Portuguese M&A firm to double transactions and enter Scandinavia

The area of mergers and acquisitions (M&A), despite going through a more turbulent phase in terms of business volume and capital raised , has managed to motivate entrepreneurs who intend to use this strategy for the expansion and development of small and medium-sized enterprises (SMEs) in Portugal.

After the pandemic, several startups dedicated to this sector emerged, including Valuing Tools. The Portuguese company, founded in 2021 by António Gomes and João Vaz Leite, is now preparing to expand into the Nordic countries through partnerships.

In the second half of the year, the focus will be on internationalization to countries such as Sweden , Norway and Denmark , after closing strategic agreements in the United Kingdom and Spain .

"We operate primarily in Portugal, but it's important to be present, to be represented in companies or on factory visits," says partner João Vaz Leite. In the Nordic countries, "there's a very high level of financial literacy, and it can help us grow as a company, taking those lessons and applying them here in Portugal," adds António Gomes.

The fintech , which began as a simple online business valuation store and evolved into a financial advisory service, also plans to evaluate around 400 companies this year —four times the number in 2024—and double the number of transactions (companies sold through its digital platform) to between 10 and 15, the founding partners of Valuing Tools told ECO. To achieve this, it will hire two more people and reach a total of ten employees.

'School of Evaluation and M&A'

The management team realized that smaller companies also face succession issues and capital needs, but they cannot be dependent on large consulting firms with high fees. Therefore, it was necessary to shorten their delivery times and increase financial literacy in merger, acquisition, and sale processes.

"These processes aren't clear to business owners. Evaluating a company for sale is murky, and sharing documentation with an external entity requires trust. Our goal is to demystify the process through pedagogy—almost being a school of valuation and M&A for everyone—and explain that it's not that difficult," says António Gomes.

At the same time, in this logic of literacy, they have a free and digital evaluation simulator, whose software was developed internally and also functions as a customer hook, which has already ranged from evaluations of 100 thousand euros to 170 million euros .

The difference from competitors like Matoaka or Trespasse.com is that Valuing Tools is not a marketplace for buying and selling companies. In other words, its team of financial advisors supports managers in both acquisitions and sales, but online, it's only possible to sell ( seller-side ). "Before going there [ on the website ], there's consulting behind it," explains João Vaz Leite, acknowledging that there's significant competition in the market.

Revenue, around €200,000, is split evenly between the two business units: valuation and advisory /M&A. "80% of leads ['orders'] come from valuation and 20% from the M&A component, where the ticket [value] is higher and balances out," adds the industrial engineer who is responsible for the go-to-market component at Valuing Tools.

Among the four main objectives of a business valuation, preparing for investor entry or a sale is what entrepreneurs most seek , in addition to strengthening negotiating power with banks and partners, identifying critical areas and opportunities for improvement, and making strategic decisions based on concrete data.

" Ideally, they should think, 'I'm going to sell the company next year, so I'm going to evaluate it now to see what I can do to improve it until then, to maximize value, and then re-evaluate it for sale .' Fortunately, we're starting to have more clients with this sense of planning operational health and comparing it with their sector," says partner António Gomes, a self-confessed corporate finance enthusiast.

When asked about the transactional market, co-founder and partner João Vaz Leite is optimistic about the second half of the year. " At the beginning of the year, there was a real slowdown in several sectors, but we believe the second half will be better. July started with a different approach . The silly season isn't even felt, because decisions have been made, corporate income tax has been paid... It seems like doors have opened," he says.