Expansion into Germany with EUR 30 million Series B for Formalize

The Danish RegTech has closed a Series B financing of 30 million euros. The round is jointly led by Acton Capital and BlackFin Tech, with participation from West Hill Capital and CIBC Innovation Banking. The aim is to massively expand the company's presence in Germany, in particular its Munich location, which is set to grow to 30 employees by the end of 2026.

DORA is running, NIS2 is coming - Germany is under pressure

The regulatory requirements for cybersecurity are increasing rapidly: since January 2025, around 3,600 financial institutions have had to implement the EU DORA regulation. At the same time, the upcoming NIS2 directive will affect around 29,000 companies, mainly from the SME sector.

When regulatory requirements meet a massive shortage of skilled workers, automation goes from being an option to a necessity. That's why the German market is now an absolute priority for us.

Jakob Lilholm, CEO of Formalize

Germany has missed the EU implementation deadline and infringement proceedings are already underway. According to estimates, the implementation costs in the first year are 4.5 billion euros, plus possible penalties of up to 10 million euros.

There is also a massive shortage of skilled workers. According to studies, there is a shortage of around 120,000 cybersecurity experts in Germany. A gap that will be very difficult to close in the short term.

Automated compliance instead of a skills shortage

Formalize offers a platform that covers DORA and NIS2 in one integrated system. An advantage for companies that need to implement both sets of regulations at the same time.

Since its foundation in 2021, Formalize has won over 8,000 customers worldwide, including McDonald's, Starbucks and, in the DACH region, Develey, Emma and Der Grüne Punkt. The DACH region already accounts for 25% of annual recurring revenue. German customers include MDR, RheinLand Versicherungen, Honda Financial Services and the Munich District Office.

With Formalize, we created a complete DORA register from all IT service provider contracts within four days - with over 22,000 automated validation checks. The tool also simplifies our risk assessments enormously.

Representative MCE Bank

Acton Capital is an experienced Munich-based fund that specializes in scalable B2B solutions for SMEs. We already reported on the successful Series A for Formalize in 2024. The funds from the Series B round will be used to build up the team in Munich, further develop the platform and expand the sales network in Germany.