Nortal Spin-Off Plumbr Raises $1M Seed Round
November 13, 2013
, the company that helps customers such as NATO and Dell predict and avoid software failures, today announced the closing of a $1 million round led by London-based US/UK angel investor Matt Arnold
. Other participating investors include the former head of Skype Estonia Sten Tamkivi
and the founders of global mobile-payment firm Fortumo
. Nortal is also an investor from a previous round.
Known for its capability to find and solve memory leaks, Plumbr has about 100 paying customers, half of whom are in the United States. Current customers include NATO, Dell, and HBO, as well as banks and telecom companies. The company expects to at least double its customer base in 2014.
"You can collect tons of metrics from your IT systems, but we know from experience that engineers
still need to do a lot of manual work to understand the real reasons behind
performance problems," said Plumbr CEO and co-founder Priit Potter. "Completing our vision
will free thousands of operations and development engineers from endless
"New investment allows
us accelerate product development and disrupt the space of monitoring and
troubleshooting solutions even faster," Potter said. To date, Plumbr has
detected the cause of more than 3,500 memory leaks in its customers.
"Plumbr is an
extraordinary example of deeply technical innovation created by members of the
new wave of Estonian startups with global ambitions, affectionately called #estonianmafia," said Sten Tamkivi. "Their product
harnesses machine learning to understand how monitored software works and why
it breaks, which to me signals a game changing mindset in how we make sure that
critical software runs fast and stably."
Priit Alamäe, Nortal CEO also said he is happy that Nortal's decision to finance Plumbr two years ago has paid off and that the team's ingenious technological idea has grown into a company. "Nortal spin-off Plumbr operates on a market with growing demand, and this is why we believe the product has great potential to succeed in export markets. The fact that the Plumbr is run by a very strong team is no less important - I know these guys for a long time and I am personally convinced in their ability to succeed. Nortal has always encouraged entrepreneurship and the aspirations to make the software development more efficient - Plumbr will save many of the important and large organizations around the world, both money and time," added Alamäe.
Founded in Estonia in 2011 as a spin-off of Nortal, Plumbr aims to
revolutionize the way people think about monitoring tools. Its software
automatically understands how an application should behave by detecting
anomalies in its memory usage patterns. Eschewing endless data and graphics,
Plumbr tells customers exactly what they need to fix, helping predict and avoid
See also www.plumbr.eu
And Tech Crunch article on the investment news
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Nortal to build a new Surveillance Activities Information System
October 18, 2013
On October 7, Nortal signed a frame agreement with Estonian Centre of Registers and Information Systems (RIK) for developing a new Surveillance Activities Information System. The new system will be fully implemented by January 1, 2015.
RIK (Estonian Centre of Registers and Information Systems) wishes to develop a new Surveillance Activities Information System, which allows surveillance agencies, the prosecuting authority and the courts to apply for the execution, extension and authorisation of fully digital surveillance activities. System has to ensure an overview of all executed surveillance activities, of all formalised applications and authorisations to conduct the surveillance activities, and of all the notifications and presentations of collected data. In addition, the information system will enable an integrated and comprehensive collection of statistics.
The base to develop this system was provided by and proceeded from the amendment of the Estonian Law of Criminal Procedure. Nortal tender win was announced in early September and it was not disputed. The whole project consists of two phases, the deadline of the first procurement contract (phase) is February 28, 2014.
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Nortal to develop a self-service portal for Lithuanian Railways (Lietuvos geležinkeliai)
October 09, 2013
Nortal signed an Agreement with Lithuanian Railways (Lietuvos geležinkeliai) in the beginning of September, 2013 for the implementation of a new self-service internet portal. Implementation of the project is estimated by February, 2014.
The overall goal of the agreement is to create a new high-functioning self-service internet portal which includes following functionality areas: usability, availability, accessibility, privacy and security. The self-service portal’s customer interface will include general passenger information, routes, timetables, cargo and freight transport, infrastructure etc. The new self-service portal will be much easier to use compared to the current system. Part of the new portal’s functionalities will be automated. The portal will also be adapted for the disabled.
The new self-service portal content management system will be built on Liferay, a web platform with features commonly required for the development of websites and self-service portals. Nortal will use CSS3, jQuery and others technologies to develop the self-service portal. Also, the portal will be adapted to different diagonal screens. The project team will consists of over 5 Nortal Lithuania employees.
Lithuanian Railways is a national, state-owned railway company, which operates most of the railway lines in Lithuania and employs almost 11 000 employees.
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Priit Alamäe for Arengufond on the export of Estonian IT and its future possibilities
September 25, 2013
Arengufond, an Estonian public institution subject to the Parliament with an aim to contribute to the economic development of Estonia, asked Priit Alamäe to write to their special edition of visionary opinion stories. Priit chose to write about the export of Estonian IT and its future possibilities.
PRIIT ALAMÄE: WHY PUT YOUR NECK ON THE LINE?
In the world of software development, work is most secure and trouble-free when it takes place in the same room with a client who speaks the same language, when the partnership dates back many years, and when you know the client completely. However, there are risks in every project, such as those associated with the team, the client, communication problems, cultural differences, payment behaviour, and a long list of other variables. As soon as we leave the so-called "safe zone", the number of risks increases exponentially.
I cannot speak for other industries, but in software development, risk measurements should be multiplied rather than added together. In the world of theatre, there is a saying that if there is a gun in the first act, it will be fired by the third. The same applies to risks – as a rule, all risks that are predicted at the beginning of the project end up occurring to a greater or lesser extent. The question that logically arises is why should we then bother dealing with all this and put your neck on the line?
At the same time, taking new geographical risks presents an opportunity to minimize other risks. The home market is nice and safe, but in today's world, the reality is that different continents have different levels of economic development and different economic cycles that are not necessarily synchronised. If we are in a crisis, there is most likely another area enjoying an economic boom. During the last economic crisis, we managed to grow because we were present in markets where this cycle was at a different stage.
It is a fact that during the next decade, markets in Asia, Africa, the Middle East and South America will grow and develop a great deal faster than our closest markets. People who have studied economic sciences have been through the Boston Matrix to the point of exhaustion, but within the wider picture it is extremely relevant – Cash Cows, Dogs, Question Marks and Stars can also be seen in the context of different markets. The wise entrepreneur always strives to maintain an optimally balanced portfolio.
In today's smart economy, everything eventually boils down to people. And people are interested in very different things. There are people in our company who say that they have no more challenges left in their home country, and that if we weren't as international or interesting, they would no longer want to work at Nortal. We have people who do not wish or bother to travel and prefer working in their home country. In both cases, they are top specialists in their field, and both groups are right to feel the way they do. If we want our top performers to stay with us, we must offer them conditions that are personally tailored to them.
The Estonian market has many attractions, but size is not one of them. There are sectors in which maintaining a team of specialists with world-class capabilities is essentially impossible, because there are simply not enough projects available. I dare say that companies operating only in the Estonian market have a very difficult time building up and maintaining a core team of specialists of an optimal size – the market demand simply has its limits.
For example, our public finance and taxation team and e-health team are world-class, but if we did not have sufficient international projects, we would not be able to nurture and engage them enough. At the same time, our clients expect us to produce them with something new and innovative; instead of us inquiring about their preferences, our clients expect us to bring new ideas to the table, complete with the experience of putting them to practice.
Fresh ideas – these days referred to as innovation – often emerge when people with different experiences as well as varied cultural and educational backgrounds come together. In science, this is called interdisciplinarity. We actively try to foster an environment where our people work alongside colleagues from different backgrounds, allowing them to brainstorm together, learn from each other, and come up with innovative ideas and solutions.
An isolated system has no exchange of energy with the outside world, and if our activities remain within the boundaries of this system, we also set limits on our professional development. What we must ask ourselves then is how we can find and keep a sufficient number of talented and ambitious professionals in order to be visible enough in the international arena and thus offer sufficient challenges to our talents through our international presence. The same applies to building the core management of the company.
Activities, processes and people with critical importance to the company have often gathered at the company headquarters. Headquarters is where a large part of our technological and business model innovation is carried out, where the majority of our R&D activities are performed, where high-income senior managers and specialists make decisions influencing various regions, and where, in the end, capital tends to concentrate. Headquarters are never moved offshore, even though salaries may be several-fold lower or the tax environment more favourable.
A country's economic durability is defined by whether companies in that country are consolidators or consolidatees. Here, it is important not to fall into the trap of the "we want national capital"-type slogans – Apple is not the property of US citizens, nor does Toyota belong to the Japanese. This is not important. What matters is that one has headquarters in Cupertino and the other in Aichi. And this is where decisions are made whether production takes place in Guangzhou or Elva.
Let us go even further and bust another myth – Estonia will never become rich by producing something with our own little white hands, which is then dispatched somewhere else by ship, train or over an internet connection. We will never be able to develop enough software to win five per cent of Germany's market. But if we act smartly, we may be able to establish subsidiaries located in Germany with an Estonian parent company, and these subsidiaries can then get five per cent of the German and maybe even some other markets.
There are simply too few of us, and we need to reinforce ourselves through others. Even the most efficient self-employed person can never create the same amount of value as a good ten-person team. We must create a situation where people in other countries work for our companies, and then bring the value created through their work back onto Estonian balance sheets and income statements.
We should nurture, respect and support the companies that have enough will, ability and confidence to sell and invest outside Estonia. It requires a coordinated strategy, which among many other things combines supporting and guaranteeing external investment, organising a combined effort by the private and public sectors to enter foreign markets and protect the interests of our undertakings there, and simplifying the procedure for bringing specialists and managers required for manning an international company's headquarters to Estonia.
Finally, we need to acknowledge that even if we do everything right, the results will start showing no sooner than in 5 to 10 years, and even this is possible only if companies' actions are backed up by a clear collective understanding, a long-term agreement, and a common effort. It is a lot easier to defend a mountain peak than to attack it. Climbing up the value chain requires sweat, blood and tears, but if we are honest, when thinking long-term, we have no other alternatives.
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Finland to create a data exchange layer on the example of the Estonian X-Road
September 12, 2013
On the 11th of September representatives of EU Commision EUGO working-group held a workshop in Tallinn. The workshop was devoted to data exchange layer X-Road and the potential of X-Road Europe. As a practical example, Estonian-Finnish collaboration on cross-border e-services was introduced
The Government of Finland is interested in creating a data exchange layer of e-services and cooperating with Estonia in the course thereof as much as possible. "We will immediately and cost-effectively create a national data exchange layer of electronic services and an electronic identification system, implementing cooperation opportunities with Estonia insofar as possible," sets out a policy document of the Government of Finland concerning the assurance of economic growth conditions and sustainability that was approved two weeks ago.
Riku Jylhänkangas, Director of the Strategic Governance of the Finnish Public Sector ICT, confirmed that Finland is planning to actively examine the Estonian X-Road solution. "We are planning to thoroughly study the Estonian X-Road. This is not just about the source code but also understanding the organisation and agreements that create the frameworks for this technology. We are also hoping to test cross-border services. In the future, a solution similar to the X-Road will benefit Finnish citizens and enterprises as it definitely allows offering public services faster and at less cost," Jylhänkangas explained.
As the first pilot service, the Estonian Tax and Customs Board has commenced cooperation with the Finnish Tax Administration to bring the cross-border data exchange to the X-Road channel. The first tests have been conducted.
Nortal is very closely following the process of possible X-road implementation in Finland and sees many opportunities where Finnish Government could utilize also Nortal`s experience.
"Nortal has an extremely unique position because we can bring our Estonian experiences and practices as part of our Finnish offerings. However, there are lot of things to do before the actual business opportunities emerge," said Timo A. Rantanen, Nortal's Finnish Public Sector Business Area Manager.
The Finnish Information Society Strategy was adopted in 2012 and the development of the information society is the priority of all ministries. The ICT cooperation opportunities of Estonia and Finland have been under discussion since spring 2013. Finland is planning to create a working group by November that would further promote the development of the data exchange layer and cooperation with Estonia. There are also plans to affirm the Estonian-Finnish ICT cooperation with an official agreement.
The X-Road data exchange layer is a technical and organisational environment that allows organising secure web-based data exchange between the information systems of the state. The X-Road allows people, institutions and enterprises to securely exchange data and organise the access of people to the data preserved and processed in state databases.
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Nortal to build new Document Management System for Estonian Agricultural Registers and Information Board
August 21, 2013
In the beginning of August, Nortal signed a new frame agreement with Estonian Agricultural Registers and Information Board for implementing new Document Management System.
The overall frame agreement goal is to create a centralised Electronic Content Management System integrated with other peripheral systems simplifying the day-to-day activities of the end-users.
During the first stage the existing Document Management System is expected to be replaced with a new one brining in the automated processes in terms of the document capture technologies.
Estonian Agricultural Registers and Information Board new Document Management System will be based on MS Sharepoint platform.
Nortal has cooperated with Agricultural Registers and Information Board since 2005 building several information systems for managing the applications for financial assistance and the payouts of subsidies. Agricultural Registers and Information Board processes approximately 200 000 applications for 45-40 different support grants.
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Nortal wins tender for Estonian Unemployment Insurance Fund software development
July 29, 2013
At the end of July, Nortal won the public procurement for the development of the Estonian Unemployment Insurance Fund's information system, EMPIS, and its document management software Alfresco. This means that Nortal will be continuing the development of the extensive pre-existing systems.
According to Lauri Tammiste, Head of the Public Sector Business Unit at Nortal, the company has already been working together with the Estonian Unemployment Insurance Fund for several years now. "We are also delighted that the latest procurement proved successful for us. We believe that Nortal prevailed because of our diverse experience, strong team and competence in developing large and complex systems", Tammiste added.
EMPIS (Estonian Employment Information System) is a web-based information processing system that allows officials to register new clients quickly and easily, determine unemployment benefits, offer various services, forward job offers, sign contracts with institutions, and process procurements, amongst other functions. The system also exchanges data with other public information systems and the internal applications of the Estonian Unemployment Insurance Fund, namely the document management application, accounting software, Unemployment Insurance Information System TKIS, and Self-Service Portal ITP. EMPIS will simplify proceedings for the unemployed and officials at the Estonian Unemployment Insurance Fund by rendering the tasks of the officials easier and more efficient.
Collaboration between Nortal and the Estonian Unemployment Insurance Fund has lasted for several years, and to date, Nortal has carried out the development, interfacing, testing, implementation and support of the following functionalities: the registration of claimants; processing of applications; calculation, payment and claiming of benefits; matching jobseekers with job offers; selection of candidates for employers; management of training; and other labour market services (including public procurements and contracts).
The central aims in the development and implementation of EMPIS were the automation of all work processes, so as to avoid human error and improve efficiency, as well as the increase in the Estonian Unemployment Insurance Fund's capacity to provide services to clients. Optimal usage of data from other sources (EMPIS is interfaced with 11 different databases) ensures the accuracy of decisions on applications. This also saves time, as clients need to submit fewer documents on paper.
Alfresco is the Estonian Unemployment Insurance Fund's document management system. Alfresco stores the majority of documents that are used in the work of the Unemployment Insurance Fund – from digitally signed contracts to email conversations and meeting minutes. This is not an ordinary document management application, as its processes are strongly integrated with EMPIS. Alfresco is used for entering, registering, viewing and working with different documents, as well as for communicating and exchanging information with clients and partners.
In terms of total number of archived documents, Alfresco is the largest document management system in Estonia. Over one hundred employees of the Estonian Unemployment Insurance Fund use this system on a daily basis. As working with the system largely involves searching for and navigating among documents, optimization has been one of the keywords in the development of this system.
In addition to these work processes, several other comprehensive workflows are also critically important, such as those related to digital signatures, approvals and resolutions. The Estonian Unemployment Insurance Fund uses many other systems that need to exchange information with Alfresco (which has been interfaced with 3 different databases).
The overall goal is the implementation of the Unemployment Insurance Fund's document management processes, which would cover the entire life cycle of the documents and their folders, from creation to archiving and destruction, and the implementation of administrative procedures that would allow necessary operations to be executed with these documents.
EMPIS and Alfresco operate within independent frameworks, but the supported business processes are equally compatible with both information systems.
In cooperation with Nortal, and within the framework of the WAPE Region Europe PES training programme, the Estonian Unemployment Insurance Fund has also trained other European labour market service institutions on how to develop the business processes of labour market services and introduce them to information systems. The programme has been hugely successful and has attracted participants from Belgium, Croatia, Turkey and Hungary.
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Financial Results of 2012
July 01, 2013
In 2012, Nortal consolidated revenue grew to 41,8 million EUR (34,6 million EUR in 2011). EBITDA decreased from 4,1 million euros profit in 2011 to minus 3,7 million euros in 2012. In 2012, Nortal’s business in Finland, Oman and noteably Lithuania was profitable. The negative results are mostly attributable to two business units in Estonia and one international project. Nortal has also made significant investment into strategic customer acquisition in Finland and internal R&D. All loss-making projects and business units have been restructured and the management believes that they will not have a negative impact on the results in 2013.
In 2013 the focus of Nortal will stay on the current geographical markets, building on the existing customer and competence foundation. In addition to the current vertical focus areas of telecom, e-government, public finance management, manufacturing & logistics, energy & resources and e-health. Nortal will continue to strengthen and invest in financial services industry competence and customer base.
With recent big customer wins in the area of taxation, e-government and financial services, the customer pipeline and project backlog is strong. Nortal technological value proposition to customers remains substantial and relevant – during 2012 and 2013 internal R&D spending has more than doubled with the focus on technology re-usability, e-service channel convergence and business service framework development. Nortal is a preferred employer in its markets and will continue to build a healthy and challenging working environment based on its core values of passion, team-spirit, results and innovation.
Despite the temporary profitability hiccup in 2012, Nortal business outlook for 2013-2015 remains strong. The customer portfolio is well balanced in terms of industries and geographies, ensuring stability and growth even in a flat economy.
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Research: Estonian e-government one of the best in Europe
June 06, 2013
The European Commission’s eGovernment Benchmark 2012 report has found Estonia to be one of the best implementers of e-government solutions in Europe.
The report surveyed 28 000 Internet users across 32 countries. The report pointed out that, although online service users in the EU were generally more satisfied with online banking and online shopping than with online public services, the Estonian government portal eesti.ee sets an example by offering the country’s residents access via a secure online environment to more than one hundred online services and information sources.
Neelie Kroes, European Commission vice-president, said these were promising trends for e-government in Europe, but “when users are more satisfied with online banking than online public services, it shows that public administration must do better at designing e-government services around users’ needs. And we have to do more to make e-government work across borders.”
In the eGovernment Benchmark report, it was also noted that Estonia serves as a good example of how decentralisation yields positive results in the digital realm. Instead of a single all-encompassing centralised system, Estonia decided to develop an open system linking many different decentralised services and databases. Through the years, the flexibility of the system has permitted new components to be added to the digital society as the need has arisen. This ability to expand freely is precisely the reason why we can speak of Estonia as one of Europe’s success stories in the last decade, and why the government has made significant progress in this area in spite of the relatively limited ICT budget.
Source: European Commission
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Nortal is the largest Baltic IT services and software development company, also a leader in IT export
May 22, 2013
Once again, Nortal ranked first in Prime Investment report on Baltic ICT Market in three different categories: Prime Baltic IT services companies (TOP-20), Top-5 software development companies and Top-5 exporting companies.
According to Prime Investment Baltic IT sector grew by 11% during 2012. Nortal increased its IT services revenue growth by 18% (39.5m EUR) and the total revenue growth by 21% (41.9m EUR) compared to the financial year of 2011. Also, Nortal’s export value (25.8m EUR) grew by 34% during 2012.
Baltic ICT market news is a semi-annual review of recent corporate developments in the sector of information technology, telecommunications and Internet access in the Baltic States. The report highlights important corporate and M&A events of the Baltic ICT market and provides proprietary ratings of the leading Baltic IT service companies. The ranking has been compiled since 2002.
Prime Investment is one of the leading investment banking companies in the region, focusing on M&A, buyouts, fund raising, corporate restructuring and strategic advisory.
Baltic ICT Market news - Spring 2013 report: http://www.primeinvestment.lt/index.php/publikacijos/publications/baltic_ict_market_news_spring_2013...
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