Automat, an Estonian technology and business software platform, is looking to grow its revenue to EUR 100m within five years, including via acquisitions, CEO Kris Hiiemaa said.

The founder-controlled company may review possibilities for opening its equity, once it has made progress on its growth ambitions, he said.

The profitable company currently generates revenue in the tens of millions of euros range and employs around 300 people, Hiiemaa said.

To reach its growth target, Automat plans to systematically acquire companies offering B2B software products, Hiiemaa said, and then grow these companies organically through geographic expansion and through finding new customers.

The company is engaged with around 50 potential small business targets, in which it may acquire minority, majority or 100% stakes worth up to EUR 1m, he added.

It is interested in companies with scalable products for the digitization of business processes, Hiiemaa said. It will assess targets based on the quality of its team, and whether it has at least several hundred customers and revenue of up to EUR 500,000, he added.

Automat would weigh acquiring in the regions where it is already active or planning to open offices, including in Estonia, the Czech Republic, Poland, Germany, the US, as well as the Nordic region, among others, he said.

Another important criterion for potential acquisition targets is that their teams are willing to rebuild their technology with the help of Automat’s AI-based technology platform, Hiiemaa said.

The company plans to finance potential deals from its own resources and bank loans, Hiiemaa said, adding that its bank in Estonia is Coop Pank. The executive declined to comment on the amount Automat considers spending for acquisitions moving forward.

Some of Automat’s recent investments and acquisitions include Estonia-based PDF Generator API, a pdf infrastructure specialist; Voog, a platform for building websites; ShopRoller, a service for opening and managing e-shops; and Hoolduskeskus, a car shop service platform, the executive said.

Long Term Opportunities

While Automat is not yet planning its next steps after reaching the EUR 100m-turnover goal, the executive did recognise that achieving its growth objectives may spark a review of its strategic options, which might include employee ownership and an initial public offering.

“We want to see how big we can grow, but we do not have an exit plan and we will figure this out later,” he added.

Nonetheless, the executive mentioned assessing the possibility of opening its equity for smaller shareholders from among its core team members among future options. While this would be the most relevant possibility for Automat, going public is also not completely ruled out, although it is “too big an idea for us” at the moment, Hiiemaa said.

Automat, which was founded in 2023, is majority-owned by Hiiemaa (age 47), and lists its team members, as well as some small Estonian family-owned funds, among its minority shareholders, Hiiemaa said.

None of its shareholders have specific deadlines for an exit, he added.

Automat has around 25 subsidiaries within the group, each of them covering different business products and geographical markets, Hiiemaa said. One of the group’s subsidiaries is ERPLY, a New York-headquartered business software specialist, which was founded by Hiiemaa in 2010.

Automat was established to solve the pain of having to rework ERPLY’s software every time its underlying programming language, JavaScript, introduced an updated framework version, Hiiemaa said.

To avoid this, ERPLY’s software was reworked based on WebAssembly, and Automat was founded as a platform to provide technological assistance to other business software providers that would like to solve the same issue, the executive said.

Hiiemaa pointed to Norway’s Hawk Infinity as a peer with a similar M&A strategy.

Automat’s product suite includes software for project management, customer relations, time tracking, and point-of-sale solutions for various industries, among others, according to its website.