GTK Pty Ltd

Introduction

The Challenge

After 28 years of building a successful business, the founders of GTK were looking towards retirement. They sought an equity partner to help them achieve the right exit value, capitalise the business for future growth, and bring in the necessary skills for positive change. A primary concern for the founders was protecting their legacy, including their dedicated staff and loyal client base, especially considering the sensitive nature of the market.

Concurrently, while GTK was experiencing significant growth, it faced operational challenges. The company had not sufficiently invested in systems and processes to support its expanding operations. Sales and administration staff were operating at capacity, struggling to manage the increasing volume of orders. Furthermore, GTK lacked a customer relationship management (CRM) system to efficiently manage sales workflows at higher volumes, and its existing accounting system was not equipped for the company’s next stage of growth.

Our Approach

To address the founders’ succession planning needs, Greenwich Capital Partners proposed an investment that provided the necessary capital for growth. A financial structure was established that delivered the exit value sought by the founders while creating a strong foundation for the business’s future. This included an opportunity for key management, including GTK’s CEO and a long-term trusted advisor, to invest in the business alongside Greenwich, ensuring alignment and robust governance. This structure also allowed the founders to retain a minority interest, enabling them to participate in future growth. Greenwich leveraged its significant experience in the healthcare sector in developing this investment thesis.

In addressing the operational challenges, Greenwich reviewed GTK’s processes to identify pain points and areas for improvement. This review led to the identification of future-state processes and a recommendation to upgrade the existing accounting solution and implement a CRM system. A detailed business case was developed to support this recommendation, outlining the return on investment and short-listing suitable software vendors.

Following the investment, Greenwich actively supported GTK by:

Outcome

Since Greenwich’s investment approximately two years prior to the case study documentation, a growth strategy was co-developed with the GTK management team to expand across the east coast of Australia. This strategy has yielded significant results:

• Revenue increased by approximately 30% within two years and continues to grow through both organic and inorganic activities.
• More recent figures indicate sales revenue has more than doubled and earnings grew by 220% since the investment.
• The founders, who retained a significant interest, benefited from increased distributions and the potential for a higher return in a future exit opportunity.

The operational improvements also delivered tangible benefits. The implementation of the CRM system was projected to increase top-line revenue by 16% in the following financial year due to efficiencies in the sales workflow and identified cross-sell opportunities.

The partnership between Greenwich and GTK outperformed the industry average by nearly two times, partly attributed to industry tailwinds from NDIS funding but significantly driven by the strategic initiatives implemented. GTK is now well-positioned to become the dominant national player in custom disability solutions. The company has expanded its presence and now has showrooms in Sydney, Melbourne, Brisbane, Newcastle, and Ballina.

Founders’ Perspective