Source: David Gardner (Founder of Cofounders Capital), originally published by WRAL TechWire. Albert Einstein is credited with saying that compounded interest was the greatest invention of the twentieth century. I would like to think that if he were alive today, he might argue that software (SaaS) exit multiples have taken that spot. It still amazes […]
Selling a Low Revenue Tech Company for Maximum Cash Read More »
Source: BizActions Mergers are like marriages. Success depends on any number of factors, but failure may be a result of one overriding flaw. In the case of mergers, that flaw often is lack of thorough due diligence. You may be able to get some of the information you need about a potential acquisition from public
Will Your Merger be Blindsided by Fraud? Read More »
Source: David Frankel, Venture Partner, Blueprint Ventures I’ve been fortunate to have been part of half a dozen exits this year, and have seen the process work smoothly, and, other times, like a roller coaster, with only the most tenuous connection to the track. Here are 10 bits of advice I’ve distilled from these experiences
10 Pieces of Advice When Someone Wants to Buy Your Company Read More »
Source: Jack Ciesielski, Analyst’s Accounting Observer In 2011, Hewlett-Packard paid $11.1 billion for UK software firm Autonomy – a 64% premium for a company with nearly $1 billion of 2010 revenues, and possessing “a consistent track record of double-digit revenue growth, with 87 percent gross margins and 43 percent operating margins.” So they thought. Little
Due Diligence Fiasco – A Look Back at HP-Autonomy Read More »
Source: Samuel Howard, Axial Networks Contributor Deals fall through, it is an unfortunate fact of life. Of course, you can improve likelihood of success, but sometimes deals — even seemingly surefire deals — breakdown. No matter how compelling the logic or promising the prospects, not every deal will make it to the finish line. In
What Happens When Deals Die Read More »
Source: Dan Hammaker, Axial Savvy CEOs will prepare for an exit well in advance, aligning time of the sale with their operational peak to maximize value. But no matter how well-run a company is, the 2-3 years preceding a CEO’s desired exit window offer an opportunity to evaluate potential business improvements. By then, any ROI
How Acquisitions Add Value Before a Company Sale Read More »
Source: Axial Network Every selling business owner dreams of the same exit outcome: sell high, retire well. As such, in the years leading up to the sale, most owner-operators become marketing experts – articulating the strengths of their company, showing would-be buyers the potential for continued growth (and ultimately buyer return). What most owners fail
5 Ways Entrepreneurs Hurt the Chance of Selling their Business Successfully Read More »
Source: Axial Networks The value a CFO brings to a mid-sized company is well understood. At a high level, the CFO manages a company’s financial affairs, allowing the CEO to focus on day-to-day operations. But what does this broad definition mean when a company is cycling through a transaction process? For companies who are selling,
The Role of a CFO in Mergers & Acquisitions Read More »
Source: Dan Hammaker, Axial Markets Competition does not preclude cooperation – just ask Apple. Even if doing business with a competitor would be unreasonable, considering rival companies when developing an exit plan can prove profitable. In many cases, competitors are the best option for a selling business owner and ultimately make great acquirers. However, selling
5 Things to Consider When Your Competitor Makes an Offer Read More »
Source: Richard Wilson , The Family Offices Group I am often struck by the way that analysts, dealmakers, and investment bankers discount the importance of cultural and personal fit when evaluating the merits of a proposed transaction, especially one that requires the approval of a founder. Founders are very protective of their business and often
Beyond Valuation – Factors that Sellers Weigh in a Deal Read More »
Graf Research™ unleashes innovation by developing ideas into disruptive technologies. The Graf mission aims to perform research, provide services, apply analytics, and create products that enable secure, high-performance, embedded, and adaptive computing solutions.
When the Director of Finance for Graf was leaving the company, Graf needed an experienced financial team to get them through the transition. Managing Director Gary Hayes was introduced to Graf and determined that CFO Rendy Richards and Controller John Schefke would be an ideal combination. These two were particularly important because Graf is a U.S. Government contractor, and both Richards and Schefke have strong backgrounds and deep skill sets in this industry.
The two Scale Finance professionals quickly responded to Graf’s time-sensitive need, logically split up the work, learned the DELTEK version used by Graf, introduced more efficient processes and techniques, and helped meet their financial reporting needs. Our professionals also determined that the Senior Staff Accountant was underutilized and helped her grow into a permanent, cost-effective Controller role.
FX HedgePool (FXHP)
FX HedgePool (FXHP) is a New York and London-based highly innovative fintech company. FXHP is an award-winning peer-to-peer matching platform that optimizes the FX swaps market. The Company eliminates market impact and minimizes the effects of volatility – significantly improving outcomes for all investors.
FXHP’s unique credit model separates liquidity from credit, creating a new source of safe and dependable liquidity for the swaps market. The Company exists for the community, guided by the community with a “win-win-win” commitment that helps members, underlying investors, and banks yield safer and better results.
Scale Finance began serving FXHP years ago, providing annual business valuations to support 409A compliance for the Company’s management incentive equity plan. During this period, Scale Finance Managing Director Dave Gilroy advised FXHP about potential strategic corporate transactions. In 2022, the Company decided to raise institutional venture capital. Scale Finance managed this process from end to end, resulting in a highly successful closing of an $8 million Series A equity financing led by Information Venture Partners with participation from Fidelity International Strategic Ventures and NAventures (National Bank of Canada’s corporate venture capital arm).
Scale Finance continues to provide periodic business valuation support.
Heritage Trust
As the first independent trust company in New Mexico, established in 1994, Heritage Trust (HT) uses innovation, experience, and flexibility to meet clients’ needs. HT provides a full range of trust services, e.g., acting as their client fiduciary for their Trust assets, being an executor or personal representative related to the distribution of estate assets, managing and growing financial assets, and preparing annual tax returns for trusted clients.
Co-Founder and Managing Director of Scale Finance Gary Hayes has been providing CFO and managing Controller support since February 2021. We have streamlined their monthly and year-end close process and established budget/forecast capability to support management. Their business has grown over 40% since Scale Finance has been involved with the company’s financial management. Gary has also participated in Board Meetings as and when needed.
Southland Transportation Company
Southland Transportation provides transport, supply chain, and campus management services on a local, regional, and nationwide basis. When Southland contacted Scale Finance, they had a strong accounting staff but no Controller or CFO. After an unsuccessful search for a full-time CFO, Southland engaged CFO and Partner Rendy Richards as their fractional CFO.
Over 18 months, Richards helped integrate a new acquisition, made improvements in accounting and finance processes, developed the company’s first-ever annual budget, helped with the onboarding of a new Controller, and provided business valuations in conjunction with Scale Finance’s Managing Director, Dave Gilroy.
For over six decades, Cooper Electrical has served a wide range of industrial, commercial, and municipal customers across the Southeast, providing best-in-class Electrical Design/Build, BIM, Prefabrication, Instrumentation & Controls, and Calibration services. Cooper’s expertise spans multiple major markets, including bio-pharmaceutical, chemical, water & wastewater, power generation, manufacturing, gas production & transmission, and food & beverage.
When Cooper’s CFO left the company for another opportunity, the owners engaged Rendy Richards as interim CFO while they searched for a full-time replacement. On a half-time basis over eight months, Richards kept the company’s financial organization humming, made improvements in several business processes, initiated a detailed financial forecast, and met with the owners to share his observations and recommendations on the most feasible way to staff their finance and accounting department cost-effectively.
SymmetryRX, LLC
SymmetryRX is a leading provider of eSampling services allowing Pharma Manufacturing companies to access physician practices for the ordering and distribution of drug samples across the US. The Company was acquired in November 2018 from Aptus Health, a wholly-owned subsidiary of Merck. Since then, the company has expanded its robust suite of services that provides pharma manufacturing executives, brand managers, sales managers, product managers, and launch managers the ability to help more patients have greater access to samples, improving medication adherence and healthcare outcomes.
Co-Founder and Managing Director of Scale Finance Gary Hayes has been providing CFO Services to the Company since 2018 and was integral in the acquisition process, facilitated initial financing to support the company with a 7A SBA loan package of $600 thousand and an SBA-backed $300 thousand LOC. Since then, Gary has been actively providing CFO support across financial reporting, budgeting, forecasting, cash planning, and strategic planning.
