Case Study.

Helped a boutique Human Capital Management vendor increase organic growth.

The Problem

A fintech firm initially brought in Orchid Black to evaluate a potential transaction and to perform a Value Creation Assessment (VCA) with the goal of identifying areas of opportunity and provide an estimated valuation in the marketplace. 

After performing the VCA, which included reviewing company data, conducting market research, and holding internal and external interviews with stakeholders, Orchid Black quickly identified massive opportunities for growth, but certain factors were inhibiting the organization’s ability to grow.

Key factors included: 

  • Drastic misalignment between the board, investors, CEO and the management team led to an uneven vision, strategy and general roadmap.
  • The goals, metrics and KPIs that the staff was held accountable for did not drive the strategic plan; in part due to inconsistencies in the plan as well as insufficient operational knowledge. 
  • General operational knowledge and processes were insufficient. Despite good content, tech and a go-to-market engine, their system didn’t create a clear hand-off from sales to operations and delivery.
  • Too many key staff held unique organizational knowledge. If key staff left, the company could not recover. 
  • Product pricing strategy was based on a non-recurring revenue subscription, which boosted short-term gains, but lacked long-term sustainability.
  • No clear understanding of who all customers were, what they wanted and how they used their products, as well as a lack of strategy around building customer success. 
The Team
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Background

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 buyerThe 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.

The Partnership



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.
  • 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.
  • 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.”

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.

Igniting Growth to Achieve Higher Valuation in Exit
The Results



Testimonial

"Orchid Black was able to come up with phenomenal insights in a matter of weeks just by analyzing the data that was already within our own company. That alone was worth every penny of the VCA (Value Creation Assessment)." 

-CEO & Founder, fintech company


This project embodies the archetype of an organization built by a brilliant, visionary founder who has a good product, then builds a successful company as large as he possibly can. However, like most great founders, he eventually hit a wall and needed to bring on a growth partner to make a decision on where to go next. The Orchid Black team was the perfect complement to help take this company to the next level, increase the value of the business, and exit quickly.
––Jim Barnish, Managing Partner, Orchid Black