Like its Canadian example, Vitec is a serial acquirer focused on the vertical market software segment, i.e., specialized software for a particular business or sector, generally designed by small teams of developers.

The imitator is currently doing less well than the original. Over ten years, between 2012 and 2022, revenues triple and cash profits quadruple, but these gains must be compared to the amounts invested to assess profitability - and therefore value creation.

What do we see at this level? That between 2012 and 2022, Vitec invested $375 million in its external growth operations. These have added $125 million in revenues - an acquisition multiple of exactly x3 the sales - and about $20 million in free cash flow per year, which is a ROI far below that of Constellation, which hovers around 25%.

Other differences with Constellation's model: the margin profile is lower and Vitec does not hesitate to proceed to capital increases when the group considers it useful; the number of shares in circulation has thus increased from 27 to 36 million over the last decade.

In short, Swedish is not Canadian, even if it has the same contours and aspirations. But it is still a very successful group. The first quarter of 2023 shows a continuation of the excellent trend of revenue growth and margin expansion.

Indeed, there was a record number of acquisitions in 2022, and this should bring revenues to around $260 million this year. With a net margin of 15% - based on cash profit rather than accounting profit, which is burdened by legacy depreciation and amortization - we can expect a free cash flow of $39 million in 2023.

The current market capitalization represents a multiple of x46 this profit. Clearly, this suggests that the market is betting on Vitec's ability to triple its revenues again over the next decade.