Roemer Capital OS (RCOS)

What is Roemer Capital OS?

Roemer Capital OS (RCOS for short) is the client portal of Roemer Capital GmbH, an independent advisory firm for funding rounds and company sales in Düsseldorf. In the client portal, clients follow their transaction process, that is, a funding round or a company sale, and receive the results of Roemer Capital's CFO services. Access is via roemer-capital.com.

The abbreviation “OS” stands for operating system. Just as an operating system is the foundation on which a computer runs its programs, the client portal is the shared starting point of an engagement. Documents, open points, figures and reports are found by management and the adviser team in one place, instead of having to be gathered from emails, spreadsheets and shared folders. Since version 2.0, RCOS has covered the CFO functions in addition to the transaction process.

Client portals in financing and company sales

A funding round or a company sale consists of work steps that build on one another. Documents are collected and reviewed, a business plan and a financial model are produced, the equity story is developed, that is, the coherent case for why the company is worth an investment. In parallel a data room is created in which the other side reviews the documents. Then follow the approach to investors or acquirers, the discussions, the due diligence (the thorough review of the company before contract signing) and the negotiation of the contracts.

Without a shared place, these steps are spread across many mailboxes and filing locations. Often only those who bring all the sources together know the current status, and many documents exist in several versions. A client portal changes this for the company being supported: it sees at any time what is available, what is missing and what comes next. It does not replace the advice itself.

What clients gain from it in the transaction process

For the company being supported, what counts is not the technology but the result. In the transaction process these are three effects:

• Speed. The documents that investors or acquirers expect are fully available earlier. The approach can begin earlier, and follow-up questions in due diligence can be answered more quickly.
• Quality. Documents, figures and equity story follow a uniform standard and are reviewed by the adviser team before they reach investors or acquirers.
• Overview. Open points, available documents and next steps are visible to management at any time, without having to ask the adviser team.

These effects are aimed at what investors expect before taking a stake: comprehensible figures, complete documents and fast, consistent answers. Contradictions between presentation, financial model and data room in particular cost trust in the review. A shared status for all documents prevents this.

CFO functions in the client portal

Alongside the transaction process, RCOS covers Roemer Capital's services as fractional CFO, that is, as an experienced part-time finance lead. For clients this shows in four results:

• Budget vs actual: The actual monthly figures stand next to the planned ones, and deviations are quantified in euros and percent (budget vs actual).
• Benchmarks and financial check: Metrics are measured against comparison values (benchmarking), and a structured review shows the strengths and areas for action in the finances (financial health check).
• Integrated planning: Income statement, balance sheet and liquidity are planned in a computationally linked way (integrated financial planning). Every assumption, such as a later start of sales, thereby affects earnings, assets and account balance at the same time.
• Clearly explained reports: The figures come with an explanation in plain language that names the causes and consequences of deviations. This is what good management reporting to management, advisory board and shareholders looks like.

These functions belong to controlling, the support of management through planning, steering and information. They show their particular value in combination with the transaction process. The financial model from the CFO support is the basis for business valuation and equity story. The ongoing reports to the shareholders create the figures on which new investors or acquirers rely in due diligence. After a funding round, the reports to the new shareholders build on the figures with which the company convinced in the round.

Limits of a client portal

A client portal speeds up the work but replaces no decision. Valuation, round structure, selection of investors or acquirers and negotiation of the terms in the term sheet, the key terms paper of a round, remain the task of management and the adviser team. Which documents each interested party receives at which point is also decided by both together. Confidential documents generally go to third parties only after a signed confidentiality agreement.

Investment and purchase agreements are drafted by the parties' law firms. The transfer of shares in a GmbH (German limited liability company) and the obligation to transfer them must be notarised (Section 15(3) and (4) of the German Limited Liability Companies Act, GmbHG). The same applies to the resolution on a capital increase (Section 53 GmbHG). The quality of the underlying data also sets a limit: if accounting, contracts or the list of shareholders are incomplete, these gaps become visible earlier in the client portal, but the company itself must close them.

Practical example: budget vs actual in RCOS after a Series A

A software company with around EUR 4 million in annual recurring revenue closes a Series A round of EUR 8 million and continues to use the CFO services afterwards. During the round the data room was fully in place before the first approach. After closing, the client portal shows the plan for the following months and, each month, the comparison with the actual figures. The figures are anonymised example values:

1. Plan after closing: EUR 9,000,000 in cash, monthly net cash outflow (burn rate), that is, expenses less income, EUR 400,000, runway 9,000,000 ÷ 400,000 = 22.5 months
2. Budget vs actual in the fourth month: revenue EUR 360,000 instead of the planned EUR 400,000, deviation minus EUR 40,000 or minus 10%. With unchanged costs, the cash outflow rises to EUR 440,000 this month
3. Cash at the end of the fourth month: 9,000,000 minus 3 × 400,000 minus 440,000 = EUR 7,360,000 instead of the planned EUR 7,400,000
4. Remaining runway if the deviation persists: 7,360,000 ÷ 440,000 = about 16.7 months instead of the planned 7,400,000 ÷ 400,000 = 18.5 months

The monthly report explains the cause, in the example a postponed contract signing with a major customer, and shows that the runway falls by almost two months without countermeasures. Management recognises this in the fourth month and not only at the annual financial statements. It can adjust costs or prepare the next round earlier, before the shareholders ask.

Distinction: client portal, data room, CRM and investor platform

• Virtual data room: serves the orderly provision of documents for review by investors or acquirers. The client portal is oriented to the company being supported and covers the status of the entire engagement.
• Fractional CFO: the service itself, that is, an experienced part-time finance lead. RCOS is the place where clients find its results such as planning, budget vs actual and reports.
• CRM: a system with which a company manages its customer relationships and sales opportunities. A client portal, by contrast, is oriented to an individual advisory engagement.
• Investor platform: platforms on which companies present themselves to a large number of investors work on the marketplace principle. RCOS, by contrast, is the portal of a supported engagement with targeted and confidential outreach.

Common mistakes

• Communication alongside the portal. If agreements and documents are exchanged in parallel by email, differing versions arise, and the status of the engagement can no longer be traced in one place.
• Incomplete basic documents. If annual financial statements, current figures or the list of shareholders are missing at the start, every following step is delayed.
• Differing figures in different documents. If revenue or metrics differ between pitch deck, financial model and data room, this counts as a warning sign in due diligence.
• Planning not continued after the round. If the financial model is no longer compared with the actual figures after closing, the basis for explaining deviations is missing at the next round.
• Portal instead of decision. A digital environment speeds up the work, but it takes no decision on valuation, structure and negotiating position off management.

Frequently asked questions

Who can use Roemer Capital OS and where is the login?

Clients of Roemer Capital. At the start of the engagement the company receives a personal access. Login is via the client portal menu item on roemer-capital.com.

Does the client portal replace the advice?

No. RCOS creates the shared status on which the advice builds. Strategy, valuation and negotiation rest with the adviser team and management, the legal implementation with the parties' law firms.

Is RCOS intended only for funding rounds?

No. The client portal supports the entire transaction process in funding rounds and company sales as well as Roemer Capital's CFO services.

What CFO functions does RCOS offer?

Budget vs actual, benchmarks and financial check, an integrated plan of income statement, balance sheet and liquidity, and clearly explained reports. They give management an ongoing picture of the financial position and at the same time create the figures for later discussions with investors or acquirers.

What does the client portal offer compared with email and shared folders?

A shared status. Documents, open points and figures are in one place and in the same order, instead of being spread across mailboxes and folders.

The Roemer Capital view

Roemer Capital developed RCOS because speed and care need not exclude each other in a transaction process. At Roemer Capital a funding round typically takes six to eight months, a company sale six to twelve months. Every week by which an engagement reaches reliable documents sooner is time the company wins back for its business. At Roemer Capital a data room can be made available within 24 hours.

A fixed rule applies for quality: before a document reaches an investor or acquirer, the Roemer Capital adviser team has reviewed it. With the CFO functions, Roemer Capital makes sure that the figures with which a company raised capital remain the basis of planning and reports afterwards. For the next round, the cash runway at the start of the process should be 12 to 18 months. The legal and tax implementation rests with the client's law firm and tax adviser.