oneneck private equity solutions
DESCRIPTION
As cloud adoption continues to accelerate, private equity firms of all sizes are encouraging their portfolio companies to host and manage their business critical ERP applications. OneNeck will illustrate how leveraging cloud-based hosted application management services yields excellent operational cost savings and reduced risk for the portfolio company and increased returns for the private equity firm. Join OneNeck's webinar "The Benefits of Cloud-based IT Strategies for Private Equity Investments" on May 16th at 11:00 a.m. CDT and learn how cloud-based IT solutions improve portfolio company's operations and generate returns. Specific topics that will be covered include: • Benefits of Cloud-based ERP Hosting & Management, including: o Cost Savings o Reduced Risk o Increased IRR o A review of a Cloud-based ERP Hosting & Management Case Study Register today by clicking here: https://attendee.gotowebinar.com/register/9104818644743220224TRANSCRIPT
1 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential. Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Benefits of Cloud-based IT
Strategies for Private Equity
Investments
2 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Agenda
• OneNeck intro
• Relevancy to Private Equity
• Benefits to Private Equity
• OneNeck overview
• Brief case study
• Mutual benefit action items
3 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
OneNeck Intro
- Scottsdale, AZ based
- 15 years in business - Profitable since
inception - Singularly focused
on providing hosted and managed IT solutions for mid-market clients
- 100% US based service professionals
4 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Private Equity Goals
Identify and acquire undervalued assets
Increase the value of the asset through increased portfolio
company operations efficiency and arbitrage strategies
Maximize IRR upon exit
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Private Equity Risks
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Portfolio Company Operations
Risk Mitigation
Resource Management
Finance Management
IT and Infrastructure Management
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Infrastructure Strategies
• Internal – Purchase, manage,
and maintain: • Hardware
• Software
• Network
• Offsite services
• Utilities
• Space
• IT resources
– Significant CAPEX + OPEX
• External – Leverage vendor
shared resources: • Expert technical
resources and tools
• Infrastructure resources, i.e. SAN, network, etc.
• Space, power, cooling
– Costs controlled through operational expenses in order to limit capital outlay
8 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Example Effect of External IT Hosting
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
1 2 3 4 5
In House
OneNeck Hosted Costs
Accumulated
Savings
$114K $235K $361K $496K $600K
Assume
7X Multiple
$804K $1.6M $2.5M $3.4M $4.2M
Savings
increases
EBITDA
Increased
EBITDA
creates
more value
upon exit
$40M EBITDA company looking to implement a $500K ERP solution
9 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Decision Point
Leave the management of the
portfolio company’s IT to the
professionals, so the portfolio
company can focus on
running their business
Where should your portfolio company management be spending their time?
10 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
• Founded in 1997 with a focus on ERP hosting and managed services since inception
• Supporting over 140+ customers and 68,000 users in more than 45 countries on 6 continents
• Over 250 full time employees, who specialize in engineering and management of IT infrastructure, including:
– Hosted application management
– Enterprise cloud services
• 8 data centers and 24x7 support centers based in the US
• 98% Contract Renewal Rate
• ERP expertise focused on Oracle and Microsoft technologies
• Recognized by The Black Book of Outsourcing for ERP hosting and managed services market leadership
• Acquired as wholly owned entity of TDS Telecommunications Corporation in June 2011
OneNeck Overview
Telephone and Data Systems
was named one of "America's
Most Trustworthy Companies"
by Forbes in March 2012.
11 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Hosted Application Management
• OneNeck currently supports over 100 different applications,
with special focus on Enterprise Resource Management
Solutions
Hosted Application Management:
• Enables clients to outsource all of their mission-critical
infrastructure and technology operations
• Features highly-differentiated services, internal engineering
and management talent, as well as network and facilities
capabilities
• Designs and implements personalized features, such as
modified interfaces or reports to better illustrate the business
operations
• Provides hosted application management services for ERP
applications as well as tier 1 and tier 2 enterprise applications
12 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
(Reports, EssBase, Enterprise Reporting)
ERP Reporting Monitoring Utilities Security Other Applications
Reporting Services
Supported Software Supporting Hundreds of Applications
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Data Center Strategy
Data centers
located in the
safest areas in
the US
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Customer
Customer Intimate Organization
Customer Management Team • An efficient, scalable, and integrated
model with built-in checks and
balances
• Ability to leverage expertise across
multiple accounts
• Acts as an extension of the customers
internal IT team
• Employee turnover rate is 10.5%, well
below industry norms
15 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
U.S. Net Promoter Score Leaders
Company NPS
USAA - Banking 83%
OneNeck IT Services 79%
Trader Joe’s - Grocery 73%
USAA – Home Insurance 71%
Costco – Dept Stores 71%
Apple – Computer hardware 71%
Oracle – Business apps 41%
Dell - IT Services 39%
HP - IT Services 38%
World
Class
Level
“On a scale from 1 – 10, where 1 is unlikely and 10 is very likely, how likely is it
that you would recommend OneNeck to a friend or colleague?”
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17 Years
17 Years
16 Years
12 Years
11 Years
6 Years
6 Years
6 Years
6 Years
1995 2000 2005 2013
Client Longevity and Commitment
Customers
for Life
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PEG Case Study: Sunny Delight
• Introduced through JW Childs
Associates
• 2004 carve out of SunnyD from
Procter & Gamble
• No internal IT after transaction
• Asked OneNeck for help in a build
vs. buy decision
• Results: – OneNeck assessed and implemented a
highly customized solution in less than
12 months
– SunnyD realized significant savings
through the early termination of its
transition agreement with its former
parent company
“OneNeck’s ability to bring the data center infrastructure online in short order was quite impressive, especially in light of the fact that SunnyD started with literally no infrastructure. Considering my previous experience with outsourcers, I was pleasantly surprised. In the final analysis, we formed a tight partnership with OneNeck and did something that had never been done before: we rolled out several enterprise-wide applications, deployed a complete communication and computing infrastructure, and implemented total business support for a multinational mid-size company, all in less than one year...remarkable.”
Greg Winholt, CIO and Global Controller
Sunny Delight Beverages Co.
18 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Portfolio Benefits Summary
• Reduce Costs and Mitigate Risk
– Flexibility to quickly grow or shrink the IT platform on demand with the business
– Rapid and proven IT deployment and data migration methodology
– Limit business interrupts by providing a trusted resource to own and manage portfolio company IT assets
• Improve investment performance
– Bottom-line cost reductions result in increased valuations
19 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Actions
WE will help your portfolio companies
reduce their operational risks and lower their
operational costs
We need YOU to introduce us to the key
operational management team (CEO, COO, CFO,
and/or CIO) at your portfolio companies
THEY will decide if an outsourced IT strategy is
right for them
20 Copyright © 2013 OneNeck IT Services Corporation. All Rights Reserved. Confidential.
Questions?
Scott Fitzgerald Regional Director
OneNeck IT Services 512-814-8474