Dear Tech Enthusiast,

Welcome to the latest edition of the Stay Ahead in IT newsletter. As we enter the final quarter of the year, the IT landscape continues to evolve rapidly with groundbreaking innovations and strategic advancements. In this edition, we explore how digital twins are reshaping industries, highlight key M&A activities in the IT service sector, and preview upcoming conferences shaping the future of technology and investment. Plus, don’t miss our exclusive interview with Jan Rodig on how digital value creation is revolutionizing private equity and family offices.

Highlights from This Issue:

  • Digital Twins: Transforming Industries with Virtual Precision
    Learn how digital twins are revolutionizing sectors from manufacturing to healthcare by enabling businesses to simulate real-world scenarios, optimize operations, and improve decision-making.

  • Key M&A Movements in IT Services
    The IT services industry has experienced a wave of strategic acquisitions since our last newsletter, highlighting the sector’s ongoing transformation. Key deals, including Bechtle’s acquisition of Magnetic Media Network and PRIMEPULSE’s majority stake in Samhammer AG, underscore the consolidation and expansion of capabilities across Europe.

  • Interview with Jan Rodig: Unlocking Digital Value Creation in Private Equity
    In our exclusive interview, Jan Rodig shares insights into how digital value creation is driving efficiency, innovation, and competitiveness in private equity. Discover how companies are leveraging data analytics, digital platforms, and AI to unlock new opportunities and ensure long-term growth.

  • Opportunities in Managed IT Services
    The managed IT services market in Europe presents significant growth opportunities. According to Gain.pro’s latest report, the market is projected to grow by 10% annually, driven by trends in cloud migration, cybersecurity, and automation. Learn how sectors like healthcare, manufacturing, and finance are fueling demand, with Southern Europe emerging as a key growth market.

Stay with us for in-depth insights and analysis that will help guide your next steps in IT investment and strategic growth.

Digital Twins: Transforming Industries with Virtual Precision

The rise of digital twins marks a revolutionary step forward in digital transformation, allowing organizations to create virtual replicas of physical objects, systems, or processes. This immersive technology offers businesses unprecedented opportunities to simulate real-world scenarios, optimize operations, and enhance decision-making. As more companies explore the potential of digital twins, industries from manufacturing to healthcare are experiencing increased agility, efficiency, and resilience.

Digital twins bring together real-time data, behavioral insights, and advanced simulations, offering businesses a clear window into the present and future. With a predicted market growth of 60% annually, reaching $73.5 billion by 2027, digital twins are set to redefine how businesses operate in a connected world.

Our Key Takeaways:

For Entrepreneurs:

  1. Operational Optimization: Leverage digital twins to simulate processes, from product development to supply chain management, reducing time-to-market and operational costs.
  2. Agility and Innovation: Use the flexibility of digital twins to experiment with new business models, innovate products faster, and stay ahead of the competition.
  3. Enhanced Customer Engagement: Develop customer twins to personalize experiences and offer immersive interactions with your products.

For Investors:

  1. Value Creation: Digital twins can optimize operations and open new revenue streams, making companies more scalable and profitable.
  2. Risk Management: Evaluate companies with mature digital twin strategies, particularly those using the technology to enhance decision-making and resilience.
  3. Sustainability Focus: Support companies that utilize digital twins to improve resource efficiency and reduce environmental impacts.

How Digital Twins are Driving Innovation

  • Product Development: Digital twins enable faster iteration cycles by allowing businesses to test and refine products in virtual environments before physical prototypes are made. Leading companies like SpaceX and Mercedes-Benz are already using this technology to innovate faster and improve quality.

  • Supply Chain Efficiency: With disruptions costing companies up to 45% of annual profits, digital twins provide real-time visibility into operations, helping leaders manage inventory, anticipate demand fluctuations, and optimize logistics.

  • Customer Experience: By creating digital twins of customers, companies can offer immersive product experiences, such as virtual test drives or custom product simulations, which lead to improved engagement and increased sales.

The Future of Digital Twins and Generative AI

The combination of digital twins with generative AI unlocks even greater potential. Generative AI can enhance the inputs and outputs of digital twins, creating sophisticated, self-improving simulations. This synergy allows companies to speed up innovation and make more accurate decisions based on data-driven insights.

Key M&A Movements in IT Services: Expanding Capabilities Across Europe

In our last Stay Ahead in IT Newsletter in July, we explored key developments in the IT service sector. Since then, a new wave of strategic acquisitions has further highlighted the ongoing transformation and consolidation within the industry. Below, we present the most recent M&A transactions that are shaping the competitive landscape and offering exciting growth opportunities for IT entrepreneurs and investors alike.

  • July, 2024: Bechtle Acquires Magnetic Media Network (MMN)
    Bechtle AG has acquired Magnetic Media Network S.p.A. (MMN), an Italian IT service provider. This acquisition strengthens Bechtle’s market position in Italy and integrates MMN, an Apple Authorized Enterprise Reseller (AAER), into Bechtle’s portfolio. MMN generated a revenue of €68.6 million in 2022/23 and employs 100 people.

  • July, 2024: Acuity Knowledge Partners Acquires PPA Group
    Acuity Knowledge Partners has acquired PPA Group, a technology-enabled service provider for financial institutions in Germany and Switzerland. PPA specializes in structuring global financial and ESG data for commercial lending and ESG analysis. The acquisition expands Acuity’s presence in European financial markets.

  • July, 2024: PROM12 Acquires Majority Stake in List + Lohr, Forms ploon.it Group
    PROM12 has acquired a majority stake in List + Lohr GmbH, a leading managed IT services provider and Datev partner. This acquisition marks the foundation of the ploon.it group, aiming to consolidate IT service providers across Germany and create regional market leaders for SMEs.

  • July, 2024: ANSR and Accenture Partner to Expand GCC Services
    ANSR, a leader in Global Capability Centers (GCCs), and Accenture have partnered to help clients design and optimize global teams for technology and business functions. Accenture has made an equity investment in ANSR, and together they aim to expand GCC operations globally.

  • July, 2024: Eraneos Sells ServiceNow Business to Devoteam
    Eraneos Group has announced the sale of its ServiceNow-focused subsidiary in the Netherlands to Devoteam, a leading EMEA ServiceNow provider. This strategic move will allow Eraneos to sharpen its focus on scaling its core services, while Devoteam will expand its capabilities in the Netherlands.

  • August, 2024: PRIMEPULSE Acquires Majority Stake in Samhammer AG
    PRIMEPULSE SE has acquired a majority stake in Samhammer AG, a pioneer in AI-powered customer service management. Samhammer provides AI-assisted service center solutions and IoT lifecycle management for mid-market enterprises. The acquisition strengthens PRIMEPULSE’s IT service portfolio.

  • August, 2024: Deutsche Beteiligungs AG Invests in UNITY AG
    Deutsche Beteiligungs AG (DBAG) has invested in UNITY AG, a leading technology and digital transformation consultancy. The investment supports UNITY’s growth strategy, focusing on digitalization and sustainability consulting for DAX 40 companies and SMEs.

  • August, 2024: CANCOM Acquires SBSK GmbH & Co. KG
    CANCOM SE has acquired SBSK GmbH & Co. KG, an IT service provider from Saxony-Anhalt, specializing in complex application systems and IT infrastructures. The acquisition strengthens CANCOM’s presence in the region and enhances its service offerings for SMEs and public sector clients.

  • August, 2024: ITGAIN Becomes Part of X1F Group
    ITGAIN, a German IT consultancy specializing in data management and software development, has joined the X1F Group. This acquisition strengthens X1F’s position in software development and expands its client base in regulated industries such as finance and insurance.

  • August, 2024: VINCI Energies Acquires Fernao Group
    VINCI Energies has acquired Fernao Group, a leading cybersecurity provider in Germany and Switzerland. The acquisition will strengthen VINCI’s Axians brand, particularly in the cybersecurity and IT infrastructure fields, expanding its reach across Europe.

  • August, 2024: Shape Acquires Dutch Agency Move
    Shape, part of the Framna digital product agency, has acquired Dutch digital agency Move. The acquisition strengthens Framna’s position in the Netherlands and enhances its expertise in mobile-centric solutions for the financial services, insurance, and aviation sectors.

  • August, 2024: disphere Acquires VOLL digital GmbH
    disphere interactive GmbH has acquired VOLL digital GmbH, a digital agency specializing in software development and SEO services. The acquisition expands disphere’s digitalization services, particularly for clients in the financial industry.

  • September, 2024: integer GmbH Joins VALLEY IT GROUP
    integer GmbH, a full-service IT provider, has joined the VALLEY IT GROUP. The acquisition strengthens VALLEY’s presence in southern Germany and enhances its managed services offerings for SMEs. integer brings expertise in industrial IT and cybersecurity to the group.

  • September, 2024: Bechtle Acquires s.i.g. System Informations Gesellschaft
    Bechtle AG has acquired s.i.g. System Informations Gesellschaft mbH, an IT system house with a focus on industrial IT. The acquisition will enhance Bechtle’s presence in the Neu-Ulm region, with plans to integrate s.i.g. into its new IT campus by 2026.

  • September, 2024: accompio Acquires r-tec IT Security GmbH
    accompio GmbH has acquired r-tec IT Security GmbH, a specialist in cybersecurity solutions. The acquisition strengthens accompio’s cybersecurity capabilities, allowing it to offer a broader range of IT services to its clients.

  • September, 2024: xgeeks Joins synvert Family
    xgeeks, a data and cloud platform engineering company, has joined the synvert family. The acquisition enhances synvert’s data, analytics, cloud, and AI services portfolio, positioning it as a leading player in the EMEA region.

  • September 2024: Tru Consulting Secures Growth Investment
    Tru Consulting, the Anaplan Partner of the Year for the Americas, has received a strategic growth investment from Superstep Capital. The partnership aims to accelerate Tru’s growth, expand its team, and enhance solutions for higher education and public sector clients. Tru Consulting, founded in 2019, has completed over 150 successful Anaplan projects for clients such as NASA-JPL and Michigan State University.
  • September, 2024: Dataciders Expands in DACH Region
    Dataciders Group has strengthened its position as a leading provider of Data & AI solutions in the DACH region with the acquisition of PASO Solutions, a Data & AI service provider based in Austria. This marks Dataciders’ third acquisition since Rivean Capital’s entry in January 2024. PASO Solutions, specializing in supply chain management solutions and Microsoft ecosystems, brings over 40 employees and a deep understanding of the Austrian market to the Dataciders Group.

Interested in IT-Service Investments? Request our Fund Memorandum.

Interview with Jan Rodig, Partner at Struktur Management Partner: Digital Value Creation in the Private Equity and Family Office Sector

IT Capital Partners: Good morning, Jan. Thank you for joining us today. To start, could you explain why digital value creation is so crucial in today’s business world?

Jan Rodig: Good morning and thank you for having me. Digital value creation is crucial because it helps companies enhance efficiency, unlock new business opportunities, and increase competitiveness. By leveraging digital technologies, companies can speed up processes, reduce costs, better serve their customers, and create new revenue sources​.

IT Capital Partners: What are the key digital levers that companies can use to achieve these goals?

Jan Rodig: There are three Digital Value Levers companies can utilize – they differ fundamentally in terms of amortization times and business case risk: process digitalization, digital marketing & sales, and digital services & business models. The relevance of each lever depends on the industry in which a company operates, its business model, and its individual situation.

IT Capital Partners: How should companies approach digital value creation to ensure success?

Jan Rodig: Success in digital value creation requires a clear strategy and targeted implementation. It’s important to conduct a thorough analysis of existing business processes and structures to identify areas where digital technologies can provide the most benefit. A step-by-step approach is recommended, starting with pilot projects that are tested and iteratively improved before being scaled up​.

IT Capital Partners: What challenges do you commonly see when implementing digital initiatives?

Jan Rodig: One of the biggest challenges is the cultural shift that comes with digitalization. It’s essential that the entire company, from leadership to employees, is willing to embrace new ways of working and continuously learn. Another challenge is technical integration, especially when companies are dealing with a variety of legacy systems that need modernization​​.

IT Capital Partners: What future developments do you foresee in the field of digital value creation?

Jan Rodig: In the coming years, we will see an increased use of artificial intelligence and machine learning to enable more precise data analysis and forecasting. Additionally, cybersecurity will become even more critical as companies integrate more digital technologies into their processes. These trends will drive further digital transformation and create new opportunities for innovation​.

IT Capital Partners: Finally, what advice would you give to companies looking to optimize their digital value creation?

Jan Rodig: My advice would be not to be intimidated by the complexity of digital projects. It’s crucial to have a clear vision and a sound digital strategy, supported by top management commitment and an open company culture. Don’t be fooled by the latest digital trends or hype technologies such as AI – think holistically about digital value creation, starting with customer and business value. Technologies are just a means to an end. And if you don’t have all the necessary competencies on board, don’t hesitate to collaborate with external experts.

IT Capital Partners: Thank you, Jan, for sharing these insights with us today.

Jan Rodig: It was my pleasure. Thank you for having me.

Managed IT Services in Europe: Opportunities for Growth

The managed IT services market in Europe continues to expand, driven by the increasing demand for digital transformation and cloud solutions across industries. A recent report from Gain.pro outlines key trends and growth areas in the sector, highlighting opportunities for IT service providers and investors. The report sheds light on the strong performance of managed services in countries like Germany, the UK, and the Nordics, as well as emerging opportunities in Southern Europe.

Key Insights:

  • Market Growth: The managed IT services market in Europe is projected to grow by 10% annually, with the strongest demand in cloud migration, cybersecurity, and IT infrastructure management.
  • Sector-Specific Demand: Industries such as manufacturing, healthcare, and financial services are showing the highest demand for managed IT services, particularly in automation and data analytics.
  • Regional Opportunities: The DACH region (Germany, Austria, Switzerland) and the Nordics are leading in the adoption of managed services, while countries in Southern Europe, such as Italy and Spain, are emerging as growth markets due to increasing digitalization efforts.
  • Challenges: Despite the growth, IT service providers face challenges such as regulatory compliance, talent shortages, and the need for continuous innovation in cybersecurity and cloud services.

Upcoming IT and Investment Conferences:

  • SaaStock: October 14-16, Dublin, Ireland - Known as the Disneyland for SaaS companies, SaaStock features extensive networking opportunities and learning experiences for SaaS founders and executives to explore new trends and practices.

  • Web Summit: November 11-14, Lisbon, Portugal - Web Summit in Lisbon is one of the largest technology conferences globally, attracting over 70,000 participants to discuss how technology influences society and business across various sectors.

  • SaaS Monster (Web Summit): November 11-14, Lisbon, Portugal - Running concurrently with Web Summit, SaaS Monster focuses on enterprise technology, offering insights into SaaS, Cloud Computing, and Big Data with access to global industry leaders and experts.

  • Gartner IT Infrastructure, Operations & Cloud Strategies Conference: November 19-20, London, UK - This Gartner conference focuses on the future of IT infrastructure and operations, covering topics from cloud computing to cybersecurity, essential for leaders in the digital transformation space.

  • Big Data Conference Europe: November 19-22, Vilnius, Lithuania - Focuses on Big Data, High Load, Data Science, Machine Learning, and AI through workshops and sessions.

  • FIMA Europe: November 28-29, London, UK
    FIMA 2024 is the world’s leading data and analytics event for investment banks and asset managers. Connect with data and analytics leaders from T1 banks to explore precise, data-driven decisions from financial institutions.

  • DevOpsCon Munich 2024: December 2-5, Munich, Germany
    Dive into the world of DevOps methodologies, automation, and container management. This event provides expert-led sessions and hands-on workshops for IT professionals.

  • IT-Tage 2024: December 9-12, Online
    Covering software architecture, development, DevOps, IT security, and cloud, this comprehensive conference features 10 parallel tracks with over 220 speakers. Expect deep dives into topics like Agile and IT operations, and explore visionary themes like New Work and the future of IT.

  • Global Digital Transformation & Customer Experience Summit 2024: December 5-6, Berlin, Germany
    The 10th edition of this summit offers insights on digital transformation and customer experience, focusing on key themes like Emotion AI, e-commerce trends, and cybersecurity.

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