Founded in 2002, Kulu Valley offers a cloud- based (SaaS), integrated solution for the creation and distribution of video content that works within an enterprise infrastructure. It was sold to Qumu Corporation (NASDAQ; QUMU) for $17.8m

The challenge

The challenge was to build trust with a young founding team, help develop and implement a sustainable growth plan and prepare them and the business for sale, aligning stakeholder interests and navigate the potentially conflicting roles of finance support, CFO and corporate finance lead advisor.  Realise invested in the business early on in the journey.

Our solution

• Organised the business, building an infrastructure that would survive scale up and an eventual sale process

  • Introduced tools and processes necessary in a scale up – interactive operational model and scenario planning, robust and comprehensive management accounts and reporting pack, tracking SaaS metrics, prepare a valuation model, management meeting oversight and action tracing

• Accelerated the business focusing on pulling the right the levers of growth to drive the best exit valuation

  • Reviewed and helped implement staff rewards and incentives e.g. sales bonuses and EMI options

  • Accessed Government grants  

  • Being part of the oversight of sales strategies and tactics

  • Got the business and the team ‘due diligence ready’ – no skeletons, no surprises, defendable financials and forecasts, no obvious price chipping opportunities

  • Prepared and defended an interactive and sophisticated acquiror grade financial model including defending the business valuation and underlying methodology taking advantage of SaaS multiples and related KPIs, best pattern of working capital and carefully tracking the “cash free debt free” position to get best price

  • Presented scenarios to show the founder and investor how their consideration might change dependent on the mix of valuation, structure and deliverability

• Sold the business

  • Identified and assessed the options to deliver founder and stakeholder objectives

  • Researched and prepared the likely ‘maximum’ valuation for the business and how this could be achieved in a sale process

  • Explored and agreed optimum timing – ‘Should you stay, or should you go’ - making the right decision to sell now or sell later

  • Took on the CFO role providing strategic and hands on support for key commercial, funding and tax decisions, and negotiating with buyer on structuring, warranties and indemnities – all to reduce deal risk and deal fees.  Including pre-sale planning eg Review of key contracts and independent 3rd party Intellectual Property

  • Confirmed and negotiated best terms – balancing maximum value, with deal structure (weighing up an upfront payment or taking less and now more later and whether any future consideration is linked to performance criteria etc) and deliverability (is the buyer able to complete a transaction and has enough cash, political and Board approval and is of sufficient strategic fit etc)

• Being a sounding board and providing emotional support for leadership throughout

• Managed any VC and management conflicts

• Coached and mentored the senior team along the journey

Client
Kulu Valley Limited

Stage
Exit

Sector
Enterprise Video Content Management

Proposition
Founded in 2002 in London, United Kingdom, Kulu Valley offers a cloud- based (SaaS), integrated solution for the creation and distribution of video content that works within an enterprise infrastructure. Kulu Valley’s platform enables quality video content creation beyond the studio and accelerates adoption of user-generated content both inside and outside the enterprise The native cloud architecture of the Kulu Valley platform features automation and self-provisioning, making full enterprise video capability available to any company instantly as a cloud-based service.

Exit
Sold to Qumu Corporation (NASDAQ: QUMU) for $16m

Relationship duration
3 years

Our roles
Growth advisor, Strategic Finance Role, CFO, preparing for exit & transaction lead advisory, VC risk management,