Blockchain/IT Platform PE Assessment for $3M Fund Raise

Target company is an open intelligence repository and platform that unlocks the power of Vertical Search in a highly scalable and profitable way. The target company platform is designed to provide a safe and secure environment to consume sector specific real-time data intelligence

Their current objective is an $3M raise to facilitate a five-year growth plan  

The LoBue team worked closely with target company executive management in reviewing and assessing the operational strategy, corporate structure, as well as financial model including business growth.

As part of the four-week due diligence process, LoBue evaluated the target in the context of organization and corporate structure, operations analysis, products and services, financial analysis, and regulatory compliance from a competence and maturity perspective resulting in a rating of Emergent, (level two on a scale of one to five).  

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High-level Review and Recommendations:

• Vetted and expanded target’s forecast for five-year plan, with driver details.
• Performed competition review of similar companies and products.
• Corporate structure review identified deal structure action items for client.
• Reviewed target company products and services and readiness for delivery.
• Evaluated sales, go to market plan and applicable benchmarks.
• Developed five-year organizational growth plan.
• Prepared Sources and Uses Statement to provide LoBue client with expected cash flow demand, as well as identifying potential challenges and opportunities.

Select Detailed Recommendations:

• Key Positions are needed for primary functions, including Technology, Security, Business Development, Sales, Operations, Human Resources and Finance/Accounting.  
• It is possible that management has underestimated the number of staff required in future years.  However, the financial impact of adding additional resources is negligible.  The important consideration for management is to stay ahead of the curve to ensure no service problems.  
• It is our opinion that user acquisition will require additions to the current staff model for Marketing, Sales, and Business Development to keep up with the significant increase in leads.  
• Develop a tracking and reporting methodology for the entire customer pipeline. This will provide valuable information for sales performance, expected resource planning, and allow executive management to understand opportunities which might get stalled or delayed.  
• Target will need to be cognizant of all search engine results in order to reach the vast audience that their financial plans require.  The market development plans must ensure that their search parameters include up-to-date awareness of key words being used by potential customers.
• In order to support the technology/operations objectives, hiring of needed staff/contractors should occur immediately after fundraising.
• As the IT Help Desk Support is implemented, the feedback processes into the Product development team should be defined so there is adequate understanding of product enhancement opportunities. This offers an opportunity to institutionalize a continuous improvement mechanism that will inform and prioritize methods to enhance customer experience, delivery capabilities and product functionality.  
• Develop onboarding process and procedure.
• Identify back-up resources for all key management positions.
• Define the targeted outcomes and key results and track the actual performance for the employee and help them in their development plan.  
• Management should develop a detailed user acquisition plan and monitor this plan weekly in order to ensure it hits the forecasted totals.  On a monthly basis, for example, review user assumptions for any modifications.
• Clarify the Cap Table and what divided and voting rights go with each type of stock.  

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