Human Capital Management 2019 Overview
Human Capital Management2019 OverviewH O U L I H A N L O K E Y T E C H N O L O G Y, M E D I A & T E L E C O M G R O U P
Houlihan Lokey is the trusted advisor to more top decisionmakers than any other independent global investment bank.Corporate FinanceFinancial RestructuringFinancial Advisory2019 Global Distressed Debt & BankruptcyRestructuring Rankings2019 M&A Advisory RankingsAll U.S. TransactionsAdv isorDeals1Houlihan Lokey1,057432JP Morgan929Moelis & Co363Duff & Phelps7344Lazard294Morgan Stanley6215AlixPartners195Bank of America Merrill Lynch612AdvisorDeals1Houlihan Lokey761672PJT Partners IncJP Morgan14134Morgan Stanley1225Evercore Partners112Adv isorDeals1Houlihan Lokey1842Goldman Sachs & Co3Source: Refinitiv (formerly known as Thomson Reuters)Source: Refinitiv (formerly known as Thomson Reuters)No. 1 U.S. M&A AdvisorNo. 1 Global Restructuring AdvisorTop 10 Global M&A Advisor1,000 Transactions CompletedValued at More Than 2.5 TrillionCollectivelyLeading Capital Markets Advisor2000 to 2019 Global M&A FairnessAdvisory RankingsRefinitiv (formerly known as Thomson Reuters). Announcedor completed transactions.No. 1 Global M&A Fairness OpinionAdvisor1,000 Annual ValuationEngagements2
Leading M&A Advisory Firm With Global Reach Consistently ranked No. 1 M&Aadvisor for U.S. transactions under 1.5 billion for the past severalyearsNorth AmericaEurope and Middle Sydney More than 1,300 employees in 23total offices worldwideChicagoMinneapolisDubaiMilanHong KongTokyoDallasNew YorkFrankfurtParisSingapore One unified team with a sharedbonus pool incentivizes bankersfor global coordinationHoustonSan FranciscoLondonLos AngelesWashington,D.C. Global reach and local countrypresence required to accesscross-border buyers and extractoutlier valuationsU.S. M&A Transaction LeaderNumber of Deals905800700500400300200 45% Owned by Employees 3 Billion Market Cap 1 Billion of RevenueNo Debt5054774744412018 M&A Advisory RankingsU.S. Transactions Under 1 Billion2019 M&A Advisory RankingsU.S. Transactions Under 1 Billion1900600Publicly TradedLeader in U.S. M&A Transactions Under 1 BillionHoulihan Lokey executed more transactions under 1.5 billion over the past fiveyears than any other firm.10001,300 EmployeesAdv isorDealsHoulihan Lokey178AdvisorDeals1Houlihan Lokey199Goldman Sachs & Co1032Raymond James Financial Inc10223Goldman Sachs & Co963Generational Equity983Jefferies LLC964Stifel/KBW975Piper Jaffray Cos945Jefferies LLC95Source: Refinitiv (formerly known as Thomson Reuters)Source: Refinitiv (formerly known as Thomson Reuters)10003
Unparalleled Experience With Financial SponsorsLargest Financial Sponsor GroupFocused on Mid-Cap FundsImportance ofSponsorsDeep Relationships Across Fund Sizes and Types Houlihan Lokey has sold more than 400 companies to financialsponsors over the past five years Buyout firms have approximately 1 trillion of dry powder1Broadest andDeepest FinancialSponsor CoverageGroup Houlihan Lokey has 16 senior officers dedicated to thesponsor community in North America and Europe Coverage of 850 private equity firms, 200 hedge funds, and100 family offices Organized geographically to ensure client coverage proximityHigh QualityRelationships Worked on more than 800 engagements for financial sponsorsin the past year Provide financial sponsors access to successful solutions–with coverage officers facilitating two-way information flowbetween the sponsors and Houlihan LokeyUnparalleled Dataon Buyer Behavior Knowledge of, and database on, financial sponsor preferencesand behavior through our relationships and deal flow Collect and analyze comprehensive data on industry, size, andgeneral market trendsCompanies Houlihan Lokey Sold to FinancialSponsorsMore Than 400 Companies Over the Past 5 Years1818120142015Source: Pitchbook.com and Preqin71201690201710620184
Leading TMT Advisory TeamSenior Leadership Team With Extensive ExperienceRob LouvRoy KablaCo-Head andManaging DirectorCo-Head andManaging DirectorJohn CooperSteve CramerManaging DirectorManaging DirectorManaging DirectorExpertise and Capabilities Key RelationshipsAWS/Azure/CloudHostingPublic CloudPrivate CloudHybrid CloudData CentersCo-LocationExpertise and CapabilitiesDigital Publishing/VideoDigital PublishersDigital VideoHealth InformationViral ContentDigital Rights Vertical Industry Software LegalTravel and HospitalityEdTechNonprofitReal Estate Film Production andDistributionMusic PublishingEntertainment ServicesMusic FestivalsEntertainment IP Sports/Live Entertainment Fantasy Sports/GamingOTT/VideoData AnalyticsSocial entHuman CapitalManagement Data InfrastructureEnterprise AnalyticsData Sources and APIsData ResourcesEnterprise Workflow/Content Management Talent Acquisition HRIS Talent Management Digital Workplace Enterprise Collaboration ERPInfrastructure/Security Manufacturing Tech/ Supply Chain/Procurement E-Commerce/Retail Tech Key RelationshipsCloud MonitoringNetwork ManagementNetwork AnalyticsSecurity Log ManagementIT Operations Management CRMCustomer EngagementMarketing AutomationAd TechData Analytics/Intelligence Digital Content DeliveryVR/ARFamily EntertainmentArcade Video Games Marketing Automation Music TechFood TechExpertise and Capabilities On-Demand ServicesCreative Participation Key geBroadcast Technology/ Media Services Consumer InternetServicesManaging DirectorChristopher WilsonThomas Olivier Daniel GosselsManaging DirectorPlanningS&OPProcurementInventoryVMSB2C E-CommerceE-Commerce EnablementRetail AnalyticsPOS5
Domain Expertise: HCM Technology and Tech-Enabled ServicesHCM SoftwareHCM Tech-Enabled Servicesa portfolio company ofhas been acquired byhas been acquired bya portfolio company ofhas received an equity investmentfroma portfolio company ofalong with minority investorhas divestedhas divested 24,000,000Series DConvertible Preferred Stocka portfolio company ofhas been acquired bya portfolio company ofhas been acquired byhas beencompletedacquireda financingbyconsisting ofhas been acquired bytoTalent & TechnologySolutionsa portfolio company oftohas been acquired byhas sold ECS Federal toBert MillerSellside AdvisorLearningManagementSellside AdvisorLearningManagementFinancial AdvisorSellside AdvisorTalentAnalyticsEmployeeEngagementhas been acquired byhas been acquired bySeries D Convertible PreferredStockhas been acquired byLed by:PlacementSellside de AdvisorSellside AdvisorSellside AdvisorWorkforceManagementhas been acquired bya subsidiary ofhas been acquired bySellside AdvisorGovernmentContractingStaffingStaffinghas partnered withWith participation from existinginvestors: 24,000,000SerieshasbeenD acquired byConvertible Preferred StockSellside AdvisorStaffinga subsidiary ofhas completed a financingconsisting ofhas been acquired bySellsideSellsideAdvisorAdvisorContingentLaborhas been acquired byhas been acquired bya portfolio company of 25,000,000Placement AgentSellside Advisor*PredictiveTalent AnalyticsSellside Advisor*Social Recruiting ContingentLabor andPlatformProcurementSellside Advisor*Sellside AdvisorSocialWorkforceEngagement and ManagementWorkforce MgmtSellside Advisor*ContingentLaborPlacementSellside AdvisorAgentSellside Advisor & Fairness OpinionStaffingTalentAcquisitionPayroll andHRISSellside AdvisorStaffingSellside AdvisorSellside AdvisorContingentLaborContingentLabora portfolio company of 30,000,000Series A Preferred Stocka portfolio company ofhas been acquired bySale of secondary shares tohas beenrecapitalized byhas been acquired byhas been acquired byhas been acquired byhas beencompletedacquireda financingbyconsisting of 24,000,000Series DConvertible Preferred StockSellside Advisor*ContingentLabor andProcurementFinancial Advisor*ATS forEducation andGovernmentFinancial Advisor*Workforce Mgmt HRISfor HourlyEmployeesShareholder Advisor*LearningManagementSellside Advisor*Sourcing andTalent AnalyticsSellside Advisor*HRISContingentLabor andProcurementhas been acquired byPlacementSellside AdvisorAgentTalent AnalyticsSellside AdvisorStaffinghas been acquired bySellside AdvisorTraining,Learning, andComplianceFinancial Advisor and Placement Agent*Payroll andHRISDeep Relationships Across HCM Software and Tech-Enabled ServicesTombstones included herein represent transactions closed from 2008 forward. Selected transactions were executed by Houlihan Lokey professionals while at other firms acquired byHoulihan Lokey or by professionals from a Houlihan Lokey joint venture company.6
SaaS Advisory Track RecordUnmatched SaaS transaction experience with more than 80 SaaS sellside transactions closed—more than any other investment bank.a portfolio company ofhas been acquired byhas been acquired bya portfolio company ofSellside AdvisorEventManagementa portfolio company ofa portfolio company ofhas been acquired byhas been acquired byhas been acquired bySellside Advisorhas been acquired byDigital WorkplaceSellside AdvisorHealthcareAnalyticsSellside AdvisorSellside Advisorhas received an equity investmentfroma portfolio company ofFinancial Advisorhas been acquired byhas received an equity investmentfroma portfolio company ofa portfolio of companies owned byTravel Technology Content LifecycleManagementhas received an equity investmentfromhas received a significant growthinvestment fromCustomerExperienceManagementRetail Analyticshas beencompletedacquireda financingbyconsisting ofhas been acquired byhas completed a financingconsisting of 24,000,000Series DConvertible Preferred Stock 24,000,000Series DConvertible Preferred StockPlacementSellside AdvisorAgentFinancial AdvisorSecuritySoftwareFinancial AdvisorTalentManagementPlacementSellside AdvisorAgentContact CenterWorkforceOptimizationFinancial AdvisorWeb ContentManagementhas been acquired byFinancial AdvisorNonprofit CRMand Fundraisinghas been acquired bySellside AdvisorManufacturingContentManagementhas received an equity investmentfromhas been acquired byhas been acquired byhas been acquired byhas received an equity investmentfroma portfolio company ofSellside AdvisorSupply ChainNetworkSellside AdvisorRecruiting andOnboardingFinancial AdvisorMobileAdvertisinga wholly-owned subsidiary ofhas been acquired byTalentManagementhas been acquired byhas been acquired byhas been acquired byFinancial AdvisorMarketingAutomationSeries D Convertible PreferredStockLed by:has been acquired byWith participation from existinginvestors:a portfolio company ofa wholly-owned subsidiary of 25,000,000Sellside AdvisorFinancialTechnologySellside AdvisorWorkplaceManagementSellside AdvisorSellside AdvisorWeb ContentManagementOutcomesManagementTombstones included herein represent transactions closed from 2014 forward.Sellside AdvisorOutcomesManagementSellside AdvisorCRM andCall CenterSellside AdvisorMarketingAutomationSellside AdvisorE-SignaturePlacement AgentSocialRecruiting7
Current Market Conditions Remain Strong for HCM M&ATechnologyand SaaS CompsRemain StrongWe are experiencing strong market conditions for SaaS technology companies and HCM continues to outperform.Capital Is HighlyAvailableCash Stockpiles Cheap Debt High Stock Prices Acquisition CurrencyLarge-CapAcquirers SeekingNew Areas ofGrowth andExpansionFew targets of meaningful size that can impact top and bottom line for buyers; HCM is valuing growth. Markets have continued to be strong despite some recent marketvolatility. HCM continues to trade strong Paycom at 20.7x revenue Workday at 10.3x revenue Median HCM is 5.0x revenue Billions of cash on public company balance sheets Private equity funds need to invest 1.4 trillion of committed capital Interest rates at record lows Strategics and sponsors are looking for more mature models withrevenue that will move the needle. Both have shown a willingnessto lean in on valuation when unit economics are strong. Public companies need to put cash to work Buyers can borrow at record lows to finance acquisitions Buyers can use highly valued stock to make acquisitionsCompany18–19E Rev. Growth EBITDA %Valuation1Company18–19E Rev. Growth EBITDA .5%2.3xPaylocity23.7%28.3%12.4xTake privates of mid-cap companies have surged over the past few years.Take Privatesare Surging as PEsLook to Write Larger Amber Road acq. by E2Open ( 415.4M/46.6% Premium) Ultimate Software acq. by Hellman & Friedman ( 11.0B/32.0% Premium)Checks2 Bazaarvoice acq. by Marlin Equity Partners ( 521.0M/13.4% Premium) Xactly acq. by Vista ( 562.0M/34.9% Premium) Jive acq. by Wave Systems ( 353.4M/22.1% Premium) Halogen acq. by Saba ( 170.1M/25.1% Premium) Neustar acq. by Golden Gate ( 2.9B/38.7% Premium) Infoblox acq. by Vista ( 1.3B/31.6% Premium) Rackspace acq. by Apollo ( 4.3B/36.8% Premium) Monster acq. by Randstad ( 429.0M/29.3% Premium)Public equities trading multiples and growth based on 2019E figures. Data from S&P Capital IQ as of December 31, 2019Source: 451 Research, S&P Capital IQ and MarketWatch3 Calculated off 10-day moving average from March 3, 2016 Netsuite acq. by Oracle ( 9.4B/57.9% Premium)ReachLocal acq. by Gannett ( 156.0M/184.0% Premium)LinkedIn acq. by Microsoft ( 26.2B/54.3% Premium)Qlik acq. by Thoma Bravo ( 3.0B/40.0% Premium)3Demandware acq. by Salesforce ( 2.8B/62.8% Premium)Marketo acq. by Vista ( 1.8B/60.3% Premium)SciQuest acq. by AKKR ( 373.0M/28.4% Premium)Cvent acq. by Vista ( 1.5B/66.1% Premium)128
Macro Market SnapshotEV/NTM Revenue by Index12.0xHCMShare Price Weighted by Market CapSaaSS&P 50060.0%NASDAQHCMSaaSS&P (20.0%)Valuation Is Closely Tied to Revenue Growth1Rule of 40: Premium on Growth 5.7x4.8x4.8x13.6x10.3x7.4x5.4x7.6x5.1x2.9x2.6x 10%18.0xEV/2019E RevenueEV/2019E RevenueNASDAQ10-20%HCM2 20% 10%10-20% 20%SaaSSources: S&P Capital IQ – Data as of December 31, 20191 Ranges shown indicate Median through Top Quartile EV/2019E Revenue2 HCM Index comprised of companies shown on company benchmarking charts in following pages 40% 40%HCM2 40% 40%SaaS9
NewEmergingChallengersLeadersTalent AnalyticsEmployeeEngagementLearningCore HRPerformanceand SuccessionCompensationand BenefitsContingentLaborWorkforceManagementTalent AcquisitionHRISPayrollOnboardingHiring ingSourcingHuman Capital Management LandscapeTalent Management10
Large and Growing Market With Massive TAMHCM market forecast to grow at nearly 10% annually until 2022, driven in large part by the growth in overall enterprise SaaS and cloudsoftware.Human Capital Management GrowthSaaS and Cloud Services Forecast in Billions in BillionsSaaS 167.2 14.5 15.82017A2018A 17.32019E 18.92020E 20.62021E 22.52022EEstimated 22.5B in total revenue by 2022, driven by: Enterprises looking for unified HCM suites to save costs andmanage the entire HCM workflow Emergence of artificial intelligence in automating HRprocesses, intelligently recommending candidates andstreamlining the recruiting process 58.82017A 190.7 72.22018A 211.9 85.12019E 234.3 98.92020E 257.7 113.12021E 281.2 126.82022EOverall enterprise software growth has been driven by theproliferation of SaaS and hybrid cloud models in the last decade Organizations are seeking simpler, more flexible and economicways to move and manage workloads across environments Overall SaaS market is estimated to grow to 126.8B by 2022at a CAGR of 16.6% Record low U.S. unemployment forcing companies to findcreative solutions to source talentSource: U.S. Bureau of Labor Statistics, Gartner, Deloitte11
Historical HCM M&A SummaryHCM M&A Transaction Summary (2010–2019)Aggregate Enterprise Value ( M)Deal Volume6458 15,000 14,000 13,000504948 12,00070564960 11,0005036 10,000 9,0004026 8,00021 7,000 6,00030 5,00020 4,000 3,000 2,000 1,000 2,440 4,326 5,324 153 5,629 5,072 41,928 4,614 2,914 16,109201020112012201320142015201620172018201910 00HCM M&A Transaction by Subsector (2015–2019)40Deal VolumeAverage EV/EBITDAEV / EBITDAEV/RevenueAverage EV/ 0x2.3x2.1xLearningCompensationand gement# of DealsAggregate EV( M)TalentAnalyticsPerformanceandSuccessionHiring 17111111511491415 13,037 2,590 4,396 5,495 33 73 817 205 517 0 218 0 3,773 3,100 27,485Source: S&P Capital IQ, 451 Research, and Kognetics as of December 31, 2019Note: Includes transactions with undisclosed financial terms; Transactions may fall into more than one indicatorNA or data not shown if data isn’t publicly available or EV/Revenue or EV/EBITDA is greater than 50x.12
Historical M&A: Select Strategic TransactionsHCM M&A Transaction by Subsector (2015–2019)AggregateEV ( M)DealVolumeSourcingRecruitment AssessmentsMarketingApplicantTrackingHiring Tools omp 17 517 27,485 3,773 33 205NA 5,495 3,100 13,037NA 4,396 817 2,590 218 73RandstadLinked SnagAJobRoperEquifaxVisma rkdayHC Svcs &SolMedix StaffingWayUpXingADPBullhornAdeccoADPAccess GroupAscentisWorkdayStone PointVismaLearningTech.DeloitteWorkforce LogiqBullhornPIXIDJohn WileyRecruitVismaHgPaycorCulture lesforcePowerSchoolIntertekLinkedIniCIMSCapp & tionsPageUpSource: S&P Capital IQ, 451 Research, and Kognetics as of December 31, 2019Note: Includes transactions with undisclosed financial terms; Transactions may fall into more than one indicatorNA or data not included if data isn’t publicly available or EV/Revenue or EV/EBITDA is greater than 50x13
Select Sponsor ActivityHCM Transaction by Subsector (2015–2019)AggregateEV ( M)DealVolumeSourcingRecruitment AssessmentsMarketingApplicantTrackingHiring Tools omp 17 517 27,485 3,773 33 205NA 5,495 3,100 13,037NA 4,396 817 2,590 218 ummitSerentAKKRBedfordFundingVectorGreat uidepostSerentSerentGreat ityInsightSymphonyTS2HoldingsGAApaxBainT. Rowe usVSSVistaRiversideTurn/RiverBain / ScaleRhoIconiqParkerGaleWarburgJMIEQT InsightKKRNew C eFranciscoInsightTiger GlobalFidelity /GenerationsAleph /JVPGSPLLRVerisysSource: S&P Capital IQ, 451 Research, and Kognetics as of December 31, 2019Note: Includes transactions with undisclosed financial terms; Transactions may fall into more than one indicatorNA or data not included if data isn’t publicly available or EV/Revenue or EV/EBITDA is greater than 50x14
Human Capital Management 2019 Overview HOULIHAN LOKEY TECHNOLOGY, MEDIA & TELECOM GROUP. s or eals 1 n y 7 2 n 929 3 s 734 4 y 621 5 ch 612 v s. . cross-border buyers and extract outlier valuations U.S. M&A Transaction Leader Leader in U.S. M&A Transactions Under 1 Billion Number of Deals
2019 Alfa Romeo Giulia 2019 BMW X7 2019 Alfa Romeo Stelvio 2019 BMW Z4 2019 Audi A3 2019 Buick Cascada 2019 Audi A4 2019 Buick Enclave 2019 Audi A5 2019 Buick Encore 2019 Audi A6 2019 Buick Envision 2019 Audi A7 2019 Buick LaCrosse 2019 Audi A8 2019 Buick Regal 2019 Audi Allroad
Jun 10, 2016 · The Global Human Capital Index featured in this Report thus treats human capital as a dynamic rather than fixed concept. The Global Human Capital Index 2017 ranks 130 countries on how well they are developing their human capital on a scale from 0 (worst) to 100 (best) across four thematic dimensions—capacity, deployment,
human capital and specialization in human-capital-intensive industries. Fourth, when we proxy human capital by schooling (labor-force) quality the impact of average schooling drops. Thus our cross-countr y cross-industry growth analysis therefore adds to the micro and cross-country evidence on the importance of human capital quality
Capital Program Development and Structure Capital Improvement Program (CIP) Update 10-Year Capital Plan. Identifies viable initiatives to address needs identified for next 10 years; financially unconstrained. Six-Year Capital Improvement Program (CIP) Capital investments planned for, or continuing in, six-year capital program. One-Year Capital .
COVID-19 - Potential implications on Banking and Capital Markets 06 Capital markets Overview of Ghana’s capital market Ghana’s capital market is gradually playing a pivotal role in attracting long-term capital financing for economic activities. The largest capital market i
HONOUR BOARD VOLUNTEERS 2019 - CURRENT David Staniforth Boorowa 2019 Bruce Gruber Boorowa 2019 Lindsay Cosgrove Boorowa 2019 Dennis Osborne Boorowa 2019 John Cook Boorowa 2019 Sue Cook Boorowa 2019 Mick Hughes Boorowa 2019 Daryl Heath Boorowa 2019 Lesley Heath Boorowa 2019 Russell Good Boorowa 2019 John Peterson Boorowa 2019 Heather Bottomley Boorowa 2019 James Armstrong Boorowa 2019
Keywords: Human Resources Management, Human Capital, Innovative Performance. THE RELATIONSHIP BETWEEN HUMAN CAPITAL MANAGEMENT AND PERFORMANCE Considerable evidence suggests that human resource management (HRM) practices and systems make an important contribution
2019-29 Capital Budget Instructions June 2018 TABLE OF CONTENTS . Chapter 1: Capital Budget Basics 1 Introduction 1 What is a capital project? . Capital project administration costs are for activities directly related to the completion of a capital project or program. See Chapter 4 for the appropriate use of tax-exempt bond proceeds related to
