Activist hedge fund firm Irenic Capital Management, which holds a 2% shareholding in Workiva Inc, has outlined a series of recommendations aimed at reversing the software company’s recent share price underperformance and accelerating value creation.

In a presentation released on Tuesday, Irenic argued that Workiva’s market-leading products, strong recurring revenue, and high-margin potential are being undervalued due to a failure to balance growth with profitability. The activist fund urged the company to adopt a “Rule of 40” operating model – measuring growth plus profitability – or to consider a sale to a strategic buyer or financial sponsor.

Irenic called for a refreshed board to oversee a Strategic & Operating Review, assessing all options to maximise shareholder value, including operational improvements, go-to-market efficiency enhancements, and potential partnerships.

The fund stressed that immediate change is required to unlock the company’s intrinsic value and close the gap with peer valuations, positioning Workiva either as a more profitable public business or as an attractive acquisition target.