innoscripta AG: Germany’s Best Kept Tech Secret? 64% EBIT margin + 150% Growth Trading at a 14x Multiple
Why This Small-Cap Could Surprise the Market
If you’ve ever tried to navigate government funding paperwork, you probably swore never to do it again. Now imagine a company that not only embraces that bureaucratic nightmare – but has turned it into one of the most profitable niches in German software.
Let me say this again: one of the MOST PROFITABLE business models I’ve come across more recently.
That company is Innoscripta.
On the surface, it’s a simple story: Innoscripta helps companies claim R&D tax credits. But under the hood, this is a fast-scaling, founder-led, high-margin machine with a fairly sticky product and a recurring revenue model that makes your typical consulting firm look like a rotary phone.
I stumbled on Innoscripta while digging into under-the-radar European IPOs. What I found wasn’t just a niche SaaS company – it was a business compounding fast, really fast, with the kind of numbers that would raise eyebrows in Silicon Valley:
58% EBIT margins,
sub-2% churn,
triple-digit growth, and
zero customer concentration.
The fact that almost no one in international investing circles is talking about it yet? That’s probably reason enough to take a closer look and at least put the name on your watchlist (that’s certainly what I’m doing).
In this post, I’ll break down the case for Innoscripta across nine dimensions – from moat to management, from unit economics to valuation snapshot. But first, let’s do what Bill Miller might do: make the 90-second pitch (I plan to do this at the beginning of every stock write-up going forward btw). So let’s set the timer … go!
Disclaimer: The analysis presented in this blog may be flawed and/or critical information may have been overlooked. The content provided should be considered an educational resource and should not be construed as individualized investment advice, nor as a recommendation to buy or sell specific securities. I may own some of the securities discussed. The stocks, funds, and assets discussed are examples only and may not be appropriate for your individual circumstances. It is the responsibility of the reader to do their own due diligence before investing in any index fund, ETF, asset, or stock mentioned or before making any sell decisions. Also double-check if the comments made are accurate. You should always consult with a financial advisor before purchasing a specific stock and making decisions regarding your portfolio.