Company Investment Banking Group LLC was retained by GreenWizard as the exclusive investment banker in the potential sale of the company’s assets. TOBIN contacted 74 prospective buyers and brought four of them to the table for negotiations with the client. The assets of the GreenWizard were acquired by UL.
GreenWizard provides a software as a service (“SaaS”) application that allows architects, specifiers, interior designers, contractors and other design and construction (“D&C”) professionals to make informed decisions throughout the building product management process.
SITUATION
When the U.S. Green Building Council established the Leadership in Energy and Environmental Design standard, better known as LEED certification, there was no single-source location to find all building materials, and the value they carried (i.e., Gold, Silver, or Platinum) toward formal LEED certification. Enter GreenWizard, Inc., a software start-up, formed to make accessing greener products, and constructing greener buildings, easy. Like most start-ups, the owners had a great idea but were cash-restrained. After six years of operation working with hundreds of manufacturers, signing up tens of thousands of products, GreenWizard’s owners decided to investigate whether an opportunity existed to sell the venture.
SOLUTION
Having previously had less than stellar experiences with traditional mainstream investment banking firms, management was looking for a special kind of firm: one with a Wall Street background and elite investment banking experience, but also one that listened, understood business from an entrepreneurial perspective, and had proven success. The firm they selected also needed to be small enough that GreenWizard didn’t get lost in a forest of larger enterprises.
“We spoke with a number of firms and when we met with Tobin & Company, things just clicked,” says former CEO Jerry LePore today. “Justine Tobin was the right person for a company like ours – straightforward, efficient process and honest – I think that’s ultimately why she left Wall Street. Very early on in our search process it became very clear to me that she was not just trying to get a contract – she wanted to help us.”
RESULTS
Tobin & Company identified several dozen potential buyers and narrowed that number down to four solid best-fit suitors, each who expressed a strong interest in the company. However, GreenWizard’s debt load prevented a deal from being made. Still the client company did what it set out to accomplish; it went to the marketplace to see if any buyers existed and at what price.
The company did what it set out to accomplish; it went to the marketplace to find out if any buyers existed, and if so, at what price. Because of its performance with GreenWizard, Tobin & Company was appointed by the South Carolina bankruptcy court to work with the buyers that it had previously sourced to sell the company assets. Underwriters Laboratory (UL), one of the original four finalists, acquired the assets and continues to operate them today.
Among the many reasons why companies seek mergers or acquisitions, one that is rarely discussed is the valuable information, feedback, and market signals that can be uncovered, all through a well-planned and executed process. Sometimes the result of the exercise may not be what management had ultimately hoped, but the insights gained are valuable to the future of the endeavor. In this instance, the outcome of the engagement allowed customers to continue to benefit from a product that they valued, in new ownership’s hands.
