Interview with Christian Stendevad, CEO Penneo
Penneo's History is iconic - from the basement to Nasdaq. Could you please describe this journey briefly?
Penneo is a SaaS company founded in 2014 with the ambition of reducing the hassle to get documents approved and signed, by replacing pen and paper with a digital signature alternative and automating manual approval workflows.
Our solution quickly gained traction within the audit and accounting industry, and after signing the first major accounting firm as a customer in 2014, Penneo reached a milestone of 500 customers in 2016. In 2017, Penneo expanded across national borders when it entered Sweden and Norway, and the following year, all of the top ten largest accounting companies in Denmark were using Penneo.
In 2020, we were listed on the Nasdaq First North Growth Market Denmark to boost our internationalization strategy and growth journey. The same year, we acquired a KYC solution from a Danish start-up to strengthen our product offering.
Then in 2022, we moved from the First North Growth Market to the Copenhagen Main Market, to enable us to further pursue our expansion plans and ambition of becoming the preferred solution for auditors and accountants across Europe.
Today, Penneo has evolved into an ecosystem of digital solutions that automate workflows related to client onboarding (KYC), signing, and document management. We serve over 2,500 customers across six countries.
Why are electronic signatures important? Are there any problems with a pen and paper?
Digital signatures are a much more efficient and convenient way of handling document transactions. You can sign a document from anywhere in the world, from any device. It doesn’t get any easier than this.
Digital signatures save time, costs, and reduce the risk of manual errors. Moreover, they facilitate cross-border collaborations, as businesses can get contracts and other documents signed in a matter of minutes with digital signatures.
In addition to that, one important aspect for us at Penneo is security and compliance. When you sign digitally, you can be sure that the person meant to see and sign a document is the person who actually signed. That’s thanks to the fact that digital signatures are typically based on electronic IDs, which are uniquely linked to the individual. It’s much easier for someone to fake a handwritten signature, whereas it’s virtually impossible to fake a digital one.
And of course, another thing that’s important to us at Penneo, is reducing paper waste. So much paper ends up in landfill sites, but with a solution like ours, companies no longer have to print and store so much paper.
What about physical proof of a signature, if going offline?
A document signed via Penneo will include the relevant information on the document itself, so it is available at any time, regardless of internet access.
Penneo creates a dedicated page for signatures, which becomes an integral part of the document itself as its last page, supporting the chain of evidence. The signature page is readable and printable (along with the rest of the document) and contains information that is cryptographically bound to the document and visible, such as identifying details about the signers, e.g. their name, role, and IP address (partially anonymiszed) and timestamp, i.e. a digital record of the time when each signature was applied.
Additionally, each document is identifiable by a unique document key visible on the right-hand side of each page of the final document. This prevents any subsequent alteration of the document.
The technical validity of the digitally signed documents can be verified through PDF readers, https://app.penneo.com/validatorPenneo’s Validator or the https://ec.europa.eu/digital-building-blocks/DSS/webapp-demo/validationEU Validator.
Do you think that an electronic signature should replace a traditional one in every situation?
There’s been a general trend of moving towards more digital and automated ways of working for some time now, and that also includes document transactions and digital signing. That’s because the benefits speak for themselves: less manual work, better efficiency, time and cost savings, increased security, reduced risk of errors, and not to mention the environmental impact of reducing paper usage. Plus, this shift is something that’s supported and promoted by EU legislation. According to eIDAS, the EU regulation concerning digital identities and digital signing, a qualified electronic signature has the same validity as a handwritten one.
To us at Penneo, it’s clear that the future is paper-free.
Have you ever counted the number of signatures made thanks to Penneo, and can you estimate how much paper you have saved so far?
Over 210 million tonnes of paper are produced yearly and a huge amount of this paper ends up in rubbish bins and later at landfill sites. Paper accounts for 26% of all waste, which is a significant amount.
That’s why at Penneo we want to help companies remove the need for paper in their daily operations – digitaliszation of paper-processes is not only more efficient and convenient, but also better for our environment.
On average, more than three million documents are digitally signed with Penneo per year, which saves more than 74 tonnes of paper. And as Penneo grows, more and more paper will be saved.
What are the types of digital signatures?
Digital signatures don’t all have the same legal value. eIDAS (Electronic IDentification, Authentication and trust Services regulation of European Union) defines three types of electronic signatures:
- simple electronic signatures (SES)
- advanced electronic signatures (AES)
- qualified electronic signatures (QES)
The simple e-signature can be anything, like typing or drawing your signature on an online document – which is not a very secure way of signing a document.
Advanced e-signatures and qualified e-signatures – also commonly referred to as digital signatures – are much more secure, as they’re often based on electronic IDs, which are uniquely linked to the individual user.
At Penneo, we offer both electronic and digital signatures, but we always encourage our customers to rely on digital signatures and only use e-signatures as a last resort. So, Penneo offers all the usual benefits of signing documents digitally, such as increased efficiency, convenience, and time-savings – but with an added focus on security and compliance.
We find that this is a key differentiator for Penneo, especially since we work primarily with businesses in regulated industries that are security-conscious. What makes a difference for our customers is knowing that when they choose Penneo, they can be assured their information is safe and they process client data in a compliant way.
A project Manager has a contract with a sub-contractor to be approved internally by the CEO and signed externally. How does Penneo's solution serve this flow?
Penneo was built to automate document transactions and help our customers work more efficiently. That also means that we spent time with our customers across industries to understand their needs and ways of working as well as possible, to then translate that into our solution.
Sending a document for signature via Penneo is a straightforward process and done in just a few steps, such as adding a few details about the case file, adding the documents and recipients, and sending the documents.
One of the aspects where Penneo makes a difference is in our signing flows. A signing flow is a pre-built sequence that ensures the right documents reach the right people, in the right order. This is a huge benefit to our customers, especially for those working with complex flows in regulated industries. They don’t have to manually ensure that everything is signed properly, as our solution takes care of that. There is also an audit log, tracking each step of the process, which can be used to prove compliance if needed.
We provide industry-specific flows that have been built in collaboration with our customers, but also offer the option of creating custom ones to match our customers’ exact needs.
From the start, it’s been very important to us to build our solutions in close cooperation with our clients. Penneo Sign, our signing software solution, has been co-created together with the largest audit firms in the world, which is why we have had an advantage in the audit industry from the very start.
This is something we’ve continued with as Penneo has grown and is now serving clients in AML-regulated industries such as crypto, finance, legal services, banks, and property. Our product teams conduct interviews and research with customers to make sure that we continue to build products that serve their needs and requirements.