Excited to announce a longer-term client of ours and their transaction with Morae. We got to know the owners of Exigent several years ago and we really admired the business they had built with nothing other than your classic bootstrapped financing. Despite not having taken any institutional capital, Exigent grew to become a market-leading powerhouse serving law firms – medium to large, and corporate clients – also medium to blue chip size, serving clients around the world.
Two Leading Tech Service Businesses Combine to Transform How Legal is Delivered
Background
Exigent was founded in the early 2000s primarily as an outsourced provider of administrative legal services, employing a scalable labor arbitrage model. As the business grew and as its employees continued to deliver best-in-class service to its clients, the entrepreneurial owners embarked on moat-widening expansion plan. The moat that was envisioned was proprietary technology coupled with an in-house staff of its own technology development. While there was certainly a path to invest organically, the management team also pursued a variety of acquisition opportunities and one such target fit their criteria and was soon successfully acquired. With this acquisition, Exigent not only picked up more client revenue but also gained a pathway to accelerate its proprietary technology roadmap.
Transaction Rationale – the Business Outgrew Original Owners
One of the most common “rationales” for a transaction surfaces when a closely-held enterprise, owned by the founders, becomes so successful that it outgrows its original owners’ capacity or wherewithal to continue as owners.
This dynamic manifests itself in many ways, including with hiring personnel, particularly high-salaried executives, highly attractive acquisitions that come along, other expansion initiatives, etc. While Exigent invested heavily in its growth, the owners also knew that it was time to accelerate and doing so would likely be best accomplished inside a larger enterprise. Hence, the owners connected with a number of investment banks as it explored options, ultimately selecting Uplift to assist them in finding the best transaction that fit their objectives.
On the Morae side, it became clear to us that they were highly interested in the proprietary technology developed at Exigent, plus the really strong team and impressive client base were both particularly attractive as well. At the end of the day, Morae viewed Exigent as very strategic and complementary to their long-term growth plan. As an advisor, it becomes very important to monitor these “buyer signals” closely throughout the transaction process.
Uplift Formed a Strong Partnership with Exigent
Following a few meetings early on when we conducted our due diligence on Exigent, it was clear to us that this was a special business that required a high degree of senior attention to tell its story to the right potential transaction partners. Exigent was such an innovative business, with very strong and loyal customers and employees. In addition, the financial profile was very compelling – recurring revenue and a growing roster of very high quality customers.
The very first step in this partnership was developing and illustrating the Exigent story and growth strategy in a confidential information memorandum. At the same time, Uplift conducted a deep dive of the industry, identifying both private equity firms and strategic players that would likely be interested in the Exigent story. Once we had the story and the universe of transaction partners identified, it was then time to deploy an outreach strategy in a discreet, professional and confidential manner to explore options for Exigent.
Despite rather turbulent market conditions, Uplift and Exigent worked together exceptionally well. One of the key roles Uplift played particularly in the later stages of the process was deploying its innovative deal management technology platform. This platform served as a central collaboration hub for nearly 75 people, including other advisors, employees and investors alike, so that all parties could keep their focus on closing a deal that will truly transform how legal is delivered.
