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Big Win!? Edgenet sells control stake to P/E Marlin Equity Partners
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Steve Proctor led turnaround

EDGENET, the Nashville-based provider of Product Content cloud (PCc), Made to Order (M2O) and Outdoor Products (OdP) content, data and configuration management solutions and digital tools, has sold majority interest in the company to Marlin Equity Partners, a private-equity firm based in California and the UK, CEO Steve Proctor, 48, confirmed.

Proctor praised the entire Edgenet team, telling Venture Nashville this morning the company has reached the 100-employee mark, and adding that he expects the company to remain in Nashville. Proctor said he and EVP Tim Stafford will remain in their roles, going forward.

Proctor said Edgenet was represented in the transaction by Waller Lansden. He said the transaction brought a strong multiple in valuation, which he declined to provide at this time.

Other sources have told VNC in the past year that Edgenet has been operating with very strong growth and profitability, since management bought the company back from owners who held it for a decade of apparent tough sailing. Edgenet in its original form was founded in 2000, according to state records online.

The company said today in a release it has experienced a 40 percent increase in recurring revenue growth over the past nine consecutive quarters and has nearly doubled the number of customers in its network. VNC reported in 2015 the company expected to generate more than $20MM revenue in 2015.

EVP Tim Stafford

Local publicist Jeff Bradford, diligently advancing some narrative for client Edgenet, said in an email to local media yesterday that the Edgenet announcement, which he did not disclose at that time, would represent the kind of "certifiable win" that the Nashville entrepreneurial sector needed.

Such comments by local observers have typically been couched in frustration that Nashville's multi-sectoral tech sector has been overshadowed by investment in healthcare services and healthIT. HealthIT emphasis recently got fresh impetus when the Brookings Institution issued a report warning Nashville that it must act to secure a leadership role nationally in HealthIT.

As previously reported indepth by VNC, in Summer 2014 Edgenet's assets were acquired for $7.98MM from New York-based private-equity firm Liberty Partners, via a Chapter 11 363 sale to former majority owner Tenth Street Capital (now Resolute Capital). Edgenet's board of directors was in 2015 chaired by Bill Nutter, a partner in Resolute.

As reported in 2015, other investors in reconstituted Edgenet included original co-founder Tim Choate, who owns and operates Murfreesboro-based Bondware and Renderosity content-management platform and computer-generated design platforms; attorney Ernie Williams IV; and, James Spalding, a former Vanguard Health Systems general counsel.

Choate confirmed this morning he has exited his ownership stake, adding that he wishes the team further good fortune and looks forward to working on other opportunities with some of the investors who backed the company.

That buyback was an apparent bargain. In 2004, according to media reports at the time, Liberty paid $70MM for Edgenet, which at one point had 300 employees, and VNC understands Liberty invested another $80MM in the company during its decade-long ownership.

The company says, Edgenet SaaS solutions "enable the exchange of detailed product information that can be used by retailers, manufacturers and suppliers to manage product data and streamline sales processes. The company's PCN software platform allows suppliers to collect, upload and share product information, marketing attributes and logistical data with retailers. Its configuration tools help facilitate and simplify the design, ordering and manufacturing of configurable products including windows, doors, decking and fencing."

Marlin says it has about $3BN capital under management. Marlin Partner Jonah Sulak was quoted in today's press release saying, in part, "Edgenet represents an attractive platform for growth and an industry-leading provider of product content and configuration solutions," adding that the company may expand its marketing into verticals adjacent to its current business. VNC

. last edited 2:33pm






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Tags: Edgenet, Marlin Equity Partners, Steve Proctor, Tim Choate, Tim Stafford


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