Delivery Hero CFO Emmanuel Thomassin - Deals, Profitability, and Fierce Competition

[MUSIC] Leading corporate transformation, the podcast by V. Ha'ul AutoBysime School of Management, powered by PWC, on the transformation of companies and their culture, from decision makers, for decision makers, or from entrepreneurs for entrepreneurs. [MUSIC] Dear listeners, a very warm welcome to a new edition of our V. Ha'ul Podcast, Leading corporate transformation, powered by PWC. My name is Martin Glam, I'm a professor at V. Ha'ul AutoBysime School of Management. And with me, as always in this podcast, is Gory Fronheurschhausen from PWC. Gory. Oh, thanks Martin. Thanks everyone. A big hello to our listeners from my side. My name is Gory Fronheurschhausen, and I'm the co-host of this podcast. As you know, I'm the transformation consultant in this talk, and I do lead our industry sector consulting at PWC Germany. My background is to help our clients to optimize and to transform their finance function. So it is a very special honor for me to introduce you to ours today guest. Warm welcome to Imalwe, Tamasin. Yeah, Tamasin, how are you Tamasin? Okay, perfect. From Delivery Hero. That's correct. Hi everyone. Thank you for having me today in the podcast. I'm very excited to be part of you. Cool, cool that you're here. Maybe Imalwe, can you give a short introduction to yourself and to the company Delivery Hero? Everybody knows them, but maybe a quick intro from somebody who's working on the top line of this company. No, I'm happy to. I mean, so my name is Imalwe, I'm the CF of the group for the last 10 years. French for nationality, but I've been growing up in Germany a lot. So I consider myself as a half German, half French. My work forking is very German. So, and yes, I joined Delivery Hero like 10 years ago, and I'm acting as a CF of the group. The company itself, I'm a like for the one that are German, is a translation of Leafehelt, which was the first company we founded, actually in Germany, and was the first platform. And literally, as we started to expand, we called it Delivery Hero. At the beginning, you could say, well, it was not really like the name was a bit confusing, because we were a marketplace business and not delivering at all. But today is not the case anymore. The company is at quarter in Berlin. We are pretty proud of that. I mean, we think, you know, we should promote European companies. We have a lot of talents in Europe. We can attract a lot of talented to Europe. That's why we stayed here in Germany, although we don't have any business anymore, but probably have a question on that later. So, yes, and the business today is delivering almost everything, starting from food very early days, which is like almost 13 years ago, to now delivering literally everything you want within 60 minutes. There are some limitations when you look at the volumes, but otherwise, I mean, literally everything that is deliverable in the 60 minutes. This is what we do. And we do this in 70 countries in the world. So, we 24/7 on actually. What an interesting case. Gory already said that to remind our business. This is the company delivery hero that became a member of the DAX family in 2020 in August, I think. At the time, I think you were valued around 40 billion euros. And it cost quite a bit of a stir at the time, because for two reasons, one or related reasons, maybe. One reason was you had never made a profit until this time. And if I may comment, still don't. Correct. And the other one was, as you already said, not doing business in Germany at all, right? But still became part of the DAX family. You remember that time? Absolutely. Directly to the finance guy, did it really matter much to become a member of the or part of the DAX? And did it matter much when two years later in 2022, you had to leave again? Sure. I mean, it was not unexpected. It was expected, but not in 2020. And I can give you your secrets. Every year, we are organized what we call the world finance meeting, a world legal meeting. So, world finance, world legal meeting, because the general council is reporting to me. And in November 19, we're thinking about what should be the topics for next year. And there were two words. Think DAX. So, we were like having a summer meeting in 2020, thinking about what should we do in order to be ready for the DAX on top of what we were doing already. And, you know, this, you know, the story, basically one company of, in German company, Wirecard, had to be excluded from the DAX and we replaced them. So, if you ask me, it came basically not as a surprise, but earlier than we expected. At that time, the rules were different, as you know, I mean, like it was not an obligation to make profit. So, we didn't, you know, we didn't force the rules. The rules were applied in Germany. And yes, we were not very welcome in the club. We were quite frank. It's something that I learned actually in Germany, so it's a very private club. And you don't feel very welcome. And the support from the politicians, let's say, or also from the economy was modest, I would say. So, yeah, and then two years after we had to leave for the valuation, the market turned dramatically. And, yeah, that was a very good learning, actually, for the entire organization. I must say, like, you know, like the IPO, like the DAX, one thing that we keep on in mind is that this is just an event. So, you have to fulfill certain obligations. And you have to make sure that, you know, you have certain processes in place. And we'll talk about this probably later on. But it was just an event in the story of the company, like the IPO. So, you have to do the job every day. And I think that's what keepers, basically, like, you know, busy until we left the DAX. So, it was an episode, as you said, and a very interesting one. Maybe we go back to the very basics, because, you know, people know your name. People may, however, not fully understand the business model you're actually pursuing. So, let's dive a little bit deeper into this. My understanding is the way it works is you're basically a platform that connects customers with restaurants or groceries or other shops. And you are the logistics part in between delivering the stuff to the people. Is that basic correct? That's correct. Yeah, that's correct. So, we were in marketplace before. So, just listing on one hand the vendors, what we could have vendors now. But they were restaurants on the, at the beginning, and connecting to the consumers, replacing the leaflets on the fridge. Can you give us a few key numbers to describe the business? Yeah, we're like, if dynamics of it. Yeah, sure. If you look today, as I mentioned before, 70 countries. We do around 270, 260 to 270 million orders per month. We have 1 million riders active per month. We have 3 million riders that are listed. So, we can ask 3 million riders to work for us. We deliver in average, you know, 30 minutes. And, yeah, we are a business that is really depending on the density of population, on the density of restaurants. Last year, we've done almost 45 billion GMV. So, this is the external umsets, or as you call it. And then, well, we were growing extremely fast. Last year, we've done 10.5 billion Euro revenues for a company that was like making 40 million revenues in 2013. An enormous growth story. That's true. The GMV I found that funny when I look into your annual report, it's there. You don't even explain it. It's there from the first page and you just assume that people know what it's cross merchant as value, right? That's correct, yes. Yeah, and this is including VAT and that's kind of a right. So, you know, your industry, you and the other players in the industry were programmed hard-coded into growth. That's right. Massive growth. Year on year, doubling the size, you know, for several years. And the promise was, you know, this is a business that needs scale. And once we reach scale, we will be profitable because it's a huge market out there, huge potential and just give us the money to grow and then we will be profitable. That's correct. But you are not profitable after, you know, you've been around now for more than 10 years and the enormous growth is still not so. Is the story wrong or what's going on? Well, I have to correct you. I mean, we are highly profitable in a lot of markets and you will be astonished. I can't tell the name here, but like some small European markets have been profitable since to find a 15 and pay dividends to the company. And there are markets where basically we are highly profitable for percent of GMV, which is quite a massive profitability and still growing by 30%. So, we are not profitable at the group level. And you can dig into the reasons, but we are building a second business. You mentioned before the demods or the dark stores. And this is a completely new business and we invest in quite a lot of money. This part of the business will become a beta, just a beta profitable at the end of the year and then continue this trajectory. So, we continue to invest actually. And if you look at this industry of the cream commerce or the demods, many players have disappeared very quickly. It's not an easy one, but we think that we have something here that will be extremely big in the future that we require investments. And yeah, the cycle of investments, you can tell us short or long. I mean, we started the demod business in 2,519, but we quite capital at the beginning. So, looking at the markets, which are very profitable, as you say, what are your most important markets and do you consider to further consolidate the business around these markets? And what's the outlook for these markets? So, you know, we are profitable, how you profitable. Korea. Profitability have been growing dramatically over the last three years since we acquired them. We are profitable for many, many years in Middle East, almost everything in countries. I mean, as I said, almost is basically there are three or four that are not. Egypt is one of those. Then you have like Iraq where we're not profitable today. And that was it, right? Turkey for the last two years. But other than that, the other markets are extremely profitable. And with a very astonishing cash conversion, which is very important. I mean, this is a cash heavy business once you turn profitable. In Europe, we're not. We bought global, which is reported in global segment, in European segment. And this is a segment that will not be profitable this year. But we are on the good trajectory here. And the last one is South America, where we're not profitable. The profitability will be achieved very, very soon. Okay. And how is the competitor landscape in this market? Is it that you are dominating these markets? So, I mean, like they're some slides, if you look at the presentation that we're doing for investors and shareholders, 90% of the GMV that produced today, I produce in countries where we are clear leader. So clear leader means for us, like we are at least three times higher, beer than the number two. Well, this is a very distant competition that we have. I mean, like, but we do have serious competitors. And this industry is, in my view, remarkable because this is a young industry. If you look at the history of this industry, but the consolidation took place very, very early days. I mean, like to find 13, 14, 15, 16. This is where a lot of companies or several companies have been making acquisition. And we want of those today, they are almost no local players. I mean, almost none are very, very adjacent countries. Yeah. Now, we just all learned that Uber Eats is now invested in delivery hero and also taking over the one of your markets. Can you give us a little bit more insights into this deal? Yeah. So the deal is quite attractive deal. Very, you know, the valuation is much higher than the current market valuation of the company. There is an upfront payment that they've done. They get the board some equity in our company, a little bit less than 3%. And then the deal is now subject to antitrust review. So we think that it's going to take 12 to 15 months. And the valuation is around 1 billion US dollar. Wow. And this is a very, I mean, this is for one market. So you can see basically when you get the valuation of the group today and you sell time one, which is basically to come to your question of profitability is breakevenish and the valuation from the peer. So basically, you can say market fair market value is around 1 billion. So you can see that basically there's a lot of for the ones that understand the business and can see basically trajectory. This is very attractive business. Okay. So I'm fascinated by the scope, geographic scope of your business and by the diversity of it and by the differences. 70 countries. Let me ask two or three questions that I mentioned. My first question is you're not active in Germany. You exit at the market, you sold your German business a few years ago. I think to a Dutch company at the time. Then one or two years later, you decided to go back into Germany only to exit again six months later. Why in out, in out and why being out at the moment in Germany? Well, we started the whole story of the review or Lifa had started in Berlin, right? So and we've been like her, as I mentioned before, in acquisition, so in many machines. So we've been buying companies, but we were also selling companies or closing markets and love people forget about this. So we've been extremely rational the way we've been approaching this industry. And in the market in Germany at that time, so back to 2018, there were many two players, us and Liferando. And the story of takeaway at that time, which is not just eat takeaway, was around two markets, Netherlands and Germany. So then it was very difficult to sell one of the two main assets, which was the story, the IPO story. And we are, we basically tried to buy them several times. I would even find an agreement on a common ground. And then in December 18, it was very fast. Within three weeks, we decided for ourselves that we would be, to be beneficial for the shoulders to sell it. And we sold it for 1.2 billion euros, which was a very, very high valuation at that time. The story continues after that, because what we did with this investments, we are, we entered, I mean, we accelerate our marketing campaign in Korea. And that was driving, that was driving the motivation, basically, for, for VUVA to accept to sell to us. So we realized that the market in Germany will never grow as fast as Korea. And that's what we decided to sell Germany and to try. I mean, like, you don't have a strategy around the success, but to buy Korea. All right. And why we entered back to Germany is basically, as we took the decision, we were not aware about the actual events entering Germany. But we thought that takeaway or just the takeaway was be weakened on delivery. And we were looking at vault penetration in Berlin and in other markets. And we saw that on delivery was, was after COVID was basically a market that were the consumers and the customers were starting to appreciate the service and we need to pay for it. And we thought this is now never. I mean, no is like, either we, we come back or we never re-enter Germany. And we tried and we said, the investments. And then it was announced that we come back and the orders and then we realized, okay, the investments are going to be too high. So whether you take a decision and everyone was thinking, oh, they silly. And why did they do this? Then to say, now, I continue for the next two years and bring cash. And that was the decision. Very rational again. For you, it seems that the dominant markets are actually in Asia and Middle East at the moment, at least. You're notably absent in North America. No presence in the, in the US. You're not active in New York or any of the other metropolitan areas. What's the reason there? Again, it's coming back to you to the early days. I mean, the, the main players in the industry were located in, in Europe or in the US. And Grapap was already with Simles. Grapap was buying Simles, which was a competitor and we're presenting the US. But they were little or two non-focus at all in, you know, what you used to call the emerging markets. So basically, there were opportunities to buy a Maccippity in Turkey or a telebat in, in MENA. Well, no other competitors were really looking at this region at all. And the same happened to South America. So we're able to do two acquisitions of America and then basically have a footprint on the Thai continent. One, the US, we knew, okay, if we want to start the business, we already have a very strong opponent. And then the investments that you will require will be, will be extremely high. So looking at your business activities and you were saying this just a couple of minutes ago. So it looks like you're a deal powerhouse, right? So you are good in executing deals. So my question is, how do you run these deals and, and how do you prepare it? What makes you so successful in, in deals? Well, I think there's two parts, right? There's the negotiation. So basically identifying the first thing is like strategy. So do we want to go to South America and markets where you already have this industry where people will have the first reaction, why don't you stay in Europe? Why don't you go to North America? Or you go exactly the opposite, you go to other markets where basically we're not on the screen. And that was, Mina was one of those. When you had already company that was 17 years old or 15 years old. And we were more looking at the delivery culture. So it was more important to us to see, where do you have a delivery culture, where people value the delivery. And then, you know, to do the deals is basically to be close to the your entrepreneurs. I mean, if you look at the story of the radio, what we did really well is that when we did a deal, the founders, the entrepreneurs stayed for us many, many years. Some of those are still with us. I mean, if I look at Greece since 2015, they're still with us. And that was very important to us because you have a big difference between entrepreneurs and managers. And for us, we saw ourselves as almost a federation of entrepreneurs. And this is how we, so first we approach their entrepreneurs, understand what the appetite, what they want to do, and if they want to build something bigger with us. And then we negotiate. And quite frankly, we're pretty, pretty aggressive in a negotiation compared to other other players. They were ready to pay more. And then yes, a good, a good, a good M&A is not the contract that you sign. It's part of it, but this is integration. So what was required also is like a kind of 100 days integration. What do you do the first 100 days? I'll do you make sure that you integrate and which part you want to integrate first. Because on one hand, you want to give liberty to the entrepreneurs to continue to build a business. But on the other hand, you have certain requirements for the capital market. And this is, I think what we learn over the time is how to onboard a company without jeopardizing the business itself, while respecting, basically, the financial market requirements. So a whole string of these M&A deals happened in the years 14, 15, 16. I think you mentioned that you did, I think when we talked earlier, 17 M&A deals in two years. That's correct. So the speed of decision making was in these days possible because you were still a privately held company. Is that correct to say, would that not be possible now you being a public company? I think it would be almost unrealistic because you would have to onboard a company, only for the financial statements, it would be extremely difficult to do like for like and all this kind of exercise. You have to do perform, I like for like, and so on and so forth. So I would think it's, I mean, I would really think it's almost impossible to do it. At that time, we were private, as you said, and then we had investors that were understanding the game pretty, pretty recently. So they were supportive. And they understood like the consideration is going to happen now. I mean, if you want to be in this region, you have to be fast, you have to be fast, you have to require. And yes, we were basically in two models. We were in negotiation in terms of M&A transaction, but also in financing. So we had to do a lot of financing. And this is what we've done. So we were on the financing side. And quite frankly, sometimes we see the money on Monday, and we wired the money on first date. So we knew exactly it's just interesting. Interesting. When some of these tickets were really big with three digit million numbers, my question is, in such a market with such a high dynamism and fluidity, I would call it, how do you do the valuations? I mean, how do you reach consensus on such prices if the markets go massively up and down all the time? So I mean, it's looking back, right? I mean, at that time, the market were more stable than today in terms of valuation. And we had like already peers, public peers. So we could orientate ourselves on their enterprise value that we're basically paid for on the stock, on the financial market. So we had an orientation. And that's basically what we did. We also discounted quite a lot in terms of acquisition. So I would say, I mean, especially in Niklas, it's pretty known as a good negotiator. And I think we've done pretty decent deals. So the ones we are surely the most proud of is the acquisition in Korea. I mean, if you get the value of what we paid and compared to what we generated on profit today, it's a very good return. So how is the deal pipeline for the future looking like now? That's a good one. I think, I mean, to be realistic, I mean, we have 70 countries. We consolidate around most 300 companies. So I think today, and also the appetite of the financial market, is much more on efficiency and to be lean. Our footprint is wide enough. So I would say, I will never say never, because the industry is changing so dramatically. And also the financial market, quite frankly. I mean, so I would say today, the focus is much more on consolidation. Consolidation means like looking at the markets where we see a clear path to leadership. I mean, they are still markets where we're not leader. And that will be absolutely rational. We've done this last year in Vietnam. And we will continue to do so. I don't see our six than footprint, as I speak today. So you said, you know, you are generally quite happy with the deal history. At the same time, you know, the last two years, you had to write down a right of a good part of the goodwill from these acquisitions, almost 1,900, roughly, million last year. And I think 600 and something in the year before is that reflection of, you know, simply a re-evaluation of the whole market. Is that coming from the interest rate, you know, dynamics or would you say, it's also a verdict on the deals themselves? What's-- I think this is a combination of the three, to be honest. You have to imagine, like when you do an acquisition, I mean, like, you know, it's based on DCF calculations. So you have a terminal value that is in 10 years in advance. Certain acquisitions we've done before COVID. So you had like a growth rate of 100% as I told you before. Before this-- the podcast, we grew by more than 100% to 12 quarters in a row. So it's like, basically-- Almost hypergroup. It's difficult to imagine. Yeah, hypergroup. So when you do business planning, even if you take a conservative approach, everything below a certain percentage of growth is almost like that. But look at the experience that we've done. I mean, like, it's-- so you assume certain growth rate before COVID and then-- and then the interest rate clearly, I mean, the so-called work have a massive impact on the valuation. So yes, I mean, the projection is different today. You probably more conservative. You see also certain areas like Asia, for example, the segment of Asia is not going as fast as we thought. The industry have changed dramatically. So the marketing spending is also more rational today with us, but also with the competitors, which have an impact also on the growth rate. So this is a combination of the-- and you can assume, like, at that time, to come to your point before, we use certain valuation that we will not use today. I mean, like, we both certain companies are certain valuation, which has the only way to require these companies and what's expecting from the center, but also from us as a buyer. And today, this valuation is different. So this all-- as you were saying before, puts a little bit more pressure on profitability. And as you say, it's about consolidation. It's about efficiency. It's about the economies of scale in the operating model, looking at your business with 70 countries now. What's your outlook on how will you create this profitability and what are the economies of scale that you see that are available? Yes, sure. I mean, like, the profitability, believe me or not, I mean, I mean, we might be startup, but you still look at the profitability from day one. So it's more-- I mean, how long will you take? And what is the opportunity? I'm also investors in startup. And one of the thinking, especially now in two years in startup is like, you will have some CEOs and founders that are so scared that funding run is not possible, that they will focus on profitability. And this is a kind of dilemma that you have. It's like, OK, you might be profitable, but if someone else is more aggressive on growth-- Faster and quicker. You will disappear. I mean, like, so this is the manager-- It's kind of trade-off, as you say. You haven't tried that yet, right? So and for us, it was like the profitability was never like maybe one day or something that is completely all of this world. It was much more like, OK, by the moment we see a certain scale, we should turn the unique economics in positive. Today, our core business-- I mean, we started with food-- is highly profitable. Yeah, that's it. You know, we're building a second industry. And what we do today, I mean, because you ask, like, what is the profitability and what can we do? The-- we call it the levers is basically to generate more revenue out of every single order. And there's still a lot of bandwidth to do that for this industry. I mean, we introduced, like, three years ago a service fee, which is, in some countries, 20% or 30% only as a fee, which is nothing compared to the basket size that you get the order. So there's plenty of room to increase a service fee without hurting your growth rate. And there are several ways to do that and efficiency. I mean, we still have to improve our efficiency in logistics. We are pretty far today, but there are still ways to improve it. So you're-- if the core logistics company-- they're probably fair to say, right? Let me come back for one second again to these-- to me, fascinating 70 countries in very, very different regions of the world. You're at the same time in the food business, and in some way, of course, also, which is very culturally determined, probably with very big differences across the countries. How standardized are you in your technologies, in the way you do things, deliver your services, and steer the company internally? And how differentiated do you need to be to adapt to the differences in the countries? Yeah, that's a very good, there a very good one. Because basically, at the meta level, this business is always the same. You deliver pizza. You do you have a coffee. Then if you look at the details, everything in market will have specificities in terms of geographic, in terms of habits. For example, Greece is very particular, because one of the orders is coffee, which is very unique in Opotfolio. Interesting. I mean, like, you see, and then I can give you for every single country that I can take for hours. Especially for second-senior. In Hong Kong, we have walkers that are delivering. So you see, I mean, every single market, we have something specific. So you have to adapt. At the same time, we do have what we call internally global services, which is very important. The global services are, you can look at kind of modules, technology, that we offer to every single country. And logistic is one of those. So if you order today in time one, or in Dubai, or in Finland, or in Chile, the logistic software is exactly the same. So this is the same logistic software that we use for the shift planning for the calculation of the distance and so on and so forth. So the technology is exactly the same. And we do have a global services, that are the same everywhere. What we differentiate ourselves is basically then what the product offering on the platform and also like your well-served organization of logistic. We were talking a moment before the interview, and you were saying that it's so difficult in your business to plan ahead, because you don't know where the orders come from at any point in time. So I would imagine that modern technology is AI-based, predictive modeling's play a role and help you in these planning. I mean, like, we give you an example to make it tangible for everyone, for the listeners. Every single rider that is online with application, at the moment, he started shift. We will ping in every three seconds. Every three seconds, we will ping his mobile phone. Obviously not to control himself, Because. I can hear maybe like some term rumors or whatever. No, this is not for that. It's just collecting data points to improve the productivity of logistics. And for that, you use science, you use science. I mean, I go with them, but also science during rich you are go with them. So we constantly looking at better optionalities. At the beginning, we were using an algorithm from an American company that is starting with the G and we recognize that actually ours is better because we were using the riders that are on the bikes, on the motor bikes, and not so generic. So that's why you know, this is we focus on the very specific algorithm. And that makes us actually more predictable, predictable, which is very key for the consumer experience. Because today, I mean, it's one thing to wait 30 minutes or 25 or 45. The most important is to be predictable for the consumer. So if I tell you today's busy day, there is a game of Germany playing today in Berlin and the orders, you would have to wait. Unfortunately, because a lot of people want to eat, you would be understanding, you will understand this as long as the time that our prediction time is right. So until you today, unfortunately, it's not 25 is 45. Do you still want to order if you said yes, you want your order to be delivered in 45. That's okay. The contrary is not. I also compliance landscape around all of this because I mean, as you say, it makes you smarter and the customer appreciates it, but nevertheless, data privacy topics come up and also compliance in the question on the impact of the riders law in Spain. So can you give us a little bit of an overview on the compliance and how you deal with it? So there are different kinds of compliance topic that we have to follow. The first one, I would say, is the food compliance. I mean, this is something that people usually don't really mention, but it's very important because every we are responsible as a platform for the menu on the platform. So if you want to order today and your allergic to onions, you have to know that in this pizza, these onions, and they were responsible for this. So we generate basically, we work with database and it took us quite sometimes to rethink the product itself on the platform itself in order to be able to do that. You do have data privacy, obviously, so that we have to follow this. So we collect only the necessary information from the consumers, which has a price. I mean, for marketing campaign, you would like to be more precise, to be clustering your customers better, and that is difficult due to the data privacy, which is also like I was in Brussels lately, and we discussed about this, like, are we selling pizza at the end of the day? So data privacy, but that's not the topic. And then there's the riders. And the riders is a very interesting one. I mentioned before that we are really poor Europe. I mean, we really had the opportunity to be listed in the US, or we thought about this, and we wanted to be listed here in Germany. It was very important to us. You should look at the European Union, we have 27 month-to-states. None of those have the same registrations for the riders. Oh, none. So we do have, and we face everywhere a certain politician pressure. And we're so far, I mean, Spain is obviously one of the most prominent topic today, but we had situations in Norway, in Sweden, in Finland, in Austria, and everywhere we find a solution. And you will have, you won't believe it, but like, for example, in Austria, the exact translation is free employees. So basically, this is a mix of free and serious employees, and this is Austria, right? So this is a solution to Austria, that is pretty unique. We'd like to have the same for all Europe. In Norway, we have bargaining agreements with the largest unions of the country, 50% of their working population is unionized in Norway. Also, people don't know this. We find a solution. So there's a wish. There's a solution. We've already been talking quite a bit about the mixture of business model and finance and financial performance. It seems to be a very intricate mix between business strategy and steering. And what exactly, how exactly does it work? Your cooperation with the CO, and then strategy operations, finance, how far does finance reach into it? What's your remit exactly as the CFO and all of this? Well, first of all, I'd like to understand my departments and my teams are enabler. Basically, we are the enabler of the strategy, and the fact that if you want to grow, if you want to do M&A and be public at the same time, you will need enablers to make sure that you can report the end of the quarter, and that you are able to onboard these entities and different topics that these entities will bring with them. So understand ourselves as enablers and facilitators. With my CO, I mean, basically, we've been working 10 years together. We share the same desk for 10 years. So we are really close together. And we will talk about finance, but also mainly about strategy and what comes next. And how should we consider our footprint or portfolio? So it's a very interactive combination and cooperation that we have. At the same time, since we are public, we have to fulfill every single requirements, like the more classic companies in Germany, like the Siemens, Fox5, and all of this world. So they are certain compliance topics that we still start up in a spirit sometimes, but we have to fulfill exactly the same requirements. My assumption would be that if you look at the current situation and your capital markets combination, it's almost imperative that you show a clear pass towards profitability. You're already on that pass. That's what you communicate. You're almost profitable, so to speak, at least in terms of EBITDA and Keshlo. That's the storyline. So what are the main levers, the main dials, the USCFO, are looking at and trying to turn a little bit to the one side where it moves into the direction of profitability? Yes, you're right. I mean, last year we were operating Keshlo. We were almost breakeven coming from very, very negative Keshlo the year before. We've been providing EBITDA by more than seven million last year. The trajectory will continue this year. So I think the company is on the right path. And this is one of the aspect of my decision. I think what we do is basically to continue to improve our unique economics and mention just before the levers. You have to imagine if you do 270 million orders, if you are able to increase your service fee by 10 cents per order, it's 27 million EBITDA. That's it, done. I mean, like, you know, and you train percent and so on and so on and so on and so forth. So you do have, with this scale, and you continue to grow, you have the capacity once you become profitable, that is amazing. I mean, like, you just have to trigger a bit, you know, this unique economics. So, and once, you know, the market or the areas that quick commerce become more profitable, then you can trigger even more profitability. And this is for certain, this is, but that means also like this is very attractive business. So you do have competitors coming in and trying to get the share of the market and so on and so forth. So it's not going to be a walk in a park. But the trajectory is pretty clear for the last years. Your EBITDA was, I think, around 250 million. That's correct. I just leave it at the same time. The last line of the of the PNL, which is net income, is still quite strongly in the red with 2.3 billion. Correct. So what makes the difference and then, you know, is EBITDA, I mean, many companies communicate EBITDA, but you know, what's the meaning of EBITDA and all that and then should invest really focus on EBITDA. Just to be that. Yeah. Just to be that. So they're just to be that that we use today. I just a little bit. Yeah. So they're just to be that can that we use to they come back to IPO. So this is a definition that we get at the IPO and we didn't change it since then, right? The Agility EBITDA for the reason is is we try to give or we want to give a clear understanding on what the operations are generating on EBITDA. Below Agility EBITDA, you will have different different aspects. One of those is related to transactions. So you have to imagine if you do any minute transactions or financing transactions that is quite sizable, then you will have, I mean, like banks that you have to pay and notaries and fees that you have to pay to the banks for the financing or for the deal itself. And that's in our view is not related to the operations. You also have share compensation for the employees. But what we had last year and you mentioned it before, we have impairment and that was like a vast majority of it. So going forward, if it depends on the interest rates evolution, so like basically all DCF calculation projection would be impacted by this. I mentioned this before. And now we have like a projection that is more in line with what we've seen over the last two years. So I will say at some point the impairment would be gone. And then, you know, like we will continue to go there at the EBITDA. So, I mean, I've been studying in Germany, you know, like Haberschland, Verr, the ones that important ultimately. So, you know, exactly. I mean, what counts at the end of the day is how much money you've done. I mean, how many cash? And that's the metrics that we are, that we are, and we apply also at the Nivea. That truly brings us in a way to the role of a CFO, to the role of the CFO within delivery hero. So maybe from a broader perspective, what would you say? What is the main, let's say, role of the CFO within delivery hero? Are you the critical investor view? Are you the performance manager? So maybe Maybe because you also said you're working so close with the CEO and co-founder, so maybe you can give us a little bit overview on the role. It certainly are a kind of almost sometimes Kafka situation that you have, right? On one hand, you present the company to investors that are critical. I mean, like, you know, the last two years and asking for profitability and so on and so forth. And internally, you defend exactly these years. So you have to, you know, to explain to the external world, but this is what this is your trajectory and these investments make sense. And I believe that too. And internally, you have to protect basically or you are the voice of the investors and almost the market. So it's kind of sometimes funny situation, right? And yes, you're right. I mean, I'm looking at the performance. I would ask like, but the return on investments of certain investments that we're going to do of the trajectory of certain countries or unique economics. And basically looking at the cash flow is like, look at these kind of investments are simply not possible or, you know, sometimes I will use what we call internally. My veto is like, no, we don't do this. Good stop. But I really want to, I mean, this kind of, I don't want to see to be finance, be perceived and seen as a blocker, which is, I mean, finance in general, right? So including legal tax and everything. But much more is inabler to fight for it. If you want to do this, this investment, so for example, the D-Mart, as we started the D-Mart, we want it, we've been involved from the very beginning. And like, okay, let's set up this entity this way. Let's think about inventories. Let's think about. So it was like from very early days, hang on, I mean, like give us, give us some times to really prepare this and not, you know, the startup like I do and then I fix it. Yeah. So that sounds like you need a very strong finance function and you need to have a great team that also needs to be equipped with, let's say, the tools that help you to steer that way. Can you talk a little bit about how does the finance function within delivery hero looks like from an organization, but also from a technology perspective? Yeah, I have you too. So I will start with the technology. And then so early days we, for the consolidation, one of the of the difficulty that we had and I say early days to find 13, 14 was really to consolidate our numbers. I mean, we were crying companies, we were very young companies and the classic one was like our consolidation was done with Excel packages with a lot of mistakes, like, you know, like this FOMIDON mistakes. And so you have to change it. So we're looking for software and we use the software look at it. Still today we do this. And we also like implement very early days for the size of the company at the time. We pick up an app solution. So we've done an FB at the end, we end up with a suspect three, like, you know, the Microsoft dynamics or a call and the stuff. And then we are, we decide for SAP. And we started the implementation into fine 16. So it was very, very early days and a lot of shareholders and board members were questioning this decision. But first was clear, if we don't do it now, it would be extremely difficult to do it like in two years or three years from now. We're growing so fast our systems are not going to, we're going to collapse as an organization and systems. So today is SAP ES4Ana is still a core, FIKO and I click, you know, financial controlling. We do have all the sort of modules around it like Arriba, Conqueror, you name it. And we're introducing now one stream for the consolidation. So this is happening as we speak. And Anna planned for planning. So to really stand the dice, it's in the next generation, let's say, for the software to be efficient, to make the information available for everyone. And also like to use the data for other analysis, correlation, and also, as you mentioned, before AI. Yeah. And looking at the team, how many people do you have in the finance function, and how qualified are they? And how do you organize them in structures, maybe? Yeah, so we do have four hubs, four original hubs within the group. So like, you know, we do have a hub in Singapore, in Dubai, in Latam and in Europe. Okay. And then we do have what we call a central organization of central in Berlin. The people in Berlin, I mean, all of them are very specialists. I mean, like in terms of, we don't have a lot of people actually. Treasuries, very, I mean, like to give you an example, treasuries only are 10 people. Pre-instructure for the size. Pre-instructure. We use software and the treasure management system is very helping us, which we're using a lot of automation. So we want to be lean as our organization and use technology. That's for us the focus. Automation is also very important to us. And we still have a lot of progress to be done. I mean, like we don't leverage enough artificial intelligence today. So Emmanuel, we've been talking about delivery hero and your role as the CFO now for quite some time. And so, intimately, almost, it might come as a shock to our listeners, turning to, you know, your decision to leave delivery hero. It's a public knowledge. So we can talk about it. I think by October, you will be working somewhere else. Another company, wise, a FinTech in Britain and London. After 10 years, that will be quite, so let's say, a cut, you know, big decision for you and for the company, big change. Why? What's going on? No, I think. So yes, I mean, this is a big change. I wanted to, I mean, there's certain goals that I wanted to achieve. And the last one was like, make sure that the company is profitable at a just a bit at level. And also like a cash flow, becoming a cash flow positive. And this is, I, this is the moment where I say, look, at that time, someone I should come. I strongly believe that after 10 years, there is a kind of risk that you become blind, that you don't see things anymore, that you have to reinvent yourself. And I think it's good for the company to, to start with a new, new view, let's say, it's not an easy one. I mean, you invest a lot of time. I mean, 10 years feels much longer. I did a radio. I mean, every year you do an MBA almost because there's a lot of new things coming out. But I thought it was, it feels like the wise decision. And why joining a FinTech is because I believe in the FinTech are for many years. I think the service there, there's a lot of services that you can provide to the consumers. But for the radio, I think it's a really good, I would think this is a very good decision that to have a new, a new person coming in, it will give a new, a new impulse and new initiatives. 10 years. 10 years from the early days of delivery year old to, you know, relatively, as you say, now reaching profitability and a more stable phase, what's for you, maybe the biggest challenge you face and the biggest learning you take away from, from these 10 years, from this decade? In terms of success or I mean, learnings I can also share. Well, success for me was like this, literally three. The first one is the, the career and transaction. Because I think in many ways, we had the chance to buy the number one. So it was number one by size, but also they build a fantastic company, a fantastic brand. We don't realize in Europe, but in, in, in Korea, if you are a IT student, you know, in New Year, in the States, you will probably go to Apple, Google, Amazon, well, in Korea, you go to never, Kakao, or wooa. So this is the three main companies. So this is, this is a, this is a really like you buy something that is really unique. I mean, that really, went on, respected and everything. So, and we bought it for a very good price. So I think that, that's one, you know, it requires sometimes to fly to Korea for 11 hours. You land at 11 o'clock, you take a shower, you negotiate for the afternoon and the midnight to take the fly back. And then at the end of the year, when you get this done, you're pretty, pretty enough, this one, I really, I really think this is my number one. Number two is something that happened in Saudi that I don't want to give too much details, but that was like very important. And the number three is the IPO. Because it was not expected. My job was to do IP, or readiness, but not to do IPO. So you asked me the successes or the learnings. And the learning, let's ask, let's come back with the, with the learnings. Yeah, that's right. So the learnings for me is like, you never get, you never, I was always shy to get experts on board sooner. So I was like, where really about the man, I mean, like, you know, funding and as like, maybe I can wait a little bit more until I get the, the expert or someone required, for example, ahead of tax. And by the moment you get this kind of experts on board, actually, you accelerate, you're, you can accelerate, you have more resources, you have more energy. And it was a, it's a learning for me. It's like, you know, get, as I see it for anything in managers, you just like I don't know the word in English, teregant, like, you know, like you're, you have a musician around your, you're, you're, exactly, a new job is just synchronized, then playing, but you should have the best, you know, the best instruments you can get because then the music is clearer. It's, you know, it's easier to do your job, right? And I tend actually to wait too long, I think that's that's what's my mistakes. I mean, looking at the experience of the last 10 years and your time before with your cast, meta design. So my question is, if you're looking at the young generation and we, I'm coming from finance transformation, how we call our consulting business, we have some challenges finding young people to attract them for finance. So, but I do believe it's a very, very interesting job because you do the performance management, you are the ones who are in, of course, of the deals, you are the ones who do understand the data and the facts. So what would be an advice, especially from this entrepreneurial spirit you were referring to in the beginning, what would you say? What makes a good CFO in the future? And if you look at the young people, how can we convince them to take a career in finance? I think what is fascinating in a job as a finance person, and then I would refer probably more to the controlling aspect of finance is that in order to predict the future, you have to understand the present in the past. It's like basically you look at the, and there's so many factors today, I mean like we talk about crises, you know, you have to reflect the ethics development, I've been inflation, the outcome of certain boats that will happen in the US, in Turkey, in a political situation, and what's the financial impact, right? Exactly. So basically what I like about it is that you have to understand your company very well, I mean to know like all the bad energy, the PNR and everything to understand the trajectory and the present of today, and try to, you know, to think about what are the alternatives or the path for the future, and then to give it as clear as possible to the top management to take a decision, and I find it always like amazing, it's like well, to try to predict the future, and hopefully to take the right decisions for the company to follow. I mean, you know, like we talked about Germany before, right? I mean, like, so we enter Germany, it was like something like September, and in December we took decision to close Germany and to close Japan, but we were like, you know, the market out there is changing, and it was not already, you know, you couldn't perceive on the stock price, and we were at 130 euros stock, but then we said, you know what, there's something here, it doesn't feel so good for next year, so let's stop Japan, next up Germany, and yes, people we criticize, and yes, people will tell that how silly you are, you know what, let's take the decision, and then, you know, February, March happened, 2022, and then, you know, like it, and then we were super pleased to have taken the decision at that time, so we, and this is basically filling the pools, talking to investors, understanding the silent signals. Exactly, yeah, and that's, you know, I think that's what is fascinating, and for that, you need a bit of experience. I mean, in order to do that, and when I say experience, like you don't like, you don't need to be here, 40, 50, but you have to stay within the company, to see the evolution, I mean, like it's not happening over one or two years, I mean, unless you have something like magic, but you need to have a little bit of experience to see, you know, how is the industry is evolving, and what could be the impact on the company? So I think that's probably one of their advice, is like, you know, don't change after two or three years, don't be too impatient, but embrace, you know, like your, this longevity in the company. So your next station I mentioned before is Y, it's a FinTech, you know, different, different segment in a way, but structurally it has also some similarities to a delivery hero. It was a startup, is maybe still in some ways a startup, but already, quite an established company, more than 10 years old, stock listed, four and a half thousand people working there. What's the challenge? Why do you, why, why this company, this particular company at this time of your career? It's a good, I mean, like it's coming back to FinTech, right? I mentioned before, so I think like in the FinTech world, there's a lot of product services that you can provide. I think they are still very, very early days in what they offer. The service that they offer is mainly on three pillows. I think they're, they're truly more coming. They's also like in terms of customers growth. I see a lot of potential there. They haven't done any many so far. So this is maybe where I can also like help and financing was not really like what they've done. So I see a lot of opportunities where I can bring my experience with also where I can continue to learn and basically see what I want. I want to continue to learn. I will learn a new culture, a new city, and also a completely new industry for me. I mean, not completely, but a new way of looking at this industry. Thank you so much, Eman. This was actually fantastic. We need to come to an end. You know, Gory and I'm sure we would have more questions, but I think we need to stop here. We don't stop immediately because we still have one question. That's the question we always end with. And that's a question about a recommendation for a book or another podcast or something else that you may want to give to our listeners. Yeah, this is a small book. I'm reading on regular basis. And you know this for sure. Is 48 rules of power. And this I'm reading this and it helped me a lot in certain cases. This is always like two, three pages with one advice. And I read it on regular basis because every time you discover something else, even though you know, you know, it's somehow and it's sometimes a tough one. I'm not like there are certain aspects of it. I don't know if I agree, but basically it's maybe a law you to understand certain partners or certain person that you have. How sings your suggestion? Exactly. So this little book is one that I will recommend. Podcasts, I don't have a particular one, but I'm listening quite a lot to Simon Sinek. Okay, interesting. Well, listeners also have our podcast to listen to. And I'm immensely grateful. I said at the beginning I was looking forward to this interview, to this session very much and I enjoyed it greatly. Thank you so much for making time available. Thank you listeners for listening in and we hope to speak to you very soon again. Thanks, Simon away. Thank you very much. Thank you very much for today. Thanks. That was leading corporate transformation. The podcast by Vika U, Aurobysime School of Management, powered by PWC. Editorial team, Marvin Shunah and Zimangirlach.