This Calder Capital case study outlines how Calder’s Sell-Side team helped the owners of a proprietary software company achieve an exceptional sale outcome.
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Valuation Summary
Prior to engaging with the client, Calder conducted a thorough valuation analysis that included identifying 16 similarly-sized sold comparables in the specialty software development industry. The median EBITDA multiple was 6.40x, and the average EBITDA multiple across those comparables was 7.01x. The highest multiple obtained in the comparable transactions was 10.60x and the lowest was 4.70x. Adjusted EBITDA of the Software Company at the time of sale was $1.7M. Calder’s valuation analysis estimated total gross proceeds of the business in this transaction as $12.24M, conservatively to $13.16M, as a market-high sale.
Background & Deal Summary
The Calder Capital Sell-Side team orchestrated a robust and efficient process that generated significant buyer interest and multiple offers, ultimately resulting in a successful transaction.
Results after confidentially, yet aggressively marketing the business:
- 650 buyers expressed interest in reviewing the business.
- 580 buyers returned confidentiality agreements and were approved to receive the CIM.
- 32 buyers submitted offers.
Top three offers received:
- $13,000,000 offer, 90% cash at closing, 10% seller-financing over 5 years
- $13,000,000 offer, 84.6% cash at closing, 15.4% deferred payment over 5 years
- Up to $14,000,000 offer, $5,000,000 cash at closing, $3,750,000 in fixed deferred payments, and up to $5,250,000 earn-out
Our client accepted the $13,000,000 offer with 84.6% cash at closing and a 15.4% deferred payment over 5 years. The earnings multiple for this sale was 7.64x EBITDA.
Why Work With Calder’s Sell-Side Team?
The marketing effort included researching both strategic and financial acquirers, confidentially promoting the opportunity through several M&A marketplaces and Calder’s website (which attracts between 20,000 and 50,000 monthly visitors, primarily buyers), promoting the opportunity to Calder’s network of more than 400,000 buyers, professional advisors, and business owners, and conducting direct outreach through targeted emails, text messages, and phone calls to prospective buyers whose acquisition criteria aligned with the opportunity.
The purpose of this case study is to illustrate the value of a competitive, limited-auction sale process. In this transaction, the eventual buyer offering the strongest all-cash proposal did not emerge from a traditional researched buyer list. Had the sale process relied solely on targeted outreach, the seller would likely have missed the best available outcome.
Instead, a broad and coordinated marketing effort created meaningful buyer competition, resulting in stronger offers, improved deal terms, and greater optionality for the seller. As this case study demonstrates, when multiple qualified buyers compete for an opportunity, sellers are far more likely to achieve an optimal result.
This disciplined, market-driven approach is the foundation of Calder Capital’s sell-side process and is utilized in every client engagement.
About Calder Capital:
Founded in 2013, Calder Capital is a cross-industry mergers and acquisitions advisory firm with offices across the United States. Calder provides valuation, sell-side, and buy-side services. We are nationally recognized for excellence in advising $1-100M enterprise value transactions in manufacturing, construction, distribution, and business services. Calder serves business owners, entrepreneurs, family offices, financial buyers, and investors. Learn more at www.CalderGR.com.
Notice: Calder Capital, LLC is not affiliated with any similarly named organizations or entities. To verify communications from our firm, visit our website or contact [email protected].