WaterWatch Corporation, a New York-based provider of utility sub-meter billing, payment and installation services to the multifamily housing market, has been acquired by Conservice, based in Utah.
The acquisition by Conservice, a portfolio company of TA Associates, will allow WaterWatch customers to benefit from Conservice’s expanded suite of energy procurement, utility payment and cost containment services to further reduce costs, promote energy conservation and encourage environmental sustainability.
This deal was unique because our client understood the value of the company they built and, out of an abundance of concern for continued customer satisfaction, was not going to sell to just anyone. We were in full support of our client’s willingness to be patient and wait for the right partner, offering the right value. As a result, this transaction took almost three years to complete, having navigated multiple twists, turns, pauses and restarts along the way.
Early on in our relationship, a large competitor of both Conservice and WaterWatch was acquired by another competitor, publicly-traded RealPage, the industry’s leading provider of on-demand multifamily property management software and services solutions. This event signaled a significant competitive statement to the market and was quickly reinforced when RealPage acquired another top-5 competitor less than a year later.
RealPage’s strategic moves were accompanied by the rise of additional market dynamics including the emergence of new cloud-based eCommerce payment processors entering the market trying to take market share with their mobile technology platforms as well as through the acquisition of other WaterWatch competitors. Other factors impacting acquisition decision making and value was a noteworthy change in ownership of the market’s largest private competitor.
Patience Rewarded – Timing Can Be Everything
While we had many offers over nearly three years, until the last, none were satisfactory but rather more a reflection of the uncertainty driven by market events beyond our control.
When considering whether or not an offer to purchase your company came from an acceptable buyer and at a price that equals or exceeds your company’s value, there are a lot of things to consider. Some of the ones we look at with our clients include:
- What factors are occurring or emerging in the market our client serves?
- What are our client’s competitors doing?
- Is timing an important consideration
- How are you performing versus the competition?
- What are competitors selling for?
- Is the buyer investing or are they strategically expanding to secure synergies and scale?
- How is your historical and forecasted financial performance?
- What level are your recurring revenues?
- Are there multiple bidders interested or just a single interested firm?
Once you understand your value, you can determine what you are willing to accept and not accept to sell your business. Also, if you are not in a hurry, you may be able to realize the highest value you were anticipating for all of your hard work. No matter what your circumstances are, this is why we at Cascade adhere to a steadfast rule: Run your business, and let us worry about the “deal.”