Case Study · B2B Software / SaaS
Industry
B2B Software / SaaS
Engagement
Value creation, exit readiness and sale process
Timeframe
Two years, from July 2024
The starting position
Founder receives unsolicited acquisition offer, heavily reliant on earn-out
$5m estimated net proceeds to the founder, after net debt and tax
The market result
Leading valuations, including earn-out, from 10 acquisition proposals
$16–17m estimated net proceeds to the founder, after net debt and tax
The decision
Keep building
With value independently validated, the founder chose not to sell.
A further two-year growth program with Runway Partners
THE STARTING POINT
A valuable business, and an offer that didn’t reflect it
The founder had built a long-established software business with deep customer relationships, strong recurring revenue and healthy cash flow. He had received an unsolicited offer valuing it at $10 million. That offer relied heavily on an earn-out and, after net debt and tax, would have left him with $5 million.
His ambition was at least $15 million, and to maximise what he would keep. Rather than go straight to market, we agreed the better strategy was to build value first.
Value Creation
What we worked on before going to market
For two years we worked alongside the founder as strategic adviser, CFO and “shadow CEO”, focusing on business performance and the factors buyers ultimately pay for.
+38%
Revenue growth, FY24–FY26
+93%
EBITDA growth, FY24–FY26
Pricing & revenue growth
Reviewed pricing and grew revenue from the existing customer base, strengthening recurring and transaction-based revenue.
Profitability & financial discipline
Improved normalised earnings, built clearer forecasts and management reporting, and introduced stronger KPIs.
Revenue quality
Analysed retention, concentration and recurring revenue, with around 90% of revenue recurring and low customer concentration.
Leadership & founder dependency
Strengthened the management team and reduced the business’s reliance on the founder.
Structure & tax
Optimised corporate and tax structures with Runway Partners’ tax specialists, helping to maximise net proceeds, not just the headline price.
Equity story
Built a credible, evidence-backed growth story for acquirers, so the business's future potential was as clear as its current performance.
THE JOURNEY IN PRACTICE
How the Growth & Exit Journey played out
01
Discover
Understood the founder’s objectives, what the business was really worth and why the early offer fell short, and agreed to build value before selling.
02
Build Value
Two years of hands-on work on pricing, profitability, revenue quality, leadership and structure, so the business was worth more before any buyer saw it.
03
Become Buyer Ready
A comprehensive Information Memorandum with financial and commercial addenda. Forecasts were tested, normalisations supported, and diligence issues surfaced before buyers could find them.
04
Create Competition
A structured process targeting strategic and private equity-backed software acquirers generated 10 non-binding proposals.
The strongest valued the business at $18–20m including earn-out, nearly double the initial offer and well above the founder’s $15m goal.
05
Realise Value
Alongside Runway Partners’ legal and tax specialists, we negotiated well beyond the headline price: upfront cash versus earn-out, revenue and earnings definitions, earn-out hurdles, post-acquisition roles, tax and cultural fit. Two serious bidders emerged. At that point, the founder chose to pause the sale.
THE QUESTION AT THE START
“Can I get $15 million for my business?”
THE QUESTION AT THE END
“Is selling at around $19 million today the right decision, or can we build considerably more?”
THE OUTCOME
The decision not to sell
The process independently validated a value approaching $20 million. It also showed exactly where the next layer of enterprise value could be created.
The founder chose to keep the business and start a further two-year growth program with Runway Partners. The goals are to scale revenue, deepen recurring income, strengthen the team, further reduce founder dependency and keep the business continuously buyer-ready for its next exit opportunity.
Client details anonymised to protect confidentiality. Figures are rounded and reflect non-binding proposals received during the process.
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