Growing a Sub-Scale Government Services Provider into a $590M Business
December 07, 2022
Building a Successful Platform from Investment to Exit with NewSpring Holdings
NewSpring Holdings recently sold its position in Avantus Federal for $590 million, representing a milestone transaction resulting in significant returns for our shareholders.
HERE'S HOW WE DID IT:
Identify a Market Leader with a Mission
Avantus checked all the boxes for NewSpring Holdings' long-term buy and build approach:
THE RIGHT OPERATOR
Avantus had a CEO with eminence in Andy Maner. He’d successfully run PE-backed businesses in the past, proved he could navigate complex integrations (previously combining multiple agencies and thousands of employees), and had an innovative, growth-focused mindset.
THE RIGHT MARKET
Avantus operates in the highly fragmented and rapidly evolving government services industry that was ripe for disruption. As a mid-sized player in a bifurcated market of large and small companies, Avantus had differentiated itself with a nimble infrastructure suited for innovation and a proven track record of financial and operational execution.
THE RIGHT BUSINESS
Avantus was a market leader with a well-defined purpose and vision for the future: deliver efficiency-driving, technology-enabled services to digitize the federal government. Avantus had the makings of a company that could sustain growth and had demonstrated its ability to expand its service offerings to meet emerging client needs.
We identified three primary areas where we could leverage our deep operational expertise to help Avantus reach new levels of growth:
1. DIFFERENCE-MAKING OPERATIONAL IMPROVEMENTS
We invested heavily in Integrated Talent Management processes and technology that brought employees closer to the company mission, aligned their ambitions with company goals, and gave them purpose and direction. This emerged as a massive differentiator for Avantus, and helped build a highly cleared, integrated workforce. We also made a serious investment into leading technology platforms and capabilities and hired a Chief Technology Officer.
2. DISCIPLINED M&A WITH A FOCUS ON INTEGRATION
We leveraged our decades of experience to execute a rigorous and disciplined M&A approach that resulted in 9 transactions over the course of our 4-year investment. We focused on building a fully integrated platform with the demonstrated ability to incorporate and leverage capabilities across our business for customers. In doing so, Avantus was able to retain top talent, effectively drive existing program expansions, and win new business.
3. DOUBLE-DIGIT ORGANIC GROWTH
We worked closely with company management to help Avantus build a mature, cohesive business development approach and mission focus to win new business and scale its depth of customer intimacy. Our full-lifecycle, horizontal approach from pre-RFP through full-scale operations enabled a high-probability of winning new business, innovative technology deployment, and exceptional execution through the life of the contract.
Growth by the Numbers
NewSpring’s approach resulted in exceptional growth metrics across the board:
Refined Strategic Focus and Continual Operational Improvements Create Integrated Platforms That Enable Accelerated Growth
Our Repeatable Process: Putting Founders First
The Avantus story is an apt reflection of NewSpring Holdings’ methodology of partnering with a proven leader of an innovative company, in an expanding, fragmented market and creating continual operational improvements that drive accelerated growth.
NewSpring’s brand of partnership starts with the proper alignment of interest with founders looking to take their business to the next level while maintaining company culture. We work on their terms to forge smart paths to sustainable growth. From acquisitions to new product offerings, we’re working alongside our entrepreneurs to create fully-integrated platform companies that can support rapid, continued growth.
FOR MORE INFORMATION, CONTACT US TODAY:
General Partner, NewSpring Holdings
Partner, Business Development