Oxx in Conversation: “Performance testing is a big, dark hole”

Oxx, the investment company for scale-up stage B2B software businesses, focusing on the UK, the Nordics and Israel, recently led a $12m funding round in Apica. We sat down with Mikael Johnsson, Oxx’s General Partner, to discuss the investment, market opportunities, and his thoughts on the world of performance testing.

Tell us more about Oxx and the company’s mission.

 I co-founded Oxx with Richard Anton following several years spent working together at Amadeus Capital Partners.  Today, our focus is on investing in B2B ‘scale-up’ stage software companies with serious commercial potential. Most investment companies focus on either early or late stage and are most interested in Internet and Consumer brands – but. there’s a large number of really great companies operating in the B2B software space, they just scale differently than consumer companies and need investors who understand and support this. Oxx’s plan is to invest in 2 or 3 of these companies per year, and support them all the way, “from promise to success”.

How did you discover Apica?

We’ve been connected to the co-founder Sven Hammar for quite a few years now, tracking Apica’s progress throughout. At Oxx, we like to know and track companies for a few years before we invest – and understand the numbers and the challenges they face so we can make an informed decision. As Apica matured and broadened its testing and monitoring portfolio to meet the demands of the digital enterprise, we recognized a company at a very exciting stage in maturity. Another pull factor for Oxx was the addition of Carmen Carey as CEO – demonstrating Apica had entrepreneurial and commercial leadership in place.

What market opportunities do you see for Apica moving forward?

In our opinion, Apica is being presented with a huge market opportunity – the industry is going through massive disruption via digital transformation, and now organizations are faced with the challenge of ‘stitching’ multiple components together into a coherent and attractive user experience. Whether it’s cloud services, websites or apps, they need to control user experience by monitoring and testing the performance of numerous and disparate systems. Add device proliferation to the mix (APIs working on APIs on APIs, and so on) and we can see the task in hand for these organizations is significant, and mission critical. This undoubted challenge actually provides a fabulous opportunity for a company like Apica.

What are your predictions for the Internet of Things (IoT) and API Economy? 

The API Economy is already here, with organizations building applications by leveraging readily available components, cloud services and APIs. The IoT Economy, on the other hand, is on the cusp of becoming mainstream technology and it’s incredibly exciting to witness. By example, an Apica customer in the automotive industry is turning its vehicles into digital hubs – this is testimony to how quickly the IoT is developing in just one sector.

Apica has helped so many companies to optimize system performance. Do you believe companies have reached a tipping point where they’ve realized how important this is?

For a large number of organizations performance testing is a big, dark hole, and this is inexcusable at a time when your business stands or falls on the customer’s digital experience. It’s really interesting to see how so many companies just haven’t got this message yet, despite the significant cost of outages. I was recently at the Apica Apex customer event, where one speaker highlighted the cost of downtime – 30-40 million dollars for just a 15-minute outage. Looked at this way, what Apica offers is a no-brainer; it’s just like buying property insurance.

What makes a company a great investment for you?

Firstly, the ideal team still has the entrepreneur at the heart of it, but possibly no longer in the CEO position. The best management teams are a mix of external entrepreneurial and commercial leaders, and leaders that recognise what their strengths are at different stages of the company’s growth.

Secondly, we look at opportunities that are typically non-binary; by that, I mean we don’t want an all or nothing situation. We are interested in the B2B software space in companies where there is a value in both the product, and the customer base. These are the organizations we can look to scale, to increase this value, longer term. We’re looking for companies that can prove they have an effective go-to-market model which is scalable.

Overall, at Oxx we think that if you build a great company, there will be all sorts of opportunities for all stakeholders – customers, employees, staff, everyone. I believe Apica is one such company – it’s an exciting time for us to help Apica scale and create a much larger success story together.