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Market growth assessment for a provider of data analytics and integrity software

Background and Challenge

L.E.K. was hired by a private equity firm to evaluate the growth prospects of a portfolio company - a leading provider of data integrity software and services to a core set of vertical end markets, including Financial Services, Insurance and Healthcare. The company had a number of growth levers available to it and was seeking 3rd party support in gaining clarity on the magnitude and feasibility on a range of opportunities.

L.E.K. was asked to develop a strategic fact base for the business, with a focus on three primary areas: 1) estimating the TAM for their current offering 2) developing a view of the competitive landscape, and 3) identifying and quantifying new use case opportunities for its Predictive Analytics technology.

Approach and Recommendations

L.E.K. defined a framework around abstracting the current and potential market opportunity into a set of established and emerging use cases for each vertical being tested, and conducted an interview campaign targeting key market participants across verticals. Interviews targeted competitors, customers, regulators, channel players, and other experts to collect views on relevant market size, segmentation and growth trends as well as their use of data integrity and predictive analytics software solutions. The research provided inputs to a market model that estimated the market size and growth outlook for each addressable segment. L.E.K. also did a high-level competitive landscape review by vertical.

Results

L.E.K.’s work found that there was a significant unpenetrated opportunity within the space and identified specific groups of use cases within verticals where opportunity existed. The work gave the portfolio company clarity over where the growth opportunity lay, and allowed the private equity client to successfully exit the business at an attractive return.