It is no secret that a robust IT infrastructure and an established digital presence have been key factors in determining how successfully businesses have been able to navigate the choppy waters of Covid-19.
It is therefore no surprise that firms specialising in the implementation, improvement and maintenance of IT services, telecommunications, data protection and cloud migration have been able to capitalise on the changing digital landscape of the past 12 months.
One such firm is Fife-based Cloudstream, which specialises in managed IT services. Established in 2014 by director Ian Maclellan, the firm has grown quickly in a few short years through a deliberate acquisition strategy that has unified nine separate entities, increasing Cloudstream’s customer base to more than 1,000.
Funding to refinance, consolidate and grow
Maclellan’s shrewd acquisition strategy has enabled the business, which offers everything from disaster recovery to cloud migration and telecommunication infrastructure, to strengthen and diversify its proposition, with the added advantage of consolidating group functions and driving growth through cross-selling.
Now, Cloudstream will use funding of £3m, under the Coronavirus Business Interruption Loan Scheme (CBILS), to implement a similar consolidation strategy to the firm’s existing debt. By refinancing the business’s existing acquisition funding into a single, tidy debt structure, the management team will be able to focus on growth, rather than managing credit with multiple lenders.
“BOOST&Co is keen to promote the benefits of using the CBILS scheme to refinance existing debt, and this deal is a great example of exactly that,” says Ryan Sorby, principal at BOOST&Co and head of the lender’s Manchester office. “By using the new product to consolidate several loans, Ian and his team can concentrate on what matters: acquiring new customers and growing the business.”
“It was refreshing that Ryan and his team completely understood our proposition from the outset and could see how a CIBLS facility would transform the future operating landscape of the business,” Maclellan says. “By freeing up management time spent juggling multiple short-term credit lines, we are now able to focus on growth and building strategic value. I cannot commend the team at BOOST&Co highly enough.”
Customers will benefit from improved integration
The funding has also enabled the firm to recruit a new finance director, who will support the continued integration of the acquired entities. By streamlining business functions and offices, Cloudstream will invest in areas of the business that will enable it to better support customers, ultimately promoting growth.
“We know that acquisition is a proven growth strategy and that Cloudstream is operating in a very hot sector,” Sorby says. “Not only is there a strong demand for its services, but the company is also able to provide excellent revenue visibility and demonstrate strong profit margins compared with peers in the sector. BOOST&Co is confident in supporting the firm and we look forward to seeing its continued success in 2021.”
“We have a strong working relationship with BOOST&Co and are delighted to have supported its debt funding facility for Cloudstream. We look forward to seeing the team at Cloudstream prosper through 2021,” says David Middleton at Knight Corporate Finance, which provided due diligence for this deal.
“David also deserves a special mention; he completed the separate associated due diligence exercise in a very professional and thorough manner,” Maclellan says. “I would also like to emphasise that I have great confidence in recommending BOOST&Co as a lending partner of choice to any business.”