Business Meeting

Project Fintech

An early-stage fintech company, owned by Management and early-stage private investors, wanted to sell in order to allow focus on new ventures. The Company utilized Quickbooks and most accounting was on a cash basis throughout the year. At the end of each calendar year, the Company generally made a proper cutoff of most receivables and payables. It had never been audited.  The Company sold annual licenses to clients for access to its platform, as well as charging for individual services. As such, the historical figures did not fully reflect the recent growth which had been achieved. 


Our team analyzed individual contracts, cash flows, and service data and created a revenue and license waterfall going back three years. We also mapped out the processes and trigger points for key accruals and estimates to be recorded during interim periods and smoothed out the impact of large expense items during the historical period. The resulting data and adjusted financials presented in our data book corroborated Management’s value proposition, and demonstrated not only the low churn rate inherent in the business but also how the top line would appear under GAAP. EBITDA on an adjusted basis was 24% higher than as reported for the trailing twelve-month (TTM) period, and the waterfall created a visible backlog that potential buyers could both visualize and confidently finance. The successful sale was for approximately $20mm more than originally planned.

Project Wholesale

A regional Industrial Wholesale company was owned by the Founder. He had decided to sell as he approached retirement age, and understood that the most likely buyers were competitors that knew the company’s industry quite well. His company had been reviewed but not audited by an external accounting firm, and his CFO knew the numbers well. Both of them had confidence in the integrity of the numbers and were initially skeptical whether a sell-side process would be worth the time and outlay, but reluctantly decided to engage us on advice from the owner’s other advisors.


While the Company had been around for 40 years, there was a bit of noise in the numbers in recent years, since two locations had been closed and three others had recently been opened but were not yet mature from an operational standpoint. Our team was able to analyze closely both operating performance of all the Company’s 19 branches, historical time to mature profitability, gross margin by product line and other relevant metrics to arrive at a pro forma EBITDA adjustment that reflected Management’s expectations of profitability two years in the future. The level of detail and support included in our adjustment allowed the owner to increase the price (originally approximately $180mm) by 8% during the process.

Project Manufacturing

A family-owned manufacturing company decided to sell in 2021 in light of expected tax changes and the resultant adverse impact to the family. But the owner was unwilling to sell at the expected multiple, at the price indicated using the historical TTM EBITDA as of March 2021. Recent changes in 2019 and 2020, and recent decisions in 2021 that were just being implemented were expected to have dramatic, positive impacts on EBITDA run-rate, and the owner was interested in selling only if he could achieve a valuation based off of that expected, future run-rate.


Our team was able to extract source data from the Company’s operating information (only partially visible in the accounting system) and detailed cost information from various sources to develop a compelling model showing the impact of three major changes: a launch of a new product line, establishment of a production facility in Mexico, and changes in their supply chain that would reduce the impact of tariffs on imported materials. The resulting model allowed the Company to demonstrate to buyers that by September 2021, the future run-rate would be achieved and even that additional upside existed. While historical EBITDA on an adjusted basis but not including the adjustments from our model showed an indicative value of approximately $120mm, our model allowed the owner to successfully negotiate a value in the $180mm range.