Improving valuation with revenue-based financing.

Launched in 2010, Patron Technology is a leader in the event technology space. The company, which was acquired by Providence Equity and is now owned by Vector Capital, offers a wide array of products to help event organizers manage their ticketing, fundraising, marketing, engagement, and payment processes, empowering brands like New York Comic Con, Coachella, and the NHL to take control of their entire event experience.

Here's how Patron was able to grow their business, retain equity, and improve valuation with the help of Riverside Acceleration Capital.

Growth capital without a valuation event

In 2016, Patron Technology was ready to take the next step in its growth trajectory with its first round of institutional financing. After six years of bootstrapped growth, the company was now looking for capital to expand internationally, as well as into other verticals.

Yet, according to our conversations with Patron Technology’s then-CEO Eugene Carr, the team didn’t feel like the company was getting the valuation it deserved as they started to pitch venture capitalists. Carr explored his options for postponing a larger equity round until he could improve valuation and looked for alternative solutions to help accelerate this growth.

That’s when Patron found RAC’s revenue-based financing model—a way to inject additional funding into their business without diluting equity or triggering a valuation event before they were ready. RAC invested $2.7M in September 2016, which Patron used to expand internationally, support growth into a new vertical (the large but nascent museum market) and hit a key revenue milestone that subsequently increased the value of the company.

Leading the future of event management

Over the next nine months, Patron leveraged RAC’s growth resources and community to make operational improvements and used RAC’s capital to start gaining proof points around the international and museum markets.

With this renewed traction and their cash runway secure, Patron returned to the VC circuit in 2017 – this time, with better metrics and a larger addressable market to show investors. The company raised a successful private equity round from Providence Equity, which purchased a majority stake in the company. As a result of using non-dilutive, revenue-based financing, instead of equity, to fund their recent growth, the team retained greater ownership at the time of the exit—while achieving a higher valuation on the back of their accelerated growth.

Patron continued to grow over the next three years, launching an integrated virtual event solution at the start of the COVID-19 pandemic, helping its many customers adapt to a new era of virtual and hybrid experiences.

In September 2020, the company was acquired by private equity firm Vector Capital and has continued to lead in the event technology space.

Case study should not be relied upon for investment decision making and should not be considered an offer or solicitation of securities or investment services. For informational purposes only and intended for General Partners or Management teams considering partnering with The Riverside Company. Portfolio company selected based on non-performance criteria.