Using a comparable companies, precedent transactions, DCF, and LBO to determine a valuation Identifying potential financial buyers and sponsors Honorable Mention

1. BrickDiscovery
Samantha Ackley | Brayden Bennell | Kevin Myers | Nick Tracewell

2. Executive Summary
Conclusion
Industry Overview
Company Overview
Valuation
Strategic Options
3
13
8
18
5
23

3. Executive Summary

4. Executive Summary
Source: SEC filings 10k, Yahoo Finance
4
Primed for Growth
Company FinancialsRecommendation
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
DCF and LBO
Analysis
Conclusion
Valuation Range
Government
and Others
Ø Based on several past transactions in the industry and the
potential synergies that may stem from bolt-on
acquisitions, we believe a sale to a financial sponsor
would maximize the growth potential for BrickDiscovery
Ø Our recommended financial sponsors include:
Strategic
Buyers
Ø BrickDiscovery is an established leader in the
Electronic Discovery Space with a consistently
increasing rate of customers outsourcing eDiscovery
processes
Ø Significant regulation in the legal environment has
given an competitive advantage to the electronic
discovery industry
Ø They have established a diverse network of clients,
offering them a firmer sense of security through their
business model
Ø Valuation analyses estimate the enterprise
value of BrickDiscovery to fall between
$241mm and $312mm
Ø 2018E Revenue: $153.0mm
Ø 2018E EBITDA: $33.5mm
Note: all $ figures in millions

5. Industry Analysis

6. Industry Overview
Growth Considerations Competitive Landscape
Key Takeaways
Geography
▪ North America is the largest market for eDiscovery services
▪ 70% of the global market in 2016
▪ Cross-border confidentiality issues have limited global market
growth
Source: IBIS World, PR Newswire
Strong Market Growth Drivers
▪ Law firms and corporations are actively looking to
improve efficiency through alternative means
▪ Pressure to reduce costs is causing a shift to
eDiscovery out of need
▪ Expected 12% CAGR from 2018-2022 is due to:
▪ Ongoing pressure for corporate law departments to
find cost savings
▪ Shift toward the narrowing of focus on core
competencies of the firms
▪ Need for reliance on third-party providers that can
provide insured results is driving demand for
eDiscovery products
▪ Shift of focus away from product offerings to a more service
oriented model
▪ Immense change in the industry over the past decade due to
new advancements including:
▪ New developments in technology
▪ Hyper-specialization
Major Players
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
6

7. 7
Industry Drivers
Source: IBIS World, Prescient & Strategic Intelligence
Key Growth Factors
Corporate Client InfluenceLegal Drivers
▪ Recently, courts have mandated the adoption of eDiscovery
procedures in a number of jurisdictions
▪ The regulatory environment has become significantly more
stringent
▪ Especially regarding data privacy and security
compliance
▪ Thus, stimulating a need for a firm with a proven track
record of success
▪ Healthy litigation volumes in today’s socioeconomic arena
▪ These are insulated from economic downturns due to
the fact they are uncorrelated with GDP
▪ Law firms are direct sources of vendors who’ve utilized and
adopted eDiscovery
▪ Therefore, having influence over the firms allow
eDiscovery service providers with preferred selection
opportunities
▪ Requires expertise in the end market and a niche group of
individuals that can create an effective specialization for the
company
Customer Segmentation
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis

8. Company Overview

9. Company Overview
9
Quick Facts Projected Revenue Growth
Management’s Talent
Onshore Offshore Operating Platform
A leading provider of eDiscovery and data management
services in the global market
▪ Global eDiscovery Market:: $8.285 billion
▪ Founded: 1994 in Oxford, Ohio
Proprietary Technology
▪ Utilizes technology developed in-house to optimize the
eDiscovery process
▪ Long Island Processing Engine
▪ Platforms continually develop and improve as revenue
increases organically or through acquisitions
▪ Highly dedicated to the firm with +150 years of combined
industry experience
▪ Recognized for combining the top talent in the industry
Unique Culture
▪ Encourages highly collaborative and loyal employees
▪ Highly regarded values:
▪ Pride in serving the clients
▪ Ambition to grow the company
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis

10. Service Offerings
10
Offerings Provided
Blue Chip Client BaseKey Takeaways
Customer Type
Law Firms
Government
and Others
Corporations
▪ BrickDiscovery brings a distinct skill set to the eDiscovery market with
top of class operating advantages and differentiating, reliable results
▪ Proprietary technology, such as the Long Island Processing
Engine project, optimize their efficiency
▪ The service offerings provide an end-to-end model for the eDiscovery
process
▪ The focus on the client experience, with the integration of an
Onshore/Offshore operating platform, distinguishes them as a
leading firm in the industry
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis

11. Growth Strategy
Source: IBIS World
11
Emphasis on Client Interaction Acquisitional Mindset
5-Step Growth Path
▪ This commitment to maintaining and expanding client
relationships is a key factor in the establishment of their
position in the market
▪ There is also an opportunity to attain additional revenue
streams from competitors through acquisition
▪ Current low levels of concentration in the eDiscovery market
create a prime environment to acquire market share
▪ Potential to procure additional and new operational
excellence from smaller, more specialized firms
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis

12. Positioning Analysis
12
The eDiscovery industry is insulated from potential
economic downturns, no correlation between GDP
and litigation volume
Niche skill set of top firm management, +150
years of combined industry experience
Increasing importance of data relevance
and analytics, as well as growing
volumes of data
Inability to service a number of data discovery
cases that cross multiple international jurisdictions
Generalist mentality could lead to other players in
the industry developing a more effective,
specialized market position
Law firms performing eDiscovery
services in house
Well segmented customer base with
capacity for expansion
Largest demand stems from government
Lack of consolidation in the industry primes
BrickDiscovery for growth via inorganic means
Further develop proprietary technology and
continue to consolidate service processes
Potential inability to expand
internationally due to restrictions of
international jurisdictions
Low barriers to entry in the eDiscovery industry
could invite competition internally and externally
from a variety of industry verticals
Evolution of the technological landscape could
outpace program engineers
S
TO
W
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Precedent
Transactions Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Source: PR Newswire, IBIS World, Prescient & Strategic Intelligence

13. Valuation

14. Comparable Companies Analysis
Source: Bloomberg, Yahoo Finance, EDGAR
TCommentary Commentary
• Selected comparable companies based on
similar business offerings and models
• EV/Revenue was used to determine EV as the
EBITDA of this comparable set was too variable
• Some companies in this set are structured to
carry significant debt levels while others are not
Note: all $ figures in millions
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis
114
BrickDiscovery Revenue:
EV/Revenue Multiple: 2.5x 3.0x
Enterprise Valuation Range: $382.51 $459.01
$153
Company Ticker
Current
Share Price Market Cap
% of 52 wk.
High
Enterprise
Value Net Debt Trailing P/E Trailing EPS EBITDA EV/EBITDA EV/Revenue Revenue
Workiva Inc WK $33.94 $1,472 83.49% $1,410.00 $19.00 0x -1.41x -54.31x -25.92x 6.24x $225.61
Bottomline tech EPAY $65.42 $2,828 88.35% $2,590.00 $150.00 272.58x 0.24x 42.07x 61.61x 6.58x $394.10
USA Technologies Inc USAT $5.94 $382.81 35.29% $365.41 $37.37 0x -0.25x 9.63x 38.x 2.85x $128.24
Upland Software Inc UPLD $31.59 $681.01 82.48% $878.80 $159.05 0x -0.8x 25.48x 34.49x 7.23x $121.48
Varonis Systmes Inc VRNS $64.21 $1,875 77.27% $1,760.00 $0.00 0x -0.85x -18.69x -94.1x 7.21x $244.06
Five9 Inc FIVN $37.70 $2,200 76.16% $2,260.00 $205.96 0x -0.04x 10.78x 209.56x 10.02x $225.51
Paylocity Holding Corp PCTY $64.85 $3,419 73.30% $3,330.00 $0.00 92.61x 0.7x 32.03x 104.06x 8.83x $377.53
High $65.42 $3,419 88.35% $3,330 $205.96 272.58x 0.7x $42.07 209.56x 10.02x $394.10
Mean $43.38 $1,837 80.18% $1,799 $81.63 182.6x -0.34x $6.71 46.81x 6.99x $245.22
Median $37.70 $1,875 79.87% $1,760 $37.37 182.6x -0.25x $10.78 38.x 7.21x $225.61
Low $5.94 $383 73.30% $365 $0.00 92.61x -1.41x -$54.31 -94.1x 2.85x $121.48
Multiples adjusted downward due to

15. Precedent Transactions Analysis
Source: Bloomberg, Yahoo Finance, S&P Capital IQ
15
T
Transaction LTM EBITDA LTM Sales EBITDA
Target Acquirer Date Type Value Multiple Multiple Margin
Guidance Software Open Text 7/26/2018 Strategic 240 N/A 2.3x N/A
Navigant Ankura 6/25/2018 Strategic 470 11.9x 1.5x 12.61%
RPX Corporation HGGC 5/1/2018 Sponsor 555 2.0x 1.2x 60.00%
Kroll Ontrack Ldisovery 10/16/2016 Strategic 410 85.4x 7.3x 8.55%
Epiq Systems OMERS and Harvest Partners 7/27/2016 Sponsor 1005 11.3x 1.8x 15.56%
Iris Data Services Epiq Systems 5/4/2015 Strategic 134 16.3x 3.5x 21.47%
Kofax Lexmark International 3/24/2015 Strategic 954 38.8x 3.3x 8.48%
EBITDAx Salesx
High 85.4x 7.3x
Mean 27.6x 3.1x
Median 14.1x 2.5x
Low 2.0x 1.2x
Commentary Commentary
• M&A environment is healthy for eDiscovery, as
137 companies since 2015 have been acquired
or seen equity investments
• Wide spread of multiples shows the balance
between strong growth projections and the
fragmented market results in variable valuations
Note: all $ figures in millions
BrickDiscovery 2018E EBITDA:
Multiple Range: 14.0x 16.0x
Enterprise Valuation Range: 468.3 535.2
$33
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis

16. Discounted Cash Flow Analysis
16
T
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis
Commentary
Assumptions:
• WACC of 7.01%
• Perpetuity growth rate of 2.25%
• Extrapolated beta through a basic average from the
comparable companies analysis
Sensitivity Analysis WACC Calculation
Source: Bloomberg, Yahoo Finance, EDGAR

17. Leveraged Buyout Analysis
Source: Company Financials, Bloomberg, Team Projections
17
Returns Analysis (6x Levered)Valuation Commentary
Exit Multiple Sensitivity Analysis
▪ BrickDiscovery makes for a strong LBO candidate as
it’s capital structure of debt is Senior and has strong
free cash flow generation with significant room for
growth
▪ With an investment horizon over the course of the next
five years, a sponsor can anticipate a 5.4x exit cash
multiple with these assumptions
*These numbers are based on
the Terminal Enterprise Value
discounted back by the
EBITDA Exit Multiple of 5.4x
Returns Analysis
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis

18. Strategic Options

19. Source: SEC filings 10k, Yahoo Finance
T
Description Metrics Reasoning
OpenText Corporation is a Canadian
company that develops and sells
enterprise information management
software. OpenText helps digitize
processes and supply chains through
analytics and AI powered intelligence
solutions for better decision making.
Epiq Systems, Inc. provides legal process
outsourcing (LPO) services in the United
States and internationally. It offers class
action administration and mass tort
managed services; eDiscovery services,
including forensics and collection,
processing and hosting, and document
review.
TTM Revenue
$2.82bn
Market Cap
$9.12bn
OpenText has an international presence
offering management for (un)structured
data for large corporations. They
recently acquired the ECD division from
Dell, and have been listed as the
“fastest growing cloud companies” list
by Pwc.
Est. Revenue
$1001bn
They have doubled in size from 561mm
in revenue in 2016 to over $1bn present
day, and has acquired three companies
in the Forensic E-Discovery space, and
legal processing in the past three
months alone.
Acquirer
Conduent Inc operates as a business
process services company. The
Company specializes in transaction-
intensive processing, analytics, and
automation. Conduent serves the
commercial industries, healthcare, and
public sectors.
TTM Revenue
$5.78bn
Market Cap
$4.28bn
Conduent is a multi-faceted firm with a
heavy share dedicated to E-Discovery
and forensics. They specialize in
moving paper into digital which is a
transition that BrickDiscovery is
reporting. Divestiture from XEROX,
focusing more on digital solutions for
the government and corporations alike.
Ankura Consulting Group, LLC provides
management consulting and expert services
to businesses. It offers services in the areas
of bankruptcy and corporate restructuring,
corporate investigation, dispute and litigation
support, expert witness, forensic accounting,
transaction advisory, and valuation aspects.
Est. Revenue
~$500mm
Ankura is one of the fastest growing
consulting agencies in the E-discovery
and technology industry, recently
acquiring Navigant Consulting’s
Forensics practice for 470mm.
Strategic Acquirers
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis
19

20. Source: SEC filings 10k, Yahoo Finance
20
T
Description Metrics Reasoning
Amdocs is a multinational corporation
which software and services for
communication, media, and digital
enterprises.
Market Cap
$3.04bn
MongoDB Inc has struggled on securing
its MongoDB platform. BrickDriscovery
has the hosting capabilities which
MongoDB can use to grow as well as
the Forensics and Processing
technologies Brick Discover needs for
securitization.
TTM Revenue
$3.95bn
Market Cap
$8.93bn
Amdocs continues to expand its
services lines by offering new products
with the most recent being the
introduction of Amdocs Optima in 2016.
This acquisition would provide the
opportunity to add more product options
to their existing client base.
Acquirer
Symantec is a software company which
provides cybersecurity and other
software services. Symantec is
headquartered in California with
developmental centers in India.
TTM Revenue
$4.83bn
Market Cap
$12.26bn
Symantec is a company which was built
on acquisitions and continually seeks to
acquire small firms for their
technological advances. Symantec
specializes in cyber security but seeks
to expand its services line.
TTM Revenue
$2.94bn
Market Cap
$4.41bn
Perspecta is rapidly growing and
continually getting patent approvals.
Having the research & development
capabilities which BrickDiscovery offers
could create the potential for operational
synergies.
Strategic Acquirers
MongoDB Inc. is a software company
which develops and offers an open
source database, MongoDB for
commercial use.
Perspecta is a new IT company which
offers defense solutions to the U.S.
government. Specific solutions include
defense intelligence, civilian health
care, and state/local markets.
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis

21. Source: SEC filings 10k, Yahoo Finance
21
Financial Sponsors
Investment Criteria ReasoningSponsor
Preferred EBITDA: $100mm -
$500mm
HGGC looks to invest in companies involved in updating end
markets that are still steeped in outdated technology,
including grocery stores, car dealerships, marketing
agencies and insurance providers. “Technology, in and of
itself, is invading every end market, and it is driving
companies to be more competitive than their peers,” - Rich
Lawson, CEO
Investment Range: $20mm - $200mm
The Carlyle group looks to invest in a diversified, high
growth, variable sized companies in a wide range of areas.
They have recently annouced their interest in the expansion
into cybersecurity and e-discovery. In 2014, they acquired
Veritas Techonologies, (Subsidiary of Symantec) for $8
billion in cash.
Investment Range: $10mm - $100mm
Preferred Revenue: Over $100mm
With more than $31 billion in cumulative capital commitments, Vista
Equity Partners currently invests in software, data, and technology
companies led by world-class management teams with a long-term
perspective. They are a value-added investor, contributing
professional expertise and multi-level support to help companies
realize their full potential.
Investment Range: $25mm - $150mm
ABRY Partners is a pioneer in the information services sector all
while going hand in hand with its approach to media. With over 100
investments in companies in the information services sector alone,
they have had proven experience in a high barrier-of-entry space. In
their Senior Equity Fund, they helped promote a much smoother
transition in late stage, total buyout of financial investors, growth
investments.
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis

22. Source: SEC filings 10k, Yahoo Finance
22
Financial Sponsors
Investment Criteria ReasoningSponsor
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis
Preferred Revenue: $10mm - $2bn
Marlin Equity Partners is a private equity firm focused on providing
corporate parents, shareholders and other stakeholders with
tailored solutions that meet their business and liquidity needs. They
specialize in Software, Technology, and Service investments, and
have had over 130 successful acquisitions in these areas.
GI Partners is a private equity firm based in San Francisco. They were
behind the merger of Consilio and Advanced Discovery in March of
2018. It focuses on four main sector groups: technology,
telecommunications, healthcare, and financial services. Based on its
recent eDsicovery, it look like GI will continue to look for opportunities
in the eDsicovery space.
Peak Rock Capital is based out of Austin, Texas. They invest middle
market companies where they can support senior management
through operational and strategic change. Peak Rock invested in
CloudNine and helped fund its acquisition of LexusNexus eDiscovery
product suite in 2017. There would be the opportunity for rapid
growth with the acquisition of BrickDiscovery, coupled with familiarity
with the eDiscovery space, provides an opportunity for Peak Rock
Capital to enter.
American Discovery Capital is a private equity firm which invests in
middle market companies in high growth industries. They specific
invest in enterprise software and business and business technology
services industries. The eDiscovery M&A market is very active and
BrickDiscovery fits a mold which ADC would invest.
Initial equity: < $500mm
Enterprise Value Range: <$1bn
Revenue Range: $50mm - $1bn
Investment Range: $30mm - $300mm
Revenue Range: $20mm w/ 20% top-
line growth
EBITDA Range: $3mm <

23. Final Thoughts

24. Conclusion
Source: SEC filings 10k, Yahoo Finance
SWOT Highlights
Our Recommendation
Valuation Range
Executive
Summary
Industry
Overview
Company
Overview
Comparable
Companies Analysis
Strategic
Buyers
ConclusionDCF and LBO
Analysis
Precedent
Transactions Analysis
24
Ø The opportunity for synergies exist through an acquisition
based on industry precedents and growth opportunities;
we believe that a sale to a financial sponsor would
maximize the potential growth outlook for BrickDiscovery
through potential bolt-on acquisitions
Ø Our recommended financial sponsors include: HGGC and
Marlin Equity Partners
Ø Biggest strength is the growth of data relevance and
analytics, as well as the rate which the volume of data
continues to grow
Ø Biggest weakness is that there is a generalist mentality in
the company, which could lead to other players in the
industry to develop a more effective, specialized market
position

25. Appendix

26. Discounted Cash Flow: Base Case

27. Discounted Cash Flow: Bull Case

28. Discounted Cash Flow: Bear Case