Selling an SEO business case study: Netcallidus

Acuity Advisors secured the sale of Northampton-based search engine marketing company Netcallidus Limited

Here is how we did it…

The opportunity

Netcallidus is one of the leading search engine optimisation (SEO) companies in the UK. The firm has enjoyed years of rapid growth and wanted to further exploit its potential. Acuity Advisors successfully oversaw and managed a trade sale or business transfer on behalf of Netcallidus to help take it to greater commercial heights.

The business

Founded in 2002, Netcallidus is a leading UK-based search engine marketing and paid search services company. It has a growing portfolio of both UK and international clients, who seek its expertise to boost their organic search engine presence and pay-per-click advertising campaigns.

In a business age dominated by the internet, the company has developed a tried-and-tested method of implementing results-driven SEO campaigns.

The reputation and approach of Netcallidus has become widely respected in the industry, and it has been delivering a solid return on investment for many years. The firm’s business philosophy is based on an honest and open approach, which provides clients with a high level of confidence. This transparency has been a breath of fresh air in the SEO industry where there is traditionally lots of secrecy. The ability to retain a portfolio of highly satisfied clients is a testament to its ability to deliver consistent results.

The need

“Competing online means having a well thought-through and high-performing search engine strategy is paramount,” said Mark Furber, Netcallidus Managing Director. “Over the past eight years, Netcallidus has built a highly profitable and scalable platform to enable companies to have an effective presence online. In 2010 we felt it was the right time to accelerate our sales reach and a trade sale was the best way to achieve this.” For Netcallidus to see through its strategy, the firm faced a couple of big challenges before it could attract the desired level of interest and, ultimately, find the right buyer.

• Securing a buyer with the same business values:

The Netcallidus team realised they had to recruit a professional team of corporate finance advisors who understood their business principles and the way they liked to operate, so they could source a buyer with similar credentials and philosophy.

• Capturing the essence of the value proposition:

Netcallidus managers were also aware that they needed a corporate advisor on board who was capable of talking their language, who knew the SEO and web marketing world inside out, shared their values in terms of delivering results in a transparent way and who could develop a compelling IM (Information Memorandum) to showcase their value proposition.

The Netcallidus team wanted to continue focusing on their rapidly-growing business and needed to recruit experts who they could trust 100 per cent to manage the process, without having to be spoon-fed. They were also seeking someone who could portray the company in the best possible light to prospective purchasers. Netcallidus soon realised that Acuity was a perfect fit for its needs.

“From the outset it was apparent that Acuity had a similar approach to us. They spent time walking us through the steps needed to sell a business. They warned us against the common pitfalls and gave me the comfort that not only did they have the right experience but also an empathy with what we were trying to achieve. It was a very simple decision to select them,” Stuart Haining, Netcallidus commercial director.

The approach

Acuity was confident it could rely on its track record and experience in digital media to professionally manage the process and deliver a first-class result for Netcallidus. Acuity focussed on achieving the best terms by adopting a competitive approach because it believed that several purchasers would be interested in the business.

Acuity focussed on crafting a bombproof IM (Information Memorandum), which portrayed Netcallidus’ sophisticated value proposition in simple terms. Prospective purchasers were profiled, researched and then targeted in a proactive manner. Management meetings were subsequently set up and Netcallidus managers were fully briefed on the best way of conducting themselves in these meetings. Getting across the value proposition in a compelling and effective manner was crucial and Acuity also coached the Netcallidus team on how best to achieve this. Throughout the process, Acuity approached the job with a high degree of tenacity and empathy.

“Conveying what makes an SEO business exceptional can be tricky. I was impressed how Acuity spent time at the beginning of the process really teasing out our value proposition. They knew what questions to ask, what was important and they subsequently produced an IM that portrayed us in the best possible light. It was clear that they were not traditional business broker and they were really thinking about how to position us.” Mark Furber.

The result

Following a series of top-level meetings with prospective purchasers, Acuity helped Netcallidus procure five offers from different trade buyers. Acuity proceeded to coach Netcallidus through the selection process and helped to negotiate the best possible deal that was also in tune with Netcallidus’ strategic goals and shareholder expectations. Acuity also used its excellent contacts and networking expertise to perform background checks on the interested parties before also recommending a legal team and advising on due diligence.

After a five-month process, Netcallidus was ultimately sold to Dot Digital Group Plc. The firm was a brilliant cultural fit, had a similar ideology and was equally ambitious as Netcallidus. Dot Digital also had an established sales operation and there was an exciting opportunity to cross-fertilise between the two client bases.

“We were very pleased with our choice to use Acuity. The sale to Dot Digital was exactly right for our business. Acuity brought together two very compatible organisations with a similar outlook.” commented Mark Furber.

“From a buyer’s perspective Acuity were easy and professional to deal with. While maintaining their client’s interests at all times they provided us with all the information we needed in a timely manner to complete the transaction.” Nicholas Nelson, director dotDigitalGroup plc.

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