Smart Cities: M&A Opportunities

Smart Cities: M&A Opportunities
Sponsored by:

World Financial Symposiums
WFS is an international organization dedicated to
educating technology leaders through monthly,
Market Spotlight webcasts and quarterly, day-long
Growth and Exit Strategies for Software and IT
Companies conferences.
www.wfs.com

Jeff Brown - Moderator
Jeff Brown has over 25 years of entrepreneurial experience building software and business services
companies in the energy and sustainability sector. He specializes in information technology for engineering,
scientific and business applications for asset intensive industries.
Jeff helped form and was President of Severn Trent Worksuite, a FTSE 100 subsidiary, which grew to become
the leading provider of enterprise and wireless workflow management software in the utility industry. Jeff was
co-founder at IntelliGIS, a pioneer in geographic information systems and wireless computing for energy
infrastructure management. Additionally, he launched Western Hemisphere operations for Simon Petroleum
Technology, a provider of energy management software, and was a member of the core team at venture
backed, GeoQuest Systems, which became the leader in energy decision support systems before being
acquired by Schlumberger.
Jeff began his career on the research staff at Columbia University where he was a published author on
global climate change.

Agenda
• Welcome
• Jeff Brown, Vice President - Corum Group
• Smart City M&A Report
• Tyler Vickers, Research Analyst - Corum Group
• Industry Panel
• Eric Woods, Research Director - Navigant Research
• Will Winn, Principal - SmartCore
• Q&A

Building a smart city
Smart Cities are interconnected,
sustainable, low carbon cities striving
to be more competitive, livable and
attract more investment than
traditional counterparts.
“To reduce isolated data and
business processes and to
encourage better data-sharing and
flow, well-managed cities are
establishing shared business
capabilities, data-rich common
infrastructures, and service-oriented
architectures.”
Internet of
Things
Integrated
IT-OT
Big Data
Analytics
Smart
Grid/Smart
Meter
Contextual
Intelligence
High
Bandwidth
Internet

The global smart city market is expected
to cross $1 trillion by 2016
Source: marketsandmarkets.com May 2014
Homes

Who’s the leading Smart City brand?
Source: www.greenbang.com

Energy Management Market ‘to Almost
Double’ by 2020

Select VC Funded Companies in 2013

Sold to
Target: CITYTECH
Acquirer: ICF International
Transaction Value: Undisclosed
- Web and mobile application development, cloud web experience management, infrastructure migration consulting and
Amazon Web Services.
Sold to
Target: ARCOS
Acquirer: Riverside Company
Transaction Value: Undisclosed
- Provides automated repair request, repair scheduling and workforce management SaaS for
electric and gas utilities and power plants.
Recent Corum Transactions

Tyler Vickers
Research Analyst – Corum Group
As a research analyst at Corum Group, Tyler Vickers works with clients to create an optimal selling outcome
by delivering value propositions and strategic marketing documents.
Prior to joining Corum, Tyler worked in risk management and compliance for a large online marketing
company where he identified and managed the fraud activity of the company’s large user base. During his
time there, he received first-hand experience dissecting a wide range of online marketing strategies. Before
that, he worked with a small IT services business, helping to establish its online presence and increase sales.
Tyler graduated from the University of California, Santa Barbara with a B.A. in Economics.

Corum Top Ten Tech Trends 2014
Mobilization Enmeshed
Systems
Advanced
Manufacturing
Digital Force
Multipliers
Information
Security
Omni-Channel
Marketing
Data-Connected
Networks
Online
Exchanges
Digital Currency
Flow
Internet of Things
CREATECONNECT

Vertical Application Software Market
Public Valuation Multiples
1.50 x
1.70 x
1.90 x
2.10 x
2.30 x
2.50 x
2.70 x
2.90 x
3.10 x
6.00 x
7.00 x
8.00 x
9.00 x
10.00 x
11.00 x
12.00 x
13.00 x
14.00 x
15.00 x
EV/SalesEV/EBITDA
Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14
EV/EBITDA 11.48 x 11.80 x 11.81 x 12.40 x 11.74 x 12.81 x 13.12 x 13.24 x 14.08 x 13.01 x 13.69 x 14.01 x 13.82 x
EV/S 2.49 x 2.39 x 2.40 x 2.42 x 2.60 x 2.52 x 2.65 x 2.53 x 2.55 x 2.72 x 2.64 x 2.79 x 2.88 x

Subsector Sales EBITDA Examples
Government 1.18x 8.55x
Energy &
Environment
3.00x 11.14x
A/E/C 3.23x 14.40x
Vertical Application Software Valuations

Horizontal Application Software Market
Public Valuation Multiples
1.50 x
2.00 x
2.50 x
3.00 x
3.50 x
4.00 x
4.50 x
6.00 x
8.00 x
10.00 x
12.00 x
14.00 x
16.00 x
18.00 x
20.00 x
22.00 x
EV/SalesEV/EBITDA
Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14
EV/EBITDA 12.13 x 12.59 x 12.09 x 15.03 x 12.83 x 16.12 x 17.94 x 18.79 x 19.37 x 19.00 x 20.34 x 19.64 x 17.49 x
EV/S 2.71 x 2.93 x 2.88 x 3.08 x 2.99 x 2.93 x 3.48 x 3.32 x 3.61 x 4.07 x 3.89 x 3.77 x 3.71 x

Subsector Sales EBITDA Examples
SCM 5.83x 26.21x
Horizontal Other 5.95x 22.98x
Horizontal Application Software Valuations

3.9x
19.0x
Since Q4 Corum AnalysisJan. 2014
Sold to
Target: Hara Software
Acquirer: Verisae [Marlin Equity Partners]
Date: Oct 2013
- Energy, water and waste analytics SaaS provider
- Verisae adds energy monitoring and analytics SaaS to its existing
facilities management offerings
Big Data

3.9x
19.0x
Sold to
Target: Verdeeco
Acquirer: Sensus
Date: Apr 2014
Transaction Value: reported at $5 million
- Offers smart grid analytics and big data solutions for electric, water
and gas utilities
- Serving more than 50 percent of Verdeeco's core market, Sensus
gains their smart grid technology to respond to customer demand
more fully
Big Data

Since Q4
Sold to
Target: Activation Energy
Acquirer: EnerNOC Date: Feb 2014
- Brings EnerNOC an immediate presence in the Irish capacity market & strengthens its ability to
deliver its full suite of energy intelligence software applications throughout Europe
Sold to
Target: Entelios AG
Acquirer: EnerNOC Date: Feb 2014
- The acquisition expands EnerNOC's entry into continental Europe with Entelios' team & existing
relationships.
Sold to
Target: EnTech USB
Acquirer: EnerNOC Date: Apr 2014
- A global utility bill management software provider
- Bolsters EnerNOC’s energy management offerings with more detailed forecasting of energy costs
EnergyManagement

3.9x
19.0x
Sold to
Target: CP Electronics
Acquirer: Inflexion Private Equity Partners
Date: Feb 2014
- UK’s leading manufacturer of lighting controls for the building sector
- With Inflexion’s investment support, in conjunction with its international
network and expertise, CP Electronics seeks to consolidate its position in
the UK and grow overseas markets
Energy Management

3.9x
19.0x
Sold to
Target: Enerliance
Acquirer: Yardi Systems
Date: May 2014
- Provides energy efficiency software focused on air conditioning systems
for large buildings and campuses
- Yardi will intergrate Enerliance’s LOBOS energy consumption with it’s
own real estate platform
Energy Management

3.9x
19.0x
Sold to
Target: PowerSense
Acquirer: Landis+Gyr
Date: May 2014
- A Danish producer of high-quality smart grid supervision and control systems for the
power distribution industry
- The acquisition will dramatically strengthen developments in the smart grid field
globally, delivering solutions which enable utility use cases
IT-OT integration

Sold to
Target: CyberGRID
Acquirer: Toshiba
Date: Jul 2013
- Provides virtual power plant network management SaaS for smart grid operators,
utility companies and energy retailers.
Smart Grid/Smart Meter
Sold to
Target: Consert
Acquirer: Toshiba
Date: Jan 2013
- Converts electric consumption in homes and small businesses into sources of
capacity and energy reserves for utilities

3.9x
19.0x
Sold to
Target: Nautical Technologies
Acquirer: LocoMobi [fka QuickPay]
Date: Apr 2014
- A global provider of smart parking and transportation innovative solutions
- The combined business will now be known as LocoMobi, Inc. and will offer
consumer-facing mobile payments to deliver new value for drivers as well as
parking owners and operators.
Location Tracking & Contextual Intelligence

3.9x
19.0x
Sold to
Target: Euroscan Holdings
Acquirer: ORBCOMM
Date: Mar 2014
Transaction Value: $29 million
- A global supplier of refrigerated transportation temperature compliance recording
systems from Netherlands
- With Euroscan’s suite of powerful asset monitoring, control technology and M2M
solutions, ORBCOMM implements the growth strategy of adding vertical expertise,
technologies and geographic markets
Location Tracking & Contextual Intelligence

3.9xTarget: Smallworld Fibre
Acquirer: Virgin Media
Date: Feb 2014
- Adds 40,000 homes in cities in Scotland and NW England to Virgin Media’s network.
High Bandwidth Internet
Sold to
Target: Zitius Service Delivery AB
Acquirer: TeliaSonera AB
Date: Dec 2013
Transaction Value: $58M
- Operates multi-dwelling residential building fiber optic networks and provides broadband services
for consumers in multi-dwelling buildings in Sweden.
Sold to

Industry Panelists
Eric Woods
Research Director
Will Winn
Principal

Eric Woods
Research Director – Navigant Research
Eric Woods is a research director leading Navigant Research’s coverage of smart cities. In this role he brings together
his research experience in smart grids, smart water networks, smart transport, and smart buildings. He has over 20 years
of experience as an analyst and consultant on new technology trends including in-depth research in the areas of IT
infrastructure, data analytics, knowledge management, public sector IT, and cleantech innovation.
Woods is regularly quoted in major publications including The Financial Times, The New York Times, and The Guardian,
in addition to being a frequent speaker at industry conferences. He has worked on consultancy assignments to a wide
range of clients, including public and private sector technology users and global IT players, as well as many small and
growing technology companies. Before joining Navigant Research, Woods was government practice director at
Ovum. Prior to joining Ovum, Woods worked as an analyst, developer, and project manager in public sector IT. Woods
holds an MSc in information systems from the University of Brighton and a Ph.D. in English literature from the University of
Sussex.

Will Winn
Principal - SmartCore
Will began his career in sales and sales management at Aerotek where he was responsible for selling engineering
services to organizations in the SouthEast. Will found his next opportunity in 1998 when he was sought out by GE Capital
IT Solutions to develop and manage accounts. In this role, Will became an expert in building and IT systems.
Will was recruited to run a sales region for Dimension Data as a Regional Sales Manager with Dimension Data in 2001.
Will was formally recognized by Dimension Data through his inclusion as a founding member in their Leadership Forum
and Key Talent Groups. He also achieved induction into the exclusive President's Club during all six years of his business
development career at Dimension Data.In October of 2008, Will along with two key business partners founded
SmartCore to capitalize on the incredible opportunity in the Connected Real Estate market. Since then, Will has been
responsible for driving many Smart Building implementations from a vast array for vertical markets, to include
Commercial Real Estate, Healthcare, Hospitality, Finance, Manufacturing, Higher Education, K-12 Schools, Municipality
and Federal markets. SmartCore was also recognized by Cisco Systems at the 2011 Partner Summit for three prestigious
awards in regards to Connected Real Estate.

Q&A
• We welcome your questions!
– Use Q&A window on right side
– Submit to queue at any time
– Ask “all panelists” – see “ask” option above text-entry box

Contact Us
For further information or copies of today’s
presentation:
Visit www.wfs.com
-or-
Email
Jeff Brown: jeffb@corumgroup.com

Smart Cities: M&A Opportunities

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Editor's Notes