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MERGE BRIEFING
Paris MB: 28 March

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Corum Speakers
 Founder & owner of 4 software companies
 Served on advisory boards for Microsoft, IBM,
DEC, Comdex and Apple, and as board
member/founding investor for Blue Coat,
Bright Star and Sabaki.
 Founder of the WTIA, the nation’s most active
regional technology trade association.
 Chosen as one of the 200 most influential
individuals in the IT community in Europe.
 A graduate with Distinction from Harvard
Business School, written 3 books on business
models for success
Bruce Milne
CEO
 20 years of international entrepreneurial and
business experience growing software and
business services companies
 CEO of The Seasam Group, digital marketing
and IoT company for intelligent transportation
systems and digital signage solutions
 Director level positions in Cisco leading
Nordic sales
 Investor and board member of a number of
startups and young companies in a diverse
range of sectors
 BBA in International Business and MBA in
Finance and Marketing, Swedish School of
Economics
Julius Telaranta
Vice President

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Partial Co-Sponsor List

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Global Presence – 60% of transactions cross border

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Research
Education
Valuation
World Tech M&A Leaders…

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Unsurpassed Buyer Access
Corum Buyer
Knowledgebase
Engagements
Internal
Research
External
Research
Education
Outside
Events
Transactions
Outside
Advisors
(WTC)

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Detailed, professional
process
Team approach
Most senior
dealmakers
World Technology
Council
Sold more software-related firms than anyone
Achieving an Optimal Outcome

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Hong Kong /
Canada
Italy / Austria Ireland / Finland Australia / Australia
Japan / USDenmark /
Finland
UK / China
US / Germany
Recent Corum Transactions

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Agenda
 Market Perspective
 Top 10 Disruptive Technology Trends
 M&A Activity & Valuations
 Factors Driving Tech M&A
 Achieving an Optimal Outcome
 Avoiding Deal Disasters
 Closing Thoughts

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TOP TEN
DISRUPTIVE TRENDS

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Leveraging Corum’s Unique Position
Top 10 Disruptive
Technology Trends
1000s of
Buyer
Interactions
(Deals)
1000s of
companies
(Education)
1000s of
industry
transactions
(Research)

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Why worry about these trends?
1. Trends create change
2. Change drives strategic imperative
3. Strategic imperative drives acquisitions
4. Well-positioned companies get sold
Are you part of any of these trends?

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Corum Top Ten Technology Trends 2017
AI Enablement IoT
Software
Visual
Intelligence
Systems
Digital Currency
Flow
Data Science
Monetization
Online
Exchanges
Omni-channel
Sales
Connected
Health
Focused IT
Services
Data
Security
CORECONTOUR

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Putting AI to work by means of big data and feedback
#1: AI Enablement
 Nascent AIs and other
machine learning platforms
need data.
 Need tasks that provide
data, benefit from improving
expertise, then provide
feedback to improve the
platform.
 Business cases emerging
rapidly across all sectors.
 Significant stores of unique
data can short-circuit “build
vs. buy” debates in M&A.
Corum Top Ten Disruptive Technology Trends 2017

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Emerging platforms, standards & analytics
#2: IoT Software
 Internet of Things (IoT)
growth brings us into its first
full software cycle.
 Each “Thing” needs
platforms, communication,
analytics, etc.
 Competing platforms and
associated ecosystems
beginning to coalesce.
 IoT software often, but not
always, inextricably
enmeshed with hardware.
 Compatibility-driven, as in
other cycles of disruption.
Corum Top Ten Disruptive Technology Trends 2017

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Intersection of AI, computer vision & analytics
#3: Visual Intelligence Systems
Corum Top Ten Disruptive Technology Trends 2017
 Evolution of Positioning
Intelligence beyond GPS
required computer vision.
 Drones and self-driving cars
driving advanced vision tech
with even larger implications.
 Retail, security, energy,
agriculture, advertising are all
being impacted.
 Companies creating practical
solutions with this tech—
especially utilizing analytics—
are in high demand.

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Decreasing friction in payments & exchange
#4: Digital Currency Flow
 Currency flow moving towards
fewer barriers, reduced regulation
and less friction on transactions
globally.
 Banks face competition from
nimbler mobile and web point
solutions.
 Includes alternative currencies—
from blockchain/bitcoin to in-
game currencies to Starbucks
payments.
 Software & systems that speed or
harness payment flow have
significant potential.
Corum Top Ten Disruptive Technology Trends 2017

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Maximizing return with real-time analytics
#5: Data Science Monetization
 In a world of freemium, free-to-
play & declining ad effectiveness,
turning users or viewers into
dollars is a premium capability.
 Robust analytic tools are no
longer optional, especially for
consumer-facing companies.
 Gaming companies are leading
the way, deriving value from their
analytic capabilities as much as
entertainment.
 Video ads are close behind with
opportunities in e-commerce,
brick & mortar, B2B and beyond.
Corum Top Ten Disruptive Technology Trends 2017

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Connecting creators & consumers
#6: Online Exchanges
 Uber & others recharging the
concept that created online
commerce, putting unused
capacity to work.
 Not just connecting buyers &
sellers, but creating previously
non-existent opportunities on
both sides.
 Disruptive opportunities
include:
 Personalization
 Real-time commerce
 Financial disintermediation
Corum Top Ten Disruptive Technology Trends 2017

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Purchasing decisions anywhere, any platform
#7: Omni-Channel Sales
 Consumer platforms & devices
continually fragmenting.
 Marketing keeping pace – next
challenge is sales, both decision
points and actual purchase.
 Point at which money changes to
product must be immediately with
customer, moving closer by being
on their favorite device.
 Persuasion must move there as
well, taking new forms as it does.
 Consumer brands leading the
way, but enterprise is not far off.
Corum Top Ten Disruptive Technology Trends 2017

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Linking people to their health data & services
#8: Connected Health
 Technological, regulatory
and demographic changes
converging to create
significant opportunity.
 Leveraging new tech:
smartphones, trackers,
connected medical devices,
genomics, remote
monitoring.
 Improved self-care and
remote care/diagnosis.
 Makes healthcare more
patient-centric by enabling
healthcare consumerism.
Corum Top Ten Disruptive Technology Trends 2017

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Differentiation drives new value in a sleepy sector
#9: Focused IT Services
 New and more pervasive
technologies creating new
needs for maintenance,
extension and utilization.
 Teams that provide customer
value around a specific
technology, sector or problem
are seeing increased value.
 Buyers seeing more value in
purpose-built IP emerging out
of services firms.
 Services on the edge of key
trends seeing particular
interest.
Corum Top Ten Disruptive Technology Trends 2017

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Building barriers in an age of blurred lines
#10: Data Security
 New technologies creating
new risks from freer flowing
data.
 High impact breaches (DNC,
Yahoo, Dyn DNS, Oracle
Micros) drive broad
recognition of security needs.
 Key trends include security
analytics, rapid detection &
in-process threat response.
 Internet of Things opening a
new front in this fight – the
Dyn DDoS attach came from
infected IoT devices.
Corum Top Ten Disruptive Technology Trends 2017

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MARKET OVERVIEW
VALUATIONS

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$3
Trillion
$1
Trillion
Cash Available for Acquisitions
Strategic Tech
Buyers
Private Equity

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Corum Index
Market
Transactions
20162015
4307 3914
Mega Deals
59 80
Largest Deal $63B $39.2B
Pipeline
2015 2016
Private Equity Deals
232 320
VC Backed Exits
657648
Attributes
20162015
34%
Cross Border
Transactions 35%
Start-Up
Acquisitions 12%13%
15 yrs14 yrs
Average Life
of Target
38%
36%
7.7%
9.1%
2.9%
38%
1.4%
7.1%

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24
21
20
15
14
13
12 12
11 11
10 10 10 10
Top Strategic Acquirers – 2016

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39
21 21
19 19
16 16 15 14 13 13 12 11 11 11
Top Private Equity Acquirers – 2016

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Vertical Application Software Market
Public Valuation Multiples
1.50 x
2.00 x
2.50 x
3.00 x
3.50 x
4.00 x
4.50 x
5.00 x
6.00 x
8.00 x
10.00 x
12.00 x
14.00 x
16.00 x
18.00 x
20.00 x
EV/SEV/EBITDA
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 15.93 x 17.11 x 16.70 x 17.21 x 17.12 x 18.38 x 17.27 x 17.64 x 17.16 x 16.30 x 16.76 x 16.40 x 17.82 x
EV/S 4.06 x 4.30 x 4.38 x 4.37 x 4.47 x 4.70 x 4.66 x 4.72 x 4.39 x 4.50 x 4.57 x 4.61 x 4.70 x

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Subsector Sales EBITDA Examples
A/E/C 5.72x 22.35x
Automotive 5.01x 20.05x
Energy &
Environment
4.78x 19.73x
Financial Services 5.08x 16.28x
Government 1.95x 13.06x
Healthcare 3.90x 19.81x
Real Estate 6.99x 23.93x
Vertical Other 4.48x 13.70x
Vertical Application Software Valuations

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Horizontal Application Software Market
Public Valuation Multiples
1.50 x
2.00 x
2.50 x
3.00 x
3.50 x
4.00 x
6.00 x
8.00 x
10.00 x
12.00 x
14.00 x
16.00 x
18.00 x
20.00 x
EV/SEV/EBITDA
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 16.98 x 17.06 x 17.55 x 19.25 x 18.93 x 18.73 x 18.18 x 18.93 x 17.70 x 18.19 x 18.39 x 17.98 x 17.31 x
EV/S 3.29 x 3.58 x 3.49 x 3.45 x 3.57 x 3.52 x 3.70 x 3.83 x 3.75 x 3.46 x 3.47 x 3.70 x 3.83 x

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Subsector Sales EBITDA Examples
Business
Intelligence
3.61x 18.85x
Marketing &
Ad Tech
1.84x 15.66x
CRM 1.61x 45.82x
ERP 4.21x 21.64x
Human Resources 6.29x 31.66x
SCM 5.68x 20.17x
Payments 3.83x 15.93x
Other 3.46x 16.62x
Horizontal Application Software Valuations

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salesforce.comUltimate Software
Concur
EloquaOpenTable
athenahealth
Medidata
ExactTargetLivePerson
Kenexa
Informatica
DealerTrack Vocus
LogMeIn
Callidus Saba
Websense Constant Contact
0.00 x
1.00 x
2.00 x
3.00 x
4.00 x
5.00 x
6.00 x
7.00 x
8.00 x
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
TTM Revenue
Multiple
Revenue Growth YoY
High SaaS Growth Tracks Valuation

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Consumer Application Software Market
Public Valuation Multiples
1.00 x
1.20 x
1.40 x
1.60 x
1.80 x
2.00 x
2.20 x
2.40 x
5.00 x
7.00 x
9.00 x
11.00 x
13.00 x
15.00 x
17.00 x
19.00 x
EV/SEV/EBITDA
Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 13.73 x 12.98 x 13.60 x 14.42 x 16.03 x 15.89 x 15.68 x 16.21 x 17.32 x 17.80 x 14.73 x 14.82 x 15.82 x 17.52 x
EV/S 1.83 x 1.88 x 1.83 x 1.76 x 2.05 x 1.96 x 2.15 x 2.09 x 2.31 x 2.16 x 2.12 x 2.04 x 2.27 x 2.18 x

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Subsector Sales EBITDA Examples
Casual Gaming 3.47x 24.95x
Core Gaming 2.44x 10.99x
Other 1.65x N/A
Consumer Application Software Valuations

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Public Valuation Multiples
Internet Market
1.00 x
1.50 x
2.00 x
2.50 x
3.00 x
3.50 x
4.00 x
4.50 x
5.00 x
7.00 x
9.00 x
11.00 x
13.00 x
15.00 x
17.00 x
19.00 x
21.00 x
23.00 x
25.00 x
EV/SEV/EBITDA
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 21.93 x 23.52 x 23.08 x 22.58 x 23.49 x 23.13 x 20.76 x 22.21 x 20.40 x 19.07 x 18.57 x 20.12 x 21.80 x
EV/S 3.76 x 3.75 x 3.60 x 3.50 x 3.71 x 4.00 x 4.54 x 4.76 x 4.32 x 4.11 x 3.81 x 4.16 x 4.14 x

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Subsector Sales EBITDA Examples
Diversified
Internet
5.29x 19.48x
eCommerce 1.18x 30.12x
Social Network 4.14x 19.24x
Travel & Leisure 5.81x 21.11x
Internet Valuations

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Infrastructure Software Market
Public Valuation Multiples
2.00 x
2.20 x
2.40 x
2.60 x
2.80 x
3.00 x
3.20 x
3.40 x
3.60 x
3.80 x
6.00 x
8.00 x
10.00 x
12.00 x
14.00 x
16.00 x
18.00 x
EV/EBITDA EV/S
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 13.42 x 13.68 x 13.71 x 13.62 x 13.45 x 13.78 x 14.03 x 13.89 x 15.38 x 15.17 x 15.20 x 15.66 x 15.50 x
EV/S 3.36 x 3.37 x 3.31 x 3.30 x 3.19 x 3.46 x 3.36 x 3.45 x 3.20 x 3.42 x 3.32 x 3.32 x 3.54 x

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Subsector Sales EBITDA Examples
Endpoint 3.64x 16.35x
IT Services
Management
4.63x 29.59x
Network
Management
2.76x 9.27x
Security 3.63x 18.42x
Storage & Hosting 2.71x 12.89x
Other 5.24x 13.50x
Infrastructure Software Market

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IT Services – Developed Markets
Public Valuation Multiples
0.40 x
0.60 x
0.80 x
1.00 x
1.20 x
1.40 x
1.60 x
5.00 x
6.00 x
7.00 x
8.00 x
9.00 x
10.00 x
11.00 x
12.00 x
EV/SEV/EBITDA
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 10.14 x 10.35 x 10.40 x 10.69 x 10.21 x 10.68 x 11.08 x 11.13 x 10.90 x 10.89 x 11.14 x 10.86 x 11.03 x
EV/S 0.98 x 1.06 x 1.08 x 1.17 x 1.16 x 1.14 x 1.26 x 1.32 x 1.27 x 1.21 x 1.30 x 1.37 x 1.25 x

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Public Valuation Multiples
IT Services – Emerging Markets
0.40 x
0.90 x
1.40 x
1.90 x
2.40 x
2.90 x
3.40 x
3.90 x
5.00 x
7.00 x
9.00 x
11.00 x
13.00 x
15.00 x
17.00 x
19.00 x
EV/SEV/EBITDA
Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17
EV/EBITDA 13.94 x 14.76 x 14.80 x 17.40 x 15.24 x 15.48 x 15.12 x 14.69 x 12.93 x 13.01 x 13.52 x 13.38 x 14.25 x
EV/S 2.98 x 3.14 x 3.15 x 3.13 x 3.12 x 3.43 x 3.09 x 3.15 x 2.91 x 2.77 x 2.70 x 2.70 x 2.95 x

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Subsector Sales EBITDA Examples
Developed 1.25x 11.03x
Emerging 2.95x 14.25x
IT Services Valuations

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French Targets – Brief Overview
Last 12 months
 101 announced Tech Deals
 Deal size ranges from €0.6M - €250M;
Median is €61M
 Revenue multiples range from 0.4x - 5.6x for
disclosed amounts
 17% of Targets had VC funding
 Markets ranging from ERP & BI software, to Data
management, to Internet content & commerce,
to Mobility, to IT & Hosted Services.

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Largest Deal
Enablon [France] acquired by Wolters Kluwer
Legal & Regulatory Solutions [Netherlands]
Risk & energy management software
 May 2016
 €250M Deal Value
• 5.6x Sales
 Top EHS provider Enablon will operate as a unit of
Wolters Kluwer’s division adding domain knowledge
for its customers.
 The acquisition is considered as one of the largest
European venture capital exits this year.

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Deal Spotlight
Ketchapp Games [France] acquired by Ubisoft
Entertainment SA [dba Ubisoft] [France]
Mobile game development
 September 2016
 With the purchase of a small startup, Ubisoft
furthers a strategy to become the biggest game
publisher on the planet and tries to stay
independent from Vivendi which has already
approached them.
 Ubisoft also bought Racing videogames software
developer Ivory Tower in October 2015.

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Deal Spotlight
OCTO Technology [France] acquired by
Accenture Ltd. [Ireland]
Technology consulting & SI
 September 2016
 €115M Deal Value
 With presence in 5 countries OCTO got access to
substantial resources by joining Accenture Digital
while Accenture penetrated digital marketing
sphere in French market to compete with giants:
IBM, Dell and Deloitte.

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Deal Spotlight
StickyADS.tv [France] acquired by FreeWheel
Media Inc. [Comcast] [USA]
Online video ad exchange
 May 2016
 €100.8M Deal Value
 After StickyADS.tv joined FreeWheel’s “Preferred
Partners” Initiative the partnership resulted into the
deal and combined offering for a new ecosystem
of TV publishers.

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Deal Spotlight
News Republic Inc. [France] acquired by
Cheetah Mobile Inc. [China]
News aggregation mobile application
 August 2016
 €50.8M Deal Value (Reported)
 News Republic will benefit of increasing traffic
while Cheetah will be able to target a different set
of users.
 The transaction followed Cheetah’s purchase of
French mobile advertising SaaS provider
MobPartner for €55M back in March 2015.

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Deal Spotlight
Talentsoft SA [France] acquired by Goldman
Sachs [USA]
Workforce management SaaS
 October 2016
 €25M Deal Value
 Talentsoft teamed with Goldman Sachs continuing to
successfully compete with Oracle and SAP in the
talent management software market.
 The transaction is a breakthrough on the global
financial scene as Talentsoft is about to accelerate
R&D and gain scale geographically (Europe).

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Deal Spotlight
Norskale France SAS [France] acquired by
Citrix Systems Inc. [USA]
Desktop & application virtualization SaaS
 September 2016
 Driven by demand for business mobility by end-
users Citrix filled the gap in the area by adding
Norskale with its excellent reputation in User
Environment Management industry.

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Deal Spotlight
Nextperf [fka Next Performance] [France]
acquired by Rakuten Marketing [Rakuten] [USA]
AI-based marketing retargeting software
 July 2016
 With Nextperf’s programmatic technology being
provided throughout Europe, Brazil, North America
Rakuten will expand into its strategic market,
Europe.

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Deal Spotlight
AlephD SA [France] acquired by AOL Inc.
[Verizon] [USA]
Advertising pricing optimization SaaS
 January 2016
 AlephD’s yield management tools will be build into
a unified publisher platform called ONE by AOL.

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1. Disruptive trends – Strategic imperative to buy
2. Cash – Strategic & financial buyers
3. Low cost debt for leveraged buyouts
4. Many new buyers (IPOs, non-tech)
5. Strong financial markets
5 Reasons Tech M&A Will Remain Strong

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1. Geopolitical Disruption
2. Currency Crisis
3. Inflation Increasing
4. Rising Interest Rates
5. Stock Market Adjustment
6. M&A Cycle Ends
6 Global M&A Concerns

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1. Consolidation of Market Segment
2. Game-changing Tech Paradigm Shift
3. Personal/Partner/Management Health
4. Conflict – Founders/Investors/Personal
5. Litigation/Negligence/Criminal Acts
6. Death or Incapacitation
6 Personal/Company M&A Concerns

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M&A Follows Cycles

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ACHIEVING AN
OPTIMAL OUTCOME

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Buyer Seller
The Inherent Problem in M&A
Price
Structure
Liabilities
Taxes
Non Competes
You will be diametrically opposed on everything……while negotiating with your future boss

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 More time - regulatory environment (SOX)
 More tasks than people realize
 Busy buyers – reviewing 100s of opportunities
 Tougher outside professionals
 More complex due diligence required
 Deal fatigue – Letter of Intent (LOI) to close
The M&A Process is Tougher…

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Your Goal: an Optimal Outcome

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Valuation
Maximization

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62
Creating the best transaction
structure

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Minimizing
personal liability/risk

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Reducing tax
liability and holdbacks

65.
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Structuring ideal
employment/non-competes

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Providing for
proper integration

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1
8 Stages for an
Optimal Outcome
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
 Set tasks, timeline
 Allocate staff resources
 Conduct internal due diligence
 Compile business/marketing plan
 Ready financials/projections
 Ready presentation materials
 Begin collecting due diligence materials
Stage 1: Preparation
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 2: Research
 Prepare buyers list (A&B level, financial, non tech)
 Perform strategic analysis on each buyer
 Prepare preliminary valuation
 Determine proper contact (Execs, EA’s, advisors)
 Outside advisor/board/investor influencers
 Prepare position statement for each buyer
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 3: Contact
 Create introductory correspondence
 Draft/customize executive summary
 Execute NDAs and non-solicitations
 Screen initial interest, valuation expectations
 Establish log on all communications
 Refine position/process based on feedback
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 4: Discovery
 Coordinate conference calls, site visits, and meetings
 Establish technology review process
 Prepare formal valuation report
 Develop synergy and contribution analysis
 Set up NDA with customers, contractors, etc.
 Finish due diligence on buyer
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 5: Negotiation
 Organize and host final visits
 Provide structure & valuation guidance
 Create an auction environment
 Negotiate with top bidder(s)
 Sign Letter of Intent (L.O.I.)
 Inform other bidders of No Shop
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 6: Due Diligence
 Verification of financial statements/projections
 Determine if outside advisors/opinions needed
 Establish confidential data room
 Technical/Legal/Ownership due diligence
 Written explanation of business model/methodologies
 Complete definitive agreement/ attachments
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 7: Closing
 Final reps & warranties
 Determine escrow hold-backs
 Final opinion(s)
 Sign contracts
 Arrange payment/distribution
 Regulatory filings
 Disclosure schedules
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1
Stage 8: Integration
 Advanced planning – during negotiation
 Determine synergies
 Best practices analysis
 Interim transition team
 Employee retention plan
 Set up monitoring/reporting
IntegrationClosing
Due
Diligence
NegotiationDiscoveryContactResearchPreparation

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1 to 5+
offers1 to 5+
20 to 200
global buyer
candidates
20 to 200
3 to 8
qualified
parties
5 to 15
NDAs
Optimal Outcome by the numbers
700 to 1000
communications
of various kinds
700 to 1000
10 to 30
expressions
of interest
10 to 30
5 to 15 3 to 8

77.
77
With a Professional Global Search
9 – 12 months
required to complete because of workload,
Sarbanes-Oxley (SOX) and buyer due
diligence (DD) considerations
…you can generate interest very quickly, but buyers
are constrained in how fast they can move.

78.
78
Resell/License
Do you want to buy
my company?
J.V./Alliance
M&A Uniquely Allows Entry to Top Execs
CEO
MKTFIN MANF
DIVDIV DIVDIVDIV
DIVDIVDIVDIV
The only time you can go straight to the top

79.
79
5 Major Benefits of a Professional Process
Model
The
preparation
process will
help forge a
better
business
model for
your firm
1
Research
Your
strategic
position will
improve from
the research/
positioning
process
2
Market
Feedback
Buyer
contact will
provide
invaluable
data/insights
to help
improve your
value
3
Relation-
ships
Not everyone
is a buyer,
but you open
many doors
which will
yield
business
4
Exit
The merger,
asset sale, or
financial
recap of your
company
5
79
Any of these benefits will
justify the time and expense
of a global partner search.

80.
80

81.
81
Sold again in 2 years for $100 million (6x)

82.
82
Sold for $56M (.6x) – missed the windowMarket consolidated—Company A bought Company B!

83.
83
AVOIDING THE
DEAL DISASTERS

84.
84
Lessons From Experience
This M&A process workload and pitfall analysis is based
on data supplied by the World Technology Council
(WTC), Corum’s 500-member advisory board of past
sellers, industry experts, buyers and investors.
Top 60 Documents and Projects
Top 6 Value Destroyers
Sellers’ Single Biggest Mistake
Top 10 Deal Killers

85.
85
• Corporate Preparation
• Business Plan
• Marketing Plan
• Org Chart
• Staff Bios
• NDA
• Non Solicitation
• Executive Summary
• Introduction Letter
• Financials (3 years)
• Recast Financials
• Financial Package
• 3 Year Projections
• Pipeline Analysis
• Lead Process
• Pricing Analysis
• Market Research
• Competitive Research
• Buyer Research
• Ind. Buyer Strategy
Top 60 Documents & Projects (1-20)
Items in RED require professional skills, confidential M&A data, inside buyer
knowledge, extensive transaction experience, or outside advisors

86.
86
• Corporate Presentation
• Comparable Transactions
• Industry Comps
• DCF Analysis
• Replacement Cost
• Terminal Value
• Valuation Report
• All Agreements
• All Litigation – Threats
• Shareholder Qualification
• HR Needs
• Audit
• Activity Log
• Terms Sheet(s)
• Synergy Analysis
• Dilution Analysis
• Tax Analysis
• Taxable Assets
• Negotiation
• LOI
Top 60 Documents & Projects (21-40)
Items in RED require professional skills, confidential M&A data, inside buyer
knowledge, extensive transaction experience, or outside advisors

87.
87
• Stand Still Prep.
• Outside Opinions
• DD Checklist
• DD Timeline
• Merger Agreement
• Asset Schedule
• Fairness Opinion
• Employ. Agreement
• Non Competes
• Patent Analysis
• Customer Overview
• Client Sign-off
• Bulk Sale
• Sovereign Approval
• Proxies
• Security Agreements
• Registration
• Shareholder Exp. Distr.
• Announcements
• Integration Process
Top 60 Documents & Projects (41-60)
Items in RED require professional skills, confidential M&A data, inside buyer
knowledge, extensive transaction experience, or outside advisors

88.
88
1. Confidentiality—internal/external
2. Theft of technology
3. Loss of staff (non-solicitation)
4. Wear on CEO/management
5. Business drop-off—lack of focus
6. Going to market too late
Top 6 Value Destroyers

89.
89
They are trying to lock you up
Often demand exclusive negotiations
Don’t want you talking to others
Want to pay less than true value
Remember your fiduciary obligation!
Seller’s biggest single mistake…
…dealing with only one buyer

90.
90
Top 10 Deal Killers
1. Dealing with only one buyer
2. Misalignment: shareholders/empl/mgmt
3. Contact at the wrong level
4. Improper research of potential buyers
5. Misunderstanding buyer process/models

91.
91
Top 10 Deal Killers
6. Inability to portray value properly
7. Improper due diligence preparation
8. Not qualifying buyers properly
9. Not orchestrating all buyers properly
10.Ego – Greed – Arrogance

92.
92
THE MOST IMPORTANT TRANSACTION OF YOUR LIFE
CLOSING THOUGHTS

93.
93
This seller
is serious.
Leverage using a Professional Intermediary
I may not
be the only
bidder.
Potential
Acquirer
Seller Intermediary
Wonderful
if I buy you,
terrible if I
don’t.

94.
94
The most in-depth buyer information in the world
Optimal Outcome – The Corum Buyer
Knowledgebase
 Approx. $25M investment
 Developed over 30 years
 Nearly 16 million entries
 Proprietary client activity
reporting technology
 Supplemented by every major
research organization
 Data updated with world’s
largest educational program

95.
95
Corum Proprietary Buyer Knowledgebase –
Advantages
Helps to ensure that you get to the right people
Insider strategic knowledge improves getting attention
Proprietary knowledge of buyer valuation metrics
Gives advanced notice of due diligence required
Includes library of buyer contracts, NDAs, etc.
Invaluable aid in negotiation process

96.
96
Tech M&A Guideline Percentages
 Buyer solicitations that result in transaction
 Average improvement from first offer with an
auction process
 How often another firm is willing to pay more
than the initial bidder
 Deals involving only one bidder that are
suboptimal
 Failure rate in “self-managed” tech M&A

97.
97
After the Deal – Celebration

98.
98
Contact Information
Visit our website at: www.corumgroup.com
Julius Telaranta, Vice
President
Berlin Office
Email: juliust@corumgroup.com
Mobile: + 49 172-971-9898
Office: +1 425-460-6250
Corum Group International
S.à.r.l.
Buechenstr. 9
8185 Winkel
Switzerland
+41 43 888 7590
Corum Group Ltd.
19805 North Creek Parkway
Suite 300
Bothell, WA 98011 USA
+1 425-455-8281