Case Studies.

Igniting Growth to Achieve Higher Valuation in Exit

Helped a boutique Human Capital Management vendor increase organic growth.
Engagement Type:
Hashtag icon "business strategy advisor"M & A
Hashtag icon "business strategy advisor"Tech Strategy
Sector:
Hashtag icon "business strategy advisor"Software
Hashtag icon "business strategy advisor"Online Storage

Summary

The Challenge

A boutique human capital management vendor was struggling to increase organic growth. Working with Orchid Black operators, the company was able to achieve desired growth objectives, leading to a successful exit at a higher-than-expected valuation.

While the company had an established presence as a leading vendor in the HCM market, they were experiencing a growth roadblock. Revenue performance was lagging, while company leadership struggled to innovate IT infrastructure at a time when competitors had already made the transition to the cloud. Growing revenue and shedding unnecessary costs were the crucial final steps of an exit strategy, and these were the core objectives guiding Orchid Black operators.

The Solution

In order to hit performance targets, the HCM vendor had to find unique ways to evolve their model and capture more revenue. This meant looking squarely at the root cause of operational inefficiencies. For this company, roadblocks to growth were rooted in poorly aligned messaging, and underutilization of cloud infrastructure to help cut costs and improve efficiency.
Having identified the roadblocks, Orchid Black operators deployed mission-critical solutions in the following areas:

  • Fresh brand and strategy roadmap. A thorough analysis of the market indicated the company was not aligned to maximize growth. A brand and messaging overhaul facilitated new revenue opportunities and partnerships, which improved profit margins and increased the top line.
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  • Strategic cloud infrastructure expansion. A number of substantial new cloud infrastructure partnerships were initiated, which cut costs and expanded IT capacity, allowing the company to expand into lucrative product-driven business initiatives.
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  • Commenting on the transformation, the company CEO had this to say: “We were able to sell the business for a much higher multiple by driving immediate growth in the 12 months leading up to the sale.”

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The Outcome

- Drove 100% year-over-year revenue and profitability increase
- Developed new businesses initiatives to improve company valuation
- New methodologies for sales, pre-sale, solutions and delivery resulted in a 25% in gross margins
- Led successful sale to a private buyer

The effectiveness of these initiatives was quickly evident. Impressive revenue growth, powered by improved organizational design, produced the outcomes needed to take the final step in the company’s exit strategy.

About Orchid Black

Orchid Black was founded on the principle that deep industry knowledge, pragmatic operating expertise, and a unique playbook produce superior results. We create strategies and deliver operational support, aligning with stakeholders to achieve objectives. Honed at hundreds of technology companies, our innovative, capital-efficient Operators as a Service model is battle-tested. It works.