Private advisory
From a US$10 Million Valuation to a US$96 Million Pre-Money Valuation
Nathan identified commercial opportunities the existing structure failed to capture, and designed the business models and commercial structures to realise them.
This is Nathan’s firsthand account of a transaction he worked on directly.
The situation
A technology business approached Nathan with a valuation problem.
The company had strong operational capabilities and had developed valuable technology. Its operations, technologies and business models were not connected in ways that maximised the value they could create.
The owners were highly capable within their areas of expertise, but their understanding of the business was shaped largely by what they had built and how they operated.
The existing valuation was approximately US$10 million and reflected a relatively narrow view of the business’s assets and liabilities.
The underlying problem
The problem was not simply how the business was being valued.
It was how the owners understood the business itself.
Their perspective emphasised their own operations and inventions rather than the broader possibilities available through customers, partners and other stakeholders.
The existing commercial structures did not fully connect the capabilities already present within the business.
The intervention
Nathan examined the business from the perspective of its stakeholders. He identified commercial opportunities that were not visible within the owners’ existing understanding.
He designed new business models and commercial structures connecting the company’s technology, operational capabilities and stakeholder relationships.
The outcome
Nathan personally designed new commercial structures and business models. That work resulted in a proposed pre-money valuation of US$96 million.
Investors were presented with both the original valuation of approximately US$10 million and the proposed US$96 million pre-money valuation.
They subsequently invested US$2 million at the US$96 million pre-money valuation, implying a US$98 million post-money valuation, assuming a straightforward equity financing. The business was not sold.
US$10M
Approximate original valuation
US$96M
Proposed pre-money valuation
US$2 million invested at the US$96 million pre-money valuation
What this demonstrates
Nathan identified commercial possibilities the owners’ existing understanding had not included, then personally designed the business models and commercial structures that made those possibilities achievable.
Human interpretation, behaviour, technology and commercial design came together in the structure of the business.
Transaction facts
- Original valuation
- Approximately US$10 million
- Proposed pre-money valuation
- US$96 million
- Amount invested
- US$2 million
- Implied post-money valuation
- US$98 million, assuming a straightforward equity financing