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Hello, everybody, and a warm welcome to our earnings call 9-month 2021. I'm Achim, the CEO, and here with me is Andre, our CFO. Hi, Andre.
Hi Achim, welcome also from my side.
Great to have you all in our call. We're sitting here in our headquarter in Munich, and I'm really happy to report on the last quarter, which we think was a very successful quarter, but also at the 9 months for the year until end of September. So our main topic for this year but also for next year is whistleblowing. And you all know that the big regulation will be in place soon. We will talk more about that. And we are fully focused on getting this market. It's a very interesting market with about 250,000 companies in Europe and huge opportunity for us to grab this market. And then afterwards, Andre will walk us through the figures, right.
Absolutely through the financials and also give an outlook and for this year, which is already close to the end and for the upcoming years.
Wonderful. So let's start with the Whistleblowing business. The basis for our business since we started EQS 20 years ago in the field of Investor Relations. -- was our strong belief. And we at EQS, we strongly believe that transparency and integrity create the most important corporate capital and its trust. So all we do is we help companies in creating trust. If companies believe that this is really important to them, that this is key to create trust among all stakeholders, we have a great opportunity to get in business with them.So we need that mindset or if the mindset is not there, then, of course, we need regulation. And this is what's going on in this very specific market, corporate compliance and this product, Whistleblowing. So let's look into this.Our role to the EU market leadership, we are at the moment in a [ poor ] position. So what did we do? In the year 2017, we decided to enter the corporate compliance market, but that was a big decision for us. We said, look, for the last 16 years, we built up a nice business in Investor Relations, and this will grow on for a long time, but we need stronger growth.
We needed to invest right?
Exactly. And we saw the strong growth in the corporate compliance field, where we started in 2017, developing our own Whistleblowing product.
I think the nice thing was the safe channel called [indiscernible].
Just a few months later, at the end of 2017, we did our first acquisition. We bought the market-leading company in Switzerland, Integrity Line, and then built from there a nice client base. And last year, by the end of the year, we acquired Got Ethics, the leading provider in Denmark. And this year, we made a huge step forward by acquiring the market-leading company in Germany, Business Keeper. The company that started in the year 2000, the same year when we started in U.S., they started that business in the Whistleblowing field. This was a huge deal, Andre.
There was lot of money we spent. I mean, nearly EUR 100 million we had to invest here to acquire the Business Keeper. And so really biggest investment we did in terms of money. But I would say, well worth, well invested. And I think there will be a lot of outcomings from this acquisition.
And it's comparable to our big deal 15 years ago when we acquired DGAP, which put us on the map and immediately put us in the leading market position in German-speaking area for Investor Relations. So we are kind of in a similar situation, huge acquisition, great position now, and now there will be a lot of tailwind coming up.
We can see that also, I think, on the next slide.
Yes. If you look at the number of the new customers in the whistleblower field, you see that the number is accelerating. Last year, by the end of October, we won 51 clients -- 55 clients, right, Andre 51 was by the end of September. So this year, we already won 428. So you see a big difference. And yes, few logos show, I mean, the logos also show we are winning the large multinationals like DHL Group, Deutsche Borse, but also international start-ups like Revolut, we have Cabify. So across different markets, listed and unlisted multinational, mid-cap, really great, and it really shows that this market is so big out there. And it will be bigger. So -- but it all depends on of course, the regulation and the mindset. So for us, as a Software-as-a-Service company, it's really important to build a community in this field. So if you go on the next slide, you see our huge success, again this year with the ECEC conference. We're building a unique compliance community, not just relying on 1 product, the Whistleblowing product, but the idea is to step-by-step become the leading provider in this field by providing the leading ecosystem. So Platform-as-a-Service for relevant corporate and compliance controls. And the ECEC showed that we are really in the middle of everything right.And we received very positive feedback from the community here. So we are in a great position to tackle the market and we said, look, on the one hand, we need direct sales, and we have to get to our target customers directly via marketing and our sales team. But on the other hand, it's a huge market and there are a lot of SMEs out there, and therefore, we need strong partnerships. So we were very, very successful in building up a great partnership program, where we have now over 100 wonderful partnerships. It's really great.If you look at the ones here, especially, I think for Germany, the Bundesanzeiger will be key, but also Datev. We have successful partnerships with auditing firms, law firms, consulting firms. So I think we really covered everything. And now it's, of course, up to these partnerships to activate their relationships and to sell their products, which are our products to their customer base. But since in many countries, the regulation is not in place yet, we are still holding back.You can see that also here on that slide that a lot of companies have certain progress, one has had have very limited progress. Others are progressing, but really from time on time are only the 2 Nordic countries, Denmark and Sweden with a transposed law and again, it shows that the Nordics they are really at the forefront when it comes to transparency and trust and building up -- applying laws, building up the framework, which is necessary in that area.Yes. And you see EU at work. The directive was introduced 2 years ago, and it said, every country has to implement this directive into local law by December 2021. And so far, only 2 countries achieved this goal. That's, of course, on the one hand side. On the other hand, the directive will be in place. So whistleblowers will be protected. So the countries have to do something. It's really urgent, and we are pretty confident that within the next few months, we will see a lot of other countries step-by-step implementing.
What's the expectation then for Germany?
Yes. In Germany, a special situation. We had the elections, and we are waiting for the new government to be formed. So we expect by end of Q1 beginning of Q2, we will have the law in place. But we already see that the interest is picking up. And as you saw with the number of new customers in the field, a lot of companies out there who are looking for a provider already a few years before the law is in place.
So overall, everything running in the perspective as planned, we have to delay in the law, but that's nothing that hits us.
The cool thing is that we have so much direct business. And this is ARR that is higher than with the SMEs. So therefore, I think on the ARR side, we are fine. But of course, our goal is to become the market leader and that's why we have to have as many customers as possible. Good thing is nobody else can get these customers at the moment since they are not out there on the market.
No, that makes sense. And I would suggest let's move on and look onto the highlights to see where we came out after 9 months. So starting with our highlight tiles here showing on the upper part, basically the sales figures we have in place and then the financial figures, revenue and EBITDA on the gray part on the lower part of the slide. So really great.Looking into the SaaS customer number, total number. We now have nearly 4,000 SaaS customers in place and 1 big step here to gain this increase was the consolidation of the market through the acquisitions. So that's a 50% increase year-on-year, really impressive and a huge potential in the future to cross [indiscernible].
This is, I think, really important again to mention. If you know how difficult it is to get a SaaS contract in the B2B field, where you have to answer 300 questions in advance where you have to sign data agreements of 50, 60 pages data security and so on. You know that onboarding and getting these clients is really, really difficult. It's a huge challenge. And therefore, for us, great we are in with almost 4,000 customers yet, and there are a lot of huge multinationals in there. And as Andre said, fantastic base for us to grow in the future.
And specifically, this year, in terms of growth on non-acquisition but just growth of new customers, we nearly tripled the number of new SaaS customers, which you can see here. And that's also what impacts then the ARR figure, which is up nearly 50% and on track. And what makes me specifically very happy, of course, is that we already now after 9 months, we are in our EBITDA corridor and EUR 2 million to EUR 3 million is the expectation for this year. We are investing, as you know, in marketing and sales. But we are already there. So that's good.
I think that was a good relief for you that we are already in the EBITDA corridor. But of course, it also made sense not to spend all the money, not to go all in if the laws are not in place everywhere, right? So if you look at the revenue, you see, of course, we have a strong increase in the compliance field also due to the acquisitions. We see, of course, accelerating growth in the future. But also, I think what's really great for us to see that the Investor Relations business also grew 10% and 10% from a way a higher basis because last year was the COVID year where we had the strong increase in this virtual annual general meetings.A lot of that has a lot of audio video webcast. And to grow from that high basis, another 10%, I think it's a very solid development that [indiscernible] results. I mean we can look at this IR business and see what's going on there and I think you see that the IPO market, especially in Germany, gave us a lot of tailwind there.The IPO market supported here a lot. Again, great logos. And yes, these customers had a nice ARR on average, and they really drive -- drove growth in the Investor Relations segment and we still have to keep in mind. And if we look at the total numbers of companies in the regulated market that's rather flat. There is even a slight decrease year-on-year. So the IPOs basically replaced others. But for us, very nice is replacement because they buy more of the average basket, and that's a great thing, and that's why we managed to grow.And again, also with these IPOs there is a lot of room to grow up and cross-selling.
Yes. Yes. So looking to our table of the key figures. Revenue growth in line, as mentioned.
Yes, everything looks kind of in line. But of course, what is obvious that the operating expenses grew a lot, 41%, that's a high number. Why is that?
Yes, that's a big increase. I see it. Absolutely. It's mainly driven by the investments we are doing in marketing and sales, as mentioned. They are relevant now. It's now time to grab that market. We have to do this year and still in the first quarters of next year. And that's why we have an overproportionate growth here. But as you already mentioned, we didn't go all in, and that's why we already achieved the EBITDA and EBITDA clean is even 9% up. So it really shows that it's solid. It's better than what I have planned but makes totally sense due to the lower marketing and sales spends in view of the bit later coming regulation.
And this strategy makes a lot of sense when you look at the churn rate. We saw that the churn rate was going up a little bit due to the migration of the Investor Relations customers to the new COCKPIT Since then, it's decreasing. We think it will further decrease and we will have a churn rate below 5% in the future. Then you see that customers, in general, when they're on boarded, they don't want to switch providers. So if you have a big market share, you can most probably predict that you will have this strong market share for a long period of time. And therefore, it is important to get the market when it's developing. In the beginning, it's less expensive. Then later on where you have to be 10x better or 10x cheaper in order to steal away customers from your competitors.
Yes. And it's the foundation of everything, also the investments. We have done the acquisitions. They had an impact on the equity ratio, as you can see, I mean, it went down to 35%. So normally, we are between the 50s and the 60s. But that's all good and all fine because we basically have predictable revenues. I mean we have a recurring rate of 86%. It's again up 2%, and it's going to increase even further because we just had 1 -- not even 1 full quarter of Business Keeper being consolidated, and they have very high recurring revenue, even higher than our grand total because they have a pure SaaS model. So I think that's good, and it's going to recovered the upcoming quarters again.So lets maybe move on and look a bit in more detail on the impacts on the EBITDA side. We see that we have acquisition, one-offs. We had a lot of consultancy fees to get this transaction done. And on the other side, acquisitions...
I wouldn't say a lot of. I think in comparison to a lot of companies, it's great to see that our internal team can do a lot and we are not so much relying on external consultants, law firms and so on, especially in the corporate finance consulting. I think our team did almost everything. So I think -- you're right. If you look at our EBITDA bridge, it's significant. But if you look into comparable deals, companies, I think it's quite limited.That's true.
Yes. And the contribution of the acquired companies was already positive. So that's a nice one. Yes, and the main impact is marketing and sales, investments for Whistleblowing. Though at EUR 2.4 million, they were lower at what I had planned as mentioned already, and that's why we are now already at EUR 2.3 million EBITDA in line with our expectation for the full year.The revenue development on a quarter-by-quarter basis, it's another interesting figure to show here because this year, we had with the several acquisitions, which were starting to be consolidated in the P&L at different points in time. It makes a lot of sense to show a bit more details in terms of how is the development quarter-by-quarter. And you can see that clearly that in the first half of the year, we had a growth, which was in line with the then existing guidance, 20% to 30%, where we had Got Ethics and C2S2 to having some impact in terms of inorganic growth and the rest came from organic growth. But now with the first-time consolidation of Business Keeper by mid of July, so 2.5 months in Q3, we accelerated that growth as expected to 40% for the quarter; 9 months, 28%, and we will accelerate further. So Q4 is going to be our strongest quarter.
Then the increase will be higher than 40%?
Exactly. There are 2 reasons mainly for that. So 1 reason is that Business Keeper will be consolidated in about 2.5 months like in Q3, but full 3 months.And then Q4 is always the strongest quarter. And it's always benefiting from the dynamics. And of course, especially in the specific situation we have with the whistleblowing law coming into force in different markets in the next years, we are seeing that momentum is picking up and that we will see further at Q4.
So for the full year, we will be between 30% and 40%. That's the higher range you said, right?
That's exactly. If we now move further to the outlook, that's what we have here. We are fully inline and with the new ARR figure as well. So we're currently at close to EUR 6 million, right, after 9 months. And we are confident that we will achieve the EUR 9 million by the end of the year.
So on general, everything is the same, except the new SaaS customer model.That's exactly what we took out now the expected customer contribution coming from the partners. So that's now the figure what we expect and what includes only the direct sales where we are in line. So half was planned with partners and the other half it was planned with our direct sales team broadly.
Yes. So a bit more -- even a bit more with partners probably, we could say, half and half. And our half, we will achieve. The impact is not significant on ARR and revenue as it's mainly about partners are mainly acquiring SME companies. There's also a profit share model. So the contribution is less than in terms of revenue and new ARR.
Got it. So that's why new ARR is still at EUR 9 million.
Exactly. And then coming to our long-term perspective, that's even more important.
Yes, if you look at this nice 3 circles starting from the left we set in the first phase of the directive, all companies with more than 250 employees have to implement the whistleblowing solution. So 250 employees is the first threshold. So the companies above that is around 50,000 in Europe. We believe that half of these companies will implement the digital solution and fully comply with the directive, also according to [ GDPR] and so on. And so if you go from that circle to the next circle, our goal is to get at least a market share of 20% of this relevant market. So this would be then 20% out of 25,000 potential customers, and that's the number we are going for. So our goal is 5,000 whistleblower customers.
We now already have more than 1,500.
Yes. So I think we are totally on track. And then later on, of course, our goal is to up a cross sell when our compliance COCKPIT then is fully developed, with all the other applications like policy management, approval management, risk management, training and then can cross-sell. And we believe that at least 20% of our then 5,000 whistleblowing customers so around 1,000 customers will use a full range of our products in this field.
So the delay in the law is not impacting our plan here for an instance next year, right?
Yes.
And that's what we also see in the financial outlook then when it comes to revenue and EBITDA. So expectation as already communicated nearly EUR 100 million revenue contribution by 2025 coming from the compliance segment, which is a strong growth, average CAGR of 37% and the contribution of the IR segment with EUR 32 million, leading then to overall EUR 130 million. And then this goes hand-in-hand with scaling operating leverage and therefore, a higher EBITDA margin coming down to at least 30% by 2025.
That's the beauty of a Software-as-a-Service model, and we see that already in the areas and in the markets where we reach certain levels where begins to scale. So as a summary, we are totally on track reaching our goal, becoming the leading European cloud provider for global Investor Relations and Corporate Compliance solutions. We think there's a huge window of opportunity. There are not many market segments in the tech area globally out there where a European company can get this market -- this leading market position. If you look at different tech sectors, you will always find a lot of very strong U.S. providers who dominate these points. But we think, especially in compliance where companies are very sensitive about data, and we handle the most sensitive data, data regarding insider information, data regarding misconduct in companies. Especially in this field, European companies trust more a European provider. So what we have to do, we have to be as good as the U.S. providers, but then we will get deals. So huge opportunity for us, huge market out there, and we are all committed to execute our strategy. So that's from our side. Thank you very much.
And we're very happy now to answer your questions. [operator instructions] We already have some questions in place here, and there are a couple of already in there.
Cool. Okay. So let's get started.
So the first questions we have. We will start here. First question is coming Knut Woller from Baader Bank. So what...
You have to translate from German.
It takes a while. Maybe you can see -- can also put some questions in here in English, maybe the easier. So 1 question is new ARR momentum seems to have slowed a bit quarter-on-quarter in the third quarter. So what is the reason for that? You cited a delay of the implementation after whistleblowing directly? And how material do you expect this delay to be -- maybe start with that.
Yes. I think, of course, on the compliance side, if the -- if the laws are not implemented, of course, less companies, especially extrinsco motivated companies are not acting. And therefore, as we said, with the partnerships, our partners are not very active. For example, our partnership with the Bundesanzeiger. They just opened their portal today. So not acquiring any customers until now that was obviously not what we expected before when we put our plan into place at the end of last year.But still, I think it's not huge, and we are not losing anything at the moment. The business will be there, maybe just a quarter or 2 quarters later.
Yes. That's a question that came up 1 or 2 times. Another 1 maybe the average selling price.
Yes, we can talk about that. Wherever we have a strong market position, it's, of course, easier to have a solid or higher average selling price than in countries where we are in a more competitive environment. And we are in competitive environments in almost any country. We have local competitors. There is no pan-European competitor out there that is comparable to EQS Group, but we have strong local competitors in countries like France, Spain, Italy and so on.So therefore, of course, if the competition is high and our goal is to win as many customers as possible to win market share, we don't focus on a high average selling price. It Is more important for us is to get the number of new customers.
Exactly. I mean then there is still a huge spread within the selling prices when it comes to the size and the requests from customers. So there are huge customers that pay off cost -- huge ARR because they have a complex necessities here. And then we have just very small companies and here and their average selling price is really low. So that's still -- you really need to look on to the different cohorts of customers to have a valid number here, which sums up. Then let's move on here.We have a couple of questions coming in from Lucas [indiscernible ] from Tegus Capital. So I think what is behind your halved targets in terms of customer winnings in 2021? I think there was..
That's what we explained regarding the partnerships, right?
Exactly. How do you see slow rate of EU countries implementing the law. I think we talked about that also in the presentation. It should be okay.
What we shouldn't forget is the directive is in place. So every employee in Europe is protected when he reports misconduct one a European level. So that is in place. So companies should really think twice if they decide not to implement the whistleblower solution. But since many companies are not aware of this situation, they are waiting for the law. And as we said, it is not giving us sleepless nights, not at all because we have the partnerships in place, and we know that nobody else can get these customers at the moment. So it's just a matter of time. And if the law is postponed by quarter, 2 or 3, by the end of next year, the ARR should be in the books anyway.
And that's well for the ARR. But of course, on the revenue side, this means shifting and how you then consider the revenue means shifting everything by 1 or 2 quarters. But I mean, basically, there is no fixed full guidance out for 2022. There was another question here. We will give that as always with the full year figures. But so far, still we see this impact, a short-term impact and not relevant for our midterm goals.Moving on to the next question. This 1 comes from Felix Wienen from SFO. So given the tailwinds from COVID in 2020 and 2021 in your Investor Relations business due to webcast and digital AGM, how sustainable are the revenues going into 2020 to as COVID might normalize? Actually, I can answer that directly. So actually, already in 2021, we had a shift in the IR business, and we showed it a bit. The drivers were mainly coming from existing customer base in other product areas, not really AGMs and the IPOs. So that was -- these were the main drivers. And on the other side, we even already had a stronger decrease here. So this effect, you mentioned here, is already happened or has happened this year, and we won't see it further next year.
Our goal is to increase with our IR COCKPIT and to increase the average selling price there on the one hand. And on the other hand, we will introduce new applications that we can sell. One important application will be the roadshow manager which will help our customers organizing road shows digitally and reach out to potential investors via our investors application in the COCKPIT. So we will introduce this by the end of this year, and we expect significant increase in the IR COCKPIT revenues for the upcoming years.
Yes. Then another question comes in from [indiscernible] from Eiffel Investment Group. So given that you have already reached your target of the full year EBITDA, does it mean that we should expect a negative EBITDA in Q4? No, not necessarily. We will do the investments that are necessary to conquer that market. And of course, now which is already achieved EUR 2.3 million, we have more headroom for Q4. But normally, Q4 is our strongest quarter in terms of total revenue. And of course, there is operating scale in. So I would not expect a negative EBITDA for Q4.But it's not our key figure this year, right? So what we really need to do is to invest in order to get as many clients as possible.
It's all about switching costs in the SaaS business, switching costs and, of course, also economies of scale and network effects. But we know from the past that if the market is divided in the SaaS business, it's really, really difficult to steal away market share from other competitors. So we have to be here now to grab this market. And this is strategically very important. We totally believe in it, and we saw already positive effect.I think for Germany, for example, all the deals we see we win more customers than all of our competitors together. So this gives us a lot of confidence that we can expand our leading position here in Germany and becoming a leading provider in Europe.
Another question comes from Marius Fuhrberg from Warburg Research. What is the new ARR figure fully organic, excluding all acquisitions also in perspective to your 2021 expected outlook. So here, I think we need to see that from our internal perspective, since we started to have a Business Keeper within our team. And also before at the beginning of the year got Got Ethics, obviously, we don't look at that specific figure because, of course, it's changing. It really depends on who's closing what and how we structure and organize the deal teams and the sales. But as a broad orientation, you could say 2/3 comes from EQS, 1/3 is coming from Business Keeper. So before we had EUR 6 million ARR guidance without Business Keeper in the market, and we would be at around EUR 4 million. And therefore, we would be in plan as well. And the rest is a contribution coming from the Business Keeper.
Well, after the acquisition, we increased from EUR 6 million to EUR 9 million.
So another 1 from Marius Fuhrberg. If regulatory changes are not yet in place in the EU countries and companies might not even be aware of it, in which channel do you spend your marketing budget? Is it primarily into partnerships in preparation to the final implementation.
I think we use all channels. Of course, online is really important. We also do PR, we work with different associations.We have, of course, our direct sales outreach. I think we do everything it takes to get this market. And we learned, of course, that marketing in this field is way more important than in the Investor Relations field since compliance officers are really well hidden in the organization and not so much out there like IR managers are.
So next 1 comes from Yannik Siering from Stifel. Congrats on the strong numbers. Sweden recently passed the whistleblowing directive other than -- and that is rather slow. Do you expect to see an impact on sales, not only number of customers going forward if we continue to see delays.
I mean, we are very confident that Germany, which is the biggest market in Europe. Don't forget, we have 17,000 companies in Germany out of the 50,000 in Europe that have to implement whistleblower solution. But in Germany, the law will be implemented by the end of Q1, beginning of Q2. So we should not lose a lot there.And in other markets, we don't know. We are not experts in the different markets and their implementation of their laws. Of course, it's not great, but the effect is really quite limited. Since the big companies want and need to comply with the directive and the directive is and will be in place in December. So we can still go out there and big companies are out there in looking for providers. And as I said, we are in a proposition. So there will be a lot of deals coming in the upcoming weeks and months despite the fact if this regulation is in place or not.
Yes. And to follow up on that, if countries implement the law from next year onwards, so delayed, should we then expect even increasing marketing expenses? Next year -- I mean, we have planned a strong marketing expenses in the first half of next year because that makes totally still sense. The law -- even if the law would have been or will be -- will come on time into place in Germany or other markets, we would see investments into marketing and sales in the hot period, which at least goes until the mid of next year. Might be that it shifts but then we also will shift the marketing [indiscernible], meaning that in the first half might be less spend.And then also in Q3, there might be more spend. So this is something which we are already [indiscernible] as you could see from the 9 months figures and the lower spend, we are adjusting and acting according to the dynamic of the regulation.
Yes. and if you look at the question from Sebastian [indiscernible] from Shareholder Value. Thank you so much, where is the current conversion rate from whistleblower to the Compliance COCKPIT. We have to tell you that at the moment, everybody at EQS Group is totally focused on grabbing the whistleblower market. So it is not our focus to convert whistleblower customers to the COCKPIT. That means, on the one hand, we are still developing a lot of applications and further develop them. So if customers approach us, of course, we will demo our COCKPIT and we take them on their compliance journey, but it is not our focus. And I think, therefore, the numbers are quite low, but that is how we plan it.
Another 1 comes from Marius Fuhrberg from Warburg Research. Could you elaborate a bit further on your partnership with, for example, Bundesanzeiger. Should we think of this as a wide-level product? And how would you judge your cross-selling opportunities in such a setup?
Yes. I think it went online this morning. It's called [indiscernible]. You can check that out online. I will check out again real quick if it's online. And there, you will see at the bottom of this website that it is a partnership between EQS and the Bundesanzeiger. So yes, it's called [indiscernible]. And Bundesanzeiger Will start reaching out to their customers step-by-step now. Did I miss anything? What was the question exactly? The second question regarding Bundesanzeiger?
No, that was mainly it. I mean what is the cross-selling potential that was question on that. I mean we believe there will be mainly SME customers there on that side. So at least in the short and midterm, cross-selling potential is limited. We still believe that we will see a trend into implementing more and more compliance functionality and triggering down to the smaller companies. That's why the regulation is picking up for companies already with 250 employees in the first step and then with 50. So we see the trend coming from the regulation, but at least in the short and midterm, it's not the focus for cross-sell. And we showed that also. I showed that on the circles that we mainly focus then on those 5,000 companies. And out of those 5,000, we believe that another 20% share is 1,000 will be the relevant ones to cross sell strongly our Compliance COCKPIT.Another 1 comes on the delay of the implementation of the whistleblowing directly with a look on outside of Germany coming from [indiscernible] from Edison. Do we have a better new idea of the new timetable. What's going to drive change and what is anticipated for full year '22? I mean we're tracking that.
I mean in the end, it's the culture and the mindset of the country, right? If you look at the Nordics, we discussed this before, they have this mindset of -- it's important to be transparent. It's important to create among all stakeholders. So for them, it was a no-brainer that they have to implement this law as soon as possible.And there are other countries where you see different mindset. The further south you go, the more politicians and entrepreneurs out there that don't like this law at all. They think it will lead to a lot of negative effects on the corporate culture and so on. So there is resistance. And therefore, it takes more time in these countries. But in the end, what can they do. It is a directive. It is out there. And they have to implement the law. So the question is, how far should they go. We had the discussion here in Germany where the Minister of Justice that we had to also protect whistleblowers if they report misconduct on a local level, on local law. The directive says only on European law. So I think you had the discussion in many countries, how far should you go. From a practical point of view, it makes a lot of sense to protect the whistleblowers also on a local level. Otherwise, the whistleblower is always to educate herself or himself okay, this is a misconduct on a European law level or on a local law level, and that will be better complicated.
Absolutely. So 2 more questions coming in on the IR segment [indiscernible. So the first 1 is have you been successful in converting acquired compliance customers, so inorganically acquired compliance customers onto the IR COCKPIT.
For compliance to COCKPIT, that's only not the way we work. Normally, we get the IPOs, sign them on the IR cockpit and then step-by-step move towards the compliance cockpit. It's seldom the way that it's the other way around, right?
And 1 big reason is that a lot of compliance customers are also nonlisted ones. So there is no real use case for them in terms of IR COCKPIT. And of course, with the big listed companies, we are mostly doing both, right?
Exactly.
So and then another question from Mr . [indiscernible] and how do 2021 and 2020 compare in terms of numbers of online AGMs you conducted? And could you give an outlook on the regulation on the online AGM for the next years. So maybe starting with the second one. On the regulatory side, I think the regulator did or is continuing mainly on the regulation that has been put in place due to COVID. We also don't know how long this regulation is going to be in place. We believe that a lot of companies have done a setup now that they have at least potential to go for hybrid in the future. I think that's something that could be a trend. But overall, it's not really our core field and it's not where we focus because we need to buy in a lot of support from other partners because we are not having the full setup here in-house. We focus rather on the webcast for the [indiscernible] quarterly earnings calls. And that's why it's not really a topic where we address too much attention to. But of course, we look at it. And if we look at the numbers last year and this year, I can't exactly tell you I would need to check that what is the exact number in terms of events, but that's even not that important because there are very big events, very small events. So it would not really make comparison, but what we know is that there are a couple of bigger events we did not do, and it's an impact of a couple of hundred thousand euro that we did not have this year. Again, the precise number, I can follow up on that with you afterwards, but I don't have that in mind at the moment to be honest.
Yes, since you're concentrating fully on the IR COCKPIT, whistleblowing and later on Compliance COCKPIT. This is really not in our focus. It's a project-based business and you need a lot of different providers to offer the full range of the one-stop shop for an online or virtual Annual General Meeting. So it's, I think, way more profitable to grow in the IR COCKPIT field in Investor Relations. Great. I think we are through. It was really great to get so many questions seeing that much interest in EQS Group. Thank you all very much for this. We will be out there in the upcoming days and weeks on different virtual roadshows also at the German Equity Forum, which is our main IR conference for us every year and hopefully meet you guys online, in a one-on-one or wherever you are or wherever we are.
Absolutely. Looking forward to that. And like always, if you have any follow-ups, just let us know, and we're happy, of course, to more questions that are coming up.
Great. Thank you all. Have a good day and bye-bye, everybody. Bye.