glc govtech market snapshot advisors... · 2019-06-02 · 10/1/2018 tyler technologies, inc....

GLC GOVTECH MARKET SNAPSHOTGovernment Technology Capital Markets Update

A Financial Advisory Firm

www.glca.com

San Francisco | Denver | New York

MEMBER FINRA | SIPC

Q2 2019

Securities offered through GLCA Securities, LLC

www.glca.com

http://www.glca.com/

GLC STRENGTHENS GOVTECH AND SAAS EXPERTISE

has received an investment from

The undersigned served as

exclusive financial advisor to

CivicPlus in this transaction

May 9, 2019

CivicPlus Receives Minority Investment from BV Investment Partners

MANHATTAN, Kan., May 13, 2019 -- CivicPlus, the integrated technology platform for local government, hasannounced a strategic minority investment partnership with BV Investment Partners ("BV"), a middle-marketprivate equity firm focused on the business services, software, and IT services sectors. The minority investment isbeing made in partnership with Ward Morgan, founder of CivicPlus and continual majority owner, and with theexisting CivicPlus management team. BV is a private equity firm based in Boston, Massachusetts. BV hasinvested in a portfolio of relevant companies and will bring growth capital and strategic business developmentinsights to CivicPlus.

With over 20 years of success serving the needs of local governments and a commitment to an aggressiveproduct development roadmap focused on developing innovative solutions exclusive to the public sector, theleadership at CivicPlus determined the timing was ideal for forming a strategic partnership with a minorityinvestor that can help take CivicPlus to the next level of growth.

Brian Rempe, CivicPlus Chief Executive Officer, said, "We went through a careful vetting process to find the rightpartner who can help us achieve our ambitious goals in the years ahead. In BV, we found a like-minded partnerthat appreciates our market, our unique position within it, our culture and employees, and the extraordinaryopportunity that lies ahead in helping make local government work better. I'm extremely proud of all that wehave accomplished to date, and I'm confident that the partnership with BV will put us in an even strongerposition to offer even greater value to our clients and their citizens."

Justin Harrison, managing partner of BV Investment Partners, said, "We have had a running investment thesiswithin GovTech, and CivicPlus stood out to us very early on as a clear leader. Ward, Brian, and their team havebuilt a great company, and we are honored and excited to partner with them for this next phase of growth atCivicPlus. This investment aligns well with our broader constituent engagement, software and technologyservices practices, and with our philosophy of partnering with great management teams to help accelerategrowth.”

"We have accomplished monumental achievements over the past two decades," said Ward Morgan, founderand majority owner of CivicPlus, "but we know that we are still scratching the surface of what we canaccomplish in the years ahead. We are delighted to have found in BV a firm that shares our excitement andvision for CivicPlus' future and look forward to working closely with them to make that vision a reality."

"We’d been called on for years byinvestment banks of all sizes. Weselected GLC because we trustedthem and took them at theirword. Time and time again thattrust was proven well-placed.Many times throughout ourfinancing process we noted howthankful we were that we hadselected GLC. We were thankfulfor their expertise in GovTech andsoftware, their efficient and hard-charging process, their creativityand persistence and theirwillingness to fulfill their role asour trusted advisor. The entireGLC team was there for us fromthe beginning to the end, guidingus through the process andensuring we met with the bestsoftware and GovTech investors.Ward, I, and the CivicPlusleadership team are extremelypleased with the outcome.”

-Brian Rempe, CivicPlus ChiefExecutive Officer

2

TABLE OF CONTENTS

01

11

16

1. GovTech Landscape & Capital Markets

2. Private Equity GovTech Portfolio Platforms

3. GovTech Industry Overview

1. GovTech Landscape & Capital Markets

Data/Smart Cities

Admin, Finance, and Payments

Courts & Justice

CRM & Citizen-Facing P&L / CD&R

Public Safety

Health & Human

GIS & MappingPublic Works, Facilities, & Transportation

GOVSCAPE2Q’19

State & Local Market Dynamics

Strong Market Tailwinds

Rapidly Changing Buyer Base

Government Inefficiencies

Thousands of Vendors

FRAGMENTED GOVTECH LANDSCAPE

1

4

1 1 11

1

2

6

2

3

2

2

32

15

2

1

33

1

1

1

52

1

3

3

2

2

1

2012 2013 2014 2015 2016 2017 2018 2019

TRANSACTIONAL REVENUEGovTech M&A activity has been robust over the last several years with both strategic and financial buyers deploying significant capital into the sector. Strategic acquisition activity has been led by Tyler Technologies, completing 23 acquisitions over the last decade and 11 acquisitions over the last three years. Tyler’s most notable recent activity was the acquisition of MicroPact Inc., an Arlington Capital Partners portfolio company, for $195M. A heightened level of private equity activity in the sector has continued to fuel a number of PE-sponsored roll-ups, strategic M&A, and secondary sponsor trades.

Private equity, now with more than $2 trillion in dry powder, has been exceptionally active in the GovTech space. Investment activity and strong participation in M&A processes continues to be driven by favorable industry trends, such as increasing government IT spend and adoption of Cloud technologies, a growing ecosystem of emerging Cloud application vendors offering alternatives to antiquated legacy enterprise systems, infrastructure spending forecasts, and a highly fragmented vendor ecosystem that presents attractive roll-up opportunities. Since 2016, private equity firms have acquired or invested in more than 40 new GovTech platforms.

Notable private equity activity since January 2018 includes the consolidation of Superion, Aptean, & TriTech into CentralSquare Technologies by Bain Capital and Vista Equity Partners. CentralSquare Technologies alongside its capital partners then went on to acquire Lucity in January of 2019. Clearlake Capital was also active in the GovTech market with the acquisition of Dude Solutions from Warburg Pincus and a growth investment in Appriss alongside Insight Venture Partners. Additionally, Polaris Partners added to its GovTech stable with the acquisition of platform company Emergency Reporting in early 2019.

GLC expects consolidation in the GovTech sector to continue at notable levels through 2020, driven by the increasing number of institutionally-owned strategics continuing to canvass a highly fragmented market of independent GovTech software vendors and service providers.

HIGHLY ACTIVE GOVTECH M&A MARKET

GovTech M&A Market Summary and Most Active State & Local GovTech Acquirers

Source: S&P Capital IQ; 451 Group; GLC proprietary data; (1) YTD through April 2019

3531

24

46

5452 52

20

40

2012 2013 2014 2015 2016 2017 2018 2019

Total Deal Volume

Annualized Deal Volume

(1)

60 19

17

9 9 9

5

2

TRANSACTIONAL REVENUERECENT M&A AND FINANCING ACTIVITYEnterprise EV / EV /

Announced Acquirer Target Value Revenue EBITDA

5/9/2019 BV Investment Partners CivicPlus Inc. *** *** ***

5/3/2019 Clearlake Capital Group, L.P. Dude Solutions Inc. NA NA NA

4/26/2019 NxGen Communications Corp. Imex Systems Inc. (TSXV:IMEX) NA NA NA

4/25/2019 Technology Crossover Ventures Rave Wireless, Inc. NA NA NA

4/17/2019 Polaris Partners Emergency Reporting NA NA NA

4/17/2019 salesforce.com, inc. (NYSE:CRM) MapAnything, Inc. NA NA NA

4/9/2019 Clearlake Capital Group, L.P. Appriss Inc. NA NA NA

4/8/2019 Geotab Inc. BSM Technologies Inc. (TSX:GPS) $88.2 1.9x 35.4x

4/4/2019 Rock Solid Technologies, Inc. CitySourced, Inc. NA NA NA

4/4/2019 Granicus Firmstep NA NA NA

2/7/2019 Lexipol, LLC (The Riverside Company) Praetorian Digital NA NA NA

2/1/2019 Tyler Technologies, Inc. All The Assets of Civic Inc. $3.7 NA NA

2/1/2019 Tyler Technologies, Inc. (NYSE:TYL) MicroPact Inc. $195.0 2.8x NA

1/8/2019 Appriss Inc. Crime Finders, Inc. NA NA NA

1/8/2019 Paya, Inc. First Billing Services, LLC $57.5 NA NA

1/8/2019 CentralSquare Technologies Lucity *** *** ***

12/13/2018 Rave Wireless, Inc. Swiftreach Networks, Inc. NA NA NA

12/10/2018 Tyler Technologies, Inc. (NYSE:TYL) SceneDoc Inc. NA NA NA

12/10/2018 Civica Trac Systems NA NA NA

12/10/2018 Apis Capital Management LLC Veritone, Inc. (NasdaqGM:VERI) $196.2 6.9x NA

11/9/2018 Granicus Inc. Southtech Systems, Inc. NA NA NA

11/1/2018 Edmunds & Associates LL Partners *** *** ***

10/29/2018 GeoDecisions, Inc. WorldView Solutions Inc. NA NA NA

10/12/2018 NEOGOV, Inc. High Line Corporation NA NA NA

10/9/2018 Passport NuPark NA NA NA

10/1/2018 Votem Corp. Everyone Counts, Inc. NA NA NA

10/1/2018 Tyler Technologies, Inc. MobileEyes Security Canada Inc. $5.3 NA NA

9/28/2018 Avenu Insights & Analystics Conduent (Local and Municipal Constituent Gov't Soft. Solutions) NA NA NA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) Sherpa Government Solutions LLC $8.0 NA NA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) Bonfire $108.0 NA NA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) Citybase $160.0 NA NA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) eCivis $101.0 NA NA

GLC GovTech Transaction Database

$50MMedian EV

$120MAverage EV

4.4x4.7xMedian EV / Revenue Average EV / Revenue

GLC Proprietary GovTech M&A Data

$52MMedian EV

$235MAverage EV

83331Total Transactions Transactions w/ Multiples

*Transaction data includes GovTech M&A and recapitalization transactions involving software, tech services and other IT targets; *** = GLC proprietary informationSource: S&P Capital IQ; 451 Group; GLC proprietary data; Transaction Data: 2018 - April 2019 YTD

4

TRANSACTIONAL REVENUERECENT M&A AND FINANCING ACTIVITY

*Transaction data includes GovTech M&A and recapitalization transactions involving software, tech services and other IT targets; *** = GLC proprietary informationSource: S&P Capital IQ; 451 Group; GLC proprietary data; Transaction Data: 2018 - April 2019 YTD

GLC GovTech Transaction Database

$50MMedian EV

$120MAverage EV

4.4x4.7xMedian EV / Revenue Average EV / Revenue

GLC Proprietary GovTech M&A Data

$52MMedian EV

$235MAverage EV

83331Total Transactions Transactions w/ Multiples

3

Enterprise EV / EV /

Announced Acquirer Target Value Revenue EBITDA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) Open Counter $28.0 NA NA

9/12/2018 GTY Technology Holdings Inc. (NasdaqCM:GTYH) Questica $85.0 NA NA

9/10/2018 Nuix Pty Ltd Ringtail Solutions, Inc. $55.0 NA NA

8/31/2018 CentralSquare Technologies Aptean (Public sector and healthcare business) NA NA NA

8/31/2018 Tyler Technologies, Inc. CaseloadPRO, L.P $9.3 NA NA

8/1/2018 CentralSquare Technologies Superion NA NA NA

8/1/2018 CentralSquare Technologies TriTech Software Systems NA NA NA

7/31/2018 Appriss Inc. HD Information, LLC NA NA NA

7/25/2018 FiscalNote, Inc. CQ Roll Call, Inc. $180.0 NA NA

7/16/2018 GCR & Associates MB3 NA NA NA

7/10/2018 CivicPlus Inc. Virtual Towns & Schools *** *** ***

7/6/2018 Providence Equity Partners LLC; Greater Sum Ventures, LLC Value Payment Systems, LLC NA NA NA

7/2/2018 Fortive Corporation (NYSE:FTV) The Gordian Group, Inc. $778.0 7.1x NA

6/6/2018 Accruent, LLC Maintenance Connection Inc. NA NA NA

6/5/2018 Municipal Code Corporation Municipal Code Online, Inc. NA NA NA

5/17/2018 Dude Solutions Paladin Data Systems NA NA NA

5/2/2018 Ontario Systems Justice Systems NA NA NA

4/30/2018 Tyler Technologies, Inc. Sage Data Security, LLC $11.5 NA NA

4/30/2018 Tyler Technologies, Inc. Socrata $150.0 6.0x NA

4/17/2018 Zuercher Technologies, LLC Metro Technology Services, Inc. NA NA NA

3/31/2018 Lumia Capital FiscalNote, Inc. NA NA NA

3/27/2018 Superion, LLC (nka:CentralSquare Technologies) Public Safety Corporation NA NA NA

3/13/2018 Granicus Inc. Assets and Operations of IQM2, Inc. NA NA NA

3/13/2018 Granicus IQM2 NA NA NA

2/14/2018 Granicus Vision Technology Solutions NA NA NA

2/9/2018 Clearlake Capital Group, L.P. Diligent Corporation NA NA NA

2/6/2018 Brentwood Associates Inc. Credentials Inc. NA NA NA

2/6/2018 Xylem EmNet NA NA NA

1/9/2018 HKW GCR Inc. $124.0 NA NA

1/9/2018 NEC Corporation Northgate Public Services $644.0 2.9x NA

1/4/2018 Securus Technologies Inc. GovPayNet NA NA NA

9/19/2017 Cartegraph Systems Pamlico *** *** ***

CENTRALSQUARE

<2012 2013 2014 2015 2016 2017 2018 2019

GEMS

Acquired January 2019

Ow

ner

ship

M&

A

CEO: Simon Angove$400M Rev

8,000 customers30 Products

2,000 employeesPublic safety

Public administration

Acquired May 2019

Sources: S&P Capital IQ, Pitchbook, GLC Research

5

6

Acquisition Sector | GLC Landscape Category News

Procurement | Admin, Finance & Payments May 2019: GTY Technology Holdings Inc. (Nasdaq:GTYH) announced its Q1 2019 results. Per the Company, revenue growth was 17% over the prior year period on a GAAP basis. Non-GAAP pro forma as adjusted revenue growth, which assumes the business combination and other related transactions had taken place on January 1, 2018 and excludes the impact of purchase accounting, was 30% over the prior year period. Q1 results: $7.9M in revenue and $4.7M in gross profit

Feb 2019: Feb 2019: GTY Technology Holdings Inc., a publicly traded special purpose acquisition company, announced the closing of its business combination between the Company and six companies that are leading the digital transformation of the public sector market.

Nov 2018: GTY Technology Holdings completes $552 million initial public offering.

Payments | Citizen-Facing, Admin, Finance & Payments

Grants Management | Health & Human Services

Permitting | P&L/CD&R

Budgeting | Admin, Finance & Payments

Budgeting | Admin, Finance & Payments

HQ: Austin, TXChairman/CEO: Steve RohlederCFO: Harry YouDirectors: Bill Green, Joe TucciPrimary Industry: SoftwareEmployees: 338

NasdaqCM: GTYHStock Price: $9.75Market Cap: $473M2018 ARR: $34MRecurring: ~80% Gross Margin: 72%

PUBLIC MARKETS: GTY TECHNOLOGY

$9.75

7.00

7.50

8.00

8.50

9.00

9.50

10.00

10.50

11.00

GTY Technology Holdings Inc. (NasdaqCM:GTYH) - Share Pricing


8.2x

5.6x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19

Tyler Verticals

Tyler: Relative EV/ Revenue Trend

Enterprise Value to LTM Revenue Multiple by Software Sector

7

PUBLIC MARKETS: TYLER TECHNOLOGIES

Tyler Technologies, Inc. (NYSE: TYL) continues to trade at arevenue multiple premium to the general software market (GLCsoftware sector groups are comprised of 89 publicly tradedsoftware companies), hovering well above its three-year averageof 8.5x EV / LTM Revenue. With the stock up an impressive 23%year-to-date, and coming on the heels of seven M&A transactions(including Socrata in the data-as-a-service solutions space, andMicroPact in the case and business process management space),newly appointed CEO, Lynn Moore, is aggressively moving Tylerforward as the clear leader in the space. Lynn has been with TYLfor 20 years and has played a pivotal role in TYL’s corporatestrategy, including overseeing the Company’s M&A strategy andexecution. We believe TYL’s ability to sustain an EV / LTMRevenue multiple above 8.0x is a strong indicator of the market’sbelief in GovTech’s prospects as a sector.

Tyler: Relative Share Performance


HQ: Plano, TXPresident/CEO: Lynn MooreChief Strategy Officer: Bruce GrahamChief Financial Officer: Brian MillerPrimary Industry: SoftwareEmployees: 4,525

NYSE: TYLStock Price: $232.36Market Cap: $8.9BLTM Revenue: $950M+LTM EBITDA: $200M+ Acquisitions: 23 in last decade

8.2x

10.6x9.9x

9.1x 9.1x

6.9x 6.7x6.0x

5.6x5.1x

9.3x

7.8x8.6x 8.2x 8.1x

4.8x

6.1x

4.9x

7.1x

5.2x

Tyler HCM SaaS Sales &Marketing

Large Cap Supply Chain Financial Security VerticalSoftware

ERP

Q1'19 Q1'18

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

110%


Tyler S&P 500

ShotSpotter: Relative EV/ Revenue Trend


8

PUBLIC MARKETS: SHOTSPOTTER

ShotSpotter: Relative Share Performance

HQ: Newark, CAPresident/CEO: Ralph ClarkChief Financial Officer: Alan StewartFounders: Jason Dunham / Robert CalhounPrimary Industry: Security SoftwareEmployees: 101

NASDAQ: SSTIStock Price: $46.65Market Cap: $533MLTM Revenue: $37MLTM EBITDA: $2M+ Acquisitions: 1

12.1x

5.6x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19

ShotSpotter Verticals

12.1x

10.6x9.9x

9.1x 9.1x

6.9x 6.7x6.0x 5.6x

5.1x

10.7x

7.8x8.6x 8.2x 8.1x

4.8x

6.1x4.9x

7.1x

5.2x

ShotSpotter HCM SaaS Sales &Marketing


ERP

Q1'19 Q1'18

-50%

0%

50%

100%

150%

200%

250%

300%

350%

400%

Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19

ShotSpotter S&P 500


Like Tyler Technologies, Inc., ShotSpotter (NAS: SSTI) is tradingat a revenue multiple premium to the general GLC softwaremarket, though the Company’s stock has undergone recentturbulence on the heels of 2018 and early in Q1’19. Despiterecent fluctuations, which are largely due to general marketvolatility in the technology sector, ShotSpotter is currently upover 50% YTD 2019. The ShotSpotter gunshot detection solutionis deployed in more than 90 cities and the company recentlyannounced the launch of ShotSpotter Missions, a crimeforecasting and patrol management software solution.ShotSpotter also recently announced it had been selected to theGovTech 100 for the third consecutive year. The GovTech 100 isan annual list compiled and published by GovernmentTechnology magazine to recognize 100 companies focused onmaking a difference in state and local government agenciesacross the United States.


PUBLIC MARKETS: NIC

Despite underperforming the S&P 500 index over the last threeyears, NIC Inc. (Nasdaq: EGOV) remains a staple in the publiclytraded GovTech landscape. NIC Inc. is currently sitting at a 2.8xEnterprise Value / LTM Revenue multiple and is trading at a 30%premium to where it began 2019. Harry Herington, thecompany’s president & CEO has attributed recent financialsuccess to the company’s ability to act on its vertical strategy andeffectively expand its expertise in outdoor recreation, health care,licensing & permitting, and payment processing. With increasedfinancial stability, Herrington also pointed to a more aggressiveM&A strategy as a focus to help bolster the company’s verticalexpansion. NIC recently completed the acquisition of Denver-based, Complia, which could be the first of many for therelatively un-acquisitive NIC. Complia provides businesslicensing, patient/care giver registration, and employeecredentialing to the cannabis industry in the U.S.

NIC: Relative EV/ Revenue TrendNIC: Relative Share Performance

HQ: Olathe, KSPresident/CEO: Harry HeringtonChief Financial Officer: Stephen KovzanChief Operating Officer: Robert KnappPrimary Industry: Tech-enabled ServicesEmployees: 920

NASDAQ: EGOVStock Price: $16.10Market Cap: $1BLTM Revenue: $343MLTM EBITDA: $80M Acquisitions: 1

9

2.8x

10.6x9.9x

9.1x 9.1x

6.9x 6.7x6.0x

5.6x5.1x

2.2x

7.8x8.6x 8.2x 8.1x

4.8x

6.1x

4.9x

7.1x

5.2x

NIC Inc. HCM SaaS Sales &Marketing


ERP

Q1'19 Q1'18

2.8x

5.6x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x


NIC Verticals

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%


NIC S&P 500


2. Private Equity GovTech Portfolio Platforms

Platform(Date of Investment)

GovTech Sub-Sectors / Application Types PE-Backer / OwnerFunds Under Management

Recent Acquisitions

Asset management, licensing and permitting, citizen engagement, back office

$5.5B / $1.9B •PublicStuff• Softright• Springbook

Public safety, GRC $13.0B •The Retail Equation•Pharmitas•Optimum Technology

Finance, administrationCourts and justice

$450.0M •Conduent’s local and municipal government software solutions businesses

Asset and operations management ~$2.0B •N/A

Public safety, public administration $46.0B$105.0B

•Combination of Superion, TriTech, Aptean State & Local businesses• Lucity

Asset and operations management $4.3B+ •N/A

Software applications, cloud services, and IT-enhanced outsourcing solutions

$38.0B •Trac Systems

Web content management, parks and recreation software, citizen engagement, payments

$3.0B+ • Seneca Systems•Virtual Towns & Schools•Rec1

Citizen engagement (elections) $4.5B •N/A

Courts and justiceOffender case management

$250.0M •N/A

11

Sep 2017

Jul 2015

Sep 2017

Oct 2016

Jul 2017

Jul 2017

Feb 2016

July 2018

Aug 2018

PRIVATE EQUITY GOVTECH PORTFOLIO PLATFORMS

Source: The 451 Group; S&P Capital IQ, GLC Research

May 2019



Recent Acquisitions

Parking management and payments $1.5B •The Payment Group•Citezone

Licensing and permitting, GRC, courts and justice $330.0M+ •N/A

Online portal to produce, deliver, review, and vote on board materials

$13.0B •BoardDocs

Facilities and asset management $44.0B+ •EnergyCenter•Paladin Data Systems•Mobile311

Funding, budget, and project management $1.4B+ •N/A

Finance, administration, and HR $1.2B •Business Automation Services, Inc

Fire and EMS solutions $4.3B+ •N/A

Emergency software solutions $4.0B+ • Firehouse software (from Conduent)• eCore Software

Network search and information services to law enforcement

$650.0M+ •COPLINK Suite of Products from IBM

Citizen engagement (communications) $30.0B • Firmstep• SouthTech Systems•Vision Technology

12

May 2019

Jan 2018

Jan 2017

Aug 2016

Jul 2016

Oct 2017

Aug 2016

April 2019

Nov 2018



Feb 2019



Recent Acquisitions

Licensing and permitting, citizen engagement (elections) $600.0M+ •MB3 Technologies•PCC Technology

Government Brands Courts and justice, GCR (regulatory compliance)Payments

$2.2B •nCourt

Document and content management $660.0M+ •N/A

Smart water infrastructure modeling and simulation software solutions

$35.0B Euro •N/A

Public safety policy and procedure manuals $44.0B+ •N/A

Public safety policy and records management system, computer-aided dispatch

$6.0B+ •N/A

Human resources $1.0B+ •High Line Corp• FirstNet Learning

Public safety, incident and security management $44.0B+ •360o Stay Safe• iView Systems

Public safety, communication/alerts in emergency situations

$6.0B+ • Send Word Now•MIR3

Finance, administrationPayments

$3.5B+ • Justice Systems

13

Aug 2014

Jun 2016

Oct 2016

Nov 2016

Mar 2017

Nov 2016

/Feb 2019

Mar 2012

Sept 2015


Mar 2018


May 2018



Recent Acquisitions

Payments (motor vehicle, taxes, utilities) $13.0B •N/A

Parking, transportation, and transit management $79.0B+ •N/A

Procurement software solutions $1.0B+ •BidSync

Civic engagement software platform $1.3B+ •N/A

GRC (fraud detection / H&H Services) $600.0M+ •N/A

Compliance, policy, and document management $1.3B+ •N/A

Health and human services $1.0B+ • Cirrus Group• SchoolLeader• KidReports

911 and first responders emergency communication $3.5B+ •N/A

Campus and public safety solutions $3.0B+ •N/A

Community development $6.0B+ •Municipal Building Inspection Solutions• Independent Inspections

14

Dec 2017

Dec 2014

Jun 2017

Jan 2018

Nov 2014

Sep 2016

Apr 2017



Apr 2019

Aug 2018

May 2019

Mar 2019



Recent Acquisitions

Electronic voting, election management, and election modernization solutions

$3.0B+ •N/A

Health and human services $30B+ •Community TechKnowledge

Parking management, permit management, enforcement, and citation services

$17.0B •ParkingSOFT•CASE Parking•Digital Payment Technologies

Hosting and managed services $1.0B •N/A

GIS, land management, utilities $5.6B •AED-SICAD, Latitude Geographics Group, Geocomm, and Dynamic Design Group

15

Sep 2016


Feb 2016


Jul 2017

Aug 2018

Oct 2016

3. GovTech Industry Overview

17

STATE AND LOCAL GOVERNMENT

Is a massive, evolving market that needs technology solutions to address the growing gap between demanding constituent

expectations and the abilities of governments to quickly, efficiently address those it serves.

$100+ BILLIONEstimated U.S. State & Local Government

Software & IT Services Market

90,000+Local Government Organizations, Agencies, and

Departments in the U.S.

38,000+Special Districts

19,000+Cities

Townships

16,000+

12,000+School Districts

3,000+Counties

Source: e.Republic; GovTech Navigator; Gartner

LOCAL GOVERNMENTS MUST DO MORE WITH LESS

2009First CTO of the United States

Appointed

30-40%of local government workersare eligible for retirement 1

~50%of U.S. states are facing

budget shortfalls

70%of residents indicated that

with more digital interactions available on their local

government website, they are more likely to interact 2

Do more with shrinking budgets and workforce

Increase efficiency when addressing routine requests

Increase transparency, e.g. financial, legislature, etc.

Better serve a fast-growing, and diverse resident base

1 The Pew Trusts; 2 CivicPlus survey

Replace paper-based processes to reduce costs

Expose meaningful data and information to residents

Enable self-service and 24/7 government

Focus on long-term and strategic planning

Engage residents and foster a sense of community

Focus on value-added government services

Increasing Challenges for Local Governments

18

19Source: e.Republic; GovTech Navigator; Gartner

1. Citizen Engagement

2. Digital Transformation and IT modernization

3. Workforce Automation and

Demographic Shifts

4. Mobile and Consumerization of

Enterprise Software

5. Internet of Things (IoT)

6. Application Procurement and The Cloud

• Citizen satisfaction and citizen-facing application growth driven by next generation 311 systems and

portals that serve as vital links between citizens and their governments.

• Effective citizen engagement becoming increasingly critical to efficiently running government.

• Overdue capital and technology investment requirements due to siloed and disparate systems that are

often antiquated and vulnerable to cyber breaches and a preponderance of paper and spreadsheet-based

record keeping.

• Improving decision making, augmenting talents of skilled workers, and automating tasks that were

previously regarded as impossible due to reliance on human knowledge and experience is dramatically

impacting the way governments do business.

TECHNOLOGY DEMAND DRIVERS

• The way users expect to “consume” software has changed as a result of wireless technologies, low-cost

mobile computing, and internet connectivity.

• The rise of connectivity that enables superior monitoring and mass data collection to support BI and

analytics-driven decision making.

• Smart-city initiatives and planning.

• Long sales cycles mitigated by Cloud and “by-the-drink” ASPs.

• Cost optimization and technology modernization efforts are pushing government to the Cloud and

Transactional

• Pay utility bill

• Apply for a business license

• Register for an upcoming event

• Inquire about a marriage license

• Pay property taxes

• Report a damaged stop sign

• Apply for social services

• Track a recently incarcerated relative

• Report a stray dog

Community

• Research upcoming events

• Review county initiatives

• Research infrastructure spending

• Identify local voting facilities

• Access the strategic plan

• Access and review visitor guides

• Find city news

• Research affordable housing

Critical Services

• Physical security

• Infrastructure (power, water, roads)

• Courts, justice, and regulations

• Emergency (hospital, fire, natural

disaster)

• Health, human, and social services

• Community (events, gatherings, arts)

• Education services

Residents expect 24/7/365 digital government and for government to operate as efficiently and effectively as a private enterprise.

RISING RESIDENT EXPECTATIONS

20

TRANSPORTATION

• Intelligent Transportation System

• Computer-Aided Dispatch / Computer-Aided Engineering

• Enterprise Asset Management

• Driver's License

• Vehicle Registration

• Project Management

• Port Security

PUBLIC WORKS

• Geographic Information System

• Project Management

• Operations and Asset Management

• Computer-Aided Dispatch

• HR Systems

NATURAL RESOURCES

• Geographic Information System

• Permitting

• Environmental Systems

• Water Resources

• Forestry Management

• Land Management

• Hazardous Waste

CRIMINAL JUSTICE

• Computer-Aided Dispatch

• Records Management

• Compliance and training

• Mobile Data Terminals

• Crime Analysis Video Surveillance

• Next Generation 9-1-1

• Criminal Justice Information System

• Jail Management

• Inmate Tracking

• Jury Management

• Court Records Management Systems

• Court Automation

ADMIN & FINANCE

• Internal Tax Systems

• Financial Management

• Collections

• Purchasing

• Records Management

• HR Systems & Retirement

• 311

• Community Development

HEALTH

• Case Management

• Integrated Eligibility

• Fraud Detection

• Child Welfare

• Child Care

• Child Support

• Unemployment Insurance

• Workers’ Compensation

• Medicaid

• Women, Infants, and Children

• Health Insurance

• Disease Surveillance

• Electronic Health Records

• Health Information Exchange

HUMAN SERVICESPUBLIC SAFETY

21

AGENCIES AND RESPONSIBILITIESA fragmented landscape with disparate decision-making processes is an opportunity for some vendors and a challenge to others. Agency-specific offerings (Parks & Rec or Asset/Operations Management, for example) are largely sponsored by the user, but must still go through procurement, while more general or broadly used offerings (portals or websites, for example) can have a variety of decision-makers in the process.

22

GLC ADVISORS

Representative Technology M&A and Capital Raise Transactions:

35+ Professionals

500+ Closed Transactions

$379B+ Transaction Value

GLC Advisors & Co. is a leading independent investment banking advisory firm, delivering objective, senior-level expertise to successfully execute financial advisory assignments for our clients.

HealthcareTechnology Financial Services Business Services Industrials Consumer / Retail

Industry Specific Advisory Focus:

GLC Advisors & Co.GLC Advisors & Co.

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New York, NY 10022

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Denver, CO 80202

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451 Jackson St. 2nd Floor

San Francisco, CA 94111

415-400-2320 (main)

Adam T. HaynesManaging Director

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Jim C. WilliamsDirector

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David J. BluthManaging Director

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GLC Tech Leaders

Offices

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Representative transactions completed by GLC professionals while at GLC and other firms

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