Thanks for the report.
How do you, @Sauli_Vilen, think that pursuing potential international growth would affect good cost efficiency?
I would argue that eQ has remained this efficient precisely because it has been able to keep both its customer base and its fund structures very straightforward and thus scalable. International sales inevitably require not only an international sales team (which is not cheap to build) but also structures suitable for international investors. It’s easy to say that we sell a good product to international clients, but their view of a good product can be quite different, and it probably doesn’t include a Finnish fund structure, at least not in its simple form.
At a minimum, a Luxembourg structure or similar would be needed, as with other Finnish peers. Or if they were to heavily target, for example, Swedish investors, then some local structure (and a distribution partner?) might be necessary. This all requires significant investments in administration in addition to sales efforts, although it can certainly be handled at least partly through partners and service providers – in which case, however, these also take a share of the margin, eroding profitability.
Not to mention that competition in Europe is also next level compared to Finland; if you want to sell fund of funds to institutions there, you have to be better than UBS, Allianz, and a hundred other larger and smaller competitors, who are also already familiar to clients and have all the systems in place. In this race, it might not be enough to have achieved a tenth of a percentage point better return over some period (even though it is a necessary prerequisite), but you also need to be able to offer tax-efficient and familiar structures and good service.
Thus, in pursuing such growth, it’s easy to burn through good profitability with a relatively high risk, at least compared to the current business model. An acquisition in Europe might be a possible way, but that’s where the real risk lies, at least if it’s of a size that genuinely seeks a quick impact on the bottom line. And otherwise, it’s also a long road.
If, on the other hand, we start with the idea of simply selling the current well-functioning model outside of Finland, perhaps through a distribution partner, then I find it very difficult to believe that such sums could be raised in that way that would truly have any significance for eQ’s size. And yet, even a single foreign investor means a change in reporting and customer service language, tax reporting, a distribution partner, or an international sales team…
This required an exceptional amount of thought, and I don’t remember an eQ report requiring this much deliberation in a long time. Historically, the eQ case has been very clear, but now the company is undergoing significant changes on their scale. 
