Karen & Larry successfully found their Business Match at IndiaBiz
2019 Acquisition: IT industry
Target: Burgeon Software Pvt. Ltd.
“IndiaBiz has really moved me off from my previous Acquisition deal”
Karen & Larry both have vast experiences working for large corporations in the USA. They always wanted to start something of their own. They worked on multiple projects together and brought complementary skill sets to the table.
They decided to take a plunge in this entrepreneurship journey together. Instead of starting from scratch and building a team; they decided to acquire a running tech-company in India.
Why not India, an Aha moment?
In their professional experiences, they worked with different teams/companies based out of India and they relied upon them for successful projects execution. There they had an Aha moment at one point where they just realised that everything that they were looking for might be there in Indian tech companies. They decided to explore the market in India to explore a lucrative acquisition opportunity.
India Specific Challenges
The most important and equally challenging task is to find the right business opportunity. In India, such information is not easily available within the SME space. Karen and Larry also faced the same challenge. Upon research, they found some suitable opportunities listed on Indiabiz platform. They found the information availability of the businesses on Indiabiz platform very helpful as this enabled them to quickly evaluate the opportunity with their interest and preferences.
“Finding multiple businesses available for an acquisition which are suited to our goals was a challenge and the next challenge was to get the different data points in a timely and standardised format (including business details, financials etc.) from business owners in India.”
They found that business practices in India were a little different, everything runs a little bit more organically based upon the needs where else Karen and Larry were looking for a more structure type of environment.
Why did they choose Indiabiz as a partner in their acquisition journey?
Karen and Larry evaluated multiple platforms and advisory companies who could potentially work as their partner for their first acquisition in India. The teams they inquired were prompt but did not take time to build the trust. Also, upon going through vetting process, they did not find the comfort they were seeking in their partner company.
“There were some other companies that had really beautiful websites represented, the stature of their team and the quality of their company. They were prompt in the communication but at the same time did not take time to build the trust and just wanted to sell us their services. We did not feel comfortable or confident having them as a partner in the acquisition journey.”
They found IndiaBiz team very straight-forward with their advice from the beginning. The advisory team shared a lot of challenges (which they faced) which could come in the transaction, where it could go wrong etc. Nothing was sugar-coated or may just seem better or worse. Overall, the team created the trust that they were looking for in their partner in the acquisition process. The comfort level made them choose Indiabiz.
How did it go for Karen and Larry?
Indiabiz team began by building buy side thesis for Karen & Larry and then started from a list of 20+ companies and then shortlisted 5 companies who matched with the thesis. Indiabiz team started to arrange management calls with the qualified businesses. Karen and Larry arranged their visit to India to meet these companies and evaluate the business proposition. Indiabiz team helped them throughout the journey of completion of the contract with one of those companies. In between Indiabiz team performed many tasks for them like; standardizing the data from those companies, support in the evaluation, negotiating, structuring, finding due-diligence experts, lawyers, helping them with the banking and in deal negotiation. The team was clear about setting expectations and helped throughout the journey as they went further and further down the acquisition process.
“We got to one point (six weeks I think in negotiations) as we’re getting ready to close we were actually at an impasse. I had called Karen said I’m packing up I’m going home. We’re going to rethink India strategy and we’re going to consider number two option.”
The team also worked with the (sell side) promoter to actually understand the objective. The valuation exercise, the communication between both, the sides and the dedication made it possible to influence both sides to get them to a mutual place where they could close the acquisition process.
Karen & Larry’s Experience with IndiaBiz