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Background

Preparing for a High-Stakes Exit After Rapid Growth

The founder of a fast-growing SaaS company was preparing to sell the business to a strategic buyer after several years of rapid growth. Although the company was performing well, its financial reporting had not been optimized for a sale, and the founder had never gone through a transaction of this size.

The client’s investment banker recommended bringing in KLR’s Transaction Advisory Services team to help ensure the company was deal-ready and prepared to defend its value during diligence.

The Challenge

Bridging the Gap Between Growth-Stage Financials and Transaction-Ready Reporting

  • Financials were prepared on a cash basis and lacked consistency.
  • The company had significant nonrecurring expenses that were overstating costs.
  • Deferred revenue and annual contract billing made working capital analysis more complex.
  • The founder had limited experience with M&A, financial reporting or the diligence process.
How KLR Responded

Creating Clarity, Credibility and Deal Readiness

  • Conducted a sell-side QoE analysis to normalize EBITDA and present a clearer view of recurring earnings on a GAAP basis versus a cash basis.
  • Identified and adjusted for non-operational expenses, founder compensation, and one-time costs.
  • Analyzed working capital trends and helped define a reasonable target for negotiation.
  • Prepared the financial schedules and supporting documentation needed for buyer diligence.
  • Collaborated with the client’s attorney and investment banker to support deal structuring and Q&A with the buyer and their diligence team.
Key Outcomes

Strengthening Value and Closing with Confidence

The QoE report enhanced the credibility of the company's financials, giving the buyer confidence in the numbers

KLR's adjustments contributed to a seven-figure increase in purchase price by improving the EBITDA presentation

The working capital target was successfully negotiated using KLR's analysis

The deal closed ahead of schedule, and the founder described the report as invaluable

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"KLR was instrumental in helping us get deal-ready. Their team clarified our financial picture, identified meaningful EBITDA adjustments, and gave us the confidence to stand behind our numbers during diligence. The result was a smoother process, a stronger negotiation position, and a significantly better outcome than we expected."

- Founder & CEO, SaaS Company

Experience Matters. Let's Connect

Preparing to sell your business?

Our Transaction Advisory team can help you present accurate financials, support your valuation, and negotiate from a position of strength so you can close with confidence and maximize your exit.

Justin Nelson

Justin Nelson, Partner, Transaction Advisory Services

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