So we were very flexible on that front with terms and valuation and things like that. Well, he must have also had realistic expectations. Yeah, yeah. Again, he was not a 5 to 15 times CBIT guy. He was narrowly scoped.
Acquiring Minds
The Joy & Pain of Buying a Tech Business
Excerpts · 330 segments · ~1:42:36 long
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Well, I wonder if it helped too that he had engaged a broker already and maybe the broker had had set his expectations, had done that hard work of, of setting his expectations before you got to him. No, actually I don't know how much of this I can share, but the broker was encouraging the seller to, to re. To ask for almost twice as much as what we paid for, which was completely unrealistic.
So the seller had done his homework separately and seen how much IT services with non recurring and reoccurring revenue business models were worth. And he aligned his own expectations despite the broker saying, you know, we paid, we paid eight and a half million for this, for this deal.
The brokers were like, this is worth 20 or 22 million. And the seller was like, no, it's not worth 20 million. So that was great because he was motivated to sell and ready to go.
Yeah, great. Well, so tell us about the business.
What did Beecker do? So when we bought Beecker, Beecker was an IT services provider in the robotic process automation space. So what Beecker did was Beecker was and still is to some extent an implementation, development and implementation partner for large software companies focused on process automation.
So basically in RPA or robotic process automation, you have large public companies like UiPath that are just software companies that sell software licenses where companies can build automations or robots and deploy them to automate certain tasks. Right.
The software is not a DIY per se. It's not that easy to operate. So these software companies like UiPath will work with services partners like Beecker who will provide the development services and the implementation and the support to help customers deploy these automations.
So basically what? Yeah, go ahead.
Well, just to be clear on two things, it's essentially the traditional model of kind of a channel, kind of a channel partnership that you see in a lot of technology software companies or where they have valuable software. But it's complex and needs channel partners who are well versed, fluent in this software to actually design and do the implementation. And, and so you're really partnered with,…
There are a couple of other big vendors, but UiPath was the big one. And you make money on the, on the implementation. There's probably servicing and recurring component, you'll tell us, and then some cut of the license fee as well, some kind of the software fee itself.
Well, we'll get to the revenue lines, but it's a common pattern in software, right? In kind of, in kind of enterprise level software. Yeah, correct. You will see the same dynamics with AWS and Microsoft and.
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