Maven achieves 5.1x return on sale of software provider to US growth equity firm

Maven Capital Partners has realised a significant majority of its investment in Manchester-based compliance and preservation software provider, MirrorWeb, through a sale to a US growth equity firm.

The realisation has generated a 4.0x return on cost for the Maven VCTs, including the value of a retained minority holding in the business and a 5.1x return on cost for NPIF Maven Equity Finance.

MirrorWeb has built significant momentum in the US thanks to its proprietary technology. Through its platform, Insight, MirrorWeb empowers financial services institutions to communicate via a comprehensive array of modern channels, capturing and archiving in a fully compliant way, and enabling the world’s largest financial institutions to meet strict record-keeping requirements.

MirrorWeb helps businesses, multinationals, institutions and government departments capture, monitor, supervise and evidence changes in their digital content via its unified communications surveillance platform.

The requirement for digital preservation is high on the compliance agenda, driven by a surge in communications technology and increasingly stringent regulation.

This has resulted in heightened demand for MirrorWeb’s solution, particularly in financial services, where monitoring and archiving content across websites, social media platforms, mobile channels, email, and business communications, such as Microsoft Teams and Slack, is compulsory.

Maven first supported MirrorWeb in 2018 through NPIF Maven Equity Finance to enable the business to roll out its innovative technology.

At that point, MirrorWeb was an emerging business with low revenues and high customer concentration but had developed a cutting-edge compliance-focused solution and a clear and credible business strategy to build scale.

Over multiple funding rounds, which latterly included investment from the Maven VCTs, the business grew rapidly, taking Maven’s total investment in MirrorWeb to more than £6.2m.

The funding has enabled MirrorWeb to enter the US market, with CEO David Clee relocating to Austin, Texas, to lead the company’s go-to-market strategy and invest heavily in product development to further enhance the functionality of its technology, helping MirrorWeb to consistently achieve year-on-year recurring revenue growth, and significantly grow its headcount. 

Jeremy Thompson, Partner at Maven, said: “This transaction is an excellent outcome for Maven’s client funds, the management team and the business.

“MirrorWeb’s story demonstrates what an ambitious Manchester-based business can achieve when a talented leadership team is provided with the right support and funding.”

He added: “The structure of the deal also allows our VCT funds to retain an equity stake in MirrorWeb post-transaction, which was a key objective based on our knowledge of the business and the team who we expect to continue to deliver significant growth and shareholder value. 

“It has been an absolute privilege to work with this team, led by David Clee, who have successfully opened up the US market. David’s decision to relocate to the US demonstrates his entrepreneurial drive and is a testament to his leadership.” 

David Clee, MirrorWeb CEO, said: “Maven supported us when we were a small start-up business – they believed in us as a management team and could see the potential in what we were trying to build.

“Following their original investment, they continued to support us through multiple follow-on funding rounds which were critical to the development of both our product and our commercial strategy.”

He added: “Throughout the six years we have worked together, Maven have provided genuine and valuable advice that has helped us to grow the business. The relationship between Maven and MirrorWeb has been a true partnership and I’m proud of what we have achieved together.”

DC Advisory (corporate finance) and Squire Patton Boggs (legal) advised shareholders on the transaction, showcasing their global capabilities alongside their local presence in Manchester.

BDO (financial diligence and tax), GRAPH Strategy (commerical diligence) and Leckie Kershaw (technology diligence) also advised MirrorWeb on the transaction.