Assertion certainty 4/5 debate potential 1/5

Inventory Planner grew from $2.4M to $4.5M in revenue during acquisition

Derek O'Connell · The Math Behind the $360m Sage Paid to Acquire BrightPearl · Apr 18, 2022 · at 3:08

Brightpearl CEO Derek O'Connell explains the revenue trajectory of retail software tool Inventory Planner during Brightpearl's acquisition of the company.

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“So that business is growing at 70%. When we sent in the LOI, the letter of intent we have, we obviously had them growing at 70%. They were on revenue at 2.4. They ended the year at four, 4.5.”

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More from Derek O'Connell

Insight
Sage acquired Brightpearl to build a retail solution to rival NetSuite
“And the reason why Sage bought us at the end of the day is they compete with NetSuite. So do we. But it's no secret that if you go to their website, you don't see a sector specific solution for retail, but obviously we are a sector specific solution for retail…”
Derek O'Connell Apr 18, 2022 ▶ 11:33 The Math Behind the $360m Sage Paid to Acquire BrightPearl
Disclosure
Brightpearl executed an internal down round to top up employee option pool
“We did do a down round, like in terms of a revalue of bride pro we had to, and the primary driver of that was to ensure that we could top up the option pool for the employees and make sure that they all came along for the ride and every share was equal.”
Derek O'Connell Apr 18, 2022 ▶ 5:25 The Math Behind the $360m Sage Paid to Acquire BrightPearl
Assertion Supported
Sage acquired Brightpearl for a $360M enterprise value plus retention packages
“Three 60 enterprise value, and then some separate retention stuff on top, but enterprise value in terms of equity was three 60, which everyone was very happy with.”
Derek O'Connell Apr 18, 2022 ▶ 13:42 The Math Behind the $360m Sage Paid to Acquire BrightPearl
Insight
Partnering beats building custom accounting tools in a commoditized software market
“I wanted to raise money to build a better accounting solution within Brideboro specifically designed for retail. But when I looked at it, the cost of doing that and having a clear idea of what the strategy was to win in a highly commoditized market didn't real…”
Derek O'Connell Apr 18, 2022 ▶ 15:32 The Math Behind the $360m Sage Paid to Acquire BrightPearl
Assertion Partly supported
Brightpearl's revenue grew from $12.8M in 2019 to $30M in 2021
“Yeah, we ended 2019 at 12.8. Then the next year, 2020 went to eighteen million. So that was about 39, 38% growth. And then in 21, just gone, we got to thirty million, which was 63% growth year over year.”
Derek O'Connell Apr 18, 2022 ▶ 1:49 The Math Behind the $360m Sage Paid to Acquire BrightPearl
Assertion Not publicly verifiable
Brightpearl's $30M revenue in 2021 included $4.5M from an acquisition
“So organically Brightboro got to 25 and a half and then the four and a half came from the acquisition that we made. So the group got to thirty million at the end, which was key.”
Derek O'Connell Apr 18, 2022 ▶ 2:41 The Math Behind the $360m Sage Paid to Acquire BrightPearl
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