The boardroom was likely quiet when the decision was finalized. No sirens blared across Oslo or London. No physical walls were torn down. Yet, in the abstract architecture of European enterprise software, a massive structural shift just occurred. Hg, the private equity titan that has spent years meticulously assembling a €19 billion empire known as Visma, decided it was time to let go of a few pieces.
They are spinning out €500 million worth of assets into a new, independent vehicle. To the uninitiated, this sounds like a dry accounting maneuver. To those who understand the metabolism of modern business, it is a surgical extraction. Recently making news in this space: Why Every Victory Lap Over Indias Energy Security is Wrong.
Think of a gardener who has spent a decade cultivating a massive, sprawling oak. The tree is healthy, dominant, and covers the entire yard. But beneath its heavy canopy, several smaller, specialized plants are struggling to find their own sunlight. They are part of the same ecosystem, but they have different needs, different growth rates, and different destinies. The gardener doesn't chop them down. He carefully digs them up, root and all, and moves them to a new plot where the soil is tailored specifically for their survival.
This is the story of how Hg decided that Visma, a behemoth providing cloud software to over a million customers, had become so large that its most nimble components needed room to breathe. Additional information into this topic are covered by The Economist.
The Weight of Nineteen Billion
Visma is not just a company. It is a weather system. Based in Norway, it has become the backbone of European business administration, handling everything from payroll and accounting to specialized government workflows. When you operate at a valuation of €19 billion, your priorities change. You focus on scale. You focus on the horizon. You focus on the massive, sweeping movements of the market.
But tucked inside that massive valuation were business units that didn't fit the "one size fits all" trajectory of a continental giant.
Consider a hypothetical product manager named Elena. In this scenario—a common reality in the tech world—Elena runs a specialized software tool for Dutch healthcare providers. Her team is small. Her customers are passionate. Her product is growing at 40% a year. But when Elena goes to the head office to ask for a specific marketing budget or a shift in R&D, she is competing with a hundred other Elenas. She is a rounding error in a €19 billion spreadsheet.
For the leaders at Hg, the realization wasn't that these assets were failing. It was that they were succeeding in a way that the larger Visma structure couldn't fully support. The "spin-out" is an admission that sometimes, the best way to protect value is to release it.
The Invisible Mechanics of the €500 Million Shift
The mechanics of this deal are fascinating because they defy the usual logic of "selling high." Hg isn't necessarily exiting these businesses because they want the cash today. They are moving them into a new structure—a "continuation fund" or a specialized vehicle—that allows these assets to operate with their own dedicated management and capital.
The move involves roughly 20 separate business units. These aren't the core cloud accounting engines that drive Visma’s primary revenue. Instead, they are the specialists. They are the niche providers of school management software, legal tech, and localized ERP systems.
By separating these units, Hg creates a "clean break."
The new entity starts with a fresh mandate. It isn't burdened by the overhead of a multi-billion-euro corporate parent. It can hire differently. It can take risks that a massive group like Visma might find too volatile. Most importantly, it can be sold or IPO’d on its own merits in the future.
Why We Get Growth Backward
We often assume that bigger is always better. We celebrate the "Unicorn" and the "Decacorn" as if the goal of every software company is to merge into a single, monolithic entity that controls everything. We are wrong.
The history of technology is littered with the corpses of "conglomerates" that grew so large they lost their soul. They became slow. They became bureaucratic. They stopped listening to the Elenas of the world because they were too busy listening to the analysts on quarterly calls.
Hg is performing a rare act of corporate humility. They are acknowledging that the "synergy"—that tired word often used to justify bloated mergers—has reached its limit.
Imagine a fleet of ships. For years, they have been lashed together to cross a stormy ocean. It was safer that way. They shared supplies. They shared a navigator. But now, they have reached calmer waters. To reach the small, rocky harbors where the real treasures are hidden, the ships must be cut loose. The ropes are being sliced.
The Human Stakes of the Balance Sheet
Behind the €500 million figure are thousands of employees. For them, this isn't a "transaction." It’s a change in identity.
When you work for a company like Visma, you have the security of a fortress. You have the brand. You have the massive HR department. When you are spun out, that security shifts. It becomes more visceral. You are no longer a small part of a big thing; you are a big part of a new thing.
There is a specific kind of electricity that happens in a spin-out. The "new" company often feels like a startup again, even if it has been around for a decade. The mission becomes clearer. The distance between an idea and a decision shrinks from months to hours.
Hg is betting that this surge of energy will make that €500 million worth significantly more in three years than it would have if it stayed tucked away in Visma’s basement. They are betting on the human element—the drive of a focused team that finally has its own P&L and its own destiny.
The Strategy of Pruning
This isn't the first time Hg has done this, and it won't be the last. They are masters of the "buy and build" strategy, but they are also becoming the masters of the "prune and prosper" model.
In the private equity world, there is a constant tension between holding onto an asset and realizing its value. If you hold too long, the asset stagnates. If you sell too early, you leave money on the table. The spin-out is the middle path. It allows Hg to keep their foot in the door while giving the asset the independence it needs to appreciate.
The financial world calls this "capital recycling."
I call it knowing when to let go.
It takes a certain amount of courage to look at a €19 billion success story and say, "This part doesn't belong here anymore." It requires a move away from the ego of "total assets under management" toward the reality of "operational excellence."
The New Map of European Tech
What does this mean for the rest of us?
It signals a shift in how European tech is maturing. We are moving away from the era of desperate consolidation and into an era of sophisticated specialization. The market is no longer impressed by size alone. It wants to see focus. It wants to see companies that do one thing exceptionally well, rather than ten things adequately.
By spinning these assets out, Hg is essentially seeding the market with 20 "new" specialized competitors. These companies will go out and hunt. They will innovate. They will perhaps even acquire smaller rivals of their own.
The ripple effect will be felt across the Benelux region, the Nordics, and beyond. Competitors who once felt safe in their niches because they were fighting a distracted giant like Visma will now find themselves facing a lean, hungry, independent version of that same team.
The stakes are higher now.
The Ghost in the Machine
There is a myth in business that numbers tell the whole story. They don't. A €500 million spin-out is a number, but the reality is a collection of hundreds of thousands of lines of code, thousands of customer relationships, and a few dozen leaders who just got the keys to their own kingdom.
The true test of this maneuver won't be found in the press release. It will be found in the software updates that roll out six months from now. It will be found in the way a customer service rep in Rotterdam answers the phone now that they are part of an independent company rather than a multinational conglomerate.
Structure dictates behavior.
By changing the structure, Hg is attempting to change the behavior of the software itself. They are trying to inject agility back into a system that was becoming too heavy to move.
The gardener has finished his work for the day. The oak remains, still massive, still dominant. But in the new plot of land across the way, twenty smaller plants are feeling the sun on their leaves for the very first time in years. They are stretching. They are growing.
The break wasn't just clean. It was necessary.
In the end, the most powerful thing a leader can do is realize when they are no longer the right person—or the right organization—to hold onto something beautiful. You don't own the future by clutching it tightly to your chest. You own it by building it, strengthening it, and then, at exactly the right moment, opening your hand.
