Background of Croatian Company Nanobit’s Sale to Swedes

Lauren Simmonds

As Poslovni Dnevnik writes on the 19th of September, 2020, the story of the Croatian company Nanobit and its two founders, Alan Sumina and Zoran Vucinic, can be ranked among the most successful Croatian stories in the last five years. It started, as is often the case with IT startups – “romantically”, without any capital, with only two computers, but with the idea and the will to gain global success in a very competitive industry – the mobile game industry.

The Croatian company Nanobit’s founders have been building the company for a full 12 years now and have grown to 125 highly educated employees, their games have been downloaded more than 145 million times in total, and are played by more than 10 million active players worldwide on a monthly basis. And what has crowned their success is an extremely successful sale or, in startup terms, “exit”. They sold the company for almost a billion kuna to the Swedish Stillfront group, which has 14 more gaming studios in its portfolio.

Namely, Stillfront, whose headquarters are in Stockholm and which is publicly listed on the Nasdaq First North Premier Growth Market, will pay 100 million US dollars in the first tranche for 78 percent of the Croatian company Nanobit’s shares, and after two years, they’ll buy the rest of Nanobit at a price that will depend on the movement of profit before interest, taxes, depreciation and amortisation (EBITDA) of Nanobit in the financial years of 2021 and 2022.

When asked why they decided to sell and not to further their independent development, Alan and Zoran answered for Vecernji list:

”The industry in which we operate is very fierce when it comes to competition and there’s a real struggle on the global market. It’s currently rapidly consolidating and the choice was to join those who will develop the company or stay alone against everyone.

True, we may have once had the idea that we will be the ones to buy other gaming companies, but we should be realistic considering that it’s almost impossible to realise this operationally from Croatia, primarily because there is not enough capital. For such a thing we had to start things up in another country, for example, like our customer, in Sweden. As a Croatian company, even if we were listed on the Swedish stock exchange, we wouldn’t get such visibility as we are now when we’re a component of a Swedish company. It’s much harder to do all this from Croatia because companies need a lot more capital for acquisitions, so we believe that this was the best we could do in the right timeframe, and the situation with the coronavirus crisis also contributed to this move,” Nanobit’s founders say, adding that they didn’t just fall for the first offer they got and that they had at least a few bidders every year.

”There were various providers, from those related to this business to those who have nothing in common with Nanobit whatsoever. We chose the Swedish company because we estimated that we’d continue to work and develop with them, have knowledge and cooperation with all their components, or with 14 other gaming studios or specifically with 800 quality employees and experts in this field,” added the founders of the successful Croatian company Nanobit.

What was almost crucial for them was that the company stays in Croatia and has high autonomy in decision-making, ie that everything stays more or less as it was before, with Nanobit’s employees getting the opportunity for personal development that ultimately directly affects the company’s results.

”During the negotiations with the Swedes, some new bidders appeared who offered us even more money. However, what our goal was is that the company still exists as it is, that it has its headquarters in Croatia and that its employees are safe and taken care of in the best way with the new owner,” say Alan and Zoran, who will surely remain at the helm of the Nanobit for another two years and continue to work, although their contract doesn’t stipulate that they must remain at the helm of the company.

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