See the format, depth and reasoning behind our work.

Illustrative reports based on fictional transactions. Every company, person and figure is invented; the reports demonstrate our analytical approach and presentation. Your engagement’s scope and deliverables are agreed separately. Read the summary here, page through the full report, or browse the databook.

Illustrative report based on a fictional transaction

Project Granite: Managed IT services, Colorado · $10.0M

The buyer’s question

Is $10.0M the right enterprise value for a managed IT provider, when the bank requires a buy-side QoE before it lends?

The finding

Illustrative adjusted EBITDA is $1,282k, 17% below the banker’s $1,540k. At the ask the sponsor pays 7.8x, and the five-year return falls to about 11%.

How the analysis supports it

Capitalized development labor expensed: −$120k
Lost top-10 client at run-rate: −$95k; bonus under-accrual: −$30k
Net revenue retention 103% to 97% over three years
Return about 11% at the ask, about 17% at a supported price

What it changes

Proceed at $8.2–8.6M, or at $9.0M with a $0.8–1.0M earnout tied to retention, with deferred revenue treated as debt-like in the peg and key staff retained.

Engagement that produces it

Transaction Assessment. Its full Quality of Earnings supports the bank’s review; the valuation and financing analysis inform the proposed price and structure.

Recurring revenue is softening just as the price assumes it is strengthening.