ift sales seminar

CappcoPartners

Value of Incorporating Sales & Marketing Best Practices During Turnaround Situations

Leaders in OperationalTransformation

• The company and team• Breakdown of performance improvement services• Turnaround strategies

• Short term revenue generation• Short and medium term exit plan• Long term change management

• Methodologies and tools• Value based selling• Growth assessment model• Pipeline assessment model

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SummaryThe objective of the session is to discuss a series of best practices where practitioners can better manage transformation projects. The focus is on how to identify and manage revenue growth opportunities and initiatives quickly and efficiently.

We are unique as we link strategy with execution and assist in delivering our recommendations. We are changing the way corporate turnarounds are completed by focussing on areas other than

cost control and financial engineering. We are changing the way due diligence is being completed by assisting investors better

understand the sales and marketing capabilities of their potential investments and doing this more cost effectively.

We educate CEO’s on the best growth strategies and tactics. We are changing how CEO’s prepare their company for an investment event by fine tuning their

sales and marketing operations in preparation.

CappcoPartners mission is to EDUCATE management and investors so they fully understand the operational issues within their company and investments and we EXECUTE strategies to successfully GROW and increase ENTERPRISE VALUE.

CappcoPartners

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We have worked with over 22 investors over the last 12 months and since 2009 have increased revenue for our clients by £ 75m and enterprise value for their investors by over £ 350m.

For 2 consecutive years CappcoPartners has won the “Operational Transformation Advisor” of the year award from the annual ACQ Global Awards.

During the M&A awards CappcoPartners was awarded the award for Excellence in Operational Due Diligence as we were able to demonstrate 14 references of successful assignments in the last 8 months.

Acquisition International Magazine manage an annual award process where CappcoPartners has won in 2 categories “Commercial and Operational Due Diligence” and “Operational Transformation”.

Mark Cappell Managing Partner - An experienced sales and marketing executive with over 25 years’ experience of managing software and service companies. Has been the CEO for 4 software and service companies and has managed 5 buy outs which have added value in excess of £ 300m for investors.

CappcoPartners is a firm of experienced sales and marketing executives who specialise in improving sales and marketing performance and executing corporate turnarounds where revenue growth and creation is essential. Since 2009 we have added £75m in additional revenue for our clients and over£300m in value to their investors.

CappcoPartners

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The team

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Chris Allen- Extensive experience in implementing sales process and is a talented sales coach with a focus on the deal and account review processes.

Has over 30 years of sales and marketing experience and has delivered training programmes

to over 200 companies such as London Stock Exchange, Microsoft, Oracle and Panasonic.

Pete Lock manages all search optimisation projects and assessments as well as marketing data

analytics. Pete has over 15 years experience in search engine optimisation and data analytics

Thomas Andersson is an experience due diligence executive and has a history in completing client

interviews and corporate research

Claire Cadogan manages all messaging assignments and has a background in business strategy

specialising in market trends, research and analysis and business development. Claire has worked for the last 12 years providing research to strategic

consultancies and commercial due diligence companies.

Paul Stratford is CappcoPartners Digital Director and is an award winning marketing professional.

Paul manages Usable Media, a leading digital agency which supports the day to day marketing

operations of the CappcoPartners clients.

Claire Hawes manages all Social Media and Branding activities. Claire has over 20 years

experience in managing marketing campaigns with a specialisation in implementing compelling sales

messages.

ZIMT PARTNERS

Private equity clients

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Due Diligence and Operational Assessment – We assist investors complete the most accurate assessment by implementing our proprietary “Growth Assessment Model” which assesses potential pre-deal issues as well as assessing capabilities for underperforming portfolio companies with a focus on sales and marketing operations and capabilities.

Performance Improvement – We increase revenue by identifying repositioning potential and improve sales and lead generations processes and capabilities for our clients. The three main services are sales and brand strategy, lead generation and sales execution.

Capital Raising and Exit Preparation – We help management teams consummate deals with a maximum return by preparing and identifying potential operational issues which may be discovered during the vendor due diligence process.

CappcoPartners delivers a series of unique operational transformation services focussed on:

Core Services

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We implement a “Value Based” methodology during our engagements which is an approach that quantifies the value the service delivers. This ensures the prospect understands and can measure the value they receive which allows the sales team to minimise discounting and increase differentiation.

“Pipeline Assessment Model” - We have created a pipeline assessment process which ensures the accuracy of data by aligning each deal to the target markets buying process.

Our proprietary “Growth Assessment Model” assesses and measures the sales and marketing capabilities and gives detailed information relating to the target firm’s ability to deliver their growth plan. We define each of the sections below with a scoring system, so that each area can be measured using an objective assessment. 1. Sales Strategy2. Brand Awareness3. Lead Generation4. Sales Execution5. Client Management

Methodologies

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Operational assessment and due diligence process

Approximately 250 data points will be examined where we will assess the current situation and their strengths and weaknesses. The following areas of the company will be assessed: Sales and Brand Strategy Brand Awareness Lead Generation Sales Execution Client Management

Analyse the current situation with a focus on how the company's sales team is selling, managing clients and managing their pipeline. Interview an agreed number salespeople and analyse the deals they have won and lost. We assess and measure the quality of the usage of the

CRM and other reporting tools and processes. We will complete a pipeline review using the company's

current process and assess the accuracy of the process. We assess and measure the quality of the sales tools such

as presentations, proposals, collateral.

Operational Assessment

Assessment of market awareness and lead generation processes, plan and capabilities in terms of strengths and weaknesses and make recommendations for change. Demand Generation assessment - review demand

generation plans, data condition, campaign successes, messaging, and conversion rates.

Website content, social media and SEO assessment. Review last six months of campaigns with leads generated

and conversion rates to identify and quantify the gap in order to support the sales targets.

Asset/content assessment - review fulfillment and promotional content such as webinars, white papers, case studies.

Assess the current messaging and target market buying behaviour and analysis of the key messages being communicated to the target markets.

We will analyse and confirm the buyer personas for each solution and document the reasons why they make decisions.

Compare client feedback on the key differentiators to that of mgmt and sales and marketing staff.

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Commercial Process75%

Demand Creation Process55%

Sales Execution Process50%

Go to Market Process50%

Market Awareness Process75%

ExecutionCapability

Sales Stages

Knowledge 95%

Education75%

Interest75%

Understand Value50%

Review Alternatives

35%

Selection75%

Negotiation 65%

Delivery Capability

Content & collateral

50%

Website Optimisation

50%

Pipeline 50%

Design & identity

50%

Customer experience

50%

Commercial 50%

External communication

50%

Tools50%

HR50%

Key Performance

Indicators

Enquiry to Lead ratio

50%

Leads to Meeting ratio

50%

Meeting to Presentation

ratio50%

Presentation to Proposal

ratio50%

Onsite to Contract ratio

50%

Proposal to onsite ratio

50%

The percentages are scores based on meeting/exceeding sales and marketing best practice

Operational assessment dashboard - example

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“We retained Mark Cappell at CappcoPartners to assist in evaluating a financial technology opportunity. His industry insight along with experience in due diligence and implementing sales process was helpful in understanding the growth potential of the firm we evaluated.” Giles Derry Partner Dunedin

“We retained CappcoPartners to perform due diligence on a potential investment. Their growth assessment model gave us a clear and measurable understanding of the potential execution issues we may face as well as a clear plan on increasing the sales capabilities in the company’s future.” Nick Jordan Partner Darwin Private Equity

CappcoPartners is a key due diligence partner and they recently assisted in the due diligence and creation of the 100 day plan for a new investment. Their assessment model was essential in identifying the key areas of focus post acquisition and their ability to work with the company’s management team ensured we had buy in for the necessary activities post deal. .”- James Blake Managing Partner - Growth Capital Partners

“We engaged with CappcoPartners to assist in the due diligence of a potential acquisition and were impressed by their industry knowledge and the methodical framework in which they analyse potential acquisitions. This was the 3rd time we have worked with them and their insight into the growth capabilities of the planned investments has been invaluable.”Jonathan Boyes Investment Director HG Capital

"We engaged CappcoPartners to perform due diligence on a potential investment 's sales and marketing operations. Their due diligence framework allowed us to gain valuable insights into the company's ability to execute their business plan and where the potential issues may occur after the close date. We shared this information with the company and this was helpful in order to agree the gaps and create in the 100 day plan. " Henry Sallitt Managing Partner FF&P

"We worked closely with Mark on a potential investment and decided not to proceed. His industry insight and experience in measuring growth businesses was crucial in our assessment of the company." Tony Nash Investment Director Lloyds Development Capital

“As part of our due diligence process we believe it is crucial to access the sales and marketing capabilities of any of our potential acquisitions. We have worked with CappcoPartners on numerous occasions and feel that their extensive sales and marketing expertise compliments our due diligence process.”- Martin Wygas Investment Director - Lyceum Capital Partners

Assessment and due diligence - examples

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Sales Execution

The objective is to implement a consistent sales process which is aligned to how their target market makes decisions.

Implement a sales process with agreed activities at each sales stage

Implement an accurate pipeline measurement process.

Deal and Account review process

Sales Training

Lead Generation

We manage and implement processes that identifies and qualifies prospects, leads and enquiries' before they are passed to sales. We create revised marketing plans and implement the following:

Updated content and collateral SEO and Website Optimisation Data Cleansing and

Appointment Setting Social media campaigns

Sales and Brand Strategy

Validation of the value proposition from an internal and external perspective and the creation of key sales messages including:

Target market size and requirements assessment

Sales territory analysis Competitor assessment –

product, brand and positioning Pricing methodology Sales messaging Partner strategy

We work for investors assisting their underperforming portfolio companies by implementing process change by managing and improving the revenue generation processes.

Performance improvement services

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Value based selling

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The company lost most competitive deals and the deals we did win were at significant discounts (avg 75%). Now, 3 months after the implementation of the value selling process was put in place, the avg discount is now 12% and we have won 65% of competitive deals. “ Richard Irons CFO Romax Technologies - Moonray Investments portfolio company

The objective is to demonstrate measurable value to the client as part of the sales process

Potential to qualification ratio

Qualification to Information

gathering meeting ratio

Pitch meeting to proposal

Legal meeting to signed contract

Agree a series of key differentiated messages and ensure all salespeople can articulate these to prospects and

clients.

Efficiency focus

Stage Based Ratios

Information gathering to pitch

meeting ratioCreate a value calculator to measure

the value the client may receive.

Create best practices in terms of differentiation and successful

activities.

Create consistencies in information gathering and objection handling.

Increase skills capabilities such as presentation and negotiation skills.

Proposal to legal meeting

Value based marketing process

“We worked closely with CappcoPartners and were able to jointly create a lead generation process and more importantly we identified areas in our process we needed to improve. We were able to make the changes quickly and as a result have seen immediate measurable results.” Jacqui Crawley CEO - KMB

“We engaged CappcoPartners to assist our management team create compelling sales messages and to implement a lead generation process. After 2 weeks we launched a series of new campaigns which were better targeted and as a result we received immediate benefits”. Nick Butcher CEO PDP Couriers - Core Capital portfolio company

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Exit Preparation - Anticipatory assessment of company’s sales and marketing operations to identify, quantify and address any problems and areas of exposure prior to examination by potential buyers or investors.

*** We have relationships with the main mid-market corporate finance firms who refer us to their clients in order to fine tune their operations in preparation for the due diligence process.

“As a new software company we needed significant help in structuring the sales and marketing processes in order to gain additional investment. After 3 months we were able to secure £28m in new funding even though we were still loss making. The fact that our sales processes were well structured was an important reason the investor had confidence in our ability to deliver the growth plan.” Tim Lyons Chairman and CEO PensionFirst

“We were in the process of selling a subsidiary of one of our investments but needed to restructure the firm to demonstrate the growth potential of the plan. After 5 months of the process improvement was complete and we successfully sold the subsidiary for £ 4m more than planned “ Heath Davies Group CEO Sword Group

Exit planning and investment preparation

Operation planning and preparation Creation of operational ratios Consistent branding and messages Creation of key documents to validate the

strategy and growth assumptions Competitor comparisons and review -

solution and products Growth and business plan due diligence -

execution and strategy assessment

Implementation of Key Operational Processes Pipeline methodology - stage definitions and measurement, Sales process - deal reviews and CRM usage Commercial process - proposals, bids, discounting and contracts Lead generation process - quality of CRM data, demand creation Client management process - account planning and cross sales

Investor Goals Visibility Measurability Consistency Proven Low Risk High reward Low

maintenance

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Turnaround strategies


Operational assessment – The process measures the current situation, strengths and weaknesses and recommendations for improvement.

Analyse why/how the firm has won and lost deals Analyse the pipeline to ensure accuracy Clarity of the sales messages and competitive

positioning Validation of the sales structure, compensation plans

and territories Analyse the sales tools which create demand such as

collateral and sales presentations Analyse the usage of the CRM system Analyse the external communication from the

website, social media and the various search engines

CappcoPartners combine strategic and operational due diligence services to ensure the clients receives the most accurate information on the potential investment or portfolio company.

Strategy assessment – The process summarises the attractiveness of the market along characteristics which are important to achieving the business plan, such as growth, trends, pricing and target segment potential.

Demand-side/supply-side analysis: segmentation, size, growth, trends and drivers

Competitive analysis: environment review, financial analysis

Review of competitor strategies and relative strengths Channel analysis: quantification, trends, relative

channel performance Product/service review: sizing, growth projections,

identification of success factors Opportunity quantification and review

Transformation assessment process

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Key turnaround activities - summary

Deal review and planning

Validate the accuracy of the pipeline

Account review and planning

Launch lead generation campaigns

Validate the accuracy of the key deals in the pipeline by interviewing each salesperson and validating the key sales criteria for each deal. Each deal has an agreed close plan and closing activities which are measured.

Messaging

Process change

Create a revised pipeline methodology based on the target market's buying behaviour and reclassify each deal in the new process. Validate each deal and ensure they are all in the correct stages with agreed activities.

Implement a series of lead generation campaigns with the objective of increasing the pipeline size and to uncover short term potential deals.

The focus in on reviewing each main client and to create a plan to either renegotiate specific terms or to identify potential opportunities. Once these are found, a detailed close plan is created and followed.

The creation of clear differentiated messages focussed on each target market and buyer persona. Each message is measurable and is validated after speaking with a series of clients.

The implementation of sales and marketing best practice is proven to increase close rates and reduce discounting. In addition, it gives confidence to potential investors that the data is accurate.


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Strategy - short term revenue generation


Validate the accuracy of the

pipeline


Account review and planning

The above case study has been verified by the Institute for Turnaround

Case study

An energy software company with 85 employees and offices in 6 countries where the objective was to make the necessary changes in order to sell the company for £ 12m within 8 - 12 months. Outcome The company was sold for £ 18m Increased profit from a breakeven forecast to £

2.5m in 8 months. This was a result of year end successful deals due to the newly signed relationship with IBM.

Signed a distribution agreement in China with IBM which increased reoccurring revenue for the next three years. This had a major impact of the Enterprise Value of the company.

Reorganized the sales teams and made significant changes in staff.

Implemented a global support process/system to monitor all client support issues.

Implemented the PRINCE 2 delivery methodology in order to control difficult and loss making service engagements.

Signed reselling agreements with Oracle and IBM.



Create an account planning format and formally contact each main client using a 3rd party to investigate the potential for short term sales. The creation of a close plan and strategy for each main client.

Pipeline – risk analysis

High deal riskRow Labels High Risk Low Risk Neutral Grand TotalNot ForecastedForecastedGrand Total

Deal control of the sales processNot Forecasted Forecasted Grand Total

ReferralPartnersDirectGrand Total

High time riskTime Risk High Risk Low Risk Grand TotalNot ForecastedForecastedGrand Total

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Compelling eventCompelling event No Yes Grand TotalNot ForecastedForecastedGrand Total

Confirmed budgetStage No Yes Grand TotalImpact AnalysisReview AlternativesSelectionNegotiationGrand Total

Formally selectedStage No Yes Grand TotalImpact AnalysisReview AlternativesSelectionNegotiationGrand Total

We have worked with CappcoPartners on multiple due diligence projects. They have consistently delivered excellent insight into the sales processes and pipeline of our investments which has benefited both ourselves and the target company. As a result, we now undertake detailed sales and marketing assessments on all our potential investments.”- Bernard Dale Partner - Connection Capital

“ECI have worked with CappcoPartners on a number of occasions, most recently engaging them in sales due diligence on a new acquisition opportunity. Their work helped us gain more insight into the opportunities within the pipeline and form a view as to the deliverable deals that we could budget against. Having an experienced sales director alongside us was a real advantage.” Lewis Bantin Partner - ECI Partners

The risk assessment is based ion the sales activities instead of traditional financial analysis

Value based selling - Deal review and planning

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The following questions were asked for each of the listed deals:

Is there a compelling event and if so what is this? Where did the original lead/enquiry originate from? What is their current system which they are using? What problem are they trying to solve? What is the potential ROI/TCO should they

implement the solution? What potential issues will arise should they

implement the solutions? Who are the competitors in the deal? Why is the solution different to the competitors? What is their selection process? What is their decision process? Has contract information been exchanged? Are there any potential contract issues Has any part of the implementation started What are the deal risks

“Our investor was very frustrated with our lack of forecasting accuracy which was due to poor pipeline management. After two months our pipeline and sales processes were restructured . The forecasts are now accurate and the relationship with our investor is on better terms” Nick Pike Sales Director ITRS – Carlyle portfolio company

“We utilised their experience in our investments and their assistance has been very well received by the portfolio companies. We are especially complimentary of their ability to assist our portfolio companies create consistent sales and lead generation processes”. Derek Elliott Partner Darwin Private Equity

“We referred CappcoPartners to one of our portfolio company’s in order to assist in the implementation of their sales process. They worked closely with the company and built a close relationship which was important in implementing the desired changes. We found that their experience in sales and marketing is important to our portfolio companies who focus on growth. “- Simon Jobson Investment Director - Growth Capital Partners

A detailed deal process is to be performed on each forecasted deal

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Strategy – exit and investment preparation



pipeline


Process implementation

Messaging

Case studyThe company had a formal offer from a US fintech firm however during the due diligence many operational issues were found and the price was reduced by $ 26m. As a result the Investor fired the CEO and hired CappcoPartners to implement a series of operational changes in preparation for the next due diligence process. Outcome Implemented PRINCE 2 implementation methodology

and took control of various problematic engagements. Implemented a sales process which ensured an

accurate pipeline and forecast The business was sold and the buyer did not make any

changes to the original bid.

The above case studies have been verified by the Institute for Turnaround



Implement a series of lead generation campaigns with the objective of increasing the pipeline size and to demonstrate the value of the pipeline.



Case studyThe company approached numerous private equity firms in order to gain additional investment to grow the company but were unsuccessful as they were an early stage company and did not have extensive operational expertise. Outcome The company successfully raised £ 28m after the 6

months engagement In 3 months the Cappco team created consistent sales

process and assisted their mgmt team in understanding their unique differentiators.

Implemented salesforce.com and created a pipeline measurement process which was accurate in the forecasting of new deals

We hired a sales and marketing team and implement a series of lead generation campaigns which increased the pipeline

Knowledge InterestEducation Review Alternatives

UnderstandValue Selection Negotiation

Commercial Process

Demand Creation Process

Sales Execution Process

Go to Market Process

Market Awareness Process

Buyers Model

Sellers Model

Each stage has: Clear objectives Information required Agreed activities Measurement criteria and KPIs Tools to support Skills to implement

We create and implement consistent processes across all areas of the sales and marketing mix

The objective is to align the target market’s purchasing cycle and process with how the company manages the sales process.


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Strategy – medium and long term revenue improvement



pipeline



Messaging

The above case study has been verified by the Institute for Turnaround





Case study

In 2010 Moonray Investments made a 45% share purchase and injected £12m in growth capital into the company. After 18 month, the company fell behind in their growth plan and there were potential cash issues.

Outcome In Q3/Q4 – 80% of the forecasted revenue

was achieved though additional sales to clients and year end revenue growth was 45%

A new sales methodology was implement and the sales team were trained and monitored using this process.

New systems were implemented such as Marketo for lead mgmt and salesforce for the sales CRM.

Created a new forecasted process in order to better manage the relationship with their professional investors.

Implemented a culture change where employees had formal roles and responsibilities.

Created a revised marketing plan Moved the licence structure to a lease model


CappcoPartnersMethodologies and tools


Value based sales process

"We introduced CappcoPartners to one of our recent investments in order to help them with their growth strategy. Their knowledge of sales and lead generation processes greatly assisted our portfolio company and was a factor in their recent success." Tony Dickin Partner Palatine Private Equity

We retained CappcoPartners to analyse the sales and marketing functions for a new investment as we have worked with them before and value their in depth sales and marketing knowledge and experience. We found the assessment very informative and as a result found significant short term efficiency gains. “ Sebastian Sipp ZIMT Holdings

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According to the Accenture analysis included in the 2012 Sales Performance Optimization Study, in the last three years, between 36 to 47 percent of sales representatives have failed to reach their annual sales quota numbers. Whereas, 92 percent of representatives who consistently used a sales process achieved their quotas.A sales process is defined as the “Critical steps in selling linked together to provide the common framework, vocabulary and metrics for how sales organizations review opportunities.” The sales process for each company should be unique and take into account, competition, industry, products and solutions. The process should be an amalgamation of the suitable parts of the following known methodologies.

Miller Heiman – opportunity planning and review process TAS – Target Account Selling (owned by Seibel) – Qualification Holden - Power Based Selling - People management and Tactics –

Trap/Inoculation Huthwaite SPIN - Questioning techniques Customer Centric Selling - Buyers Model ROI selling – calculation of measurable value Solution selling – differentiation of the solution

Growth assessment model

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The objective is to give the investor a clear view of the firm's ability to deliver the growth plan and to identify the potential gaps and issues which may incur after the investment or acquisition.

Pipeline methodology - example

Company Buying Stage Forecast Deal Control Business type

Budget confirmed

Compelling event

Legal Discussio

ns

Reference visit

Business case submitted

Legal Discussions

Licence Value

Time Risk

Formally selected

Contract Signature Date

Negotiation Yes Partner New Business

Yes No Yes No Yes Yes Low Yes September

Negotiation Yes Direct New Business

Yes No Yes Yes Yes Yes Low Yes September


Yes No Yes No Yes Yes Low Yes September


Yes No Yes Yes Yes Yes Low Yes September

Review Alternatives

Yes Partner Existing Business

No Yes Yes Yes Yes Yes Low Yes October

Selection Yes Direct New Business

Yes Yes Yes Yes Yes Yes Low No October

Selection Yes Referral Existing Business

Yes Yes Yes No Yes Yes Low No October

Impact Analysis

Yes Direct New Business

No No Yes Yes Yes Yes Low Yes October

Negotiation Yes Partner Existing Business

Yes No Yes Yes Yes Yes Low Yes November

Negotiation Yes Referral New Business

Yes No Yes No Yes Yes Low No November

Negotiation Yes Direct Existing Business

Yes Yes Yes Yes Yes Yes Low Yes November

Negotiation Yes Direct Existing Business

No Yes Yes Yes Yes Yes Low Yes November

Impact Analysis

Yes Partner Existing Business

Yes No Yes No Yes Yes High No November

Review Alternatives

Yes Direct New Business

No No Yes Yes Yes Yes Low Yes December

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The pipeline for each company is restructured to ensure