2014 User Guide. Copyright 2014 PrivCo Media LLC. All rights reserved. Private Company Financial Intelligence. PrivCo User Guide

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1 2014 User Guide Private Company Financial Intelligence

2 Table of Contents Getting Started 2 Understanding the PrivCo Homepage PrivCo Private Company Financial Report - Contents 4 Section Overview 5 Key Action Tabs 6 Business Summary and Recent News, Updates and Analysis 7 Overview & Corporate Organization 8 Industry Information and Competitors & Comparables 9 Ownership Table 10 Charts, Financials, and Statistics (Table Format) 11 Charts, Financials, and Statistics (Graphs) 12 M&A Activity Table 13 M&A Details Subsection 14 VC Funding Activity Table 15 VC Funding Round Details Subsection 16 Private Company Financial and Legal Exhibits 17 Detailed Business Description PrivCo Advanced Searches for 19 Section Overview 20 Private Companies 21 Private Companies (Full Advanced Search) 22 Private Market Investors 23 Venture Capital Fundings 24 Private M&A Deals 25 Private Equity Deals 26 Advanced Search Results PrivCo Extras 28 Knowledge Bank (for terms you are unfamiliar with or want to better understand) 29 Case Studies (examples of how all client-types use PrivCo on a daily basis) 37 Testimonials 38 Contact Information 1

3 Understanding the PrivCo Homepage Quickly search for a company or investor by name in the search bar Use PrivCo s Advanced Searches for granular, criteria-based searches for Private Companies, Investors, Funding Rounds, M&A Deals, and PE Deals Click on the knowledge bank to learn more about a term or concept you may be unfamiliar with Watch the PrivCo Database grow with live Database Statistics Quickly perform a search for private companies based on key criteria Keep track of all recent M&A activity involving privately-held companies Click right into the most popular private company and private investor reports See which companies have recently received funding Stay up-to-date on all recent Private Equity deals/activity Instant Access to Featured Private Company Research Provided by PrivCo Financial Analysts Keep track of all IPO-related activity involving privately-held companies 2

4 Contents of a PrivCo Private Company Financial Report This section details the contents of a PrivCo Private Company Financial Report 3

5 PrivCo Private Company Financial Report A PrivCo Private Company Financial Report will provide a thorough understanding of a private company. PrivCo Financial Analysts create and update reports to continuously provide the most accurate, useful, and upto-date information on private companies around the world. Each PrivCo Private Company Report is viewable via the web platform or as a downloadable PDF or Excel file. All report versions contain identical information but in different formats. PrivCo Online Platform PDF Version Excel Version Reports have a standard format for easy viewing and seamless navigation. Each report contains separate sections pertaining to different aspects of the company. Sections in a standard PrivCo Private Company Report are outlined below and will be explained in depth: Key Action Tabs Business Summary Recent News, Updates and Analysis Overview & Corporate Organization Industry Information Competitors & Comparables Ownership Table Charts, Financials, and Statistics (Table Format) Charts, Financials, and Statistics (Graphs) M&A Activity Table VC Funding Activity Table Exhibits Detailed Business Description 4

6 Key Action Tabs All private companies are given a unique Private Company Ticker Symbol TM only found using PrivCo At the beginning of each PrivCo Private Company Report you will find 5 key action tabs, allowing you to do several important things, quickly: Download PDF Report: With one click you can download the PrivCo Private Company Report to PDF and send it off to a colleague or client. The PDF report includes everything you see in a private company report on the database, including any exhibits that may be linked up to the report. Export to Excel: By exporting to Excel, you can export the entire PrivCo Private Company Report to excel and share it with your colleagues or clients, or create your own presentation. View Exhibits: By clicking on the View Exhibits key action tab, you will instantly be directed to PDF documents pertaining to the private company. Exhibits include items such as lawsuits, trademarks, bankruptcy filings, Articles of Incorporation, internal s etc. To learn more about Exhibits, see page 16. See Industry M&A Activity: The user can click this key action tab to see a list of all M&A deals in the same industry of the current private company. See Industry VC Activity: To see private companies in the same industry that are raising money, simply click this key action tab. Both the Industry VC Activity and Industry M&A Activity Key Action Tabs are fast and easy ways to gain a complete understanding of industry activity. 5

7 Business Summary Business Summary: The Business Summary section of a PrivCo Private Company Profile gives you a succinct yet complete idea of what a particular company is all about. The Business Summary quickly provides an overview of the company s operations as well as pertinent information such as when the company was founded, who the founders are and where its headquarters are located. This section is great for introducing you to a company you may not be familiar with. Recent News Updates and Analysis Recent News, Updates, and Analysis: This section of the report links the user to any PrivCo Newsletter in which the current company was referenced. PrivCo has an in-house news team that publishes the Weekly PrivCo Newsletter, giving you up-to-date news and analysis on private companies. Navigating to a Particular Newsletter: When you see a newsletter linked to a company profile, you have the ability to click the title of the newsletter and gain instant access to the research conducted by PrivCo Financial Analysts. 6

8 Overview & Corporate Organization Overview & Corporate Organization: Here the user will get a complete understanding of the structure of a private company. Every company is going to be tagged if it is PE-backed, VC-backed, minority-owned or woman-owned, if applicable. The user will instantly know the year founded, any former names, fiscal year end, revenue and employee growth rates (1 and 3 year), headquarter location, phone number, website, and social media info. Any of the private company s brands, subsidiaries, parent companies, and founders will also be listed here if applicable. 7

9 Industry Information Industry Information: This section gives the user a granular breakdown of the industries that the private company operates in. Industry codes will be noted on the left and include PICS TM (The PrivCo Industry Classification System), NAICS and SIC. Users can click on any of the PICS TM codes or particular PrivCo Industry name to the right and instantly see a list of all private companies operating within that industry. NAICS and SIC have become outdated and do not include some of the newer, emerging industries like PICS TM. Competitors & Comparables Competitors & Comparables: This section includes comparable companies and competitors of the current company being viewed. Competitors and comparables listed are researched by actual PrivCo Analysts, not simply auto-populated based on a matching industry classification. Click on the name of any company in this section and go directly to that company s unique profile. 8

10 Ownership Ownership Table: This section provides an overview of the private company s ownership. Here the user can easily determine an owner s name, type, and percentage of ownership. The user can click on the name of the owner and be taken immediately to its respective investor profile where an overview and list of key contacts will be displayed, in addition to all investments. This allows the user to see an investor s portfolio in real-time. 9

11 Charts, Financials, and Statistics (Table Format) Charts, Financials, and Statistics (Table Format): This sections is where the user will be shown important financial, employee, and industry-specific metrics. Financial information will displayed here in a table format, parsed out by year and separated by financial statement type. If applicable, the user will find revenue breakdowns by categories such as region or product line, as well as total employee and productivity figures. Additional financial tables may include, but are not limited to, auditor information, industry-specific metrics (such as subscribers, daily payments processed, etc.), location statistics, and/or secondary market trading activity. 10

12 Charts, Financials, and Statistics (Graph Format) Charts, Financials, and Statistics (Graph Format): This section provides the user with a graphical representation of each of the line items in the prior section. These graphs provide a quick and efficient way to print out or copy into a presentation. Because PrivCo s database is live, graphs will be updated immediately if any years, line items, or sections are added to the tables above. 11

13 Mergers & Acquisitions Click Details on any particular deal to see a complete breakdown M&A Activity Table: This table displays all M&A deals involving the private company currently being viewed. Sorted by date, each deal will have information on its Status, who the Target and Buyer were, the Deal Type (whether an Acquisition, LBO, Divestiture, Joint Venture, etc.), and the Price of the deal. Users may click on the target or buyer s name to be taken directly to that company s profile. Clicking Details will open a new page with an in-depth breakdown of the particular deal. This is outlined on the next page. 12

14 Deal Details Find all key transaction multiples. See all advisors, both legal and financial for buyers and targets. Click any advisor s name to go directly to their Advisor Profile and see all of their advisory activity. 13

15 VC/Funding Activity VC Funding Activity Table: This section of a report provides an overview of the private company s funding history. Displayed here will be total funding received broken down by round. Each round overview will include the date, the round, the investors involved, and the investor type. Clicking on an investor name will take the user directly to that particular investor s profile. Total funding raised to date will be displayed at the bottom of the table. The user can click on Details to the left of each round and be given an in-depth breakdown of that particular round. This is outlined on the next page. 14

16 Funding Round Details Click an advisor name to see all other deals or rounds the particular firm has advised on See which investor led the round and click any investor s name to see their portfolio in real-time Find key valuation multiples on the hottest private companies 15

17 Exhibits Exhibits: Exhibits are downloadable PDFs attached to a report offering greater insight into the company. Items included could be lawsuits, trademarks, patents, bankruptcy filings, Articles of Incorporation, and internal s. Users can simply click on the name of the Exhibit and instantly select to download the PDF which can then be saved, printed, or shared with colleagues very easily. Exhibit Example US Patent 16

18 Detailed Business Description Detailed Business Description: This is an actual, detailed analysis of a private company. A PrivCo Analyst will provide a history of the private company and information on its revenue model, cost structure, competitive landscape, risks going forward, potential acquisitions, and more. This is great as it offers insight from a financial analyst and is not simply sourced from another location. 17

19 PrivCo Advanced Searches This section breaks down each of PrivCo s five Advanced Searches 18

20 PrivCo Advanced Searches PrivCo Advanced Searches allow the user to perform searches based on their own preferences. Selection options vary depending on the particular search, allowing the user to perform as broad or as granular of a search as they would like. Users can select their specific Advanced Search by clicking one of the options on the black bar across the top of any PrivCo webpage, displayed below: Once on an Advanced Search webpage, the user can begin selecting criteria that will ultimately determine what is displayed in the search results. The search technology will combine all of the user s selections and perform a search of the entire PrivCo Database, displaying only those results (whether companies, investors, funding rounds, or deals) matching the specific criteria searched. The Location & Industry Criteria section is available in all Advanced Searches while Private Company Advanced Searches will include selections specific to companies (such as Revenue and Employee Criteria) and Private Market Investor Advanced Searches will include unique sections specific to investors (like Investor Type and Preferred Stages of investment). Each of the PrivCo Advanced Searches will be displayed with feature explanations in this section of the PrivCo User Guide, followed by an overview of the search results page. Private Company Advanced Search Private Investor Advanced Search Venture Capital Funding Private Company M&A Advanced Search Private Equity Deal Advanced Search Search Results Page 19

21 Private Company Advanced Search Choose Region/Location allows the user to search for companies headquartered in particular locations around the world. Hold the control key to choose multiple selections. Search for companies headquartered within a mile radius of a particular city by inputting the zip code or typing the city name. The system will automatically recognize your input.. Keyword Search is designed only to search company profiles containing a particular word, such as bankrupt. Search only by a keyword or include your term with other criteria below. Choose Industries lets the user search for companies in particular industries or subindustries. Clicking + expands the industry to display sub-industries. Enter a keyword or phrase related to your particular industry if you are unsure of where it falls in the hierarchy and hit enter to see all industries and sub-industries containing your term. Choose Annual Revenues limits the companies searched to a particular revenue range. Input values or select from PrivCo s list. One field can be left blank if you re only interested in a minimum or maximum value rather than a range. Choose Total Employees limits the search to those companies with a particular employee count. Input values or select from PrivCo s list. One field can be left blank if you re only interested in a minimum or maximum value rather than a range. Choose Employee Growth Rate limits the search to those companies growing or shrinking employee numbers at a particular rate. One field can be left blank if you are only interested in a minimum or maximum value. Users can select 1YR Growth Rate and 3YR CAGR (Compounded Annual Growth Rate). Selecting this box will include prerevenue companies or those for which revenue is unconfirmed. Choose Ownership Criteria lets the user specify if PE-backed or VC-backed firms will be included or excluded in the search results. A third dropdown option also allows for ONLY PE/VCbacked firms to appear in the search results. If you are more familiar with SIC and NAICS classifications, PrivCo allows you to input the specific industry code by simply selecting one of the two from the dropdown menu. Choose Revenue Growth Rate limits the companies searched to those that have revenue growth of a particular rate. One field can be left blank if you are only interested in a minimum or maximum value. Users can select 1YR Growth Rate and 3YR CAGR (Compounded Annual Growth Rate). The FULL ADVANCED SEARCH link expands the search criteria to include additional selections (displayed and descried on the next page). 20

22 Private Company FULL Advanced Search (cnt d) (Additional Employees & Ownership Criteria, VC Funding and Specialty Criteria sections added by clicking FULL ADVANCED SEARCH) Additional Options added to the Employees & Ownership Criteria section: The user can check one or more boxes to include only companies fitting the selected criteria. Company types include: Family-Owned, Woman-Owned, Minority-Owned, and Franchisors. Selecting this box will only include companies that trade on secondary markets. Choose Total Funding allows the user to search only for those private companies that have raised a particular amount of funding. Input a range to search by or select a minimum or maximum value. Users can choose to search for companies that are a certain age by inputting multiple values to create a range or a single value to create a minimum or maximum age. 21

23 Private Market Investor Advanced Search Choose Region/Location allows the user to search for investors located in a particular location(s) worldwide. Hold the control key to choose multiple selections. Choose Preferred Stages allows the user to include in their search only those investors that have made at least one investment of the particular type selected Search for investors located within a mile radius of a particular city by inputting the zip code or typing the city name and the system will automatically recognize your input. Choose Investor Type gives the user a list of investor-types to choose from. Only those investors classified as the particular type of investor selected will be displayed in the search results Choose Industries lets the user search for investors making one or more past investment in the selected industries or subindustries. Clicking + expands the industry to display sub-industries. If you are more familiar with SIC and NAICS classifications, PrivCo allows you to input the specific industry code. Simply select one of the two from the dropdown menu and input the code in the text bar to its right. Enter a keyword or phrase related to your particular industry if you are unsure of where it falls in the hierarchy and hit enter to see all industries and sub-industries containing your term. Choose Investment Activity allows the user to only include only those investors that have made an investment during a specific period of time. A custom date range can be entered or the user can select PrivCo s options from the dropdown menu which include the past 6 Months, 1 Year, 3 Years, 5 Years and 10 Years. 22

24 Venture Capital Funding Advanced Search OPTION 1: Selecting Search by Funding Round Size will allow the user to search by specific funding rounds based on their dollar amount. The amount can be specified with options below, or users can even choose to include funding rounds of unspecified size. OPTION 2: Selecting Search by Total Funding Raised will allow the user to search by the total amount of funding a particular company has received and specify the dollar amount using the options below. When searching for individual rounds, the Round/Transaction Date option gives the user the ability to search only for funding rounds that occurred within the specified range. Specific start and/or end dates can be specified or 3, 5, and 10 years can be chosen from the dropdown menu. The Date of Most Recent Round option gives the user the ability to search for total VC Funding raised by date of the most recent round. Specific start and/or end dates can be specified or 3, 5, and 10 years can be chosen from the dropdown menu. Choose Region/Location allows the user to search for VC Funding by the location of the target company s headquarters. Choose Industries lets the user search for VC Funding by the industry of the company receiving the funding. Clicking + expands the industry to display sub-industries. Choose Investor Type gives the user a list of investor-types to choose from. Only VC Funding activity involving any one of the selected investor types will be displayed in the search results. If you are more familiar with SIC and NAICS classifications, PrivCo allows you to input the specific industry code by selecting one of the two from the dropdown menu and typing the code to the right. Enter a keyword/phrase related to your particular industry if you are unsure where it falls in the hierarchy and hit enter to see all industry and sub-industries containing your term. Choose Round Type(s) lets the user specify the specific types of funding rounds included in their search. Selectable options include Series A, B, and C, to Debt Funding and Mezzanine Financing. 23

25 Private Company M&A Deal Advanced Search Choose Region/Location allows the user to search for M&A deals based on the location of the target company s headquarters. Choose Deal Size allows the user to search only for M&A Deals of a particular dollar amount. Specify a minimum and/or maximum value or select one of PrivCo s ranges. Users can even choose to include funding rounds of unspecified size. Choose Industries lets the user search for M&A deals by the industry of the acquired company. Clicking + expands the industry to display sub-industries. Enter a keyword/phrase related to your particular industry if you are unsure where it falls in the hierarchy and hit enter to see all industry and sub-industries containing your term. If you are more familiar with SIC and NAICS classifications, PrivCo allows you to input the specific industry code, just select one of the two from the dropdown menu. Choose Date allows the user to search only for those M&A deals occurring during the specific date range. Specific start and/or end dates can be specified or 3, 5, and 10 years can be chosen from the dropdown menu. Choose Ownership Criteria lets the user specify if M&A Deals with PE-backed or VC-backed targets will be included or excluded in the search results. A third dropdown option in each menu allows for ONLY M&A Deals with PE-Backed or VC- Backed targets to appear in the search results. 24

26 Private Equity Deal Advanced Search Choose Region/Location allows the user to search for PE deals based on the location of the target company s headquarters. If you are more familiar with SIC and NAICS classifications, PrivCo allows you to input the specific industry code. Just select one of the two from the dropdown menu and input the code to the right. Choose Industries lets the user search for P&E deals by the industry of the acquired company. Clicking + expands the industry to display sub-industries Enter a keyword/phrase related to your particular industry if you are unsure where it falls in the hierarchy and hit enter to see all industry and sub-industries containing your term. Choose Date allows the user to search only for those M&A deals occurring during the specific date range. Specific start and/or end dates can be specified or 3, 5, and 10 years can be chosen from the dropdown menu Choose Deal Size allows the user to search only for PE Deals of a particular dollar amount. Specify a minimum and/or maximum value or select one of PrivCo s ranges. Users can even choose to include or not include PE Deals of unspecified size. Additional Target Funding lets the user specify if PE Deals involving VC-backed targets will be included or excluded in the search results. A third dropdown option allows for ONLY PE Deals with a VC-Backed target to appear in the search results. 25

27 PrivCo Advanced Search Results Search results for any type of advanced search are displayed very clearly in a standard format, but columns will vary depending on the particular search (a company search will display company names while an investor search will display investor names, for example). All search results can be sorted by a particular column, clicked into, or exported to Excel. All blue, linked terms displayed on the search results page (Company Name, Country, Industry, State/Province, or View Deals) can be clicked for more information. Example: Private Company Advanced Search results page After viewing and organizing search results, the user can either click into any of the results or choose to Revise Search or Export Results to Excel by clicking the blue or orange buttons on the top right: Clicking Revise Search returns the user to the Advanced Search page with all previous criteria selections in place, allowing for quick changes to any search. Export Results to Excel adds an additional section to the top of the search results page (displayed below) where users can select to export an entire page or just specific selections by checking the corresponding box to left of a particular result 26

28 PrivCo Extras This section details some additional PrivCo features available to users 27

29 PrivCo Knowledge Bank Knowledge Bank: The PrivCo Knowledge Bank allows the user to learn about terms or concepts they come across while using PrivCo that may not be familiar to them. Users can select from the options in the CONTENTS for a detailed set of content options or click any letter to search alphabetically for a particular term. 28

30 PrivCo Case Studies Business Broker Case Study A business broker based in Nevada is retained by the owner of a privately-held regional chain of 6 sports bars and restaurants in the Las Vegas area to sell the business. The business has combined revenue of just over $15 million. The business broker needs to both arrive at a fair asking price for the business, as well as target potential buyers. To arrive at a valuation of the business, using PrivCo's Advanced Private Company M&A Search the business broker searches nationwide for private market acquisitions within the past 3 years in the bar and restaurant industry where the acquired company had sales between $10 and $20 million. Using selected deal values and deal multiples, the business broker calculates that restaurants and bars have sales prices averaging 1.2x the company's revenues, helping the broker decide on a starting asking price of $20 million for the client company. Then to find suitable prospective buyers, the broker narrows the search for private market acquisitions and buyers in Nevada, Arizona and California, generating a list of 47 suitable prospective active buyers of restaurant-bars in the region. Consulting Firm Case Study A management consulting firm is retained by a client in the home appliance industry to conduct a competitive analysis. The consulting team finds only four competitors who are publicly-traded and finds that the other six major competitors are privately-held. Without access to the PrivCo private company data platform, the consulting firm s competitive research on the privatelyheld firms would be significantly more difficult. However, by using PrivCo, the firm quickly finds financial data, ownership, revenue growth, M&A activity, and other competitive information on its client s six major privately-held competitors. Using PrivCo s industry targeting, the consulting firm also identifies several other privately-held competitors it otherwise may have overlooked, allowing the firm to have a complete look at its client s major competitive set, both public and private. PrivCo enables the firm to efficiently and thoroughly serve its client and provide the competitive analysis the client needs. Investment Banking Firm Case Study #1: M&A Pitchbook A second year M&A analyst at an investment bank who often pulls all-nighters is asked to prepare a pitchbook for an outof-town meeting with a prospective client that manufactures semiconductors. The bank will be presenting its M&A ideas at the meeting in three days. Later that night, while working with an associate to compile a set of potential acquisition targets, the analyst comes across PrivCo, which the investment bank has just subscribed to. Using PrivCo's Advanced Private Company Search, the bank's analyst and associate are able to quickly and efficiently locate privately-held companies in the semiconductor industry within a set revenue range, employee size, and geographic criteria, as well as by a desired amount of venture capital raised. The pitchbook is completed two days ahead of schedule. 29

31 Using the pitchbook and acquisition candidates prepared with the help of PrivCo data, the bank is awarded the engagement, and successfully helps its corporate client close on strategic acquisitions of 2 private semiconductor companies for a total of $120 million, earning a significant M&A fee for the bank. Using PrivCo regularly throughout the firm, the investment bank notices an immediate increase in deal sourcing productivity, team energy, and overall efficiency. Investment Banking Firm Case Study #2: IPO Candidates A middle market investment banking firm is seeking IPO candidates. By definition, these IPO candidates must currently be private companies, making the task difficult and time-consuming. The investment banking firm purchases a firm-wide subscription to the PrivCo private company data platform, allowing its bankers to quickly target potential IPO candidates using a variety of highly useful criteria, including: Revenue greater than $50,000,000 PrivCo Tag: Generational or Leadership Change Within Past 2 years 1-year Revenue Growth Rate Select Targeted Industries Currently Attractive to the IPO market Whether Venture Capital-Backed, Private Equity-Backed, or Independent Using the PrivCo private company data platform, the investment bank is able to successfully file and take public several middle market private companies. Law Firm Case Study #1 A law firm is seeking to expand its client base and global presence in an increasingly congested field. To find potential clients, the law firm uses PrivCo to identify and monitor growing companies as well as companies in financial trouble, all of which are in need of legal services. To locate such companies, the law firm utilizes PrivCo s Private Company Advanced Search, screening companies based on criteria such as their revenue growth rate and region, state or city. A business development team can easily search for privately-held companies within X miles of a zip code to expand business. To identify companies that raised funding and have extra capital to spend as well as a need for legal representation, the law firm utilizes the VC Funding Advanced Search. The firm also utilizes the PrivCo Private Company M&A Deal Search to locate the participants of a deal. The target, buyer and seller in an M&A deal are also in need of representation and are potential clients. The firm can also conduct competitive intelligence, monitoring what law firms are providing legal advisory services to companies. Finally, the law firm is able to conduct private company research seamlessly and better advise existing clients. By using PrivCo, within 6 months the law firm was able to retain 4 new corporate clients; conduct accurate research on private companies efficiently for 7 existing clients; and monitor the advisory activity of 3 comparable law firms. 30

32 Law Firm Case Study #2 A group or senior partners at the Law Firm is working on a case and needs to conduct private company research to prepare a solid case for his client. The partner works in tandem with the research/library team and utilizes PrivCo to research comparable companies. The team is able to easily identify similar companies via PrivCo s ultra-specific industry classification system to parse through thousands of privately-held companies. The researcher is also able to prepare valuation comps by analyzing comparable private company financials and deal activity. By using PrivCo, the research team was able to find accurate private company information efficiently, allowing them to build a sound case for the firm's client. The firm saves a tremendous amount of time and resources, allowing the partners to take on two new clients that they otherwise would not have had time for. M&A Firm Case Study A small specialty M&A firm is retained by a profitable and growing Internet E-Commerce company to explore potential strategic options, including possible sales to strategic or financial buyers. To find prospective targets, the M&A firm uses PrivCo to identify likely buyers of the client company. The M&A firm uses PrivCo s Advanced Search capabilities to locate the most likely privately-held strategic buyers and active financial buyers such as private equity firms. The Buyers list is prepared by searching for major privately-held corporations in the Internet industry. This is then supplemented using PrivCo s Advanced Private Deals search to short-list those private Internet companies that have had M&A activity in the past 2 years or have otherwise been active buyers. The M&A firm also uses PrivCo s Private Investor Search to identify private equity firms that have recently purchased similar Internet companies. The resulting Buyers list contains 10 publicly-traded Internet companies, 42 privately-held Internet companies, and 12 private equity firms. As a result, the M&A firm is able to contact, sign NDAs with, and meet with over a dozen likely buyers and signs an LOI with a major privately-held Internet company. The firm closes the sale within 6 months. Private Equity Firm Case Study A major private equity firm has a deal sourcing team dedicated to searching out suitable, privately-held companies for private equity investments and acquisitions. The firm specializes in making investments in innovative, high-growth private companies that are committed to and capable of becoming public or acquired. Its target companies typically meet the following characteristics: Later stage with greater than $10 million in revenue At least 25% annual revenue growth in past 3 years In its target industries of media, communications, or education 31

33 The inefficiencies of cold-calling, NDA legal negotiation and the subsequent meetings with firms that didn t meet their financial criteria led the firm to turn to PrivCo where the deal sourcing team was able to find that many of the screening financials they had wasted time obtaining through traditional deal sourcing practices were easily found within PrivCo s database. Using PrivCo s Advanced Private Company Search, the firm s deal sourcing team was able to search privately-held companies that meet the above investment criteria, generating a broader target list within the firm s comfort zone. The team then uses PrivCo s Private Company Advanced Search to also create a short-list of private investment targets by adding 2 additional preferred criteria (private company is located in U.S. Northwest or Western states, and preferably independent not Venture Capital or Private Equity backed as this client PE firm prefers to negotiate directly with the firm s owners, believing these firms to offer better terms and valuations). Using its short-list the deal sourcing team arranges 18 meetings in the following month, signs 5 LOIs, and makes 2 successful target investments. Commercial Real Estate Firm Case Study #1 A regional office of a major CRE firm needs to boost their quarterly numbers but cannot find tenants that need to move into new office spaces fast. Using PrivCo to search for venture capital investments, the research department instantly identifies a list of companies that just received funding and will need to move space to accommodate their rapid growth. The firm saves money and time by focusing their attention on the list of qualified companies that otherwise would have slipped under the radar. Not only do they close multiple deals that quarter based off their PrivCo search, but the brokers receive repeat business for years to come after being the first to build relationships with the young companies. Commercial Real Estate Firm Case Study #2 The owner of a large shopping center comes under duress when one of the large anchor chains in their facility files for bankruptcy and closes its locations. In addition to the anchor store closing, there are a number of smaller spaces that have been vacant for 2 months. The shopping center begins to see a significant decrease in revenue due to the lack of traffic. The owners of the shopping center do a PrivCo search for growing retail chains and instantly generate a list of chains that have been adding locations. They perform another search for a large established chain to identify a tenant for their anchor space. The owners easily evaluate the financial health of a number of different large retail outlets and narrow their search. Shortly after, the shopping center has zero vacancies and revenue begins to quickly rebound. 32

34 Research Institution Case Study: In order to quantify national economic growth, an American research institute team is looking to compile both a list of businesses across the country and the aggregate revenues for these individual companies over the past three years, segmented by state. After days of attempting to source information, the research institution finds data available for only a few industry players, who are publicly-traded, and finds that information on the vast majority of its target companies is extremely difficult to obtain, as most are privately-held. Without access to the PrivCo Private Company Database, the research institution s task would be significantly more difficult, if not impossible. However, by using the PrivCo Private Company Database, the research institution s team is able to quickly compile a list of privately-held businesses across the country and identify each business s revenues and employee figures. Using PrivCo s ultra-granular advanced search capabilities, the research institution is able to not only identify larger, wellknown companies but also several other privately-held companies it otherwise may have overlooked, allowing it to construct a more complete analysis of the economic environment and its development. Trade Association Case Study A manufacturing industry trade association is looking to compile a list of companies within a specific sub-sector within the manufacturing industry as well as aggregate revenues for individual manufacturing companies over the past three years. The trade association is only able to locate information on a few industry players, who are publicly-traded, and finds it extremely difficult to find any information on the vast majority of companies in its space because most are privately-held. Without access to the PrivCo Private Company Database, the trade association s research would be significantly more difficult, if not impossible. However, by using the PrivCo Private Company Database, the trade association is able to quickly compile a list of privately-held players within its specific targeted manufacturing sub-industry, as well as each company s current and historical revenues and employee figures. Using PrivCo s industry targeting, the trade association is able to not only identify larger, well-known players, but also thousands of smaller privately-held companies that it otherwise would have overlooked. Business Appraisal & Valuation Firm Case Study A business appraisal and valuation firm based in Illinois is retained by the owners of a privately-held manufacturer to value the company for IRS tax purposes. The company has annual revenues of $40 million. The appraiser needs to both arrive at a fair market value for the business to support and justify a fair market value for tax purposes. To arrive at a valuation of the business, the firm first uses PrivCo s Private Company M&A Advanced Search for acquisitions of privately-held manufacturing companies within the past 3 years where the acquired private company had 33

35 comparable sales of between $25 and $75 million a year. Using selected deal values and deal multiples, the business broker calculates that privately-held manufacturers in this range have sales prices averaging 0.7x the company's revenues. The appraiser also searches for venture capital and private equity investments in similarly-sized, privately-held manufacturers resulting in results that have an average value of 0.5x the company s revenue. Based on PrivCo private company deal data, the appraiser is able to support a value for tax purposes of 0.6x her client s annual revenue, or a company value of $24 million. Corporate / Strategic Buyer Case Study A major waste management company looking to accelerate its growth and more rapidly expand its geographic reach seeks small to mid-sized add-on acquisitions in geographic areas that it doesn't already service. Preferring to acquire suitable, privately-held companies, the waste management firm s acquisitions team uses PrivCo s Advanced Private Company Search and is able to find targeted private companies that meet its characteristics (privately held, in the waste management or environmental services industries, and located in one of the 22 states it doesn t currently serve). The waste management company is able to acquire 3 attractive, privately-held waste management and environmental services companies, adding 3 more states to its national expansion. Libraries & Universities Case Study 1: Business Coursework A student enrolled in a business course is assigned a case study on Cargill, the largest food and agricultural company in the United States with over $100 billion in annual revenues. Since Cargill is privately-held, searching for financial, ownership, and other information on Cargill in the university s stock databases yields no results. Searching on PrivCo and using its proprietary private company research database, the student immediately finds Cargill s current sales figures, operating profits, ownership breakdown, and Cargill s recent acquisitions. PrivCo also gives the student immediate access to past year s sales figures, Cargill s current number of employees, downloadable historical sales growth graphs. The student is also immediately able to see Cargil s major competitors (not only publicly-traded competitors but privately-held competitors as well) thus gaining a true look at the market Cargill competes in. A business description and Cargill s history is also available. The student saves countless time and is also able to access financial and operating information unavailable in stock and publicly-traded company databases. Libraries & Universities Case Study 2: Student Entrepreneur A student interested in entrepreneurship considers starting a cloud computing company. The student wants to identify what other cloud computing companies exist. Because cloud computing is an emerging industry, nearly all cloud computing companies are privately-held and, therefore, information on them is not available in stock research databases. 34

36 The student accesses PrivCo, which has an advanced, modernized industry code system (the PrivCo Industry Classification System, or "PICS"), which includes the sub-industry "Cloud Computing". The student is able to research dozens of privately-held Cloud Computing companies for market research. After preparing his business plan, the student needs to seek venture capital funding. Using PrivCo s Advanced Private Investor Search, the student finds venture capital firms, angel investors, and other private market investors who have invested in private cloud computing companies within the past 2 years. The student generates a target investor list, submits his business plan, and secures venture capital funding with a major regional venture capital firm for his startup. Executive Search Firm Case Study An executive at an executive recruiting firm needs to conduct due diligence on potential client companies within the engineering industry. Using a PrivCo search, the executive finds a list of engineering firms with consistent decreases in revenue. The engineering firms need to hire temporary employees to finance a number of upcoming projects. Using the list of declining engineering firms, the executive closes multiple deals for contract staffing. The engineering firms effectively finance their projects and consider the staffing firm their trusted source for all temporary hires from that point on. Market Research Firm Case Study A market research firm is retained by a client to conduct a study on the Business-to-Business Publishing industry. The consulting team finds only that of the major players in the industry, eight are publicly-traded but at least a dozen other major B2B publishers are privately-held. Without access to the PrivCo private company data platform, the market research firm s study of the privately-held firms and their activity and trends in the industry would be significantly more difficult. However, by using PrivCo, the firm quickly finds financial data, ownership, revenue growth, M&A activity, bankruptcy and restructuring activity, and other industry information on the major privately held and family-owned companies in the industry. Using PrivCo s micro-industry targeting, the firm is able to prepare a list of all the privately-held companies in the industry and by using PrivCo s M&A, Venture Capital Funding, and Restructuring searches, the market research firm is also able to include in its study a list of M&A activity, Venture Capital activity, as well as a list of Bankruptcy and Restructuring activity among major privately-held companies in the industry. With PrivCo, the result is a complete look at the B2B Publishing industry for its market research engagement. Economic Development Center Case Study In order to quantify regional economic growth, an economic development center team in Southwestern United States is looking to compile both a list of businesses within its region and the aggregate revenues for these individual companies over the past three years. The economic development team finds information available for only a few industry players, 35

37 who are publicly-traded, and finds that information on the vast majority of its target companies is extremely difficult to obtain, as most are privately-held. Without access to the PrivCo Private Company Database, the economic development center s research would be significantly more difficult, if not impossible. However, by using the PrivCo Private Company Database, the economic development center s team is able to quickly compile a list of privately-held players in their region, as well as identify both current and historical revenue and employee figures for individual companies. Using PrivCo s ultra-granular advanced search capabilities, the economic development center is able to not only identify larger, well-known regional players but also several other privately-held companies it otherwise may have overlooked, allowing it to construct a more complete analysis of the economic environment and development in its area. Venture Capital Firm Case Study A Silicon Valley venture capital firm has deal sourcing analysts dedicated to searching out suitable, early stage, privatelyheld companies for venture capital investments. The firm specializes in making VC investments in early stage private companies that are capable of becoming public or acquired within several years. Its target companies typically meet the following characteristics: Early stage, $1 million to $ 5 million in revenue Have raised at least $500,000 in seed angel or venture capital funding, but not more than $2 million In its target industries of technology or biotech In its target locations of California, Nevada, Oregon, or Washington The inefficiencies of extensive time spent cold-calling, searching tech trade journals, attending startup conferences and business plan presentations, negotiating NDA agreements and meeting with target early stage private companies that didn t meet their financial or investment criteria led the firm to turn to PrivCo data to improve deal sourcing efficiencies and deal results. Using PrivCo.com, the VC firm s analysts were able to quickly narrow down potential target private companies using its above search criteria. PrivCo s modernized and proprietary PICS codes ("PrivCo Industry Classification System") could be used to drill down into emerging micro-industry sectors such as Ag-Biotech, Social Gaming, Online Coupons, and Mobile Location Based Technology, categories that don t exist in traditional SIC and NAICS code systems. Business descriptions, funding histories, current ownership, and whether the firm was independent or already venture backed are all used to include or eliminate prospective venture investments, increasing the firm s deal sourcing accuracy, saving time, and locating hidden-gem investments missed by other VC firms with the potential for maximum investment returns. The venture capital firm closes several attractive venture investments, including in under-the-radar private companies overlooked by competing VC firms, that are perfect fits for its latest VC Fund IV. 36

38 PrivCo Client Testimonials Some of PrivCo s clients include PrivCo has been featured in 37

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