Highlighting Portfolio Company: Delta Data Software

In December of 2021, we discovered an interesting capital markets software company with tremendous untapped potential. Up to that point, Delta Data investors and management had solidified an impressive business position as a trusted, sticky vendor of back-office software to asset managers and distributors who focus on public equity pooled funds. Existing stakeholders were comfortable with a lifestyle business operating in valuable niche market, but operations, scale, and growth were not where the company thought they could be.?

With Cam, Paul, and the entire incredible Delta Data team, we're proud to look back at where we've all come just three years later. Since acquiring Delta Data: 1.) revenue has more than doubled;. 2.) earnings have 6x'ed;. 3.) headcount has grown by 50%; 4.) the serviceable addressable market has expanded significantly; 5.) DDS is now a niche-leading franchise.

DDS management and TCP accomplished this together with the same playbook we've used several times and by leveraging our key differentiators:?

• 1.) We actually help. The company wanted to build a professional management team in order to tackle the complex challenges demanded by world class customers, so we helped to recruit and ramp an all-star team who had "been there, done that" including 3 C-Suite, 3 VP-level, and 14 other game-changing additions to the roster.? Our TCP technical team helped to drive a transformative shift from on-prem to cloud, eliminate tech debt, and streamline a complex product offering.?
• 2. We drive add-on acquisitions soup to nuts. NQR press release. NQR provides intermediary oversight software and transfer agency audit services for large mutual fund co's. We eliminated DDS's only pure-play competitor to the Intermediary Oversight product and increased stickiness with value-added services. Phoenix press release. Phoenix Systems' software offers mutual fund transfer agency trading capabilities and record keeping. We bolstered a core DDS product and added strategic geography by expanding heavily into Europe and O-US broadly.?
• 3. Patient capital background.? The above projects were neither cheap nor easy, so it makes perfect sense to us that they were not accomplished yet. We were able to make the right long-term investments and decisions for the business with patient capital partners behind us.?

Despite coming a long way after three years of hard, rewarding work, we're struck by the fact that there is still SO MUCH to go tackle now that a seasoned team is in place, the product/tech have been modernized, and the pooled fund market tailwinds are in full swing.??

One of the many reasons we love operating in the lower middle market is that if we're successful, the job is never complete but just evolves through the many lifecycle stages of a healthy platform.

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Refresher on TCP.

Terminus Capital Partners is a growth-oriented, private equity firm focused on business software companies, founded in 2017?and based in Atlanta, GA. Differentiated by its industry expertise, sourcing engine, operations playbook, and buy-and-build methodology, Terminus strives to be the premier partner for capital providers, bankers, and management teams in the enterprise software sector.

Why TCP?

• We actually help.?More than half of our team are former operators and experts in their functional areas from sales & marketing to engineering. We're not hand-wavers, we're doers.
• We drive add-on acquisitions soup to nuts.?Historically we've averaged 2-3 transformative add-on acquisitions per platform, and we do all the work sourcing and executing.
• Patient Capital. Our track record with patient LPs allows?us to structure unique investments that are best for each business we build, flexibility management teams don’t find elsewhere.

Check out our website here.

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Our Investment Focus

• Majority investments (not passive/minority)
• Enterprise/b2b software
• $10m-$30m in ARR for platforms ($1m+ for add-ons)
• Positive EBITDA (breakeven cash flow, or getting there quickly)
• Majority recurring revenue
• Positive organic growth
• North America-based for platforms
• Nichey?markets and use cases, e.g.?vertical market software