How did you segment the various customers you had at Aloc?

In the value chain of banking institutions in Scandinavia, there are IT banking centrals. In Denmark, the financial institutions are grouped around IT banking centrals like BEC, the original owner of Aloc, and SDC. There were also groupings of banks that had come together over time to share resources. Due to the ownership, some of these banks were highly accessible since Aloc was owned by BEC, one of these players. However, some were less accessible because they had already paid for similar offerings through their bank centrals.

There are various banking centrals in Denmark, and they either build their own solution or they purchase it from SimCorp or from competing companies. You would actually try to avoid going after the customers that are connected to those banking centrals because they probably already have their own solutions.

We didn't completely avoid going after them, but we knew that it was much less likely and would take much more time. The sales process time was much more uncertain and much longer than those that were already on the same banking central as the ownership. This led to the strategic realization by the owner of the company that they were not the best owner for the company.

Why was the growth negative? Did some customers go out of business?

Yes, indeed they did. From 2008 to 2010, the number of financial institutions in Scandinavia, specifically in Denmark, reduced by roughly 15% to 20% due to consolidation. A few of them simply went out of business.