Here’s why I am excited about the fundraise and the road ahead.
Adara once had a pre-covid revenue of around $100m annually. Post-covid its revenue fell to $25m and was making losses of 15% at the EBITDA level and it was not able to recover until rategain came to the rescue and acquire it for mere $16m. Since the acquisition it has brought it a lot of synergies for rategain and has been generating cash from the very first quarter. Here’s the breakdown from the data I have analyzed based on the numbers given in the investor presentations and the concalls.
Adara has not yet reached the full potential and there is a huge runway for growth and the management has aspired to take it back its glory days (and reaching $100m revenue in the process) and even if they reach the halfway mark in year or two, it will still create a lot of value because of the operating leverage.
I don’t expect all their acquisitions to perform the same way, but they have turned around the businesses in the past (like myhotelshop) and I am waiting on their next announcement.
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