BUSINESS DESCRIPTION

Achilles manages a global network of collaborative industry communities. The business provides a cloud-based service, enabling networks of buyers to create industry standards for collecting and validating supplier information. This is made available through the Achilles platform, together with search, reporting and risk management tools.

Suppliers join the platform to gain access to the whole community of buyers and information to help them achieve and maintain compliance. Both buyers and suppliers pay annual subscription fees.

The verified data gathered and delivered by Achilles is crucial to support processes around risk management and compliance with regulatory, social responsibility, and health & safety requirements. Achilles currently operates more than 30 communities, across 22 countries, in five continents.

WHY DID WE INVEST?

Achilles is a subscription-based network business model with significant recurring revenue streams. It is a leading company in supply chain data, with stable growth driven by the increasing need for risk management.

HOW DO WE INTEND TO CREATE VALUE?

With high levels of contracted revenue, Achilles’ position as a global, scalable business model has considerable potential in revenue and margin growth, as well as multiple opportunities for expansion into new geographies and industries.

WHAT HAS BEEN ACHIEVED?

We have made a significant investment into the business, focusing on the development of their technology, processes and sales to support global growth. The business is currently developing a variety of data products, further to benefit stakeholders in the supply chains.

During 2015, Achilles raised an additional £40 million of equity (of which the Company’s share was £10 million) to continue to enhance significantly the global scalability and competitive positioning of the business.

HOW IS IT PERFORMING?

With the considerable transformation of the business that is underway, Achilles is experiencing lower than trend revenue growth year-on-year, influenced in part by macro trends in the Oil & Gas sector. Significant investment in the company’s global infrastructure has reduced profits in the short-term and we expect margins to rise over the next year, as global efficiencies are achieved.

The Company’s valuation of its stake in Achilles has fallen by £7 million over the year. The business has seen broadly flat revenues over 2016, which has led to a lower rating being applied to this investment.

HOW WILL WE CRYSTALLISE VALUE?

There has been strong interest in Achilles from both strategic and private equity buyers and the business’s recurring revenue base is likely to maintain this interest throughout the economic cycle. It could also be an attractive IPO candidate.

 

 

Sector Location Date of Investment Residual cost £’000 Unrealised Value £’000
TMT UK July 2008 15,218 21,125