Embarc Advisors first met Vizzia Technologies, Inc. during a buy-side process for another client. Later on, Vizzia engaged Embarc to help them sell their business, which we successfully did through six key strategic actions.
Introduction:
Embarc served as the sole M&A advisor on the sale of Vizzia. Through our differentiated approach, we demonstrated how small but specialized companies can achieve successful exits with the right advisor. This case study details the six key actions that set Embarc apart and led to a multi-offer process and successful sale for the company.
Background: The Challenge
Vizzia, founded in 2005, is a leader in Real-Time Location Systems (RTLS) and provides cutting-edge tracking solutions for the healthcare industry. Its innovative technology helps hospitals optimize operations by offering real-time visibility into asset and personnel locations. It’s a complex business that involves hardware, software and managed services. Understanding the intricacies of these revenue streams and customer relations was key for buyers to understand the value of the opportunity.
The Turning Point
A year after we first met, Vizzia’s management, impressed by Embarc’s thoughtful approach during their buy-side interaction, reached out to us to serve as their sell-side advisor. Our involvement marked a transformative phase for Vizzia, driven by a systematic and thorough preparation process. Embarc worked closely with Vizzia’s management, dedicating significant time to prepare the opportunity. Here’s how we positioned the company for a multi-offer process that led to a successful sale.
Six Key Actions by Embarc Leading to Vizzia’s Successful Sale:
- Organizing the Financials
When Embarc first analyzed Vizzia’s financials, we realized that our goal was to categorize the mix of one-time vs. recurring revenue across hardware, software and services. Once we categorized the mix of revenues, the underlying story needed further definition. Embarc collaborated closely with Vizzia’s team to align the narrative with the numbers, ensuring a cohesive presentation. We helped organize the financials, streamlined the chart of accounts, and clearly identified every revenue type and gross margin calculation. This effort made it easier for buyers to appreciate the true value and strength of Vizzia’s financials. - Conducting a Quality of Earnings (QofE) Analysis
Recognizing the importance of verifying Vizzia’s financials, we conducted a thorough Quality of Earnings (QofE) analysis. This step is crucial in our approach, especially for smaller companies, as it provides potential buyers with confidence in the reported financials and serves as a foundation for the forecast. The QofE analysis helped ensure the accuracy of financial statements and highlighted the true power behind Vizzia’s numbers. By accounting for non-recurring and one-time expenses, the QofE provided a more accurate basis for valuation, resulting in an adjusted EBITDA that accurately reflected the operations of the business. - Developing a Defendable Forecast
With the solid foundation provided by the QofE analysis, we turned our attention to developing a defendable forecast. Vizzia was at an inflection point with significant growth for the coming years. Embarc and the management team had high confidence that the company would achieve its revenue growth goals. The key was to build a credible case to support the forecast. This included diving deep into the company’s backlog, pipeline, and go-to-market strategies. Through a series of collaborative sessions, we crafted a forecast that was both ambitious and grounded in reality, supported by tangible evidence. This forecast made the growth projections understandable and attractive to buyers, helping them see the potential future value and making the acquisition more appealing. - Crafting a Compelling Pitch
Vizzia’s original pitch was focused on the product and technology, which were core strengths of the business. Embarc saw an opportunity to expand upon this to capture a narrative that sold the company, not just the product & technology. We worked with Vizzia to distill their value proposition into a concise and powerful story that highlighted the strategic benefits of acquiring Vizzia. Together, we crafted a buyer-focused pitch, condensed to less than 20 pages, emphasizing quality over quantity. When it comes to pitches, we firmly believe “Less is More.” This engaging narrative made it easier for potential corporate development teams and private equity buyers to understand and present the opportunity to their stakeholders which in turn significantly improved potential buyer engagement. - Streamlining the Data Room
A key success factor at Embarc was to organize the data room to key essentials. Again, “less is more” can be very helpful when potential buyers are considering an acquisition. Additional documents were staged for further diligence, ready to be shared as needed. This approach ensured that buyers could quickly and efficiently evaluate the opportunity without feeling overwhelmed. The streamlined data room facilitated smoother and more focused due diligence, keeping buyer interest high and the process moving swiftly. - Managing Buyer Engagement
Vizzia was a company in demand and had no shortage of interested parties. Embarc introduced a structured sell-side process with a planned and executed timeline, coordinating all buyer interactions and setting a unified bid date. This structured approach created a sense of urgency and competition among buyers, ensuring that all bids came in simultaneously, giving Vizzia the leverage to secure the best possible deal
Result
Through these strategic actions, Embarc successfully repositioned Vizzia as an attractive opportunity Through these strategic actions, Embarc successfully repositioned Vizzia as an attractive opportunity for buyers. Our efforts led to multiple offers and a successful sale to a global strategic buyer.
Conclusion
At Embarc Advisors, we believe that even well-operating companies, whether VC-backed or PE-backed, need to undergo a Sell-side Readiness process to prepare for a significant transaction.
Embarc has built a Financial Planning & Analysis (FP&A) and CFO services practice specifically to facilitate sell-side readiness. The goal is to position the target company in an attractive manner to potential buyers or investors by crafting a compelling story supported by thorough preparation. “Facts tell, but stories sell”. Our hourly rate based model (with no success fee) uniquely positions us to provide the intimate attention and care required to maximize the value of even the most complex transactions.
Many companies believe they are ready to transact simply because they have clean financials and all the necessary documents. However, true readiness means being able to present and support a compelling narrative under the scrutiny of due diligence.
Get in Touch with Embarc
Our unique hourly billing model allows us to invest substantial time and effort into small to mid-sized deals, providing a true white-glove service. This focus ensures that each opportunity we undertake receives the attention it deserves. If you want to learn more about preparing your company or portfolio company for a successful exit, please reach out to Embarc Advisors at info@embarcadvisors.com.
