countering Bullis’ initial request for$1.8 million for 6% of the companywith an offer of $1.8 million for 12% ofLifeworks, which brings its valuationdown to $15 million from $30 million.
Eusey also countered with a similarbut smaller offer, though she was willingto bring in additional investors.
After deliberating for a short minute, Bullis quickly accepted Bicknell’soffer. “Welcome to the Mariner family,”Bicknell said, smiling broadly as the firstmega-deal for ScratchWorks Season 3was struck.
Next up was Act Analytics, ananalytics platform that provides insights on thousandsof publicly-traded companiesand funds across 200-plusenvironmental, social andgovernance factors to helpadvisors better align investment portfolios with theirclients’ values.
CEO Mike Unwin began his pitch
for $1 million, or 10% of the company
at a $10 million valuation, by explain-
ing, “We want to make sustainability
Unwin then described the technology
integrations and distribution opportu-
nities Act Analytics has built. They’re
impressive for such a new company and
arguably support a premium valuation
of the firm.
Interestingly, despite the fact thatthe judges all lead large RIA firmsworking with wealthy families, theirinvestor clients have different levels ofinterest in ESG investing.
“Frankly, this is a very challenging
space for us as we definitely are reading
about ESG and its popularity,” said Eadie.
“However, we are not having any client
inquiries, so for that reason I am out.”
Similarly, Bicknell said he wasn’t
interested in the technology solution
since his firm wasn’t constructing ESG
“might be interested.”
The other three investors — Eusey,
Nathanson and Jones — are all active-
ly involved in ESG investing and were
interested in the platform, but not at the
$10 million valuation.
“It’s a very crowded space, and Iworry about adoption,” Nathansonsaid. Jones agreed. Eusey floated apotential deal at a valuation of $2 million to $3 million.
But despite host Canter’s aggressiveprodding, Eusey could not get Unwin tobudge on his higher valuation.
While there was no deal made on theScratchWorks’ virtual stage this year,Act Analytics and three ScratchWorksinvestors agreed to continue to talkabout possible opportunities offline,with all parties optimistic that sometype a transaction could be made.
The final participant was ReAllocate, an“allocation intelligence” enabled platform that analyzes the risks of directreal estate investments and helps advisors build investment portfolios alignedwith their clients’ risk tolerance.
CEO Adam Hooper began his pitch
with another big ask: $3 million for
15% of the company, representing
a $20 million valuation. Hooper also
asked for advice and guidance from the
Scratch Works investors on how to best
position and navigate Reallocate in the
The plan of digitizing direct realestate investing and making it easyto consume as an asset class for advisors definitely caught the attentionof the panel.
“I love the business and would love toinvest in it, however, I struggle with thevaluation,” said Bicknell, expressing aview echoed by the four other investors.
When presented with a counteroffer from Eusey of $1.5 million for
15% of the company at a $10million valuation, Hooperdeclined. It looked likethere would be no deal asthe event concluded.
Canter and Hooper joineda later video session to discuss what had happenedbetween the original filming and the final editing ofSeason 3.
“I’m here to let everyoneknow that today we signeda term sheet with a Marty Bicknell-ledinvestment group for the full $3 millionask and couldn’t be more excited tohave this team of investors on our side,”Hooper proudly announced, wrappingup ScratchWorks with its largest dealto date.
Canter ended the final episode in his
inimitable style: “For emerging fintech
and wealthtech companies looking for
their big break to garner industry expo-
sure and the potential to pitch for mil-
lions of dollars from the ScratchWorks
accelerator, Season 4 is now currently
open for submissions.”
Find out more at www.scratch.works,
where you can view all four episodes of
Scratch Works — Season 3.
Timothy D. Welsh, CFP, is president, CEO andfounder of Nexus Strategy, LLC, a consultingfirm to the wealth management industry. Hecan be reached at email@example.com oron Twitter @NexusStrategy.
Lifeworks founder and CEO
Ron Bullis opened his pitch
for $1.8 million, or 6% of his
company at a $30 million
valuation, by stating, “Wealth
management is broken.”