Case Studies
Examples of Paladin's recent work and impact
Joining the C-Suite Makes Us a Partner in Success
Opportunity
At the end of 2005, a new CEO was appointed by a unique health care company that does business as a licensor. The CEO had a previous business relationship with Paladin, and asked for Paladin’s assistance in evaluating expansion opportunities for his company in the United States. Paladin recognized the company’s opportunity not only for short term growth, but also for robust growth year after year. Because Paladin ties its fees to the growth of its partner companies, and participates in an equity position, it was able to jump in at the ground level of this opportunity. Paladin deployed not only its expertise as a fellow C-suite member, but also its ability to develop a company’s North American headquarters, assist in generational succession planning, and act as a resource for mentoring and coaching executives.
Solution
Paladin developed and facilitated the company’s original strategic plan. It performed a needs analysis of many business procedures and managed the sourcing, purchasing and implementation of these procedures. It was able to help the company manage its expansion by assisting in financial and tax matters, and by providing guidance on the hiring of senior executives. Paladin continues to provide tax advisory services in conjunction with other outside tax advisors.
Paladin embarked on many special projects for the company which still continue today. Paladin has negotiated many contracts on the company’s behalf, including license arrangements and minority interests in other industry-related entities. Paladin acts as the liaison between the company and its outside attorneys, auditing and accounting firms, and various consulting organizations. It also retains many ongoing responsibilities related to the company’s board of directors. One Paladin partner maintains a corporate officer position as part of the engagement.
Paladin is proud to have applied its expertise in mentoring and coaching company executives. Top company management has participated in the mentoring program. The senior executives currently participating in the mentoring program are learning sophisticated concepts related to people management, operations, and internal communications among the executive team. Paladin has provided these company leaders with advanced tools for success.
Results
This company has grown from a startup to revenues totaling hundreds of millions, with exceptional profitability. The relationship between Paladin and this company is now approaching ten years.
Opportunity
Paladin was approached by a company whose innovative technology was moderately successful in a Western European country. Both Paladin and the company recognized that this product could be a substantial enterprise in the United States.
Solution
First, Paladin assisted in the evaluation of the opportunity. Next, Paladin planned with attorneys the company’s corporate and tax structure in the United States for the foreign owners. With this U.S. entity up and running, the company’s owners were able to make their dream a reality, and Paladin was able to step in and assist in managing company operations. Because the company began its U.S. business with small revenues, Paladin structured its fees to grow with the company.
Paladin assumed board level and C-suite responsibilities for the U.S. entity, and evaluated the company’s plan to raise capital. Paladin also interviewed and assisted with the hiring of high level management.
Paladin supported all financial, legal and contractual negotiations until the company reached a critical mass that enabled them to manage day-to-day operations internally. Paladin maintained a meaningful decision-making and advisory role with the company.
Results
The company is on track to be a $100 million company in 3 – 5 years. Paladin was able to facilitate a foreign company’s business in the United States so that there was a seamless integration with the U.S. business culture. The relationship between Paladin and this company will be approaching two years.
Structure a
North American Headquarters for Growth
Providing the Financial Leadership of an Out-Sourced CFO
Opportunity
A small professional services firm was experiencing a rapid phase of growth. The firm was an industry innovator, but lacked high level business management skills. It had in place very poor controls over accounting, causing cash flow and payroll issues, as well as difficulties related to unpaid taxes.
Solution
Paladin installed accounting policies and financial reporting procedures. Payroll issues were corrected, and the company was able to pull key metrics out of their financial reporting to better run the business. With respect to areas such as payroll and financials, the firm for the first time could analyze the profitability of their employees, projects and different engineering disciplines. With tracking mechanisms in place for employees and projects, management could understand what resources were required for various efforts.
Paladin also implemented HR policies related to hiring, retention and terminations. It oversaw the creation of employee benefit packages, negotiating with insurance companies for plans related to health, life, and disability. To help manage company liabilities while maintaining an attractive employment package, Paladin implemented a 401(k) plan and terminated the company’s defined benefit program.
Paladin worked on a capital management plan for the company that included negotiations with banks for working capital, and a line of credit to finance expansion. Paladin acquired and maintained bank relationships with respect to all credit facilities.
In addition, Paladin built an internal accounting team at the company that reports to Paladin. Paladin has been managing this team for over a decade.
Results
This professional services firm expanded from just one office to five domestic offices and one international office. These new offices provide for geographic diversification of the company’s revenue streams, and also expansion of revenue streams through different engineering disciplines. The relationship between Paladin and this company is now in its twelfth year.
Opportunity
A multi-state non-profit was facing a number of financial and public relations challenges due to the prior CFO’s potential misuse of funds. An IRS examination, plus multiple federal investigations, threatened the company’s 501(c)(3) status and had the potential to shut the organization down. The organization was also responding to Congressional hearings about the fraudulent use of funds. On the public relations front, the non-profit faced a crisis not only due to the negative publicity over the use of funds, but also related to how the organization raised their funds. The organization was in urgent need of accountability, visibility and management of the various investigations.
Solution
Paladin took control of the organization’s finance department, and moved all financial records to its South Florida offices. Paladin established internal controls for accountability purposes, and set up financial reporting and cash flow management processes. To address the organization’s public relations issues, Paladin hired and supervised a South Florida crisis communications firm.
Paladin managed the IRS examination, working directly with the IRS examiner to investigate the organization’s prior records. Paladin also worked with the organization’s banks to maintain those relationships, and keep open bank accounts and lines of credit. Paladin changed the organization’s payroll policies to comply with state and federal regulations and avoid future penalties.
Paladin also created and implemented a growth strategy for the organization, which included a change it its solicitation practices.
Results
The IRS examination resulted in a “no change audit.” The IRS based their finding on the change in internal controls, and the outsourcing of financial operations to Paladin. Paladin walked the IRS through the cash cycle of the business so the 501(c)(3) designation could remain intact. The IRS noted that internal controls were now strong, and that the agency had confidence in the flow of money – how it came in, and how it was distributed. All other investigations were dropped.
The organization’s growth strategy has resulted in expansion into 3 new states.
The relationship between Paladin and this organization has entered its third year.