How Terradatum used iDeals to handle several aсquisitions and a separate forensic audit

Embracing M&A to shape the future of real estate intelligence

As a leading market analytics provider for the real estate industry in the US and Canada, Terradatum used iDeals virtual data rooms for over four years to handle its acquisitions and a forensic audit while also managing different offers for the potential sale of the company.

In 2021, Terradatum was acquired by Lone Wolf Technologies in a deal worth an eight-figure sales price. Using iDeals, the technology company could open and control all the activity from different stakeholders for as many projects as needed, keeping each project separate and confidential.

The context

From a bootstrapped software startup in 2004, Terradatum rapidly became one of the most important players in the American real estate market, supplying various brokers with real-time business intelligence and relevant data to help them gauge the market more accurately.

In 2015, as their market share continued to grow, they were beginning to consider what the company’s future might look like.

Mark Spraetz, President and CEO, explained: “Some of our former founders wanted an exit, though others weren’t ready to do that” at that time, besides handling different acquisitions of their own, another path they started to explore was being acquired by another company.

Key challenges

It was clear that handling all the different opportunities would require an efficient way to share their data with multiple stakeholders. To ensure absolute control of the decision-making process and a meticulous due diligence process, the company’s key requirements were:

• Ensuring that their confidential data was stored in the most secure virtual environment
• Keeping track of their acquisition options separately from the company’s potential sale
• Tracking buyers’ interests and monitoring the progress of each bid
• Creating separate data rooms with their own Q&A section
• Controlling access for each individual involved in the different projects, allocating different permission levels for each folder and document within the same room

It just so happened that while helping them with their due diligence, Terradatum’s broker, Catapult Advisors, LLC, was familiar with and recommended iDeals Virtual Data Room. “Catapult had used iDeals for a wide range of different-sized transactions and thought it would be the best solution for our type of company,” said Mark.

Solution

By 2017 Terradatum had their room all ready and, parallel to the process of being open for potential buyers, they continued to look at several options for making acquisitions of their own.

A year later, when they had just decided on an acquisition, an offer came in for them. “We were just on the cusp of making an acquisition,” said Mark, “so we put that project on hold and created another folder to receive information from the potential buyers.”

This was just the first of multiple offers received by Terradatum. Each time “we agreed to exchange information, we used iDeals to set up a separate folder and limit the access to the people associated with that offer,” Mark explained.

Having chosen iDeals based on their broker’s recommendation, Mark said that one of the biggest advantages was how easy it was to use the room. “Once the vault was set up, it was straightforward, and everyone could access all the materials they needed.”

In coping with this complex and ever-changing landscape, Terradatum used the iDeals features to:

• Move data over to a new folder each time a new company came forward with a new bid
• Organize the documents efficiently with the automated index, easily creating new folders in their data room and inviting users to exchange information 
• Regularly update the company’s sensitive information, keeping it ready for any new offers that might materialize 
• Open separate new rooms in the platform for each different project 
• Exchange information easily and quickly, giving them a superfast reaction to new opportunities

Sure enough, in 2021, one of the companies they had been in discussions with previously resurfaced, now with new owners keen to revamp their M&A strategy. According to Mark, “they had been sold by their PE owner, and the new PE owners were breathing new life into their M&A strategy.”

The would-be buyers already had their own virtual data room solution that they wanted to use for the transaction. But Mark insisted that iDeals was a better fit – “and we’d already got iDeals all set up, so we agreed: this is what we’re doing!”  

The future

As a leader in their market, with multiple licenses and accreditations, the due diligence process highlighted the need for a separate forensic audit. “We created a separate project so we could just have the people associated with the audit collaborating there,” said Mark. “We didn’t want to risk cross-contamination with the due diligence project, which might have been an overreach on our part, but given the urgency of the project it was the most secure way to proceed.”

With their virtual data room up and running, Terradatum can open and control all the activities for as many projects as needed, keeping each project separate and confidential, culminating in a fast reaction time to all new opportunities.