GrowthSTEP™: Ephor's Corporate Development Process
- The acquirer is pursuing a "Buy & Build" or "Platform Investment Thesis." (The Platform Thesis has been documented including an economic model.)
- The acquirer is the platform company and has all the attributes of a platform company.
- The acquirer is a top quartile performer for their industry and markets.
- The cost of sales (customer acquisition costs) has been modeled and proven for direct selling, alternative distribution, expansion and acquisition
- Acquisitions will increase the valuation multiple and value of the company and thus wealth for all stakeholders.
- Mapping of the competitive, alternative and market economics landscape has been completed.
Management Team Requirements:
- Ownership type #1: Private company with $5M to $50M in annual revenues with an "Entrepreneur" style owner who set out to “build a business” within the last five years, and realizes that 10% organic growth will not be sufficient to build meaningful wealth.
- Recognizes the need to identify and rank acquisition targets.
- Recognizes the need for help to structure and run a successful corporate development process.
- Typically the executive is a "Learner Type", has an MBA or other advanced post graduate degree, and intense vision and desire to create wealth. The definition of success is wealth creation.
- Company may have a strong #2 internally or externally, whom may or may not have CFO role.
- Ownership type #2: Private company with $10M to $100M in annual revenues. The owner has been in his business for awhile and has achieved a fair level of growth and execution. Knows and understands his competitive landscape and can rank acquisition targets off the top of the head with justifications. Has already built some wealth but now thinks about shaping his industry. Has completed or at least evaluated some small acquisitions.
- Typically a Learner type (high level of self awareness).
- Has opinionated advisors.
- May have experience with M&A &/or "outsourced corporate development.”
Sequence of GrowthSTEP™ Engagement :
- Confirm Platform Thesis economics, valuations, key drivers, etc..
- Identify and confirm Intelligence on the landscape.
- Confirm Constituency Alignment.