Shareholders of a software development tool provider (client) sought to harvest investment, allowing shareholder liquidity and the CEO the opportunity to retire. On the face of it, the client company appeared to be a run-of-the-mill software purveyor, focused on a legacy market (legacy software modernization) with little growth and below-industry financial performance.
Strategy was developed to position client IP as route to materially enhance gross margins of technology services companies. A process was run to identify those services companies and the messaging to best approach them to generate interest in the concept:
Shareholders realized 3.5x revenues enterprise value for a company that the general market otherwise would have valued at little more than 1x revenues (5x EBITDA). CEO was able to retire and transition within 6 months.