With revenues of R$ 7.2 billion, this Italian large is shopping for a number of firms in Santa Catarina. As a result of?
Italian Zucchetti has already bought three Brazilian companies founded in the state, one of them for more than R$ 100 million; CEO details strategy
From the interior of Santa Catarina, the small town of concordwith just over 70,000 inhabitants, attracted the spotlight by winning over an Italian multinational for its thriving entrepreneurial ecosystem and inclination towards technological innovation.
With little-known success stories, the municipality already has success stories to share. The most notable of these is perhaps the healthya food brand that originated in Concordia in 1944. Currently, Sadia joins Perdigão in the oligarchy that makes up the BRF group, one of the largest in the world.
With a base economy centered on agriculture and livestock, especially on raising poultry and pigs, it might be unusual to relate the small municipality in the west of the state to an essentially technological location. Could. Since then, Concórdia has become the headquarters of multiple companies in the sector, with emphasis on cutting-edge software developers.
In view of the vertiginous growth of these companies, companies with global prominence are starting to turn their attention to the small municipality of 70,000 inhabitants — and to the companies created there. It is the case of smallsoft and the doortwo retail technology companies acquired by the Italian multinational Zucchetti in a transaction of BRL 140 million announced this Monday, the 12th.
What does Zucchetti do?
Zucchetti works with technology development, such as software and business management programs. The company was founded 40 years ago, in Italy, and in 2022 it will also celebrate its 11th anniversary in Brazil.
Zucchetti has revenues of more than 1.3 billion euros per year, something like R$ 7.2 billion. There are, in all, 8,000 employees and 800,000 customers globally, in an operation present in more than 50 countries — 11 of them with their own operations. In Brazil, the highlight is the creation of solutions aimed at sectors such as:
- Industry, with management software
- Human resources, with solutions for team management and performance evaluations
- Retail, with products for inventory control and other metrics for managing the point of sale (POS)
Why the company is making acquisitions
Parallel to the company’s arrival in the country is the bet on the merger and acquisition strategy, an extension of the Italian way of operating globally — in 40 years, there were more than 150 international acquisitions. Since it created a Brazilian vertical, Zucchetti has also grown inorganically, having bought seven companies in the past 11 years.
According to Alessio Mainardi, CEO of the company in Brazil, the rationale behind the checks lies in the country’s potential to become a kind of “laboratory” for testing Zucchetti’s solutions on a large scale. “Zucchetti’s name is recognized worldwide, but we are not the most common management software developer in the minds of Brazilians. So we believe going after established companies makes the most sense,” he says.
With the two new purchases, the idea is also to establish Zucchetti’s name among the companies dedicated to the digitization of small retailers.
Smallsoft, for example, creates commercial automation software for these establishments, with technology for issuing electronic tax documents, inventory control, registrations and finance for a base of 19,000 customers. Gdoor, on the other hand, is aimed at managing micro and small retailers, with technology for sales, issuing coupons and invoices, financial management, inventory control and generation of tax files. The approximate customer base is 37,000.
With the purchase of Smallsoft and Gdoor, Zucchetti also brings new impetus to an unusual strategy among large companies: an attentive look at companies that are born in the interior of the states. This is a movement that started in 2020, when Zucchetti bought Compufour, specializing in management systems for micro and small companies — and also from Concordia.
At the time, the integration of the business into Zucchetti’s day-to-day business was based on the idea of the Europeans that the market for solutions for retail SMEs, here, was still incipient. The main competitor in the race was Linx, a management giant that developed solutions for larger companies. Without pompous representatives to dispute a market that adds up to millions of small businesses, Zucchetti decided to bring Compufour, currently with 43,000 customers, in a transaction of more than R$ 100 million.
Coincidence or not, the two new acquisitions in Brazilian territory, after the successful relationship with Compufour, also involve companies founded in the city of Concórdia. Now, the municipality has the largest number of Zucchetti employees in Brazil.
For Mainardi, even though she was agnostic in the selection of the city where her new acquisitions start from, small ecosystems, such as those in Concórdia, encourage the creation of new entrepreneurs capable of attracting the attention of the market. “This dynamic at Concórdia, where we see a company in which a partner has already been a partner in others and where many people know each other, can give indications and so on, favors business”, she says. “The location of the companies is of little relevance to us. But the truth is that the family environment helps a lot”.
With the new acquisitions, Zucchetti intends to be closer to leadership in the management and automation market for micro and small retailers, with something around 100,000 active customers.
Now, the idea is to take advantage of the robust portfolios of the two companies to grow with the help of a base that is already familiar with the technologies created by the companies from Santa Catarina, even though it labels the solutions as its own. “We are going to keep the product lines, but with communication that refers to Zucchetti. We want to be “top of mind” in our segment”, says the CEO. “We want to level up and fight with the big guys that are already on the market”.
In the near future, Mainardi is also evaluating the possible incursion of Zucchetti’s Brazilian operation applied to hotel chains, something already well-oiled in Europe. “We thought of systems that would help hotels that have bars and restaurants in their facilities and groups, for example, and need to simplify this sales management”, he explains.