Software Company Dreams of Surpassing FPT: Profitable from Day One, No Capital Pressure, Aims for IPO in 2028

During 2023-2024, while many businesses struggled due to economic crisis, Rikkeisoft maintained a 40% annual growth in the Japanese market. According to Rikkeisoft Chairman Ta Son Tung, their major goal is to surpass FPT and become the market leader.

"Unlike typical startups, Rikkeisoft has followed a B2B (business-to-business) model from the beginning, basically generating profits from services and being profitable from day one, never operating at loss. Therefore, we face no pressure regarding fundraising issues," shared Mr. Ta Son Tung - Co-founder and Chairman of Rikkeisoft at the Scale Up Forum organized by Endeavor Vietnam.

Rikkeisoft is a Vietnamese technology company established in 2012, specializing in software outsourcing. The company's main market is international, primarily in Japan - accounting for over 70%, followed by the United States at around 20%. The remaining 10% includes markets such as South Korea, Singapore, and others.

According to Mr. Ta Son Tung, during the Covid-19 period, while small and medium-sized enterprises (SMEs) in Japan received substantial financial support from the Japanese government, Rikkeisoft's client base consisted mainly of large corporations. During this time, as clients were reducing costs, Rikkeisoft's growth was limited to approximately 10% per year. However, when the Covid-19 pandemic ended, Japanese SMEs faced significant difficulties and lacked capital. Competitors who worked with SMEs had to downsize their operations. Meanwhile, large corporations - Rikkeisoft's clients - showed remarkable resilience and experienced strong growth against the trend.

As a result, during 2023-2024, Rikkeisoft achieved approximately 40% annual growth in the Japanese market. Mr. Tung mentioned that the company's workforce has explanded from around 1,600 employees at the beginning of the year to 2,200 currently.

At present, Mr. Tung emphasizes that financial management has become crucial, moving beyond the initial approach of simply earning through service provision. Consequently, in early 2023, Rikkeisoft appointed a Chief Financial Officer.

"Rikkeisoft aims to pursue an IPO overseas around 2028. Through our consultation process, I have determined that there will be two rounds of fundraising before the IPO. Therefore, at the end of last year, I began sending out the message that we are ready to accept investment," Mr. Tung explained.

Last month, the Chairman of Rikkeisoft shared on his personal Facebook page that the company had officially received investment and formed a strategic partnership with Sumitomo - one of Japan's largest and oldest corporations. According to him, the deal is worth thousands of billions of VND, potentially making it the largest in Vietnam's IT sector this year, though specific figures were not disclosed.

At the Endeavor event, Mr. Tung mentioned that even without this investment round, he still expects Rikkeisoft to maintain a 40% annual growth rate. The reason being their market is sufficiently large to sustain such growth over an extended period.

"In our market segment, FPT Software is the largest company, achieving revenue of over 1 billion USD with more than 33,000 employees. With our current workforce of 2,200 people, we definitely have significant room for continued growth.

Over 10 years ago, software outsourcing was quite straightforward, essentially following a 'do as told' approach. Clients didn't demand particular complex tasks. However, things have evolved significantly now. The projects we receive are much more larger in scale, reaching millions of dollars in value," Mr. Tung explained.

The Chairman of Rikkeisoft revealed that their next objective is to build a strong consulting team in their most crucial market, Japan. This will serve as a driving force to elevate the company's status.

"For Rikkeisoft, I aspire to achieve something truly significant. In the immediate future, if we can successfully IPO and become a unicorn within the next five years, I would be extremely happy. But what comes after becoming a unicorn? Perhaps we'll dream even bigger, driven purely by our ambitions. When money is no longer the primary motivation, what becomes most important to founders?

Personally, I want Rikkeisoft to eventually surpass FPT. Simply put, we aim to become number one - who comes second doesn't concern me. I believe that only by becoming number one can we truly make an impact and leave our mark; finishing second or last amounts to the same thing. I hope we can overtake FPT soon," Mr. Tung candidly shared.

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Source: Cafebiz / 24/12/2024 / https://cafebiz.vn/cong-ty-phan-mem-nuoi-mong-vuot-fpt-lai-tu-ngay-dau-tien-khong-co-ap-luc-von-dat-muc-tieu-ipo-vao-nam-2028-176241224140031099.chn