Client Overview

Investor: Mid-market private equity firm specializing in technology platforms
Target Company: Lab compliance and EHS software provider
Industry: Laboratory safety, research compliance, chemical inventory management
Geography: North America

Situation
Our client sought add-ons for an existing portfolio company in the lab compliance space. During our outreach, we connected with a founder-led lab compliance software company whose CEO had openly expressed interest in joining a larger organization to accelerate growth and expand into research tools.

Challenges

• The initial target didn’t perfectly align as an add-on based on the product roadmap of the investor’s platform
• There were questions around whether integration would create immediate synergies or require a standalone growth strategy
• The platform investor needed conviction in the end market’s scalability to justify a standalone platform thesis

Basin Lake’s Role

• Identified the target’s openness to a strategic partnership or acquisition during direct founder conversations
• Highlighted the broader market opportunity for a lab compliance platform with adjacency to research enablement tools
• Presented the opportunity to the investor as a potential standalone platform, not just an add-on
• Advised on market dynamics and potential white space in research and lab operations software

Solution & Process

• Introduced the target directly to the investor in October 2022
• Supported diligence, positioning, and market evaluation efforts as the investor shifted strategy toward a new platform
• Worked with the buyer and seller to align on vision for scaling through further acquisitions

Outcome

• Investor closed the acquisition in April 2023, launching a new platform focused on lab safety, compliance, and research enablement
• Platform established a scalable foundation for further M&A in fragmented lab software markets

Key Takeaways
✅ Transformed an initial add-on search into a thesis for a new platform investment
✅ Created alignment with a founder seeking the right partner to grow beyond compliance into broader research tools
✅ Enabled investor to establish a foundation for a buy-and-build strategy in an attractive, under-digitized niche

Client Overview

Investor/Platform: Lab compliance platform acquired in 2023 (see Case Study 1)
Target Company: European lab software company specializing in electronic lab notebooks (ELN)
Industry: Research informatics, lab management, biotech & academic labs
Geography: Europe + global customer base

Situation
Following the platform acquisition, we formally engaged to canvass the lab compliance and EHS market for strategic add-ons. We identified a European lab software business owned by a large global life sciences company. The target’s founders had departed, and the seller’s leadership was disengaged, with minimal sales support coming from their parent company.

Challenges

• The seller’s parent organization debated pausing discussions to run a formal process, which risked losing deal momentum
• Leadership upheaval at the seller created process uncertainty and ownership gaps
• The buyer faced competition from multiple parties submitting bids once the opportunity surfaced

Basin Lake’s Role

• Introduced the European target within one day of discovery, driving immediate buyer-target engagement
• Navigated complex internal dynamics after the seller’s internal process lead resigned mid-deal
• Helped the buyer and target frame the benefits of a direct, quick close instead of a full-blown auction
• Guided valuation negotiations and exclusivity strategy to maintain momentum despite additional bids

Solution & Process

• Coordinated introduction and alignment between buyer and target leadership in January 2024
• Facilitated diligence and structured conversations around deal terms while maintaining confidentiality
• Advised both parties during shifting seller dynamics and supported continuous communication to prevent deal collapse
• Assisted buyer in adjusting bid and securing exclusivity in fall 2024

Outcome

• Buyer closed the acquisition on 12/13/2024
• Add-on more than doubled platform scale, adding 1,000+ labs, ~60% biotech customers, and major international reach
• Platform strengthened leadership position in lab compliance and expanded into ELN and broader research markets

Key Takeaways
✅ Proactively sourced a high-impact, proprietary add-on expanding platform scale and international presence
✅ Navigated seller leadership turnover, competitive tension, and board uncertainty
✅ Enabled the buyer to move quickly and secure a transformative acquisition despite potential derailment

Client Overview

Investor: Global secondaries and structured equity fund
Target Company: Growth-stage cybersecurity SaaS platform providing advanced data-centric security solutions
Industry: Cybersecurity, data security, information rights management
Geography: Headquartered in Asia with a large U.S. customer base

Situation
While conducting a cybersecurity-focused search for a separate client, we identified a software company facing a unique crossroads: it had strong customer traction and a growing market, but it struggled to raise fresh capital at a valuation investors found reasonable. Complicating matters, the company had a cluttered cap table with legacy VC investors resistant to dilution or exit. The banker running the raise was marketing a larger primary round but faced limited investor interest due to valuation concerns.

Challenges

• Outdated cap table with early VCs blocking new investment
• High valuation expectations that made the marketed primary round unattractive
• Cross-border operational complexity requiring redomiciling to the U.S.
• Urgent need for growth capital to keep pace with market opportunities

Basin Lake’s Role

• Identified the opportunity as a better fit for a secondary + primary capital structure rather than a straight equity raise
• Consulted directly with the banker to realign strategy toward a hybrid solution
• Introduced the banker and company to a specialized secondaries investor experienced in founder-led and VC-backed situations
• Guided discussions on structuring the transaction, valuation expectations, and the complexities of moving the company’s domicile to the U.S.

Solution & Process

• Structured a deal combining approximately 50% secondary capital (to clear out legacy VC positions) and 50% primary capital (to fund growth initiatives)
• Helped the investor assess the redomiciling requirements and plan around cross-border legal and tax complexities
• Managed valuation conversations and expectations between the company, banker, and investor, keeping alignment despite geographic and structural challenges
• Supported the process through closing, ensuring steady communication and momentum

Outcome

• Investor closed an investment of around $30M, split evenly between primary and secondary capital
• The transaction cleaned up the cap table and provided the company with fresh funds for growth
• Post-close, the business accelerated hiring, expanded go-to-market execution, and significantly improved its growth trajectory

Key Takeaways
✅ Recognized when a struggling primary-only raise could succeed as a hybrid secondary-primary transaction
✅ Enabled a cleaner ownership structure and provided critical growth capital
✅ Navigated redomiciling challenges and cross-border transaction complexities
✅ Demonstrated expertise in bringing actionable, creative solutions to growth-stage technology companies

Client Overview

Acquirer: Mid-market procurement software platform
Target: Aging enterprise spend automation provider
Situation: Distressed asset in a sponsor portfolio with ~$7M ARR

Context
In mid-2022, our team identified a procurement software company that had been largely stagnant under private equity ownership. The asset had flatlined in growth, burned through over $50M in invested capital, and accumulated significant debt. The sponsor was actively seeking an exit, and a banker was running a limited process.

At the same time, we were working with a next-generation procurement platform open to acquisitions that would deepen its capabilities in the U.S. enterprise spend automation segment. After evaluating several options, the acquirer engaged on this opportunity due to the complementary customer base, data capabilities, and brand value.

Challenges

• Distressed cap table with urgency to exit
• High fixed costs and declining services revenue
• Customer concentration with a handful of aging auto and industrial clients
• Limited growth, poor margins, and outdated tech stack

Basin Lake’s Role

• Identified and presented the distressed opportunity to the acquirer early in the process
• Helped position the target as a synergy-rich asset with immediate scale and EBITDA upside
• Advised through stalled negotiations and helped structure a transaction at an attractive valuation
• Guided internal alignment on integration approach, synergies, and execution risk management

Transaction Details

• Acquired for $11.5M total enterprise value
• ~$7M ARR with ~65% gross margin
• ~$2.5M in negative EBITDA, but cost-reduction potential of $5M+ identified pre-close
• Transaction closed via a structured payment including a 12-month business continuity earn-in

Strategic Rationale

• Scale: Doubled the acquirer’s revenue base and established mid-market credibility
• Customer Base: Added ~30 U.S. enterprise clients, including 9 in spend automation
• Cross-Sell Potential: Opened new accounts for analytics, sourcing, and marketplace modules
• Data Enrichment: Unlocked a proprietary India-based capability for item-level SKU enhancement
• Marketplace Model: Validated a ‘one-vendor’ marketplace model the acquirer had been developing
• Brand Augmentation: Strengthened market presence and increased inbound interest and analyst visibility

Outcome

• Deal signed and executed at a distressed multiple with favorable terms
• Immediate headcount and OPEX synergies triggered during diligence phase
• Target team retained for continuity with planned phase-in of broader integration
• Acquirer elevated into a “must-know” vendor category in procurement tech circles

Key Takeaways
✅ Identified a non-obvious match between a distressed asset and a growth-stage acquirer
✅ Helped navigate internal resistance and pricing hurdles to close at under 2x ARR
✅ Unlocked major strategic value by combining scale, margin upside, and cross-sell potential
✅ Drove execution of two synergistic acquisitions in parallel — a rare feat at this stage