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Our added value in Software & fiancial services sector.pdf

  2. 2 P R I V A T E & C O N F I D E N T I A L TABLE OF CONTENT I. Market trends in the software & financial services sector 03 III. Our expertise, added-value & methodology in the software & financial services sector 12 IV. About GEREJE Corporate Finance 23 II. M&A trends in the software & financial services sector 08
  4. 4 P R I V A T E & C O N F I D E N T I A L SOFTWARE INDUSTRY IN FRANCE Resilience of the sector explained by SaaS business models § 45% of the sector's revenue is due to SaaS solutions in 2021 A highly fragmented market with few big players § 10% of actors (revenue > €100m) realize >70% of total revenue in 2021 § TOP5 publishers of Truffle 100 contribute to >50% of total sales Increased demand for cloud, cybersecurity and mobility solutions § Cybersecurity spending is expected to rise by +12% in 2021 to €150bn Evolution of the sector’s revenue in France 2018–2023e (in €bn) 15,3 16,4 17,9 19,4 21,2 23,0 5 7 9 11 13 15 17 19 21 23 25 2018 2019 2020 2021 2022e 2023f Sources : numeum, EY, Truffle 100, IT social, xerfi
  5. 5 P R I V A T E & C O N F I D E N T I A L INTERNATIONAL PRESENCE OF FRENCH COMPANIES EMEA is the most targeted area by French companies French Software companies mainly target neighboring countries such as Spain, Germany and the UK Strong contribution of market leaders (revenue > €100m) with 67% of sales realized outside France § Smaller companies (revenue < €50m) focus their growth in domestic market Sources : numeum, EY Geographic breakdown of revenue in 2021 of French Software companies Strong international activity driven by the largest French players (revenue > €100m). In 2021, 59% of the sector’s revenue is generated abroad The US: Largest market for French Software companies after its domestic market Sample of 254 companies France 42% EMEA 30% Americas 21% Asia Pacific 7%
  6. 6 P R I V A T E & C O N F I D E N T I A L The EdTech market in France is now undergoing a consolidation trend Source: EY Parthenon, GCF Research Example of consolidation § Kahoot! acquires: Drops, Clever, Motimate to consolidate its position & growth in specific verticals § 360Learning acquires the UK's leading training company: Looop § Eduform’Action completed 3 acquisitions this summer: SOFIS, l’Ecole des Métiers de l’Habitat, Projexia A consolidation trend § 80% of the sector's turnover is represented by 20% of the players § 60% of the companies have no more than 10 employees and a turnover < K500€ 668 725 785 2 500 352 304 273 299 - 500 1 000 1 500 2 000 2 500 3 000 - 50 100 150 200 250 300 350 400 Investissements en M$ Nb total de transactions VC 2018 2019 2020 2021 Evolution of VC investments in EdTech in Europe (2018-2021) Investments in $M Total nb of VC transactions
  7. 7 P R I V A T E & C O N F I D E N T I A L FOCUS ON REGTECHS Sources : Zion Market Research, Xerfi, EY, Thomson Reuters, GCF Research Number of deals in regtech worldwide 325 353 444 5 55 105 155 205 255 305 355 405 455 505 2019 2020 2021 A record year for regtechs investment and particularly in France § +244% global investment in 2021 vs 2020 § French regtech companies raised €400m (+100% vs 2020) Digitalization acceleration and technological advancements in AI and machine learning will positively impact the regtech industry Demand for Regtech is carried by the continuous hardening of the regulatory framework
  9. 9 P R I V A T E & C O N F I D E N T I A L M&A TRENDS – VALUATION METRICS Company Size § The largest the company, the higher the multiple with key thresholds (10M revenue; 50M revenue; 100M revenue…) Profitability § EBITDA margin compared to peers may be the most important comparison criteria when the companies’ sizes are similar Market position § A leading position within a local market improves a valuation multiple, on the other hand, a mid-tier position will drive a lower valuation. Within the same sector, valuation multiples vary according to the size, profitability, and market positioning of the company European SaaS M&A activity 2019 - Sept 2022 Source : GP Bullhound European SaaS fundraising activity 2019 - Sept 2022 2892 2740 2956 1834 2019 2020 2021 Sept. 2022 388 415 700 456 2019 2020 2021 Sept. 2022
  10. 10 P R I V A T E & C O N F I D E N T I A L RECENT TRANSACTIONS IN SOFTWARE 1/2 Date Investor Target Information Transaction amount More info Mar. 2023 Egerie (FR): SaaS platform of cyber risk management solutions €30m here Jun. 2022 Ecovadis (FR): Platform for evaluating CSR performance and responsible purchasing €500m here Jun. 2022 Dattak (FR): cybersecurity company €7m here Jun. 2022 Strapi (FR): leading an opensource headless CMS €31m here May. 2022 Whoz (FR): software publisher of a cloud staffing solution €25m here Source : Mergermarket, Fusacq, GCF Research Click on the logo to access the website
  11. 11 P R I V A T E & C O N F I D E N T I A L RECENT TRANSACTIONS IN SOFTWARE 2/2 Date Investor Target Information Transaction amount More info May 2022 Total Specific Solutions (NL): European leading publisher of vertical software Prima Solutions (FR): software publisher for insurance sector - here Feb. 2022 Sharpist (AL): offers online digital coaching and personalized training solutions for employees to accelerate the development of companies and their employees' skills €23m here Jul. 2022 Contentsquare (FR): Leader software company in improving the digital experience €600m here May 2021 Shift Technology (FR): Saas company in cybersecurity for insurance sector €182m here Mar. 2021 Quadient (FR) : Leader in omnichannel solutions Beanworks (CA): Publisher of an account payable automation solution €70m here Source : Mergermarket, Fusacq, GCF Research Click on the logo to access the website
  13. 13 P R I V A T E & C O N F I D E N T I A L OUR EXPERTISE & ADDED VALUE 1/2 We have a solid track record and a strong expertise in the Software & Financial Services industry. We have a direct access to >1 200 companies in this specific sector in Europe, Asia, and internationally 1. Our Expertise & Experience in the Software & Financial Services sector Our multicultural teams with our own offices in Europe and in Asia (Paris , Singapore, Geneva, Lyon, Nantes, Vienna, Lisbon, Munich), and our partners in the Middle East, Africa and the US 2. Our International presence Entrepreneurs close to Entrepreneurs = reactivity & adaptability 3. Our “entrepreneurial” culture Privileged access to > 1 400 investors (Cap development funds, VC, debt funds, Family Offices), with a specific interest in the Software & Financial Services 4. Our Privileged access to Strategic & Financial Investors
  14. 14 P R I V A T E & C O N F I D E N T I A L OUR EXPERTISE & ADDED VALUE 2/2 We prefer to act over the long term as partners alongside business leaders 5. Advisor & Partner With over 80 closings between 2016 & 2022, GEREJE is No. 1 & No. 2 between 2016 & 2021 in the Advisory Fusacq ranking – Corporate banking fundraising rankings in France 6. Our Track-Record Our expertise in structuring complex operations: Earn-Out, Management Buy-Out, Owner Buy-Out, Joint Venture… 7. Our Expertise in complex structuring We work with no conflict of interests and ensure confidentiality & discretion 8. Our independence
  15. 15 P R I V A T E & C O N F I D E N T I A L Ex- GoMyPartner Small Cap companies ~500 companies in Europe, Asia and Worldwide - listed in our proprietary data base Mid-Large Cap companies ~700 companies in Europe, Asia and Worldwide - listed in our proprietary data base ● ● ● OUR DIRECT ACCESS TO STRATEGIC PLAYERS
  16. 16 P R I V A T E & C O N F I D E N T I A L OUR DIRECT ACCESS TO POTENTIAL INVESTORS Being active in the M&A industry since 2007, we have a direct access to ~1 400 investors (PE, VC, CVC, Family Offices, etc.) with a specific interest in the software and financial services sector - listed in our proprietary data base
  17. 17 P R I V A T E & C O N F I D E N T I A L Jean DE MORAS Senior Advisor at GEREJE Corporate Finance + 13 years of experience in M&A advisory + 12 years as PE investor at Pléiade Investissement EXPERIENCE & EXPERTISE Ø Specific Expertise in the software sector : § 15 deals closed § 50 deals analyzed § Ongoing investor of GENERIX, a listed provider of Saas Software solutions for the Supply Chain and Logistics sector § Former investor in HARVEST, a software editor for wealth management § Former Chairman of the Supervisory & Strategic Board of Divalto for 10 years, a CRM and ERP solutions developer § Sell-side advisor for the divestment of CRM ENEIDE CONSO+ to the listed company COHERIS Ø 70 deals closed in Small, Mid & Large cap in Europe and in Asia. OUR EXPERTISE IN THE SOFTWARE SECTOR 1/2
  18. 18 P R I V A T E & C O N F I D E N T I A L 18 Fabrice LOMBARDO Founder & CEO of GEREJE Corporate Finance Expertise at the international level, in Europe, Asia (especially ASEAN), Middle East & Africa, in GEREJE’s 8 key sectors Education: BBA at Oxford Brookes Université, Grenoble Business School, Executive MBA at ESSEC, SFAF Certified Key Points: ● + 12 years in Business Dev. (multinationals) ● Creation of GEREJE: 2008 ● +100 deals closed OUR EXPERTISE IN THE SOFTWARE SECTOR 2/2 EXPERIENCE & EXPERTISE Ø + 15 years in M&A consulting for SMID & Large Caps Ø Buy-Side Mandate & Sell-Side Mandate Ø Fundraisings (Equity / Debt) Ø Valuation & Structuring Ø Speaker & Lecturer at ESSEC Paris, EGE, EDC Paris BS Ø Specific expertise in Fintech : Ø Fundraising advisor for Weeloy, a SaaS plateform Ø Fundraising advisor for Goswiff (then acquired by PaySwiff in 2017) Ø Financing advisor for Uangteman
  19. 19 P R I V A T E & C O N F I D E N T I A L OUR BUY-SIDE METHODOLOGY Option: Preparation of a "Long-List" of potential targets in the targeted sector and geographical area and ranking them in order of interest and according to M&A criteria (sales, EBITDA, etc.) Initiate contact between GEREJE and the target(s) (without giving the name of the client) to validate their actionability Meeting between GEREJE and the client to select a short list of targets to be approached in phase 2 Assist our client in the final Due Diligence Optimize the discussions between all involved parties: legal, audit, accounting… Advise on the best strategy and tactic for final negotiations with the target(s) until closing. Assist in the drafting & proof-reading of final contracts. Drafting & negotiation of a Letter of Intent (LOI) Management of client’s questions & requests (Q&A) Optimize the negotiations with the target Advise on the best structuring (equity / debt / mix) in the interest of the shareholders Option : Preparation of a strategic and financial note (detailed profile of the target) for the client Signing of the Letter of Intent (LOI) Signing of a Reciprocal Confidentiality Agreement (RCA). Meeting between the target and the client to confirm the strategic fit and the mutual willingness to enter negotiations Phase 1 – 1 to 3 months Market Screening & Preliminary Approach Phase 2 – 4 to 9 months Maximization of Negotiations – Signing of LOI Phase 3 – 2 to 4 months Final DD – Offer – Optimization of the Closing
  20. 20 P R I V A T E & C O N F I D E N T I A L BUY-SIDE BEST PRACTICES [1/2] DEFINE clear & ambitious strategies for yourself & the potential target 1 2 BE PROACTIVE: approach actionable and specific targets à value creation 3 TIME is the essence: giving rhythm by respecting a structured process 4 COMMUNICATION: take the time to explain every step until the closing 1 2 3 4
  21. 21 P R I V A T E & C O N F I D E N T I A L BUY-SIDE BEST PRACTICES [2/2] OPTIMIZE the structuring to align the interests regarding valuation 5 THINK about the forward value by working on a joint business model 6 ANTICIPATE tax and legal issues (shareholders' agreement) 7 ANTICIPATE the cultural differences (cross border) 8
  22. 22 P R I V A T E & C O N F I D E N T I A L OUR TAILOR-MADE FUNDRAISING & SELL SIDE PROCESS Phase 1 – 1 to 2 months Preparation phase Financial analysis (past results and business plan) Structuration (equity/debt/mix) Electronic dataroom (docsend) Blind Teaser on our online platform In order to optimize the process, it is essential to prepare the project seriously, explain the use of the funds and demonstrate the positive impact on turnover and margins Phase 2 – 2 to 6 months Selection, teasing and approach of investors Maximization (digital) of the investor approach process (electronic NDA) Checking of candidates’ seriousness and motivation Management & Optimization of negotiations Optimization of different structuring options for the deal Phase 3 – 1 to 2 months Closing optimization Optimization of the Due Diligence process Optimize the discussions between all involved parties: legal, audit, accounting… Advise on the best strategy and tactic for final negotiations until closing. Advise on the different structuring schemes including earn out Analysis and validation of the final offer Prepare a Strategic & Financial Note for investors Negotiation and signature of the Letter of Intent (LOI) Transition to phase 2 after mutual consent
  23. 23 P R I V A T E & C O N F I D E N T I A L DIFFERENT TYPE OF INVESTORS Strategic and financial investors have different investment criteria and objectives involving different sales strategies and structuring scenarios themselves • Strategic investors are often competitors, suppliers or customers of the target. • Their objective is to identify companies whose products or services can be integrated in synergy with their existing portfolio or gain market share, in order to create long-term value for their shareholders. • The main driver of the acquisition is strategic (vs. rapid return on investment). These buyers may also be unconnected to the target and seek to expand in its market to diversify their revenue sources. Strategic investors • Financial investors/buyers include private equity firms, hedge funds, family offices ... • These players make investments in companies and achieve a return on investment within 5-7 years with a sale or IPO. • Some Family Offices have an unlimited time horizon and can invest large sums of money to support the growth of the business at all stages of its development. Financial investors These buyers have fundamentally different objectives, so the way they will approach the activities of the targets in an M&A process will differ considerably.
  25. 25 P R I V A T E & C O N F I D E N T I A L THE “GEREJE” PHILOSOPHY In the 13th century, the Emperor Kublai Khan awarded Marco Polo a gold tablet in the form of a long piece of currency named « GEREGE » along with a password, which ensured numerous privileges to the beholder. With this golden passport, Marco Polo obtained all necessary protections, supplies and assistance which included horses, food and equipment for his safe return to Venice accompanied by his immense fortune. The GEREJE, first diplomatic passport, ensuring safe and secure cross border transactions, is a powerful symbol matching perfectly our mission and goals GEREJE team members share a common passion in dealing with cross border transactions and are united around the GEREJE symbol reflecting our mind set as well as our working philosophy.
  26. 26 P R I V A T E & C O N F I D E N T I A L OUR WORLDWIDE REACH We are an independent M&A firm with an “entrepreneurial” culture, providing both strategic and financial advisory services, composed of a multidisciplinary team based between Europe & Asia Our Corporate Film EUROPE § Paris § Lyon § Geneva § Nantes § Vienna § Lisbon § Munich ASIA § Singapore § Hong-Kong EUROPE MOYEN-ORIENT ASIE
  27. 27 P R I V A T E & C O N F I D E N T I A L EXECUTION TEAM ENSURING THE QUALITY OF THE DOCUMENTS Fabrice LOMBARDO Founder & CEO Antoine ALEMANY Partner, Lisbon Clarisse SUN M&A Associate, Paris Laurent GOBINET Partner, Nantes Hélène PEYRUSQUE M&A Analyst, Paris Hugo MONNET M&A Vice President, Lyon Servais MICOLOT Partner, Geneva Jeff CZELUSTA M&A Director, Munich
  28. 28 P R I V A T E & C O N F I D E N T I A L SENIORS BRINGING SECTOR & GEOGRAPHIC EXPERTISES François LAURENT Senior Advisor, Hong-Kong Olivier JOB Senior Advisor, Lyon Jean de MORAS Senior Advisor, Paris Arnaud BEASSE Senior Advisor, Vienna Maurice LAM Executive Director, Singapore Gregory LAM M&A Vice President, Singapore Bertrand LAM Partner, Singapore
  29. 29 P R I V A T E & C O N F I D E N T I A L Partial or Total Sell mandate Managing and Optimizing a sell process, leveraging on our structuring experience, valuation expertise & international network to maximize the transaction price. Using every financial tool to align the interests of all parties. OUR SERVICES The quality of our services relies in our 100% in-house team enabling us to manage the entire transaction process, thereby ensuring efficiency, confidentiality and tangible results Buy mandate / Acquisition / Joint Ventures Optimizing external cross-borders expansion strategies. Global Knowhow, Local Approach Strategic Advisory – Business Consultancy The experience and operational know-how of the senior team allows us to optimize the development strategies of companies and thus facilitate the management of corporate finance issues (Fundraising or acquisition) Fund raising mandate & IPO – Capital development Structure a solid & realistic business plan in order to maximize the valuation forward and raise the capital needed (Equity, Debt, Convertible Shares). Local Markets Approach and Implementation Assistance for IPO to maximize forward value & optimize Transaction Structuring
  30. 30 P R I V A T E & C O N F I D E N T I A L OUR PROVEN METHODOLOGY GEREJE is recognized for the quality of its documents (strategic & financial analysis) based on personalized execution, enhanced by a multidisciplinary team acting under one hat ! Execution Excellence Each assignment is managed by one Team leader to optimize the process We rely on our own proprietary research Our mandates are on an exclusivity basis only, including fixed and success fee Our mandates are tailor-made We manage 100% of the Transaction coordinating the process We deliver regular reports to optimize the momentum Our digital platform allows us to have constant access to all the necessary information
  31. 31 P R I V A T E & C O N F I D E N T I A L OUR STRONG NETWORK OF PARTNERS Our solid network of partners in Europe and Asia enable us to get qualified, updated information in order to accompany our clients and create value. EUROPE Access to +1,100 Family Offices +150 banks & private bankers +100 law firms ASIA Access to +700 Family Offices +200 banks & private bankers +150 law firms Partnership signed with Business France (website) in 2021 Coverage of 110 countries, offering a direct access to international investors
  32. 32 P R I V A T E & C O N F I D E N T I A L TESTIMONIES In this complicated economic environment, the support and involvement of the GEREJE teams were key to the success of the project. Mr. François- Denis POITRINAL Founder & CEO Thank you for the excellent work done by the GEREJE team. Mr. Kaci KÉBAÏLI Founder & Chairman GEREJE supported us successfully & diligently in structuring our fundraising process so we can keep control of our company, They did a great job at finding the right investors for our projects! Mr. Francois CHABANIAN Founder & CEO In this complicated economic context, the support and involvement of the GEREJE teams were key elements in the success of the operation Mr. Guillaume RAGUET CEO *click on a logo to access the website
  33. 33 P R I V A T E & C O N F I D E N T I A L Articles Surveys Sorainen - Top 10 TMT trends for 2021 Tool Advisor - Les logiciels SaaS et On-Premise en 23 chiffres Business Scoot - Le marché du software et service en France The business research company - Software Products Global Market Report 2022 Statzon - The Global Robotics Market Growing Rapidly France fintech - Un ecosystème en plein essor Alantra - Trends driving sector M&A EY - Les principales tendances du secteur TMT post-pandémie KPMG - Technology, media, and telecom M&A skyrocketed in 2021 PWC - Global M&A Trends in Technology, Media and Telecommunications: 2022 Mid-Year Update PWC - The future of TMT sector Deloitte - Top TMT industry trends and emerging issues to tackle in 2022
  34. DISCLAIMER This presentation is being distributed against the signature of a Non Disclosure Agreement and is strictly confidential. This presentation may not be reproduced, summarized or disclosed, in whole or in part, without the prior written authorization of GCF, and by accepting this presentation you hereby agree to be bound by the restrictions contained herein. This presentation is based on publicly available information and/or data provided by GCF’s client which have not been independently verified by GCF. Any estimates and projections contained herein involve significant elements of subjective judgment and analysis, which may or may not be correct. Neither GCF nor any of its affiliates, or any of its direct or indirect shareholders, or any of its or their respective members, employees or agents provides any guarantee or warranty (express or implied) or assumes any responsibility with respect to the authentherety, origin, validity, accuracy or completeness of the information and data contained herein or assumes any obligation for damages, losses or costs (including, without limitation, any direct or consequential losses) resulting from any errors or omissions in this presentation. This presentation was prepared by GCF (GEREJE Corporate Finance) exclusively in the frame work of an agreement for the benefit of its clients in connection with the possible Transaction. GCF has duly and professionally challenged all information & data provided by our clients, including past & existing figures, assumptions of the Business Plan as well as the professionalism of the management team/ shareholders. The economic valuations and proposed deal structuring contained in this presentation are fair and based on current market practices, which may change significantly over a short period of time. Changes and events occurring after the date hereof may, therefore, affect the validity of the information contained in this presentation and GCF assumes no obligation to update and/or revise this presentation or the information and data upon which it has been based. GCF designates the companies, whilst legally they are independent entities, sharing GCF corporate identity, logo, documents, working methodology & ethical rules. All GCF offices are working as an integrated group of companies under the governance of a written agreement for the interest of the clients. GCF legal entities are privately owned and independent structures. GEREJE Advisory Asia Pte Ltd (Singapore) is MAS (Monetary Authority of Singapore) Exempt Corporate Finance Advisor © Copyright 2023 GEREJE Corporate Finance. All rights reserved
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