“I am confident this acquisition marks a significant milestone not just for Talkwalker, but for Luxembourg. It proves this vibrant ecosystem’s immense potential for nurturing and scaling startups into global tech leaders,” says Talkwalker CEO Lokdeep Singh in a press release from 4 April 2024. “Together with Hootsuite, we’ll continue to harness Luxembourg’s dynamic environment, propelling innovation, driving growth and serving our customers as we shape the future of social media performance.”

The press release gives no information other than the news that the Canadian company will acquire Talkwalker and transform it into Hootsuite’s European headquarters. When contacted by Paperjam, the two spokespersons refused to answer any questions, inviting us to ask them at a future Q&A session instead.

Those who attended the Startup Weekend organised in 2009 by , then-CEO of Technoport, may remember two kids in shorts and flip-flops--Thibaut Britz (26) and Christophe Folschette (27)--who had come to “sell” their social network monitoring project to businesses. The two quickly realised that they needed capital to develop the project, and caught the ear of .

One of the (eventually) highest-valued “made in Luxembourg” startup projects thus started to grow in similar fashion to another project on the other side of the Atlantic… Hootsuite. Both projects sought to enable companies to monitor what people were saying about them on social networks. Today, Hootsuite has sales of nearly $300m, compared to Talkwalker’s €35.5m (2021).

It is difficult to get a clearer picture, since neither the results for 2022 nor those for 2023 have been published in the commercial register. Nevertheless, we know that after losing €3.9m in 2020--the first year of covid--Talkwalker lost €9.77m in 2021 (bringing the losses carried forward to almost €21m). This led shareholders to “invite” a new CEO to take over the reins in July 2022: .

At Talkwalker, full-time equivalents hit 95 in 2019, 99 in 2020 and 112 in 2021; at Trendiction, the company that manages Talkwalker’s intellectual property and updates the technology itself, the increase was even sharper: from 102 people in 2019, to 119 in 2020, to 148 in 2021. But as soon as he arrived, Singh embarked on a reduction in the workforce, following that up with a second wave in January 2023. We don’t know how many people are on the payroll today.

 (French only) caused such a stir in Luxembourg that the new CEO agreed to an interview in February 2023, admitting that he had reduced the group’s staff by 36% to 400 by the end of 2022.

Marlin and the acceleration of external growth

The shareholders had to contribute tens of millions of euros to Trendiction’s capital, in several phases. In early 2018, the American fund Marlin Equity Partners announced that it had taken a majority stake in the Luxembourg success story, which was looking to accelerate its international growth. Marlin took a 66.82% stake in Tiger Bidco Lux for between €41m and €43m, while 26.74% remained in the hands of the three founders via Trenvalor and less than 7% in those of the management.

Objective: to grow, fast and well. The first visible sign of this came in July 2020, when Talkwalker announced that it had acquired the American company Nielsen Social for €5.2m. Then the news kept coming. In June 2021, Talkwalker set up a subsidiary in London; in July 2021, Talkwalker appointed American Tod Nielsen CEO to allow Robert Glaesener to step aside. In September 2021, Talkwalker US bought Reviewbook; in October 2021, Talkwalker opened a branch in Australia (it was closed a year later). Also in October, Talkwalker bought Discover AI for €10m. In December 2021, Talkwalker opened in Italy; in March 2022, Talkwalker opened in India.

At the same time, the company points out that it no longer expects positive results before 2024. In the February 2023 interview, Singh stated that the company's results would be in the neighbourhood of €80m to €90m on the back of double-digit growth in 2021 and 2022.

One company in two does not understand the impact of social networks

“In an era where over 5 billion individuals engage on social media for over 2.5 hours daily, most of today's businesses boast a social presence. Yet, Hootsuite’s latest research reveals a gap: only 56% of organizations believe they truly grasp their social media strategies' business impact and ROI [return on investment]. This sparks a game-changing shift from social media management (the category Hootsuite started) to a category evolution fuelled by customer demand: social media performance,” says the press release.

“Hootsuite exists to help customers unlock the value of their social media relationships. By acquiring Talkwalker, one of Luxembourg’s most high-profile start-up success stories, Hootsuite takes this mission to the next level. By bringing together two category leaders, businesses will, for the first time, have a social media performance engine to turn insights into action into impact--all fuelled by AI.”

That’s the whole point: in 15 years, social networks have changed a great deal, thanks to the emergence of new players, new modes of communication and--above all--the arrival of artificial intelligence, which will completely change the ecosystem.

Those who see the glass half empty will see in this announcement the disappearance of a Luxembourg brand; those who see the glass as half full will see the arrival of a giant in Luxembourg; the neutral will see a classic stage in the life of a company. Thibaut Britz has gone back to work on another quantitative trading project, Sedai.lu, which, according to NorthData, will receive €1.4m in funding from the ministry of the economy. Along with Christophe Folschette and Patrick Kersten, the three men have decided to ‘give back’ a little of their success to startups through their ProjectRise initiative.

This article was first published in French on . It has been translated and edited for Delano.