Summary
This US based Healthcare IT firm was developing a Natural Language Processing platform with tie ups with Google and other leading players. It wanted to raise funds from US Private Equity Funds and needed a guidance for the negotiations.
Vora Corporate Finance performed valuation exercise and prepared information memorandum to the satisfaction of the group within the time commitment based on the understanding of US healthcare industry and IT background and streamlined efforts for raising equity funds.
The Full Story
The Situation
DEF* is a US Based IT Healthcare firm. It develops software applications with tie ups with Google and other players to help modernize healthcare administration in U.S. The firm uses Natural Language Processing (NLP) and Artificial Intelligence (AI) to work with electronic healthcare records.
These technologies simplify the cumbersome process of manual documentation and manual coding and also save cost of hiring coders. NLP and AI are the future of US Healthcare and with a ready solution to finance this business DEF needed funds from a private equity fund.
Its management approached Vora Corporate Finance to perform valuation of its business for fund raising.
Our Approach
Vorafin took an understanding of the NLP and AI business in depth as well as US healthcare market, US investments in US healthcare and valuations done in recent transactions.
Understand the business & its market
- Understand the NLP and AI business in depth
- Understand US healthcare market
- Understand recent transactions of M&A and investments in the US healthcare market
Perform valuation of business
- Projections of future cash flows to be done
- Analyse the projections & underlying assumptions
- Determine discount rate to be applied to cash flows
- Arrive at the present value of future cash flows of the business
Prepare Information Memorandum
- Prepare IM including roadmap of business growth
- Include in IM the information related to financials, current traction, risk and mitigation, etc.
- Identify Exit options for incoming investor
Our Action
- Vora Corporate Finance performed valuation of the firm based on the audited financials as well as fine-tuned the future financial projections under multiple scenarios
- An exhaustive information memorandum was prepared so as to attract buyers and also give out information related to financial standing, business and market position, clients, strategies and promotion methods, etc. in a logical and coherent manner.
The Results
- Exercise was completed in very short time to the satisfaction of the promoters.
- Valuation was done with Built in Sensitivity Analysis was made to incorporate uncertainty and volatility.
- DEF was able to get funding by an MNC for one of their product subsequent to exercise.
* We take our clients’ confidentiality seriously. While the names are changed, the results are real.