October 5, 2022

The importance of data before, during, and after a fundraise or exit

Highlights from our Leeds Digital Festival discussing the role of data in a fundraise – before, during, and after – and the impact of good data on investor confidence, smooth due diligence and, most importantly, valuation.
The importance of data before, during, and after a fundraise or exit.

Hasn’t Leeds Digital Festival been a blast? The events have been absolutely phenomenal this year and it’s been a real pleasure to be a part of. During the festival, I was delighted to sit down with Amman Boughan, CFO of Lights4fun, and Mitchell Cox, Director of Corporate Finance at EY, to discuss the role of data before, during, and after a fundraise or exit.  

We had a thought-provoking conversation, digging into how data can be used to drive improved valuations and mitigate valuation erosion during the process, and also how it can be leveraged to drive growth during the cycle.

Here are my key takeaways from the discussion:

  1. A good initial market pitch starts with a sophisticated business plan. The more this is backed by solid data, the better aligned all stakeholders and shareholders will be during the bidding process and the better your valuation.
  2. The business plan is supported by the finance model – which needs to be tested and challenged. Have those assumptions been tested enough? Can the data justify those assumptions? Having the data to support the business plan and financial model is key to maintaining the valuation throughout the process.
  3. If bidders/investors can’t mitigate or get comfortable with perceived risk, you’ll see value erosion. You can protect value with comprehensive data sets and analytics that bidders can use to understand risk and get comfortable with the size and shape of it. If you don’t have solid data across the breadth of your business, you risk leaving parts undervalued.
  4. Investors do the due diligence and agree on a business plan with the management team – but this needs translating into actions. These actions and their outcomes can probably be tracked across several different systems and data sets but extracting that and transforming it for reporting can be ‘hands-on’ and time intensive.
  5. Partnering with The Data Refinery allowed the automated integration of data sets leaving the team free to interpret the insight. This not only provided up-to-date reporting on progress but provided more granular insight to drive incremental value driving action.
  6. An integrated, trustworthy data asset allows the management team to focus on the key question, which is “How do we drive value?”.
  7. Finally, the overwhelming theme of the morning was: Improving reporting can add value and will increase returns.

If you are interested in finding out more – please join us at our Every Deal is a Data Deal event in conjunction with Panintelligence, Data Diligence and The Data City on the 11th October at 4pm where we’ll be discussing this topic in more detail, particularly for advisory teams.

I’ll be joined by Amman once again to get a real-life case study on the impact of data on the deal process and how it can really be used to drive value during the deal cycle. Alternatively, check out our case study with Lights4fun to learn how we helped them become a data-driven organisation. Request a demo of The Data Refinery here to see how we can change your world with your data.

As an aside – huge congratulations to Amman who shortly after sharing his thoughts with us at the festival won “Finance Director of the Year for Innovation” as a result of his work at Lights4fun. Thoroughly well deserved!

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