new financial targets today. The next major financial event will be -- will take place next -- early in March when we'll present full year 2019 results, and we will update our 2020 guidance within the framework of Deliver 2022. So, we will conclude presentations by mid-day with a short Q&A session. And at 12:30, at the latest, we will have lunch next door, and we would be delighted if you could join us. So let's get started, and please welcome our CEO and General Manager, Matteo Del Fante.

So we want this event to be a bit informal so, no tie. And thank you from all of us for spending a couple of hours trying to understand what we mean with innovation. The song says we don't need education. We think innovation and is the translation from an Italian [ center, and so ] that sounds better, but we try to make it work anyway. For us, it's breaking the rules, breaking the habits and in doing it, having success. So things have always been done in a certain way. You are expected to do it that way. You dare to do it in a different way, and it works. That means lateral thinking obviously, which is something that it doesn't come to a firm like Poste like this. It requires a management team that really endorse it, that really gets it under the skin. And that management team then slowly brings it into the company and to the way the company does business. When I joined Poste 3 years ago, it was a bit like many of the large companies, certainly in Italy. You have a lot of divisions, business unit, which are sometimes responsible of one specific area, and they try to do their best, but not necessarily, they look at the big picture. So the first thing I did naturally, I knew the company because I had been working, as many of you know for 11 years, selling financial products into the network. So I had a competitive advantage on knowing the management. I pick 5 topics, which were strategic for the company. I told the management team, you're out of this exercise, I pick second and third level managers, build 5 teams, 10, 15 people selected per topic and then gave them 2 months to work together, not that the first-line at the second and third line and bring me their inputs. And that's something that probably today, I wouldn't need to do because now the company is really taking change, and if you want to innovate, you need to be ready to change. Really across all businesses in a way that impacts the company and doesn't keep any single business at the center of one line without doing the bridges with the others. For these reason, we hire one person that you're going to see this morning on stage, Melany Libraro, and we give her the job. She comes from a Internet very successful platform. So she's done it, she has seen the movies. She had great client impact and we gave her the job to transform our client experience. So she has a cross-functional responsibility to help all the businesses, singing the same song, which is the song of the client and having a road map, which is aligned because typically a large firm in many different products has the business that goes with one road map and they are under pressure, they have the budget, not necessarily, they have the time to understand what the next business is doing. And for us, this is very important because we created 3 years ago, one business unit out of the banking business unit. Most of you remember, have follow the creation of Postepay because we identified back in 2017 payments to be an important area where we need to have specific focus. Marco Siracusano that is certainly one of the -- let me say, legend in payment in Italy. He has been all across the top players, and especially, he has built our presence in payments that you're going to see today with some new products so that we're in the process of launching. So that line, obviously, has to be coordinated with the rest of the business. But that line has a lot of technology in it because it's the most exposed to digital transformation in this market context. Certainly, there is an open banking, you're going to see one company today that we recently decided to work with and to establish a partnership. And what does it mean a partnership? Many of our competitors in the financial, in the industrial space think that doing innovation means following startuppers, creating maybe a fund, choosing a very smart dynamic team to follow the market and then picking the best companies, doing the investment and trying to link those investments into the business. We took a different route. We didn't allocate any specific amount of money, I didn't go to the board, give me, I don't know, EUR 100 million, and I will give it to this business unit to do the investment. We told the businesses it's up to you. So every business knows that they have to innovate and they have to change the way they do business with our clients. So they have a road map, and I'm telling them, tell me what you need in terms of acceleration to go faster in the -- in your road map. So if you see an opportunity to shortcut the development of a platform or a service. And today, with cloud and data analytics, this can be done in weeks. This -- the companies you'll see today, we close the technical bridge into our systems in a matter of a few weeks. And that you can do in 2019, 5 years before, it could have not been possible, okay? So you could close the technical thing in 5 weeks, you become a shareholder because when you are a partner of Poste, and we give you the platform of 35 million clients, obviously, is a very important event for all this companies which are not stacked up any longer, they're already more advanced, but it's still an important event for them. So we like to enter into this company that's when we do the investment because that makes the relationship closer. And we understand better the company, we have clearly more attention from the company. And we can follow maybe hopefully, the good appreciation from the market of these companies that we invested. And in a way -- and I'm closing on this, and I learned this when I go in the states in Silicon Valley or Boston, talking to start-uppers, they made me understand one kind of counterintuitive thing that I want to share with you today. A large company, which is an incumbent, call it, a legacy company and there is no more legacy than Poste, if you think about it, in many things we do, is the very best place where to innovate. And why do I say that? If you are a start-upper and I discovered that you guys know it, but they're all serial. So they do one and then once they've done it, they restart again, correct? What do you do? You like to build something? It means you sit around a table with your cofounders. You put it on the table an idea, a product, a service that you think the market will take, and then you build around it, the funding, the technology, commercial side is -- it's tough. When you take that brainpower and you parachute it on a company that has already an activity that has already 2.5 million transactions per day, 35 million clients, et cetera, et cetera. Obviously, the impact of that brainpower and focus is much more important. The problem is that we need to be fair tie. We need to be lateral thinkers. We need to break the way we -- the rules of the way we have been used to do business. In order for this high-power idea generation and energy to contaminate Poste. And I think this is happening. You're going to see 4 companies. The first one, I received the information on the company, I send it to my business, and I had to do 2 or 3 meetings to get it going and done. The second one it was a few months later, I just mentioned the name, and then the team did it on its own. So I mentioned -- I read something about this company? Can you look into it, and I didn't even meet the management, they did it. The third one, they found it and they did the whole process on their own. It was an important technology agreement. And the fourth one, it was 6 weeks from the time they mentioned the name, they gave me information. I brought it to the board, and it was done. And I think the most important thing is that these guys have told me, the CEO of these companies that what they were impressed in the process with Poste, is how fast, committed and technical we were -- my team, so nothing to do with me. But my team was really up to speed because it's very important as a CEO that I don't bring in our family. Companies, even in terms of partnership, even if you don't think about buying shares of each other. But simply doing commercial agreements that are not decelerating my guys. As a CEO I have many potential offers of people that want to work with us, we're the dream distribution platform, obviously, in the country. But I always pay a lot of attention when accepting to go with one company and get on the market together. If the day after my meeting when they sit at the operating level. On the other side, are there smart people that are not going to slow down my guys. In that case I don't do it. Obviously I don't tell the CEO that this is the reason, but I don't do it. In this case I know they're fast because they already scale up so by the finish, they are faster and I'm very proud when they tell me that my guys were fast enough for what they needed. So I hope you're going to enjoy today and I hand it over to Melany.

Thank you Matteo. Good morning everyone. So before going into the -- who I am and why I'm here, I wanted to show you a small [ picture ] because Matteo talked about how innovation is embedded in our DNA. And it is true and it happens every day and in every moment around our offices and in different functions and business units. So I wanted to take a glimpse of what's going on every day and then we'll talk more. [Presentation]

Thank you. So as Matteo was mentioning, I -- let me introduce myself. I come from a technology background. So I spent the first 10 years between London and the Silicon Valley, working for Cisco, Skype and Google in early 2000. So when they were startups, some were like the one that we're going to see today. And then I moved on to kind of bring in this internet experience into the telco world where in 2008, it was really conceivable that you should use internet connection over your cell phone. And we had to convince people as a telco to make up mobile internet and now we can't do it without. In the past 5 years before in September 2019, when I joined Poste I was the CEO of Italian largest classified marketplace, which is [indiscernible] IT. So with this experience it was kind of obvious and also from you've seen in the video that Poste was going to be kind of a playground for innovation. It has incredible numbers, it's so unique within the Italian market. It has a unprecedented physical presence and digital presence. 35 million customers and 30 million downloads. Every day there's over 1 million people coming into our offices and over 2 million people interacting with our digital interfaces. So there is so much that can be done in terms of skill and innovation and as Matteo said, it's probably the best place where you can really test new things. And the amazing thing is that this innovative kind of culture has been there for a long time. It's just that technology advancement and the digital transformation is just really pushing it forward and making it more accessible and easy to make it happen and there's already people there doing that every day with a lot of confidence and passion. So, today I want to talk to you about 3 main things: First of all is the IT transformation and what are we investing in in order to bring this digital transformation forward. Then secondly the benefits that this transformation enables and brings of course in terms of customer engagements, retention, satisfaction and also ultimately business results. And then showcase some of the innovations that are happening, and these are innovations that are not just coming from outside the company, but coming from within the company because we do both that internal and external. And so let's see what are the 3 areas of technological innovation. It's cloud computing, data management and CRM and API's, application programming interfaces. So let's talk first about cloud computing. You all have heard about it, a lot of course. And we know that moving from a digital -- a physical infrastructure -- today we have we had 13 physical data centers. Moving to the cloud brings you cost benefits, of course, but also brings you great reliability of the service you're giving your customers and for the business. And that is a major part of the customer experience as well. Then again, though, our approach is being innovative towards what normally company do when they're moving to the cloud. Normally, what is done is kind of a lift and shift approach. So what you do is actually, you take part of your architecture and lift them up from your physical data centers and put them on to the cloud and shifting it to a different reality. What we're doing is we're taking the opportunity to rewrite a lot of our code, rewrite a lot of our software and make it cloud-ready and future-ready in order to scale it and go to a time to market that is much faster. Also, we are approaching the cloud in a different way. So rather than committing to one provider, we're looking at a hybrid setup where we have part of our own cloud and other providers to make it more diverse and scalable and also modular in a way that we can manage it. So of course, shifting to the cloud brings great benefits to our data management because we're pulling data from all different sources. It's much easier to have real-time insight, and this insight can be easily -- because we apply artificial intelligence to the data that we gather, much easier to being able to do data-driven business decisions and have better insights about what works, what doesn't, what our customers are doing and what they want. And of course, the customer relationship management is enriched on the cloud because all of this data will allow to also identify cohorts of customers that we can better serve. Lastly, but not least, of course is application programming interfaces. APIs, I don't know how many people are familiar with that, I'm sure some of you are. But told in kind of layman terms, in simple terms. An API is a piece of software, but is a piece of software that is around one of the many services that Poste Italiane can have, and it acts as a connector for the external world. So an external player, a third player can talk to a Poste Italiane API. And that API will talk to our own IT infrastructure and that API sends a message back to the third party. And so essentially, by creating a lot of different APIs, we create what it is today already an open IT infrastructure, and we can make available so many of our different services. And this can be as simple as skipping -- booking a number to skip the line at the post office with an external API that we can make available or making a financial transaction or a payment or an investment. And the more we build this, the more we can even get to the point of creating a marketplaces of APIs to open up our infrastructure to the market. So after that, of course, these technological enablers are fundamental for my job, as Matteo was describing because I kind of need to transform the customer experience in all of our business lines, and we already built products that are stocked for the customer. But we want to make that experience completely frictionless and as easy and sticky as possible. So how do we approach the customer centricity? And I'm going to tell you about it. So first of all, we start from the voice of the customer because you need to start from that insight. And what we're doing is moving away from more just data gathering and passive listening and more to a proactive listening of the customer. So we gather all of the data that we get and we're actually listening also. Let's remember that we're not just digital, we have a massive physical presence and it's not as easy to measure what customers are doing when they are in inside a post office. So if we want to improve that experience as well, we need to physically be there and observe what they do, what their needs are and try to address them in their experience. So we mentioned the CRM before, we gather data from across all different business lines. And that data that is applied, and AI is applied to get information about what they're doing. We need to know what works, what doesn't work, where are friction where funnel are not working so that we can better address, and move away from what do we want to give to our customer, in terms of offer and service to -- what is it that customers are not asking for, but they should ask for because I know, thanks to data that they should have that type of service and product. And so that is the announcement that our customer relationship management gets from all of the data. And then there's kind of like 2 streams that they are starting after this because on one side, we're responsible to design the customer experience when it comes to new products, such as some are the ones that you're hearing from today, but also improve it because we have a massive presence of a lot of products and services already that needs to be improved. Where that friction needs to be removed, and the experience has to be completely sticky engagement -- engaging and delightful for our customers. And then on the other side, we have already 35 million users, and we need to manage that value. And so based on the same data, we can address people with the right product. And so continuously improve our cross-selling and up-selling capabilities because, ultimately we want to build retention and loyalty in our customer base, in order to drive better business results. So this is how we were approaching it and trying to transform and you kind of -- with a new approach, the new products and review our current products with a completely different light. So you see that innovation is already a culture, and we want to grow, but for growth, we need both scale and speed together. And we have the scale. We talked about how vast already our presence is, and before speed, we also want to have accelerators. And a lot of the partners you'll see today help us accelerate on some of the aspects that we want to move forward. And because we talked about being an IT -- an open IT infrastructure, we can plug these partners in a much faster way. And sometimes, it has happened in the space of very few weeks. So you'll hear some of this, and you'll hear later today, also some of our completely in-house innovation. But let's -- let's see how we also work in innovating. Matteo has already mentioned how business unit and people within the company are completely empowered into seeking ways to innovate and speed up innovation within the company. So at kind of a like business unit level empowerment we scout for potential partner that meets specific needs of the business units, be it Mail & Parcels or financial or payments. And after that, we try to identify a clear pathway within a framework to do testing or a proof-of-concept in order to see whether this partnership can work and whether we can draw quick results. And after that, of course, there's exploring possibility of capital investments. And -- but we try to keep kind of a mindset of try before you buy approach. So let's see, these are the partners that already Matteo mentioned and we stand from Mail & Parcels to Financial to Payment system and to tech enablers. So let me tell you about the first one and so we move a little bit further into drilling down in the examples of innovation and acceleration. So we've been exploring partnership within our Mail & Parcel business. And this traditional division has completely embraced this innovative mindset. So as highlighted by Massimo Rosini, which you might have met at the Bologna Hub visit, the long haul transportation strategy is a priority for us. Long-haul of road transportation already amounts to EUR 100 million costs for us, and it's a priority to be optimized. And in this period of really rapid growth of e-commerce, of course, this is even more of a priority because there's a higher demand in terms of service level and tech optimization, and we want to meet this third-party expectations. So we'd be scouting the market for one of the most innovative and promising startup in this space. And we found center that has developed a technology that maximizes transportation saturation and service level, and also because of the optimization it has a better impact in terms of the [ ultimate ] reduction. So it even has better sustainable business. And we started a trial as per our approach, and we had a very successful trial because starting from Black Friday throughout the whole -- the Christmas season. sennder has already managed for us 8 million parcels over that period, so it worked really well. And this allows, of course, Poste to have better optimization of our system, reach economies of scale and meet that demand that is both in Italy and abroad. But I'm not going to say anything less -- more -- I'm going to leave it to David, which is the managing Director, sennder to tell more about it. David?

Take a moment and look around. Did you know that every single item that is around you, on you has been on a truck. In Europe, we transport 2 trillion-ton kilometers of freight every single year, across all industries. My name is David, and I'm Co-Founder of sennder. sennder is a digital freight forwarder with a focus on full truck loads. We are building Europe's largest network of trucks and vans. If you look at our business model, we can see that on one side we have large enterprise shippers, they're called Poste, Siemens, Scania, that have to move freight from point A to point B. And these are dedicated trucks that moves the freight. And here the concept of full truckload. On the other side of our business model, we are family-owned trucking companies that typically have 5 to 50 trucks, and no digital processes. So what we do at sennder is we bring these large enterprise shippers together with these small family-owned trucking companies, but not only as a marketplace, we go a step further. We are the contractual partner and a single point of contact for both the shipper and the carrier. And are, therefore, able to repackage the service of this family-owned trucking companies so that the touch and feel for the shippers, our customers, as if the trucks were ours, even though we are completely asset light. Before I tell you what we do differently than a traditional logistics company, I want to show you why we find this space so interesting. I would like to do so by showing you a picture, a picture of a logistics or dispatching office in the 1980s. A lot of paper, fax machine, old computer, 2 phones. Today, that math has changed. Bookings are still made through fax machines, phone calls are used to determine the approximate location of a truck, and everything is the paper base. Probably the only thing that changed over the past 30 to 40 years is that smoking is no longer allowed in these offices. Furthermore, this market is highly inefficient and fragmented. I want to give you 3 numbers to illustrate you this inefficiency fragmentation. First, 70% of all trucks that you see on roads are owned by family-owned companies with fewer than 10 trucks. So 70% of market capacity but very, very small companies. Secondly, between an enterprise shipper, let's say, Siemens, Zalando and the truck driver. You have, on average, 2 to 5 middleman to just pass the load over and over to the next one. And thirdly, 26% of all trucks that you see on highways are completely empty. And this is because of information asymmetry. And this is where we come in. First, we increase transparency and optimization by cutting the middleman, the 2, 3 middleman and redistribute the margin that we save. And we're able to do so because we have our -- through our technology, we are able to connect large enterprise shippers, our customers, with thousands and thousands of these family-owned trucking companies across Europe. Secondly, we maximize the load efficiency and optimize pricing by using technologies, such as artificial intelligence and algorithm to, for example, combine loads of different customers in a much more efficient way to increase the utilization of trucks to 90%, 92%, 93%, and therefore, to reducing significantly CO2 emissions. Finally, we offer services to our trusted partners and carriers, such as Invoice factoring, insurances, fuel cards. That on one side, allow our small partners to optimize the operations and their cost, on the other side, allow us to monetize 100% of the operation of our partners, even though typically, we only have 20% to 30% of their wallets, meaning 20% to 30% of the trucks typically drive for us, with these value-added services, we're able to monetize 100% of the business. We are able to deliver this efficiency increase to our customers, our carriers and our internal operations, we have invested heavily in our tech infrastructure and developed several platforms that address the different needs. On average, we are 3x more efficient than a traditional logistic operator. I mean, this is based mainly on 3 pillars: digitalization, automation and transparency. To put this a bit into perspective, I want to give you 3 examples. We're currently digitalizing the entire process. By for example, providing 100% of our carriers with self-billing invoices. We're also automating the entire process, for example, are providing 78% of our orders automatically registered in our system. And finally, we provide full transparency by increasing -- by offering over 50 -- a majority of our transport with GPS tracking. It's important to understand our focus because our focus is what allowed us to grow very, very quickly. So in the bigger logistics market space, we only focus on road freight, no sea freight, no air freight, just road freight. Road freight is the largest segment in Europe, EUR 350 billion in size. With done road freight, we only focus on full truck loads. We don't do last mile, we don't do parcels, we don't do pallets or half trucks. We only focus on full trucks, which is a dedicated truck driving for one customer from A to B, is not always full. Within this segment, which is the largest, EUR 150 billion, just in Europe, just full truckloads. We focus on cross-regional shipments, on average, 500 kilometers. And within this segment, we focus on contract cargo, meaning loads that assigned to us after tender process and allocation, where we have contractual agreements for multiple years, and we just execute this transport for Siemens, Zalando and the other customers we have, and faster for a longer period of time. This focus, the technology that I shared with you earlier. It's also what allowed us to grow very, very quickly. Today, we do a 9 digit yearly revenue. We raised EUR 100 million from investors, such as Poste, but also traditional [ DCs ] such as [ XL ], U.S.-based fund, and Lextar, one of the largest growth funds here in Europe. We started in August 2016, with this business model in Berlin. Since then, grew to 250 people and are serving Europe across 4 offices in Italy, in Spain, in Poland as well as from our headquarter in Berlin. We have a clear objective, getting to EUR 1 billion in revenue by 2024. This would take us to be one of the 10 largest full truckload forwarders in Europe. And would give us the opportunity to start thinking of an IPO. I would like to share a little bit also the experience that we had here with Poste, which was a very, very positively surprising experience. The entire journey with Poste started when I met Del Fante in August 2018. And we spent approximately 10 months understanding, trying a few things, what can we do? We're going to tell you a little bit more about in a seconds. Then we said, okay, let's see if the theory, what we thought of can work in practice. And that's the phase that we just completed, and we are about now to launch the EUR 100 million spend joint venture partnership. Where we will manage the EUR 100 million in spend and generate significant savings, targeting 6%. So when we first started the discussion with Poste. We try to understand what are the main pain points that currently Poste experience, and what are potential solutions and processes and approaches that we can bring to the table. We quickly understood that flexibility was one of the major challenges that Poste had. And with the growing demand and especially from e-commerce. And here we said, with our back then 7,500 trucks connected, we could possibly support and bring more flexibility to the network of Poste. The second aspect that we realized Poste was looking to work on was efficiency. Increasing digitalization and processes, and also here with our technology, we thought we probably can help. And finally, traceability and visibility, bringing GPS coverage and knowing where the trucks are, where are they transporting parcel and mail. This then took us to the second phase, where we said, okay, let's really test whether we can actually implement the synergies and the ideas that we have developed. And this brought us to opening an office in Milan with around 30 people and there still relatively small team managed over 1,400 full truckloads in a single week. And as we had earlier, 1 -- 8 million parcels between Black Friday and December, which probably made up a large share of the Christmas presents that were delivered in Italy during last Christmas season. Now we're about to officially launch this partnership a joint venture. That will manage EUR 100 million in logistics spend with Poste, with they're bringing the know-how, the operations, the spend, and we're bringing the technology, our also -- our people, our culture into the picture in order to achieve -- an overall saving of approximately 6% and over the total spend. Then I was very exciting, a very fast ride with Poste. I mentioned earlier, I'm very excited or surprised that things are moving so quickly and so efficiently. That's why I'm more excited to start now the next phase with Poste where we fully ramp up this partnership. Thank you very much.

Thank you, David. So let's move forward in our journey of innovation. Now we skip on the opposite side of long-haul transportation and talk about the last mile. Because we're moving to the business-to-consumer battlefield. And as much as long-haul is being fueled by e-commerce, the same is happening in this space, where e-shoppers' expectations are continuously changing. And the bar is getting higher in terms of having and wanting faster solutions, customized solution. And in Poste is developing a innovation in this space, focusing on same-day delivery and schedule delivery, and working with Milkman has been a disruptive journey because they are disrupting last-mile delivery specialists. And one of the accelerator that is helping us in the next phase of development in this area. And by working with them, we can put Poste and Milkman into a leadership position and future-ready for the development of this area. And personally, I'm a big fan because I'm an e-shopaholic. So I encounter their service quite a lot. And so I'm very proud that we're working together, but I'd leave it to Antonio to tell you more about it. So Antonio, please welcome and the CEO of Milkman. Thank you.

Good morning, everybody, and thanks for having me. I would like to talk to you about our innovation process, starting from Milkman is actually -- the name we chose for this that's probably evocative. The 3-wheeler dropping bottles of milk, down the road. We do happen to also deliver some bottles of milk but obviously, this is more like about the technology that we built to enable innovative home delivery services. And home delivery services should innovate down the line to be loved by both online shoppers and online shops as well. And really, these are the main challenge of our industry, that the beneficiary of the service, the actual person we serve is not our customer, but it's our customers' customers. And it is very, very difficult to delight someone that you do not manage the expectations of. So that's why we invest so much in the communication channel. And I'd like to drive you through what we've built. But obviously, underlying this, it will be more clear why partnering with Poste was such a meaningful move for us. Because of the obvious implications and synergies of having new technology deployed in large network or logistical assets. So let's turn about -- I talked about how to build a great service that's loved by shoppers and shops. So if we look at the booming e-commerce adoption, it's pretty obvious that shoppers love choice, convenience, is open all day long, all through the week. And normally, there's good prices. So merchants have refined this by providing better user experience, better conversion rates, but they still struggle on the questions that arise on top of a consumer, while checking out, like, well, it's just a shame that I can't have it today, like I cannot assess it on my own to rely upon reviews, et cetera. And there's cost involved, if any? And what if I don't like it. So merchants struggle because they need the logistics industry to actually support them in addressing these points. So while building a home delivery service, you want to honor the value prop what people like of buying online, so offering choice, control and convenience also in the shipping service, and at the same time, you want to address these opportunities for us to doing better business with our merchants. So if we'll have merchants do a better job and delight their customers, we're going to win the market. Let's start with this first example, this is where we can help our customers doing a better job. I mean, this is a checkout page with just a few options, not very appealing. And this is where a solution like ours as integrated with the Poste network can help. The tracking page is also a bit legacy. It all -- it talks the logistics jargon, I mean, it's good to see that there's progress behind the scenes, but who really cares if a package left the hub at 4:37 this morning. What it really misses out to answer is the question, okay, when is it going to be delivered? I need this information because I have my own personal busy life. I have my own family logistics things to go after. And similarly, this is probably the most frustrating piece of the home delivery legacy software as a legacy experience, which is the not at home card, well, it's like shame on you, you weren't home. But I knew, I wouldn't be home. I would -- just to tell somebody not to come when I wouldn't be home. So this is what we build. It's a solution that can be embedded into the checkout experience is a widget like this, where shoppers can actually point out when they intend to make themselves available to receive the delivery. When can we show up? And they simply interact with this pattern and say, come today after 7:30, or I'll be home tomorrow after 2:30, but please arrive earlier than 5:00 because I've got to go out or come whenever you want provided that you come earlier than Thursday. I mean, being reactive is a big value. You want to serve customers as soon as they want. But I bought a tie for my sister-in-law wedding, I didn't need it that day, I need it by the 27th of April. The following week, I broke my computer, I need a new computer like immediately, right? But there was a chance for us to show up with both computers and tie. There's a lot of exercise in the math behind this, as you can guess, because everybody may choose the same half an hour. Everybody may create a big peak in demand. So we built a revenue management engine that made its calculation and built personalized ranges of options. And that you start thinking about the synergies with the Poste Italiane network and the Poste Italiane data set. In that data set, there's simply a lot of information for us to consume and build better ranges of options for our customers. You can do the same with the tracking page or you simply interact this with the mobile version, but it's a simple URL as usual and you can reschedule in any time. What happens next after we committed upon a time window. Well, we keep the user, the final user updated about our arrival time. No matter the window they originally chose. We want to update that with a more and more accurate prediction throughout the delivery day, like half an hour prediction. At this point, with a quick glance, they know whether to take that shower or to pick up the milk, by the way, down the street. And we also host the merchant brand, the logo we want, the entire experience to be branded because it is a big part of the overall purchase process. And we want people to be in the position of changing their mind. I simply have different priorities. Today, I want to stay in the office longer? Well, maybe I want to one more beer with friends, let's put it this way. And we want them to know that they have the opportunity. We even solicit them 10 minutes before arriving, we send them an SMS or an e-mail, and we say, hey, for last-minute changes, just click here. Providing value to the customer, to the end customer, does not mean that it's a premium service that costs more. Vice versa, technology enables a double win in this case. And in many others because if you align the customers' interest with the ones of efficient supply chain behind the scenes, you're winning market and provide better results. So this case shows that we switched to a live map. They see us approaching. They see the face of the guy that is going to serve them for safety reasons, and again, they can reschedule. This is great for them. But this speeds up the service times a lot. They are ready to receive us. And a successful result is a proof of delivery. So there's a timestamp, there's a signature of who actually received this, and that is a great chance for us to ask, hey, how did we do? I mean, Italy probably more than the rest of the countries in Europe, is a little bit behind in measuring results. And that is, I think what Melany was saying about the entire chain. And if you don't close the loop, you're missing a big opportunity. Also to reward great people because they are the ones -- there's a physical touch in the entire digitalized process, which can't be removed, and they are in charge for this. Customers can still be absent and we want to manage all possible anomalies, and this is all automated and tracked. And we provide evidence that we stopped by at that time. There's actually pictures. These are doormen being not available, for example, and this is so important for us. Dropping the number of tickets, like hey, you said you stopped by that's not true, where is the -- and building trust. If you want to be loved, you need to be trusted. What Melany introduced earlier, it's a process where you don't just talk and think about the future, it -- go live immediately. So we talked through the summer, and we deployed a joint effort with one of the most important customers, that's Amazon. It -- on time for the Christmas period. And through that, we managed to deliver, to fulfill more than 40,000 deliveries on appointment together, along with this customer's experience provided by Amazon. You see that there's 4 hours lost -- 4 hours loss and 3 years loss for the evening, which is just a little effort for us and for what the technology can enable us to offer. We can do, as narrow appointment as half an hour appointment. And so just think about what the future can reserve for us, but the important thing is that they are charging a premium for these value adds. So forget about free shipping, free shipping means that merchants are really great at selling products but not necessarily services. You want to have a range of products that's large, but you also want that same wide options also on the service. And this, obviously, U.K. is probably one of the most advanced countries as far as last-mile innovation goes, and we want to pursue the same kind of approaches, but with an Italian twist. So we want to provide also same-day options and evening options to serve families. Initially, these brands had chosen Milkman, despite a smaller, a modest geographical footprint. It was more like a proof-of-concept initially but then we realized that these big brands were so interested in innovating, providing their customers with something new that would better meet their expectations that they embedded our solutions even if with a limited small print -- footprint. And so if you think about the power of these into the Poste network, the synergies are pretty clear. We are launching soon this new skin. It's a branded version of the experience that I showed, and we are going to deploy this into the main cities in Italy. Let's give a look to costs and the cost structure. Serving constrained orders. So orders with a window. It's obviously -- it obviously implies also an extra cost. Because you have discard all those solutions where you arrive in a time that's not compatible with expectations of the shopper. Interestingly, though, if you keep good balance between premium and economy, and you drive scale through density, density meaning number of orders per square kilometer per square mile. These 2 lines gets converted to the same. So this means that we can offer extra revenue services at no extra cost. Same cost, you always have a truck stopping by at your house at a time it's convenient for you without implying additional cost. And that is one more reason for us to join the Poste Italiane network because Poste Italiane owns the market and the density and the capillarity. What's next, is more like a vision. It's one more reason why we needed to partner with someone that embraces this concept of open innovation. Innovation is all about testing solutions, really, iterating fast, pulling together an offer, put it out and see response and either wait further. So you need both scale but also an attitude, an attitude that desires to try out. What we tested in Milan at a small scale are up-selling services. So I'll bring you the shoes you actually bought, but that's for me a chance of also carrying over a belt with the same leather, so give it a look. Online shops have a lot of data and they do the same kind of approach to that data, so extracting information. They know that Melany's looked at the sweater for 10 minutes before buying another shirt. So why don't we simply show it physically to her, she's going to buy. So that's something that we should test at scale in the future. We built a service, we call it Milkman reception in Milan a few years ago, a couple of years ago. That was extremely interesting. People would shop online and use our depot as the shipping destination, as a shipping address. So we would be receiving parcels on their behalf. We were receiving hundreds of parcels every day for many carrier and as soon as they arrived, we would notify them, hey, we've got a package for you. So that they could schedule the delivery by the time it was more convenient for them to the evening, this Saturday, et cetera. Interestingly, 1 out of 2, consolidated 2, 3 or more purchases into one single last-mile delivery. This means sustainability as asked by the final market is not us pushing down what we think can be sustainable. It's them saying, hey, come when I want, do not simply come. The attitude of offering like a razor blade online and then having a truck that delivers a razor blade is not really sensitive, I mean, sensible for the future. We cannot have as many as the white vans or twice as them. We want to create consolidation and help families enjoy this. Immediate returns is another example that we tested. I'm bringing the shoes and you wear them on, and if you don't like them or they don't fit, I'll bring them back. With no additional, with better service, better experience overall and with no additional pollutions and emissions. And then there's much more. So I want to close with this point that we think jointly that logistics effort and the home delivery effort are really part of -- big part of the future of retail. And that's why we're joined -- we're partnering with -- we've partnered with Poste to start exploiting these and putting that -- and hitting the road together right away. And with that, I thank you. Melany?

Thank you, Antonio. Thank you for thinking that it takes me 10 minutes. It's more about 10 seconds. So we move away from million parcels, we've clearly seen that there's been a major embracing of innovation in this area. And so let's now talk about money and moving to the financial world. Poste and Moneyfarm, you've seen the brand that formed the partnership to deliver a very innovative digital wealth management for our clients. And for those who think the kind of wealth and Poste Italiane don't really match, are not really compatible. Let me just tell you that 2.6 million of our customers of those 35 customers are private and affluent, and they amount to EUR 310 billion of the EUR 540 billion total financial asset of Poste Italiane. So there's a massive potential in this space. And also, you remember we talked about API, and this comes together because this was 1 of the largest API-based agreement that it was done. And one of the largest in digital wealth management in Europe, given the large customer base we're starting from. So Matteo talked to you in the past already. It's one of the key parts of our Deliver 2022 plan. If you expand our portfolio in financial services in our product and trying to become a financial one-stop shop for our 35 million customers. So before I hand it over to Paolo, which is the Chairman of Moneyfarm, I want to show you a quick video of Postemoney, which is the service that we built together. Video, please? [Presentation]

Please welcome Paulo Galvani.

Thank you, and good morning, everybody. It's really a pleasure being here today at this event and being -- and having the opportunity to work together in this very meaningful partnership for Moneyfarm and Poste, I hope. First words about ourselves. And why Moneyfarm. You have seen the presentation. But in a nutshell, what we have thought a few years ago, myself and Giovanni was that there was really a big opportunity and a big gap in the investment space between what small and medium clients are looking for and what's the offer is. Usually, people with some money aside, they are looking for advice, for someone who helps them to reach a certain objective, a certain goal. And at the end of the day, the products are not exactly what they care. They care to reach a certain goal. On the other side, the supply tends to be very much focused on selling products. And here, you have the first important misalignment between what is the needs of the client and what is the industry structure, which is very my -- very well focused on selling products, not to add the concept of potential conflict of interest in between the type of product has been sold versus the objective of the client itself. So we try to basically set up a solution that was much more focused on helping people to reach their goal rather than selling products and provide this advisory service in the most independent and unbiased structure as possible. Now as you can imagine, a physical structure is a problem simply for scale economies, scale structure. So you need to use technology in order to deploy a solution like this one for everybody depending on the amount of money they are investing. Today, we are managing more than 40,000 clients, more than EUR 1 billion of assets under management in a complete B2C approach. Through 3 countries growing, I would say, in the last 3 years, about 100%, 3 years, both in clients and assets. We raised substantial amounts of capital, as you can see with 120 people spread across 3 countries, which are Italy, U.K. and Germany. Now key points, let's say, I briefly touch it. You've seen the video, but let me go quickly through the 6 points that we would consider important. And then we will somewhat highlight how hold this conversation fits perfectly into Poste way of seeing in the investment stage at how we can build a very meaningful partnership. So first of all, simple, transparent, flexible, digital platform. I told you at the beginning, it is critical to build central that is as transparent and as easy as possible, for the client to understand what we are talking about. We make the transparency and the ease-of-use, the most important things, and these goes hand-in-hand with usability with technology and with the way in which people can understand what they are investing for. We were talking about advice. Well, technology allows you to make something, which is more personalized. Again, the video shows you the set of information we are collecting in order to profile you in the best possible way and understanding which is your risk profile, your risk tolerance and how to basically somewhat match your need with a proper investment solution. Third, what do we sell at the end? We do sell portfolios of ETF. This is the most important activity we are doing, why we're choosing ETF? Well, ETF, as you know, are passive funds. They are really low-cost structure. And what do we do in deploying these things, and I will go briefly through the investment strategy afterwards, is basically, we set up a portfolio of ETFs, very well diversified, that touch basically all different asset class. And as you can imagine, for a client that want to invest EUR 10,000, well, basically having a portfolio well diversified in different tools, with different exposure is definitely an approach that otherwise from a traditional, let's say, distribution network would be not the case. It would be more kind of a fund or a specific bonds. It's an hybrid service model. And this comes, what has been the most important lesson when we started in Italy at the beginning. We are talking about investment. We're talking about money. So we initially thought about, let's build something completely digital. And it took up very little time to understand that, in fact, for most of the people, human touch point is necessary. So you need somewhat to build a moment to client -- in the client decision in order which a client can somewhat talk with someone and understand who's on the back of the technical structure they see. So there are a few people that like to do everything by themselves without anything -- with any interaction but there's a lot of people who looks for this moment in time. And so we built this hybrid approach that allows basically to have -- to offer the client both, direct and an indirect basically interaction. It's a scalable platform, and this goes hands-in-hands with the technology and the way in which we have built it. We built basically all the stack, all the technology by ourself. Out of the 120 people you have seen in the company, more than 50% are dedicated to technology stack from the front end, back to the back end and the infrastructure. And why is it important? Well, because this gives us the twist on the product and the velocity and flexibility to build the products in a more effective and fast-moving way possible. And finally, we will add, and we are keep on adding more and more products to the platform. So we have started with what is called in Italian, [Foreign Language] So instead of discretionary mandates portfolio, there's a pension products, both in Italy and now in U.K. and more will come like ESG, for instance, line of products or guaranteed products as well. Now as I already told you, these are the numbers. Those are the assets. Where is the contact point between Poste and Moneyfarm at this stage? Well, I think you can easily understand how many potential important points are beyond this kind of approach. On our side, working with Poste means opening up this kind of proposal to a very large potential amount of clients offering them the opportunity to enter into a model like this one, as I said, completely transparent, ease of user and low cost. And for Poste, I think, is a fantastic opportunity to enter into the investment space. With a new digital approach, which is very much in line with the philosophy of the group, which is somewhat very sensitive to the way in which things are deployed to people, to responsibility. And to the fact that at the end of the day, this big opportunity could be taken in a complete new way, very effective and very open. Two words on technology, just to give you a bit of a highlight on how everything work on the backstage. So as you can see, the light blue box represent a numbers of micro services that we have built internally and which basically allow us basically to divide and manage all the service you have seen in the video, so from the profiling to the investment creation to the portfolio to the data analytics, completely on a proprietary basis. Again, the fact that we completely control this part, allow us then to modify and adjust them accordingly and to make it more and more effective. And then, as Melany were saying at the beginning, structure on APIs, basically, interact and interface, all these micro services within the Poste properties, which means basically that you can find all these services within the Poste web work in, going to say, personalized and tailor-made structure. On the left, the custodian structures. In other words, where the security lies, which are in case -- in the specific case, [ Saxo ] and [ Sella ]. And on the right, there's the third-party service providers, which basically somewhat helps to make all the core of the business more effective, adding value-added services through the use of, as you can see, Salesforce or Tableau in order to make these things more and more effective. Again, the importance of technology controls is really that this gives us the opportunity to have something extremely transparent and extremely tailor-made and low cost. Two words on the investment process, given the audience, I think it could be interesting of understanding how do we manage the money at the end. I mentioned already the ETF approach, there is -- just to talk about Italy, there's more than 1,000 ETFs listed in the stock exchange. So selection, ETF is a big job anyway and finding the right ETF to invest is an important part of the job. But first, there's a beginning way of building the long-term vision of what macro variables will affect the markets. In other words, expectation of macro variables, 5 to 10 years horizon, in terms of return of volatilities that are then dropped into an asset allocation models in which we are basically setting our return expectations, and our risk approach. And we then build 7 profiles, 7 model portfolios with different mix of returns and risk embedded into it. And for all of these 7 profiles, we then basically -- decline these profiles into a portfolio of ETF, which are very, very well diversified from fixed-income bonds to corporate, to equity, to emerging markets, to commodities. So that you basically can find yourself invested even with EUR 10,000 in 7 ETFs with different weights that basically represents the expected return and the risk you are supposed to run. This is, again, an internal process that we run as a company. And of course, when we then work together with Poste in order to build specific lines for Poste clients with specific level of risk and return for the type of clients that we are expecting to find in the Poste world. The partnership started effectively in terms of product deployment and the openness of the product yesterday. So as of yesterday night, you can find a link into the Poste website that can allow any Poste client to invest. Clicking the bottom and entering into the pattern that you have seen in the video. Of course, this has been a relatively longer, but for the type of exercise, short, I would say, as well type of exercise because it took us no more than 6 months basically to embed all our knowledge and technology into the Poste world, which I can tell you, for prior experiences is quite quick. And today, we are basically ready to go with a product that is now a Postemoney denominated one. Final remarks on a few points of the partnership. As I said at the beginning, as you probably have understood by the type of products we are building and the type of solution we are offering, there's a very, very close vision on the type of service clients are looking for when we're talking about investment. And this has been probably the key element that basically helps to kick off the interaction with Poste, somewhat sharing the way in which we would like to treat our clients and the way in which we think it's important to offer clients products like this one. Of course, Poste is benefiting from our experience in ETF, as I said, selecting ETF is not obvious. And so this experience and the way in which we are building portfolios are beneficial for Poste and especially for the clients. Of course, it's a mix cooperation in the sense that technology is provided by us, where the clients are managed by Poste so this means that all the customer journey is in the hands of the Poste, while ourself are basically helping to the infrastructure, helping the back end and helping the asset management. As we said, we've already spoken about the asset management. Of course, in all these things, the reputation and the brand of Poste becomes paramount. And I have to say this is definitely a game -- potentially a game changer in the space of the investment space and the asset management space because it's really the first time that a large player like Poste embrace a digital approach in order to help clients to invest their money in such a clear and important way. Poste has been our investor, it started investment. So it has an investment with us and a Board seat, which again, it's very important because it allows us to work more and more strategically in future objectives in terms of investments based on what we can do in the future. And I would say with this, I have finished. And I'm, of course, around here and happy to take all your questions now or probably later on. Thank you.

Thank you, Paulo. So we're moving on to the final part to see what other innovations are around the corner. And you'll hear from our very own Marco Siracusano, the CEO of Postepay. Under Marco's leadership, Postepay has been -- has played a critical role in the transformation and the digital transformation of Poste Italiane. And it really accompanied in the innovation journey as a product, as an entity now and as the largest Italian electronic money institution. So the -- his team in payment and mobile and digital has really been a kind of a growth engine for Poste because it has brought continuous revenue and continuous results, thanks to the very successful commercial launches that it has been doing. And continuously, literally bringing new products and solutions to the market. For example, the convergence play between mobile and payments such as Postepay Connect, but also trying to transform itself from moving away from a payment method to a future-ready open platform for payments in a payment platform in a, actually, complex ecosystem. So Marco will focus on some of these innovations, such as Codice Postepay, which you'll hear from and how Postepay's becoming a fantastic announcer of our digital offer. So over to you, Marco.

Sorry. This microphone. Thank you, Melany. Good morning, everyone. I, just to recap that probably you already know that Poste Italiane is a trusted leader on payments in Italy, considering our 27 million cards in circulation, considering 1.1 billion transaction and also, for instance, our market share of 25% on e-commerce transaction. So since Postepay inception in 2003, 2 years later, PayPal arrived in Italy. Innovation has been always, let me say, central throughout our business, throughout our let me say, range of products. I think that you can see in this slide, the Postepay ecosystem and the strategic vision of our CEO to put the -- inside the Poste Deliver 2022, the creation of Postepay SpA, let me say, has allowed us to proactively shift, let me -- our status of being an incumbent in issuing services to leader in digital payments. In order to capitalize opportunities coming from the complex choices facing our customers in a new digital world. Thanks to Poste investments in IT. Thanks also to the new customer transformation function, we are driving greater integration, it delivering more synergies, both within Postepay and across the entire group. The digital payment sector is rapidly transforming in terms of services, products and customer experience, both on consumer side and on the merchant side. And our ambition is to exploit our capabilities as a market leader and to become an innovator in order to compete not only with the traditional banks, but also with Fintech, the digital giants across all product lines. You can see that we really put in place during the last 3 years, the Postepay ecosystem, starting from cards for mobile payments, to telcos going ahead also in very distinctive platform like the loyalty in-store acceptance, online acceptance and also payments on public administration. So this kind of ecosystem, let me say, also is at the center of our strategy on digital payments. And here, I -- let me show you a short video in order to sum up the features of our ecosystem. [Presentation]

So you can see that we are a fast-moving incumbent in issuing because we are very keen to transform our innovation, and our moving. Also, let me say, we will use our trusted status, our innovative infrastructure and our valued-added services offer to serve millions of Italians that are increasingly adopting our platform. This is very, very relevant for us. We have to consider that, that kind of growth on traditional card-based world, on digital world are amazing. Also, for us, are the opportunity to increase our positioning, considering that a lot of Italians are not yet customer of BancoPosta but they are adopting the digital platform, the digital payments coming from Postepay. And this is very, very important for us. So many of you have heard the wider Postepay story during the last capital market days. And fortunately, for me, during the last one-to-one meetings. So therefore, I would like to focus my presentation of the new innovation on business side, Codice Postepay, even though the last year innovation, that Melany mentioned before, regarding Postepay Connect has been on consumer side, a very successful product and project for us. So this is Codice Postepay and we are launching Codice Postepay as an internally developed app-based acquiring solution. It is a QR code solution. QR code is a payment technology very, very well used in Asia, not yet in Europe. And let me say, we would like to be the players that starting a new kind of history on payments, considering not only our traditional card-based solution. Our new for the future account-based solution. But we are keen also to explore all the other technologies that are coming from the digital players. And for sure, QR code coming from a big leader in Asia is something that we put throughout our offering network. And we are, as you know, a leader in issuing side, but we are sincerely speaking, a new comer on acquiring. So we recognize that, let me say, a fully innovative app-based acquiring, especially for under segment, underserved market segment in Italy is very, very relevant. Talking about addressable market, we consider that there are 2.3 million merchants in Italy, 1.1 million without POS, 1.2 million with the POS. And also, we think that we can target these businesses throughout Codice Postepay and throughout value-added services linked to Codice Postepay. Codice Postepay is easy to use, is convenient, is secure. You don't need a Poste -- you don't need Poste terminal with related cost and requirement. You don't need a new dedicated account because Codice Postepay offers direct credit to any bank account. So this is the concept to have a -- to put in place an open platform. And of course, merchants are, let me say, immediately integrated as value-added services to our ScontiPoste loyalty program. ScontiPoste in Italy is one of the major cash-back program, it is very, very relevant from consumer side. And ScontiPoste can give to the merchants -- can give the opportunity to have in conjunction between our millions of consumer customer and the new merchants that will adopt Codice Postepay. And also, we consider that, that kind of platform, that kind of value-added services could give to these small businesses, let me say, in particularly, we are talking about professionals. We are talking about small businesses that are -- that in some cases, do they need to have the opportunity to increase your business also using that kind of partnership? And I think that we also have to also consider that we can offer in -- as one of the feature of our platform, we can offer immediately instant access to 5 million customers with active e-wallets and in time, 12 million customers without active e-wallets. So you have to consider that this new kind of acquiring a solution is something also that we are put in place in order to transform cash payments into digital payments because our mission is not only to fight with other acquiring, but our mission is considering the fact that in Italy, for the time being, 80% of transaction is still made by cash. We would like to put in place for consumers and merchants all kind of product and digital payments to transform cash in digital payments. So how does it work, Codice Postepay? Codice Postepay enables Postepay app users, that kind of million of users, to pay for goods and services without the need for cash or card. By simply using the app on their smartphone to scan a QR code and -- at the merchant counter. At the same time, the merchant uses their app to manage the transaction at their end. Let me see you a short video of Codice Postepay in action. [Presentation]

You can see that Codice Postepay is fully integrated into our new app for consumer. It is a very relevant -- a new use case that we are put in place. On the other side, there is the same experience on merchant side. This is very relevant. But again, for us, it's very important to transform cash payments in Italy into digital payments. Codice Postepay is officially launched in January, and it is being rolled out throughout the top 100 commercial shopping districts in Italy following a very successful trial in Rome. We will also soon rolling out Codice Postepay across our post office network because we deeply believe that also the post offices will be a big boost of this new kind of technology because -- as a means for pay services and products available over the counter. But also, we think that our mission is to develop our ecosystem, but also to put in place very relevant partnership for us. And regarding QR code, this launch also will coincide with the start of a new Postepay agreement partnership with Alipay, a world leader in the digital payments. So this is important because I mentioned it before, that that kind of technology is very well-adopted in Asia, and we are very happy to have an agreement with Alipay in order to combining our evolution on QR code with the leader of QR code in the world. Even though for the time being, the agreement will allow Alipay customers and tourists to pay at our post offices back in the second half of 2020, also paying -- using QR code in the same store accepting the Codice Postepay. So for us, is very, very important, this. We look forward, in any case, to updating you on Codice Postepay during the next IR event. Let me now give you some -- our total -- our positioning about how we see -- let me say, the open banking. Because the shifting banking landscape as a result of PSD2 is an area of potential growth for Poste Italiane. With financial institutions no longer, let me say, enjoying a monopoly on payment transaction data, we see an opportunity to capitalize on Poste's trusted status and ready-to-go IT as you -- as Melany mentioned it before, in order to expand our offer. It become more central in our customer digital world. Again, from a Poste perspective, there are 5 million Postepay customers with active payment e-wallets, where there are still more than 12 million customers without an e-wallet. And we need to more actively target them. Compliance with the PSD2 for the time being, let me say, in terms of account aggregation of payments, initiation services has been a starting point for us, leading us, let me say, to better use the data and tools and also to deliver an enhanced customer experience, particularly from our multibank bank. Because, let me say again, one of the big value, in my opinion, of Postepay is to be really a source of domestic over-the-top because there are millions of customers that are still happy customers of their bank, but they are heavily, as I showed before, heavily adopting Postepay platform and digital services. So PSD2 is something that in an open API architecture, we can address offering to that kind of multibank clients. And of course, again, we think that we could be the domestic players that offers our platform and services to all potential payment customers, no matter who they bank with. In addition, a PSD2 benefit is access to third-party PSM data, which allow us to better profile, let me say, potential customers and offer more targeted propositions both for consumers and again, for small business. Because what we are doing on Codice Postepay framework is the ambition to be what we did in the past on consumer side. Small business is one of the new target that we would like to address. We are an incumbent on consumer. We are a newcomer in a small business. But again, let me say, putting [ plain ] in open platform, also we can have different products and services also to target that kind of business. And rather than looking at customers in silos, payments, banking, mobile, because you have to remember that also Postepay SpA also has customers coming from payments, customer coming from mobile. We believe that our offer, built on trust, open API architecture and value-added services will allow us to attract all Italian digital customers in a different and highly competitive way. In this context, we have been working with our partners at Tink, Europe's leading open banking platform, to boost our internal efforts, because this is what Melany and the CEO explained before. We deeply believe that what we are able to do end-to-end, also we have to complement with a very relevant partnership, both on commercial side, like Alipay; and on infrastructural side like Tink. Through API, Tink allows customers to access aggregated financial data, initiate payments, enrich transaction and build personal finance management tool, very relevant also for the Postepay customers base. And as announced this week, Poste Italiane has invested in Tink's latest investment round demonstrating our interest in this ambitious growth business. So thank you for your attention. Please welcome Daniel as the CEO of Tink.

Hi, guys. Thanks for being here today. So I'm Daniel Kjellén. I'm CEO and one of 2 founders of the open banking platform, Tink. We like to think ourselves as the rails and the brains of open banking, meaning that on the rail side, we build connectivity to now 2,500 banks across 13 markets. And on top of that, we build value-added data services that helps our partners, financial institutions, to get the most out of this infrastructure. And as mentioned, I think that it's fair to say that retail banking market has been one of the static markets where we've seen limited innovation. And even if you did or put out fantastic products out there, it didn't really matter because you didn't get the amount of new customers that you truly deserved. I think that there has been 2 distinct reasons for that. One is the monopoly that the account opening bank have had on viewing transactions, balances and to make payments, which kind of gives you a day-to-day [ forced ] relationship with the [ other ] client. And with that, you can do financial advisory and kind of the only one who can do -- or to sell financial products. On top of that, retail banking has been, to a large extent, analog branch business. But what we're seeing now is 2 megatrends in banking. One is banking going from analog to digital and data-driven; and going from closed to open. I think that this is probably the most rewarding time ever to be a banker, because for the first time, the innovators, the first movers, is going to get the upside -- the number of new customers that they truly deserve. This transformation obviously poses opportunities but also to some extent, threats for the participants in this market. For the account opening universal banks, this means they need to do so much more with the data to keep their customer relationship in a new competitive environment. For the niche FIs, for the fintechs developers, it means that for the first time, they are on par with the large traditional banks in terms of infrastructure and can compete to increase their share of wallet. What we see on the European scale is that people are heading in the direction of building bank-agnostic bank services, which is completely data-driven, which means it doesn't really matter where you signed up initially and where you have your salary account, because you plug in whichever bank you want into new financial services and use them. So what about Tink? We have been live since 2013. We're almost 300 people across 10 offices in Europe. We headquartered in Stockholm. Super happy to have Poste Italiane join our last funding round that we announced last week, EUR 90 million, which is basically us doubling down on building pan-European connectivity and value-added services on the platform side. So short, it might seem or even look complicated, what we do, but -- so on this side, we built a proprietary network of connections to 2,500 banks, 13 markets. We connect all of those connections into one platform. And on top of that, we then add value-added data services. Could be data normalization, cleaning, financial insights. Secondly, all of our customers can access this platform through one single API, which allows them to let their customers connect banks from other financial competing banks into the Postepay app for example, to aggregate data and then getting financial advice, but also to execute payments from other competing banks. On top of that, all our large customers, enterprise clients that we have is also feeding all of their internal data to the Tink platform in real time. We process something like 0.5 billion transactions per month from the likes of PayPal or Klarna, or [indiscernible] ABN, Nordea, RBF, BNP Paribas. The Poste partnership here -- I mean, first, I think of a history of trying to partner with the innovators across Europe, both the fintech unicorns but also people with strong local brands and market knowledge. And I think to me, the biggest opportunity in this market right now is for people with strong brands, and large customer bases where a majority of the customers has another bank account, so with typically a smaller share of wallet. In this category, you'll see the likes of Klarna, you'll see the likes of PayPal. But to me, you also see the likes of Poste, with 35 million customers, extremely strong local brand and where a majority of customers has a relationship with another bank as well. So the opportunity here is obviously to be a first mover, which I think we truly have the potential to do together in Italy and to increase that share of wallet. The plan is to use all of Tink's services, the aggregation, the payment initiation, but also the data services, both for non-Poste users as well as the entire customer base. The typical areas of use for these technologies, which is also the plan for how we want to use this with Poste, is that people use that to increase conversion at onboarding, number one. That means that you can do credit scoring, you can let customers take their entire financial history with them when switching banks or it's just prepopulate or verify a bank account. It's about increasing engagement. It's about helping the end user understand her finances through enhancing and enriching the data set. It's equally about to get the bank to understand the customer base because without that local branch or dialogue, it's all need to be done via data instead. And to use the understanding of customers and the customers' understanding and understand it -- their -- the customers' understanding of their finances, as kind of a common ground to do financial advisory and to ultimately sell financial products. It is about targeting intelligently because once you see that your customer is aggregating data from a mortgage account or a pension account, savings account from a competing bank. Of course, it's a fantastic opportunity to send targeted offers to these customers. And it's about to transfer funds. That part can be done by executing on an advice saying you should move money from 0% interest to something better here at Poste and then drag money from competing banks into the Poste app. It can be facilitating a more smooth process when topping up your Postepay app or just as a way of paying online. The deal here with this partnership is to leverage our pan-European expertise and kind of knowledge of best practice together and pair that, obviously, then with Poste, with local teams with a local knowledge to the 35 million potential customers here. It is not for us about just sending a documentation and say, "You go build something." But we are making all of Tink developer teams, innovation team, research, et cetera, available and co-create products with Poste with the aim of actually then bringing amazing products that we jointly created. We're just getting started, but I had a funny incident because my co-Founder and CTO was down in Milan meeting Mirko, who is the CTO of Poste. And he came back and said, "Daniel, these guys are pretty sophisticated. They use the exact same tooling and programs that we would use." And truth be told, I mean, Tink pride ourselves as an engineering-driven organization. We have the luxury of not -- or have only been around for 7, 8 years, meaning that you have less systems and integrations and so on to take care of. And we work with a bunch of mega organizations. I don't -- I -- it's not always the case, but very happy to hear those words, and we're truly looking forward to the partnership. Thank you very much.

Thank you, Daniel. So our journey is now finished. So I'm going to leave it to Matteo Del Fante to the final closing.

So we're very mindful of your time, and thank you again for paying attention and we'll finish sharp at 12:30. Just a few minutes of wrap-up on what we've seen today and then open to questions. Those initiative we have seen this morning are addressing 3 targets at the same time. The first one is, obviously, going into our client road map in any single business, starting from the last one we heard, it's very clear. Think about Milkman and same obviously for Moneyfarm. And the internal innovation that we develop, obviously, is aiming at giving a better service to our client. And making more and more Poste, not as a company that is selling one product or another in different industries, but a company that offers a platform where the client find different services. And then you're not selling the payment, you're just using the payment to service your client with other options and other products. The second objective that we achieved, obviously, is the one -- we invest some money -- this company looks really good. I'm not an expert into scale up or private equity, but they convinced us as an equity story. But I think the third, one and is typically the example of sennder, in this case. They allow us even to enter new markets because there we are not addressing a client's need, which is in full truckload. We were clients of small companies, as David has shown us, and we were spending EUR 100 million per year to get our Mail & Parcels around Italy. So we were -- in our cost structure, you will see EUR 100 billion of COGS related to that business. With this initiative, you see that giving this business to sennder, we have a saving of 6%. And in logistics, 6% is a big number. But we give to this new company we built with -- we launched with sennder GmbH. Our business flow and therefore, we make this company much more likely to succeed in Italy. Because we give the platform, we give the flows, and you can call it kind of a Uber of food truckload. You put in the country a big fleet of Uber to start with. So you need -- you don't need to start with the first one, first car, 3 -- third truck, 5 truck, you start already with -- in December, 8 million parcels delivered. It's already a platform, it's already a market. And at that point, that company can go and sell those products to other clients that are in the business. So for us, in a way, to some of the clients that sennder would serve, we would have never thought of being able to go and offer a service in full truckload. We were a client the same way they are clients. So this is a very special opportunity for us. And I think this -- the things we -- as shown with our partners today, are very close to our road map, and I think they're very strong in telling where we're going. I think the Postepay needs a special focus because as Marco said, we are very present with the issuing side of the payment system. But historically, we are not present on the acquiring side of the payment system. We think that there is a transformation. Obviously, Italy has a huge opportunity because there is still 86% of payments being made by cash. So that figure goes towards the 50% or below that we have in more mature market. Obviously, there is a lot of volumes that are going to go digital. So the wallet of the market of digital payments will grow. And we think that naturally, there will be space next to the card business also for digital device-driven payments. And there -- and I'm closing with this remark. Data, which is the theme that goes around all these ventures. And I think some of you might say, "But why didn't you build this initiative internally?" Possibly, we could have had the idea, okay? But this company started 10 years, 6 years ago, they have very smart people, focused, there is proper technology. And what they know very well is how to use the data. And the learning that we get from these companies on how to use the data is very important. And in Payments, we think that at the end, the value we will bring as a platform, is giving data to our clients. So giving information to the acquiring side. Today, Payments is about, you know, the fee that you make on the transaction. I think in 10 years' time, it's going to be much more in giving -- in value-added services to the merchants and the payer and the issuance side with the data that you need to use in the best way possible. And we're already doing the first pilots in this space, and we think that this is really the future of the system. And I think we're ready for questions

Ashik JPMorgan. You have the mic now. Yes, every table has a mic.

This is Ashik Musaddi from JPMorgan. A pretty impressive presentation. Nice to hear this. A couple of questions I have. One is on Moneyfarm. And second is on Codice Postepay. On Moneyfarm, I mean, we -- in U.K., we have something like Hargreaves Lansdown. It's a big platform business, which is, I think, what you're trying to do with Poste -- BancoPosta investee thing, but you have limited funds at the moment. And then, it's mainly focused on ETFs. So how do we think about the charges that you are charging to the customer? How should we think about scaling up more funds into this to give more optionality to customers? How should we think about those things? I know it's very early days. It's just launched, I think, yesterday, I think, it was mentioned. And any thoughts on that? And secondly, on Codice Postepay. How should we think about the benefit that the merchants get when they use this QR code? Is there any monetary benefit as well or is it just the experience, anything that both of them get? And what are your plans? Like what are your expectations by the end of the year, you'd be getting 1,000 merchants signed up? Or any thoughts on that? Any number's great material.

The pricing of the Postemoney product is clearly competitive, but versus the physical asset management industry. And we believe that at Poste, we have the responsibility of helping people to save. So the issue of the asset allocation and more products goes more in the direction of tailor made in -- and it was mentioned by Paulo, by the CEO, in terms of pension schemes, more tailor-making on benefits, sometimes tax benefits, that are not taken by many Italians. And the focus is more there because we think that's on the asset allocation. And on the product line, on the asset side. There is some innovation, but we think there is more upside and more need for our role on making people save in a more efficient and sizable way. In terms of the merchant benefit, one can say convenience. But that you have to take it for granted. We think that the convenience alone is not enough because, as I was saying, the merchant and, you know, all players have a tendency to stick to the habit. So changing the habit is a big thing. I don't know how many of you came via tube, but it was clear in this country that when you were allowed to replace [ Oyster ] With Contactless, it was a big change in the way people perceived the credit card. So there is a stickiness on the merchant side to the current means of payments. We believe that the data can be really the way we can make a difference for them. What do I mean? Having a lot of clients already using our payments. So the 27 million cars, we have web information, in any point of time, on where they are and what they spend. So if the merchant wants to attract, now and there, some clients, we can activate ourselves to bring more business to that merchant. And then at that point, that merchant is probably happy to pay for a revenue increase service as opposed to for the cost of using one electrical -- electric tool. I think it was Gian Luca.

Gian Luca, Mediobanca. Three questions. The first on college Codice Postepay again. Can you share with us some results of the pilot testing role? So how many merchants tried and how many merchants are still using the service? And can we think about these as the first way to jump in the SME segment going forward? So to set out a proposition for SMEs, once this project would be up and running, and hopefully, with good numbers. The second is on Moneyfarm. Now if I look at your proposition in asset management, investing in Life, I guess, with Moneyfarm, you have the solution with the lowest margins. And first of all, I would like to understand what is the fee-sharing when a client is buying a Moneyfarm Manager account, I guess, serving online use Manager accounts are having management fees around 30, 40 basis points. So I was curious to understand what is the sharing between you and Moneyfarm? And linked to that, you are setting up a network of 9,000 Relationship Managers. So you are having a cost to serve when you sell a financial product. With Moneyfarm, as we said, margins are not very fat. So is this going to be a pool product and an Internet product. So I go there, if I want that, but it is unlikely a Relationship Manager will drive me through this kind of product. Is this correct or not? Last is on Tink. I think, it could be disruptive if you can manage all the data of all your clients on all the banking relationships they have. I guess, clients had to give you the approval to access their information. So how many of your 30 million customers gave you the capability to look into their own things? So what is the population where you can start working for cross-selling, up-selling and sending commercial offers?

I'll start with the last one. We signed last week and we started a journey. So I think it's very premature, but we need anything, all banks need to move. And then maybe in a few months' time, I'll be able to give you a more precise answer. On the margins of -- on the logic of Moneyfarm, yes. Totally. We will -- we let this product grow by itself because it's adding one extra option for our clients. It's an extra stream of revenues for us, but is independent from our physical clients' business, which is the one which is actually in our Deliver 2022 plan. So you should see there's an add-on at this stage. In terms of margin, Massi said we don't comment. We have to decide the strategy without a comment on this because the moment we disclose the fee structure, obviously, we make a commitment to keeping that disclosure over time and is premature. The code was tested in 100 shops. And they keep using it. The beauty is that it's a print. I mean, there is 2 versions. There is the one, which is a static picture that you print. There is one with an RFT transmitter behind it. So you can do the Contactless. And it's behind the QR codes. So you can choose -- Your open the camera and point to the code or you put the phone next to the code and you have the same experience. We think that this is, in terms of SME, not going to change our soul. We are a retail company. The beauty about the code is that it can be sold easily because, basically, to get a code and receive money, you need to fill a form, where you give us the name of your company, the bank account where you want to receive the money and the e-mail, or if you're using an app, but not even -- you would download the app where you want to receive the message that you've been ordered the transfer. So the easiness of sale is very similar for those of you that are familiar with the Postepay, the way we were successful with the Postepay is that we have our postal offices with Postepay on shelf with a number on the card. You enter the post office. You say I want to buy a Postepay. The Postepay is taken from the shelf. In the system, you link the credential of the person to that number. At that point, the person is basically in our systems. If he downloads the app, it's recognized as that person and the app uploads the card, which has been bought in the office. You can think of a similar experience for the code, okay? Maybe you have a bit of know your client exercise, that obviously, we have to do but is a very easy product to distribute. So it's just a matter of getting practice. And we believe that the physical presence will help because the agreement, Marco mentioned, is with Alipay is exactly in this space. The agreement is allowing us today, as we speak, you go into a post office, you're Chinese, you have an Alipay app that's your wallet back in China and you want to pay in the post office. Then we have a device, which is already there, which is producing a code that is talking to that app. And so we get the credit in Europe, and he gets debited back in China. So the moment that the post offices will start offering and tutoring the learning of this new way of paying, it will accelerate. And this is in the plan for 2020. So we're going to use the physical presence to get people familiar with the system.

The next question is from Irene from MainFirst

Irene Rossetto from MainFirst. My question is on Milkman. What share of Poste Parcel you expect to be tackled by Milkman? And do you expect some profits benefit or is mainly a customer experience improvement?

It's a good question. I mean, all these initiatives are not in Deliver 2022. We have some internal business plan, obviously, but is all additional. And we don't anticipate that it's going to be fast or having an impact on our financials soon, okay? So let's make it clear. So we don't even talked about market share of the Milkman, but it is clearly a value-added service. And for Poste, which obviously is in the mail space goes back to the memory of the old business for Poste to be able to say that in Italy, the top service in parcel delivery is delivered by us with our partner is already big value because it's changing the perception of the company.

Elena from Banca IMI?

Yes. I have got 2 questions. Actually, the first one is on Moneyfarm on your partnership. What kind of penetration would you expect on -- for Postemoney in the investment within your clients' base? And the second one is on the future. Are you working on other potential partnerships in the tax space and in which segment or -- okay.

For the first question, again, we have -- there is no target in terms of share of our asset management business to go with Postemoney today. Yes, we're looking at a few more, but we think that these are the key. We've been working more than 2 years to identify these 4 partners. So I think, there might be space for another or a couple more. And we are always looking at opportunities, but this is already for us a big step forward with these 4 partners.

Enrico from Crédit Suisse has a follow-up questions?

Enrico [indiscernible] from Crédit Suisse. I have a question related to Tink. As the colleague was mentioning, in U.K., we have players like Hargreaves and a lot of platforms that, to some extent, are competing in the same market space. And I found very interesting, the discussion about the technology of the API that would allow to transfer money easily and funds from one bank to the other. I was wondering how easy would be to replicate or extend that technology? Also more broadly speaking, to the asset management industry, so within the platform space, for example, transferring money from Hargreaves to AJ Bell or to a different type of platform?

Eventually, I guess, Daniel (sic) [Enrico], it is going to happen. It's a matter of, probably, time. Maybe if you want my opinion, as many -- we all have experience with disruptions. And we tend to make 2 mistakes. Sometimes, you think that it happens too fast because you understand the way it will change. And you think that in the next 6 months, it all would be changed. Then -- and that's a mistake because it takes time to get the disruption. Sometimes, you do second kind of mistake, that if it doesn't click at the beginning, you think that it will never click. It didn't work. So you have -- but part of the population that is putting the disruption away from the time horizon, probably too far in the future. And another part of the population that thinks that it will happen too fast. Most of the time, the disruption takes unless it's one of those more viral disruption, but it is not the case, I think, for banking or for asset management. It's going to take some time, but it's going to happen.

Giovanni from Equita.

A very quick clarification on what you said about your Poste -- Codice Postepay. Did I get correctly that you will charge a fee on your -- on the merchant. And then clearly, as the landscape in the payment ecosystem is very crowded, I think that at the very beginning, your value proposition would be relatively aggressive vis-à-vis the other players. And then another more broader question on what you said before about the fact that clearly, your physical infrastructure still plays a crucial role in Poste Italiane -- in Poste Italiane business. This is even more crucial as long as you add new services. So complexity increases in your product portfolio. How is your CRM system integrated, how do you think is integrated your CRM to allow your colleagues at the post office to be able to engage the customers because you clearly leverage on the 35 million customers. A lot of them, clearly, goes in to the Post Office. So it's crucial to have also the infrastructure. And how happier are you with these infrastructure at the moment?

Yes. I think in terms of the commercial offer on the merchant side, obviously, there would be some commercial offers launch product strategy, where we're going to be more aggressive. On the second question, I think, that gives the opportunity, maybe, to calm the -- in a way -- the audience, you know, I was meeting an investor last week. He was anticipating some of this topic and he tells me, "Yes. But you know, it's very nice all the things that you're doing in different industries. But at the end of the day, you are a legacy firm." Okay. So if these guys are trading us very important values, you are still a legacy firm. Okay? And we know, we're fully aware, that we're a legacy firm, but what we do in technology allows us to have more opportunities to remain a legacy firm, to start with, and to be good at technology, the way we are trying to be, is the best way to leverage on our legacy business. So going directly on your question, all the technology you see here, the first place where we use it is in the postal office. So we're giving to the 9,000 consultants much more advanced support tools to interact with clients. And to your very last question, we used information on our clients and our CRM, which is now across all products, in a much more efficient way. And that comes in a way the platform concept, where, for example, in parcels, we receive, Antonio, 65 million queries per annum, track and trace. And the query, in itself, was always perceived by the company as a burden. You have to service. We are trying to say, wait a second. You have 65 million times people coming on our systems to know about something that they care about. How can we transform this? First of all, I want to have the information in my CRM. That is the guy didn't receive the parcel because we did bad service, okay, last week. And he sits in front of the Financial Adviser. I want the Financial Adviser to know it and to say, I'm sorry, I know that we had a bit of a problem. Apologies, it will never happen again, okay? So that's -- all this technology intensity, the first place where he goes is in our physical business, which is Poste.

Filippo from Kepler Cheuvreux.

And then we have the last question.

Filippo Prini, Kepler Cheuvreux. Two questions. You mentioned in the press release, EUR 200 million investment in current to future of this new partnership. Could you make understand how much of the EUR 200 million is yet to be invested? And on the 4 companies that present today -- which is your project. I mean, in terms of you might need it and exit in the future?

Every company has its own specific situation, and we have adapted our sales to the situation and the pack. So Tink was in the process of closing [ 90 million ] round. And it was easy for us to say we're in. Milkman, with a very strong algorithm that Antonio described around revenue management, rightly thinks that this algorithm can be used in different industries, starting from logistics, but it doesn't stop there. We say that we're only interested in logistics. For this kind of algorithm, let's -- buy the logistic patents and do a JV on that, where we have significant majority stake. So we adapt ourself. We will grow with this company. So we will support the growth, also, financially of this company. And the exit, again, is going to be very specific. And it's going to be on a case by case. But if we can't do an exit situation for us, the bulk of the value is not on having made money, which is clearly important. But is having worked with these companies to accelerate our road map. And the first question, I think, is more a matter of the signing versus the closing of some of these deals. So I don't think it's very relevant, if I may say.

And for the last question, we have Michael from [indiscernible].

Just a very boring legacy question. So sennder, you're contracting out. You're privatizing your trunk network. Milkman is contracting out privatizing your last mile. I want to know what the Union's reaction is to that and how you're handling it?

Yes. We were not in the long-haul. So we're not externalizing anything, okay? And that's sennder. So not a topic. For Milkman, it's quite the opposite because it has the curve that Antonio has shown you. Giving density to that model, allows us to probably give -- this is the end game, some shipments also to the postman. And I must say that since February 2018, our Unions understood that in logistics, the future for Poste is in B2C. And they were very supportive of all the changes that we implemented in the last 2 years, starting with weekend deliveries, afternoon deliveries, never happened in Italian history before to deliver in afternoons. They are with us on this road map. Thank you. I also want to thank all the online presence, which I've been told, were quite a few. And thank you very much, again, to everybody.