RapidRatings is an independent ratings, research and analytics firm that is used by risk, procurement, and credit professionals at hundreds of Fortune 1000 companies to help them manage supplier risk, corporate credit risk, institutional investment risk, and other financial supply-chain risks associated with third parties including vendors, customers, underwriting counterparties, borrowers, and investors. The company was among the first to note concerns about firms such as MF Global, Enron, WorldCom, Parmalat, General Motors, Bear Stearns, Ford, US Steel, and Peregrine.
Marlin & Associates (“M&A”) has had an ongoing dialogue with RapidRatings’ management team for many years. As the company grew it received inbound interest from industry participants and financial players. In early 2018, management and the company’s board of directors asked M&A to help the firm develop, evaluate, and execute on its alternatives.
M&A leveraged its deep sector and transaction experience in financial technology and the risk and compliance space and worked in collaboration with the company’s management to develop materials that highlighted the strength of the company’s proprietary analytics, its strong competitive position, and its marquee client base. Additionally, M&A helped the team prepare a financial forecast backed up by detailed supporting models and a robust virtual data room. Then, together with management, M&A identified, contacted, and answered questions from potentially interested parties with relevant sector expertise and strong track-records that could add clear value to RapidRatings’ aggressive growth plans. M&A then worked with management as part of an efficient process that brought credible offers from six viable potential partners.
M&A worked closely with the management team to assess the various options presented to them. Ultimately, the company decided to pursue a $30 million growth equity transaction with FTV Capital, a growth equity firm specializing in supporting innovative enterprise technology and services-focused companies.
M&A acted as the exclusive strategic and financial advisor to RapidRatings on this transaction, working closely with RapidRatings’ management team and its legal and accounting advisors to develop discussion materials; identify potentially interested parties; engage in dialogue with possible investors; manage the due diligence review process; negotiate value, structure, and terms on alternative term sheets; select a partner; negotiate definitive legal agreements; and complete the transaction.