What Really Drives Multiples
During my time as an executive at two entrepreneurial ventures, I was fascinated by valuations—valuations of companies with similar business models, valuations of companies within our industry and the trend of valuations at any given time—and, of course, what the valuation for our company would be. My fascination usually defaulted to the prevailing wisdom (or, more accurately, the urban legend) at the time of the appropriate “multiple” to use and whether it was a multiple of revenue or EBITDA. My thoughts on valuation usually began and ended with the exercise of applying a multiple to revenue or EBITDA and, more often than not, applying an extremely high multiple that spread through the industry grapevine like wildfire.
Or What Every Entrepreneur Should Consider When Starting a Business
In the summer of 2007, I made a decision that changed the trajectory of my professional career. After practicing law and advising clients for five years in Nashville, Tennessee, I had the opportunity to join an entrepreneurial technology venture. The thought of building something and being a part of a team intrigued me and the chance to do it in a high growth environment excited me. So, while my colleagues thought that I had lost my mind, I packed up and moved to Jacksonville to jump head first into uncharted waters.
For most technology and services companies, acquisitions are an important part of their growth strategy. However, corporate M&A is often an inefficient, reactive process with limited resources and infrastructure. With a dramatic increase in M&A activity and the growing footprint of large private equity funds, the “War for Acquisitions” is increasing in its intensity. Wall Street continues to ratchet up growth expectations for successful companies, and M&A is one of the most effective ways to show growth in revenue and earnings in a short period of time. M&A deals can be incredibly impactful in today’s environment where innovation and time-to-market timelines are compressed. The companies that continue to view their acquisition programs passively are at a distinct disadvantage to their competitors and the often-nimbler private equity buyers. The War for Acquisitions is on – it’s time to get proactive.Read More
Since 2008, MortgageTech has seemed to be a sector where good ideas go to die. The consensus opinion has been that this is due to a lack of innovation contributed by an industry dominated by a few banks and servicing companies, uncertain regulatory changes and a weak consumer backdrop.
At the 2017 MBA Tech Conference in Chicago, we observed a significant change in the air and came away with three key observations.
Private equity-backed promotional products leader, HALO Branded Solutions, announced its acquisition of third generation, family-owned rewards and recognition (R&R) provider, Michael C. Fina Recognition (MC Fina). The transaction touches on three dominant themes we see playing out in the R&R space:
1. Long held multi-generational family businesses striving to adapt or exit
2. Traditional point platforms evolving to tech-driven engagement solutions
3. Interest from investors and adjacent industries
Value-based care, the growth of consumerism and system consolidation are leading US healthcare trends designed to reduce costs. Technology integration is the key to making these three dominant trends successful in 2017.Read More
With persistently low interest rates and public equity market indices hitting record highs, investors have increasingly turned to private equity funds in their search for returns. In this low-return environment, private equity funds have enjoyed unprecedented fundraising success, accelerating the decades-long surge in private equity assets and new fund formation.Read More
Following years of regulatory uncertainty in what is a heavily concentrated market among the largest banks, there are new signs of accelerating investment and innovation. In the past 18 months, we’ve seen out-of-character actions from incumbents and a small but building amount of new activity from venture capital and private equity firms. The opportunity to streamline inefficiencies inherent in the U.S. lending process is not a new one. However, after years of stormy regulatory upheaval, industry consortium wrangling and volatile economic backdrop, there appears to be a new sense of opportunity.Read More
From encouraging healthy eating, offering biometric screenings and pushing the use of wearables to promoting mindfulness practices, teaching sound financial management and blending with employee engagement as a whole, corporate wellness programs have been evolving and broadening by definition.Read More
Welcome to the rapidly changing sector of technology we call WealthTech. WealthTech is where investment management, portfolio accounting, advisory services and related software and services converge into a niche space within the technology world. The WealthTech space includes a rich field of incumbent providers, established services and a dynamic set of newcomers chasing the super-sized wealth management arena.Read More
High rates of employee turnover and low productivity cost companies billions of dollars a year, and a lack of employee engagement has emerged as the impetus behind these trends. According to Deloitte, employee engagement and retention have emerged as top problems facing companies today, due in part to the dominance of millennials in the workforce and their proclivity to demonstrate less loyalty to a single employer than preceding generations. Aside from reducing turnover, engagement among employees also positively affects productivity per research by the Gallup Organization. As strong levels of engagement both reduce the likelihood of turnover and increase productivity on the job, CEOs and HR departments everywhere are looking for ways to increase engagement among employees.Read More
I attended the Digital Benefits Conference in Austin, Texas hosted by Employee Benefit Advisor and Employee Benefit News. Below I recap insights and ideas gathered at the event.Read More