The challenge
An 8-figure edtech curriculum business approached Midici as they were beginning to consider going to market. They wanted help with evaluating their business from the outside, the way a potential buyer would evaluate and value them, and then support in operational reporting and strategy to move the metrics that would impact their valuation most.
The company manages its business course by course. It measures retention by whether a course is offered again the following term, and looks for upsell opportunities within each course. That is a sensible way to run the business, but it is not how a buyer measures retention. A private equity firm will expect a standard measure, such as year-over-year retention of the same customers, without the context of which courses were available to renew. Our founders ran product and engineering at an education company that sold into courses in the same way, so we had worked through this translation before.
Our approach
We began with a Value Creation Assessment, scoring the business against the benchmark metrics buyers commonly use to value a company like this one. The assessment showed where the company would be strong under a buyer's review and where it would be questioned, and it identified metrics the company was not yet tracking, including a measure of its total addressable market.
With that picture in place, we built the reporting its teams would use to move those metrics from week to week.
What Midici did for them
- We restated the company's course-level data in the terms the assessment set out, starting with year-over-year retention of the same customers.
- We built automated reporting on the Midici platform, drawing on the company's HubSpot data, Slack channels and meeting notes, with access set by role and every past report kept for reference.
- We delivered a monthly report card to the executive team, covering the metrics a buyer would focus on, where leadership should spend its time and the largest risks to the company's valuation.
- We delivered weekly reports to the growth and sales team on new business and upsell opportunities, and to the retention and customer success team on retention and expansion, with the top 50 accounts by revenue tracked individually.
- We gave each go-to-market leader a weekly summary of what had happened and the recommended next steps.
- We identified accounts at risk in three ways: accounts with most of their revenue at risk, accounts whose projected net revenue retention had fallen, and large accounts with no meaningful contact in the previous 60 days. Accounts that appeared in more than one view were raised with their owners first.
- We flagged where the underlying data needed attention, such as reasons for lost deals that were too general to act on.
What changed
The report card made clear where the company would be weakest under a buyer's review, and gave leadership two priorities for the period before the sale: improving retention, and building a clearer measure of the total addressable market by tracking the full pool of courses the company could sell into.
