Sometimes a little digging needs to be done…research. Sometimes it is not that easy to find valuations, niche parts of industries are tough, but lets try a “Remote storage backup company”
The WHIR described this privately held Company as a firm that “…provides offsite, online data backup and restore services that let enterprises and government agencies rapidly and securely backup and restore files, databases and operating systems.”
The Company Acquired: DS3 DataVaulting Fairfax, Va
Founded 2002
Privately held
Annual Revenue: $6M
EBITDA: $1.5M
Investment in DS3 by Angels $6M
The Buyer: Terremark Worldwide, Inc. (NASDAQ:TMRK)-Miami
Annual Revenue: $300M
Annual EBITDA $75M
A story by By Joseph Kovar at ChannelWeb had an interesting quote: “Terremark found us because they want to focus on the Asigra technology,” Hayes (president of DS3) said. “They were interested in us because we have the Asigra 3D Hybrid partnership. They said, since we have it, they’ll buy us instead of building it themselves. If they didn’t buy us, we could have helped them develop the service.”
The good fun part: Deal Metrics…
Purchase Price: $11.5 million in cash
Multiple of Revenues: 1.91
Multiple of EBITDA 7.66
My thoughts —– I was impressed with the EBITDA valuation pushing 8 is more than excellent for a privately held company….theoretically you are waiting 8 years before you get your investment back…right? Anytime a company with $300+ million revenues and $80M EBITDA, Terramark, buys a company with $6M in revenues and $1.5M EBITDA, DS3,they want something. Usually firms just don’t buy companies to raise revenues or EBITDA 2%.
Terremark acquired DS3 DataVaulting for the SAS aspects in order to beef up its services offerings and make it a bigger player in the cloud computing market.
This is part of the cloud timing and urgency…and possibly the frenzy I am studying and working info future blogs. Timing is everything today and you need to move fast to position yourself.
Later Tom – Or Meet me in NYC at the WHIR Networking Event Thurs March 25th.
More about Tom: NCC – the Hosting Business Broker Twitter: TomNCC
About Tom Millitzer
I am an M&A guy. I sell Hosting Companies. I want you to fulfill your dreams. If you are building your company or exiting for success...I want help you grow rich.
I started NCC International in 1994, we represented our first hosting company in 1997. NCC has completed over 400 assignments. If you are considering buying or selling you need to know me. I do not bite.
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