IT SEMINAR VESA TYKKYLINEN, CEO HELSINKI, 24 NOVEMBER 2016 - PowerPoint PPT Presentation

CARNEGIE IT SEMINAR VESA TYKKYLÄINEN, CEO HELSINKI, 24 NOVEMBER 2016

IMPORTANT NOTICE The following information contains, or may be deemed to contain, forward-looking statements. These statements relate to future events or future financial performance, including, but not limited to, expectations regarding market growth and development as well growth and profitability of Basware. In some cases, such forward- looking statements can be identified by terminology such as “expect”, “plan”, “anticipate”, “intend”, “believe”, “estimate”, “predict”, “potential”, or “continue”, or the negative of those terms or other comparable terminology. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Future results may vary from the results expressed in, or implied by, the forward-looking statements, possibly to a material degree. All forward-looking statements included herein are based on information presently available to Basware and, accordingly, Basware assumes no obligation to update any forward-looking statements, unless obligated to do so pursuant to an applicable law or regulation. Nothing in this presentation constitutes investment advice and this presentation shall not constitute an offer to sell or the solicitation of an offer to buy any securities of Basware or otherwise to engage in any investment activity. 2

WHY BASWARE Huge market THE market Cloud focused opportunity leader strategy

MEGA TRENDS DRIVING DEMAND FOR BASWARE’S SERVICES Digitalisation Automation Disruption of e-commerce Traditional Financing Models Public Sector Open Networks Initiatives EXCITING AND GROWING MARKET OPPORTUNITY

REGULATION IN THE EU AND THE U.S. PUSHING E-INVOICING PENETRATION EU and US More than 50 governments pushing e-invoicing public sector • Cut costs mandated to • Increases tax income support • Reduces fraud e-invoicing from end 2018 65% of businesses supply the public sector = 14 million companies in the EU alone 5

MARKET POTENTIAL FOR NETWORKED P2P 370 billion invoices annually, globally, 95% currently in paper format Current Total Addressable Future Potential: Market: 3 billion 100% e-invoices, e-invoices 1% of total E-invoice Other electronic formats Paper and unstructured data 6 Source: Management estimates, Billentis, EESPA. Covers B2B, B2G and B2C

GLOBAL LEADER IN A FRAGMENTED MARKET Network Purchase to Pay Financing Services #1 in Accounts #1 e-invoicing Payable and Top 3 Nascent market operator globally in Procurement 3% share of 7% share of Nascent market addressable market addressable market Offering is unique in Very few global Global competition breadth competitors from ERP providers Competition Multiple small local Smaller local depends on competitors providers customer size

BASWARE A LEADER IN GARTNER’S MAGIC QUADRANT FOR PROCURE-TO-PAY SUITES “ P2P suite Leaders demonstrate a market-defining vision of how technology and services can help procurement establish, develop and maintain contract compliance and cost- effective processes for managing and controlling external spend. They have the ability to execute against their vision with products and services, and they have demonstrated results in the form of growth and customer satisfaction. Leaders successfully sell into multiple industries and multiple geographies. Leaders are often what other providers in the market measure themselves against, and they are the most likely vendors from this report to be in the P2P suite business five years from now.” Source: Gartner (June 2016) *Gartner, Magic Quadrant for Procure-to-Pay Suites, Deborah R Wilson, Paolo Malinverno, Magnus Bergfors, Desere Edwards, 13 June 2016 This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the context of the entire document. The Gartner document is available upon request from www.basware.com. Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

WE HELP CUSTOMERS DO THREE THINGS Manage Connect Optimize • Deliver financial insights to • Drive growth and operational • Simplify and automate the business excellence • Eliminate paper • Improve collaboration • Create competitive advantage • Strengthen supplier • Control margins and spend • Minimize business risk relationships • Tap into supplier innovation • Reduce supply chain risk • Navigate regulatory • Drive cost savings and • Improve cash flow complexity • Optimize working capital efficiency • Improve data accuracy

END-TO-END SOLUTION UNLOCKS VALUE UNLOCK CASH FLOW TRANSFORM PROCUREMENT Basware Network SUPPLIERS SUPPLIERS OPTIMIZE INDIRECT & DIRECT INVOICE PROCESSING

SUCCESS ENABLER: OPEN BASWARE NETWORK Basware Network is the largest open e-Invoicing network globally, powered by over 220 interoperability network partners and over 1M buyers and sellers • One single connection , the most cost-effective way of communication • Basware automatically converts invoices to the end format required • Suppliers can reach a large number of customers using our interoperable network partners • Global trusted partner: multi-lingual, multi- format and connected to main government hubs

“ The Basware solution has proved incredibly flexible, providing a seamless integration with our existing systems.” Ed Prins Financial Services Manager

HOW BASWARE WILL GRAB THE OPPORTUNITY Continue to strengthen sales and marketing Strategic Actions To Enable Strategy Priority Focus on Customer Success Cloud Grow and monetize network and data assets Revenue with value added services including financing Growth Increase productivity by simplifying our operations and increasing scalability Evolve our culture and way of working to focus more on performance

CLOUD REVENUES APPROACHING 50% 2016 Q3 2015 2010 Cloud Revenues Drive Growth Other Revenues Enable Cloud Growth  SaaS  Maintenance  Transaction Services  Licenses  Financing Services (excl. alliance fees)  Consulting  Other subscription revenues

2020 STRATEGY GOALS Strategic Priority 2017-2020 Strategic Goals Cloud revenue growth >20% CAGR on an organic basis Annual net sales Cloud revenue growth >EUR 220 million Recurring revenue ~ 80% of net sales Continue to improve underlying profitability * Cloud revenue includes transactions services, SaaS and other subscription and financing services revenue excluding alliance fees ** Recurring revenue consists of net sales excluding license sales, consulting revenue related to deliveries, and alliance fees

WHY BASWARE Huge market THE market Cloud focused opportunity leader strategy

NEXT REPORT Q4 INTERIM REPORT ON FEBRUARY 1, 2017 MORE INFORMATION: www.basware.com/investors www.basware.com www.twitter.com/basware www.facebook.com/BaswareCorporation www.linkedin.com/company/basware