Case Studies

Valuation analysis of a datacenter flash storage company for a private equity fund

Posted by | Fuld & Company

Supporting a private equity fund with the valuation analysis of a datacenter flash storage company for its ongoing Series C financing round

Background + Challenge

A private equity fund wanted to conduct a valuation analysis to assist with an ongoing financing round of a datacenter flash storage company at the cusp of explosive growth. As part of the analysis, the fund desired the inclusion of both quantitative and qualitative factors, including the company’s past financial performance, proliferating market opportunity, and its blue-chip customer base. The fund approached Fuld and Company to achieve this objective.

Fuld and Company’s Solution

To ensure the inclusion of both quantitative and qualitative aspects in the company’s valuation, Fuld and Company conducted an extensive research to determine the industry trends, and the company’s position in the industry.

Fuld and Company incorporated various valuation methodologies, including publicly traded comparable analysis, precedent M&A transactions analysis, close business comparable Series B and C fund raise valuations, precedent private placement transactions analysis, and discounted cash flow analysis.

The valuation report collated by Fuld and Company included an executive summary comprising the findings of the report and the valuation summary in an illustrative football field format, a deep dive into the industry trends and the company’s positioning, and the valuation analysis.

Outcome for Client

The valuation analysis allowed the fund to attribute an equity value to the financing round of the datacenter flash storage company. In addition, the findings with regard to industry trends and the company’s position in the industry offered a varying perspective to the PE fund. The analysis also facilitated a comparison between the multiples of various companies within the industry.

 

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