This exciting Software Company provides a Subscription-Based Revenue Model via telephony-based time and attendance software. The business represents a solution to healthcare clients and their home health care providers via a highly sought-after Software-as-a-Service (SaaS) model. The proprietary software tracks caregiver in-home visit time, schedules, activity and GPS locations for billing and payroll. Sometimes referred to as an EVV (electronic visit verification), the product provides an essential service in the ever-growing health care industry.
With 120 commercial clients and approximately 10,000 current users, the Company is gaining significant traction in the EVV market. In addition to organic growth from its existing client base, the company is adding three new major clients with over 1,500 new users in Q4 2016 alone. The Company also has a pipeline of eight more clients enrolled in its 30-day free demo program. TTM Sales through September are $455,000 with TTM earnings of $233,000. 2016 TTM earnings are set to top $250,000.
This Tech Company can be valued in multiple ways – via a multiple of Annual Recurring Revenue (ARR) or via a multiple of expected earnings. Using the ARR Model, and without projecting past 2016, the company would be multiplied conservatively at a roughly 2.6X multiple. Using the expected cash flow model, the company would be multiplied at a roughly 4X multiple.
This company has seen annual sales growth of between 34% and 52% for each of the last four years (with over 50% annual SDE margins) and is expected to significantly exceed this moving forward. One major component that has cemented this future growth is a recently completed API (Application Interface) with two major national healthcare billing providers. This is a significant strategic alliance that will expose the Company to THOUSANDS of new potential clients as the preferred EVV partner of these billing providers.
The software is web-based and is easy to get up and running with no hardware or software to set up. The company offers a free trial period for new clients to test the software and it currently has eight new clients in this pipeline (with an average 30% conversion rate). Revenue streams include a mix of monthly recurring billing, per transaction fees, set up fees and mobile app usage fees. The software platform is extremely sticky in that once users are set up and on board, the low cost and ease of use limits turnover.
The company is growing in popularity among home health care companies and will soon be exposed to thousands more due to its recent API development and strategic alliance with its billing partners.
This is an amazing opportunity to acquire a SaaS Internet Company selling proprietary, industry-leading, sticky products that are in high demand – all with recurring revenue.
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