Flowscape Technology AB, a Stockholm-based listed company registered on the Swedish Spotlight Stock Market, is a provider of space booking software and hardware with revenues under $10 million. In this Research Note, we examine the business, based on their trading updates, investor presentations, and workplace management strategy.

Flowscape, founded in 2011 has developed a system for optimizing office space as well as increasing employee efficiency and well-being. Their solution uses IoT sensors and indoor positioning technology to create a SaaS solution for smart offices, which includes room booking, desk booking, planning the week at the office, colleague finding, space utilization analytics and internal communication. 

Company strategy during 2021 has been to increase software sales, which enable annual recurring revenue, and to reduce the proportion of hardware and non-recurring revenue for higher and long-term stable growth. As a result, the company's total recurring license revenues increased by 49%. However, the decrease in non-recurring sales of hardware meant that total net sales in 2021 did not increase by more than 3% for the full year, to SEK 32.6 million, (around $3.5 million) in comparison to 18% revenue growth in 2020.

Even so, 2021 was reported as a good year for Flowscape with a positive cash flow, successful establishment in the United Kingdom and the United States and increasing recurring license revenues. This is despite a wait-and-see market in the wake of the pandemic. The business has about 200 customers in 50 countries and in 2022, and plans to open more offices in the US and establish offices in Germany and in Norway.

Memoori's new research report, The Global Digital Workplace Market, estimates the total global market was worth $3.7 Billion in 2021, and will rise to $9.2 Billion by 2026, growing at a rate of 20% CAGR.

Flowscape's largest deployment to date was announced this month at WSP, the global professional services firm. Flowscape software and hardware has been rolled out as their global workplace platform in 92 buildings in 17 countries.

The company has partners at a regional or global level, including Atea, Fujitsu, Kinnarps and Ricoh. They have previously signed a reseller agreement with Ricoh Europe, a global supplier of digital office solutions, which allowed them to effectively scale to 19 countries in Europe. Flowscape also signed a five-year collaboration agreement with Ericsson, which offers Flowscape products together with its global IoT product offering for smart buildings aimed at 350 telecom operators.

In January 2022, The board of directors of Flowscape Technology announced its intention to carry out a list change from Spotlight Stock Market to Nasdaq First North Growth Market. The Board believes that a change of marketplace for the company's shares to Nasdaq First North Growth Market will increase the market's awareness and confidence in Flowscape and have a positive impact from both a customer and partner perspective. It will also simplify future possible company acquisitions in and outside Sweden.

During the Q4 2021 investor presentation, the company mentioned that they will broaden their software to become a workplace app. The driving forces for this are that each business area will thus become more valuable, the product will cover a greater customer need and the company will strengthen its product leadership towards competitors. As our new Global Digital Workplace report confirms, there is a general trend for Flowscape and its competitors to broaden their offerings.

There is less distinction between space management and workplace experience solutions as platforms converge and evolve to offer both a proposition for the building owner and operator to reduce costs while at the same time, giving building occupants more choice and control of their dynamic work environments and providing a greater positive impact on their experience in commercial office buildings.

This article was written by Daphne Tomlinson, Senior Research Associate at Memoori.