Technology division in 2020 

Cristian Herghelegiu, Vicepresident for Technology in Bittnet Group

While the pandemic introduced a real systemic shock in all the world’s economies, this shock was felt significantly differently from industry to industry and from company to company. In this difficult context, the ability of companies to adopt technology has, in many cases, made the difference between companies that have managed to overcome difficult times and those that have had to reduce and even close down 

According to the latest McKinsey study, “Digital Challengers in the next normal” – across the whole of Central and Eastern Europe (EEC), there has been an acceleration in the growth rates of digital economies. Practically 78% of the increase registered in 2019 was achieved in 2020 in the first 5 months 

Although in most cases the measures taken by companies were aimed at solving one-off problems in the short term (online labor migration, solving access to systems and data, securing platforms) – on the principle of urgency and without planning adequate budgets – we expect 2021 to mark a consolidation of these online communication systems / platforms / channels. 

There was also a significant trend of digitalization of services to consumers – according to the same study at the EEC level – almost 12 million new users accessed online services (banking, e-commerce, public services); many of these new users have started accessing services through online platforms for the first time, and 70% of them intend to continue using them. This change also has a cultural (profound) dimension – the segment with the highest increase in the use of online services is that of the population over 65 years. 

During 2020, several directions were felt that influenced the evolution of the technology division of the Bittnet Group and that will make their presence felt in the following years: 

  • Companies that have a clear digital development / transformation strategy are the first to overcome the crisis phase and start reaping benefits in the short and medium term; 
  • Additional pressure has been created on companies in the SME segment that invest significantly less in the digital area; in conjunction with the funding programs announced by the government and the European Union, we believe that this segment will enter a significant upward trend in the coming years (trend started at the end of 2020); 
  • The potential for technology services remains significant in Romania – according to the DESI index, we are at the bottom of the ranking in terms of technology adoption and integration. Financing programs and the pressure to increase competitiveness can create real premises for an accelerated growth of the Romanian IT sector. 

In the context of a national economic contraction of 3.9% in 2020, the technology division of the Bittnet Group recorded an increase in revenue of over 11%, an increase in gross margin of 33% and an increase of over RON 4 million in operating profit (from RON 1.5 million to RON +2.5 million). Also, both Dendrio Solutions and Elian Solutions recorded significant increases in the number of projects developed and delivered during 2020. 

  31-Dec-20  31-Dec-19  Evolutie 
Revenues from contracts with clients  96,575,966  86,919,239  11.11% 
Revenues from the provision of services  19,273,343  14,290,146  34.87% 
Sale of goods  77,302,623  72,629,092  6.43% 
Cost of sales  82,821,810  76,576,645  8.16% 
The cost of selling goods / materials  (68,431,366)  (64,551,308)  6.01% 
Cloud Services  (5,178,219)  (1,863,093)  177.94% 
Human Resources  (9,212,225)  (10,162,244)  -9.35% 
Gross margin  13,754,155  10,342,594  32.99% 
Other incomes  147,984  153,919  -3.86% 
Sales / distribution expenses  (5,256,621)  4,510,037  16.55% 
Human Resources  (4,690,387)  (3,936,580)  19.15% 
Advertising  (566,234)  (573,457)  -1.26% 
Administrative expenses, out of which  (5,778,445)  (7,482,289)  -22.77% 
Human Resources  (3,335,510)  (4,024,156)  -17.11% 
Amortization  (1,328,914)  (1,183,277)  12.31% 
Other third-party services  (551,355)  (686,032)  -19.63% 
Operational Profit (EBIT)  2,867,073  -1,495,813   

DENDRIO. Your journey. Upgraded.                                   

100% owned by
Bittnet Systems SA          Cristian Herghelegiu, CEO DENDRIO


2020 was still a year of growth for Dendrio Solutions (over 10% both in terms of revenue and gross margin, generating an increase of over 3 times the operating profit) but we can say that the business dynamics was different from previous years: 

  • The global health crisis has led to a significant impact on the production and distribution chains of hardware equipment – at the end of the year the main partners producing hardware equipment with closed production units or with reduced production. This led to the impossibility of Dendrio to deliver certain projects during 2020 – contracts worth almost RON 5 million and generating an additional profitability of over RON 800k to be delivered during 2021. 
  • This effect was also amplified by the parliamentary elections at the end of the year, which led to delays in signing certain contracts in the public space, respectively to delays in the conduct of contracts. Such a significant project, worth RON 22 million, which was awarded to Dendrio in November 2020, was signed in final form only in January 2021. 
  • Even in this complicated global and local context, the 4th quarter remained the strongest quarter of the company, without entering the seasonality of recent years. 

From the perspective of Dendrio integration projects: 

  • We managed to deliver a 20% higher number of projects, in exceptional conditions, restricting travel and reducing resources as a result of quarantine procedures. 
  • The higher volume of projects also led to a significantly higher load in the whole team, which led to an increase in operational profitability; 
  • Significant projects in national communications infrastructure were delivered; 
  • We started the implementation of the first Application Centric Infrastructure project based on advanced concepts of Software Defined Network; 
  • We have continued to expand our collaboration with telecommunications operators – a direction we believe will continue to develop in the coming years; 
  • During 2020, we completed two projects with service delivery at the regional level and won a third such project that will – due to international travel restrictions – be implemented during 2021. 

Strategic partnerships 

We started, together with major technology partners such as Microsoft but also with partners in the business environment such as Raiffeisen Bank, Banca Românească, Eximbank, ProCredit Bank, programs for the digitalization of entrepreneurship in Romania. These steps started in 2020 and will continue, we hope, in an accelerated way – and in 2021. An extremely important aspect is the alignment of these steps of the technology division with the National Recovery and Resilience Plan – respectively the digitization programs for SMEs. 

Although we are at the beginning of 2021, we can say that the interest of SME companies for these digitization programs funded together with the European Union is significant: over 200 such companies have already interacted with this ecosystem in which funding comes to support the need for companies to and increase productivity through technology. 

Subscription economy = the new old economy 

We believe that in 2020, including the Romanian market, it has made a significant leap in the direction of adopting technology as an important factor, both to ensure business continuity and to ensure future growth. The use of technology on agile principles, from the cloud, as a service, is becoming a fact. During the second half of 2020 we delivered over 20 such technology adoption workshops and starting with 2021, we created a dedicated team for Customer Success, at the level of the entire company. 


51% owned by
Bittnet Systems SA                 Iulian Moțoi, CEO ELIAN

The year 2020 was a year of growth / reorganization for Elian and, looking at the numbers, we can say that it was the best year in the company’s history. Elian generated 12% more business, but 44% more gross margin than the previous year. Referring to 2019 and taking into account the 3 business lines that the company has, the figures look as follows: 

  1. Implementation services: 53% increase by strengthening the team with senior resources. As a result, we delivered implementation services faster and to a better quality standard. It is the first year in which the volume of invoicing from services (where the company has the largest margin) is compared to the sale from licenses. Until 2019, the head tractor in business was the sale of licenses. The balance of the two business lines marks the transition to large implementations for companies with complex business, in various areas of activity: public services, agricultural production, textile production, cable production, retail, distribution. 
  1. Licenses: in total we have a decrease of 8%, but with the reconfiguration of the share between the sale of licenses on cloud versus the sale of licenses on premises. If in 2019 the share of sales on premises was 76% versus 24% in sales on the cloud, in 2020 we have an increase of 10% for the cloud, the final figures showing as follows: 66% licensing on prem, 34% licensing on the cloud. As on prem licensing is a one-time sale, and on cloud licensing the sale is recurrent, in the medium and long-term keeping the licensing volume with recalibrating the weights between on prem licensing and on cloud licensing, actually means recurring business growth, the business direction agreed through the partnership with Microsoft. 
  1. Support services for existing clients in the portfolio: the figure is comparable to that of 2019, but in the following market conditions: 
  1. In pandemic conditions / COVID-19, most customers were in the cost cutting area for recurring services. 
  1. In the current support activity for the clients in the portfolio, the cost cutting part was reflected in the time & material contracts. For the support contracts with the number of hours included per month, we had an increase by passing the implementations completed in support, thus compensating the decrease of activity from the time & material type contracts. 

In conclusion, as with the sale of licenses, the decrease or in this case the stagnation in figures actually means an increase in the area of recurring business. 

At the project level, the year 2020 marked the closure of large projects, complex from a business point of view and implicitly implementation, covering all operational flows: we can mention here companies Impetum Group, Ivatherm, Pandora, Chopstix, Supercom, RDF, RC Europe, companies that will support in the first quarter of this year. What is to be pointed out in the 2020 implementations is that they helped us to consolidate our ERP solution verticals for the agricultural production, textile production and retail business, but also to build / consolidate a portfolio of Elian products under our own license: we are talking here about the retail add-on, real estate services, the ClockIn-ClockOut application for tracking production activities in the production hall and last but not least, the location of the system. 

As for the team, the year 2020 came with 3 big challenges: 

  • preparation of projects in work-from-home conditions, 
  • appointment of 2 new team leaders for the development /implementation teams and 
  • integration of new resources into teams. 

The teams grew as follows: 2 development resources, 3 implementation resources and one support resource. It was a continuous process of reconfiguring the internal work procedures, the implementation methodology and the stages that a new resource goes through in order to be able to integrate in the team, being able to say that at the end of 2020 and beginning of 2021, these stages have been completely completed, are 100% stable organizationally and functionally, giving us the opportunity to focus our efforts on the development of recurring business, road started in 2018 and consolidated in 2019. 


25% owned by
Bittnet Systems SA           Daniel Ilinca, CEO SOFTBINATOR

The year 2020 brought again a doubling of the company’s turnover (from RON 6 million to over RON 12 million), a situation that is repeated every year since 2017. The increase resulted from the sale of services almost exclusively abroad, with especially in the US and Israel – two of the most powerful technology hubs. If in previous years it was delivered to customers in the US, Israel, in the last year, in addition to the strong consolidation in these markets (increase by over 50% compared to last year’s sales in each country), the company attracted customers from new regions – ASIA – Singapore, Great Britain and Germany. 

Regarding the industries for which the company is involved in product development, Softbinator Technologies has continued to deliver web and mobile solutions for digitizing the education process, lifestyle / medical and health, e-payments, e-commerce, online gaming and ticked in 2020 areas not explored in previous years through digital banking (including crypto), Internet of Things (IoT), Automotive and explored a new vertical in e-commerce expertise: marketplaces. For the company, it was certainly the year of blockchain and the growth of know-how in solutions based on artificial intelligence, thus continuing the direction in recent years to stay very close to areas with high potential and where it can innovate rapidly. This strategy of addressing only customers who are software dependent and in turn deliver technology to end users as a business model has not only maintained a secure position of accelerated growth, but pushed the company out of the risk of being affected. the negative effects of the pandemic. 

Also in 2020, Softbinator Technologies strengthened the company’s mission – “We build tech for humanity” by contributing to a round of investment in the Yummdiet lifestyle platform, led by local fund Simple Capital. 

Regarding technical expertise, in addition to the consolidation and constant migration to the latest stable versions of technology stacks already used in recent years (Java, .NET / C #, PHP, NodeJS, Python, React, Angular, MySQL, SQL Server, Oracle, MongoDB, NodeJS, Kotlin, Swift, ReactNative), new languages, technologies and architectural approaches have been added to the skills matrix of in-house teams. 

  • Flutter (an alternative launched by Google, already mature and with a high adoption for the development of cross-platform mobile solutions). 
  • Golang (modern language that has recently become very popular with the speed with which web services / microservices can be developed). 
  • Solidity and Python for blockchain / crypto (creation of solutions based on smart contracts using Ethereum, scalable solutions that serve real-time cryptocurrency exchanges). 
  • IoT (fault-tolerant architectures, real-time communication with WebRTC). 

Softbinator Technologies thus continues to be both a versatile vendor for the development of solutions based on cutting-edge resources, and an attractive destination for developers eager to work with the latest technologies used in web, mobile, blockchain and IoT. The solid know-how in these topics led, beyond the developed solutions, to the delivery of courses and trainings for other companies in the industry, together with the education division of the Bittnet Group. 

In 2020, although it was a year of remote work, which made the process of attracting talent more difficult, the company managed to maintain a high retention rate and double the total number of employees and collaborators, from 37 to 76. Also last year, due to the high interest of graduates in the final year, the places in the internship program were supplemented, being the largest volume in recent years. 

The relationship with academia and programming communities has expanded: 

  • 13 employees participated as experts in the field together with tenured professors in laboratories and courses of the profile faculties in Bucharest and Constanța in the two semesters. 
  • Partner and sponsor for the largest entrepreneurship program for students – Innovation Labs. 
  • Sponsor for the third consecutive year in the “ANIS Scholarships” competition for innovative faculty with the award for the best course for the development of knowledge in medical technology. 
  • With the support of the company and other sponsors, the NGO Softbinator Association continued to organize events for programmers, reaching in 2020 over 140 meetups and over 300 unique speakers. 

Regarding the distinctions obtained, Softbinator Technologies received from the Senate of the University of Bucharest, the award “Employer of the Year 2020” and was recognized for its intense activity for the benefit of the IT industry by ANIS (Employers Association of Software and Services Industry) the title of “ANIS Member of the Year“. Also in 2020, the company is appreciated on the most watched platform for employees in Romania – Undelucram.roas a top employer, 4th place both in the general ranking and in the ranking for IT – being, in fact, the most appreciated company 100 % Romanian from the top.