Science for the Art of M&A

How Neil Kleinberg is bringing FinTech M&A due diligence software into the twenty-first century via DiliVer

Neil Kleinberg, DiliVer LLC

As a four-time entrepreneur, Neil Kleinberg is on the front line of what he describes as the secretive and artsy world of mergers and acquisitions (M&A). Yet his repeat success throughout his twenty-five-year career has also exposed him to the inherent pains of the full M&A transaction life cycle—the inspiration behind his latest award-winning venture, DiliVer.

The financial technology (FinTech) M&A due diligence software company inaugurated a new enterprise-wide, metrics-based scorecard solution that’s earning accolades, including the prestigious TOP 10 FINTECH SOLUTION PROVIDERS–2018 award from CFO Tech Outlook in May. The annual award is given to companies that have “opened the doorways towards new opportunities to literally rewrite tomorrow and can drive the industry forward in entirely new ways.”

“We’re making a mark on the M&A community,” says Kleinberg, DiliVer’s founder and CEO, since the company’s launch in 2014. “Any time you try to disrupt an established environment, validation from reputable, independent sources tells us that we’re moving in the right direction, and it is always appreciated.”

Kleinberg invented the DiliVer intellectual property that helps solve “the outcome problem,” referring to the historical lack of post-M&A transaction success for combined entities being formed. “This problem may be largely attributed to the widely-accepted but highly-inefficient M&A deal paradigm, which has a deal team and transaction-focused mindset, and which uses a general purpose and process-driven software toolset to conduct the transaction,” Kleinberg says. “To solve this problem, DiliVer promotes a new paradigm that introduces a combined entity and outcome-focused mindset, and an industry-specific and data-driven software toolset.”

From a practical perspective, DiliVer replaces the buyer’s outdated M&A due diligence checklist with a two-tiered scorecard that uses Kleinberg’s proprietary algorithms and key performance indicators (KPIs) to measure the seller’s current enterprise performance, as well as its future growth potential.

In an era when M&A innovations target software products rather than consulting services, DiliVer’s solutions are built from a FinTech M&A platform that comprises three main aspects: a business excellence framework, a process model, and a data model.

“When you put those three parts together, it helps companies grow faster through both organic means and inorganic or M&A transaction means,” Kleinberg explains. “The platform principles, guidelines, and rules apply to two different perspectives, whether you’re a buyer evaluating a candidate seller, or a seller wishing to position themselves to become more attractive to a potential buyer as part of its exit strategy.”

In addition to precipitating better outcomes, DiliVer’s software also provides additional M&A transaction life cycle benefits, including a less painful and more accurate due diligence process. When combined with other M&A software packages, this combination creates better deal sourcing, valuations, and post-merger integrations. “We’re trying to add as much modern technology as possible to complement the M&A artwork,” Kleinberg says. “We’re getting better results and relieving a lot of suffering.”

DiliVer’s dexterity across industries reflects Kleinberg’s own career, which spans IT, financial services, national security, healthcare, judicial, public safety, and telecommunications. He warmly describes his evolution from “lead geek” as a technology engineer to management consultant to an executive to industry disruptor as the source of crucial insights he needed to apply the principles of performance measurement to vertical markets via enterprise software.

His track record reveals his proof of concept. Prior to DiliVer, Kleinberg served as the director of corporate development at a market leading enterprise software company after orchestrating the strategic acquisition of his own CRM solutions company, VerticalFalls Software, by Sage in 2007. Previously, he also founded two additional high-growth tech companies: EIC, a management consulting firm, as well as NTC, a specialized high radio frequency electronics firm.

Kleinberg earned a bachelor’s degree in bioengineering and a master’s degree in computer science at Johns Hopkins University. Outside of DiliVer, he is an adjunct professor at Johns Hopkins Carey Business School, where he teaches M&A, entrepreneurial finance, and corporate governance. He’s also an advisory board member and mentor for many of Hopkins’ organizations, which pairs the CEO’s penchant for next-gen FinTech with his passion for preparing future entrepreneurs. In the Washington, DC, area—near DiliVer’s headquarters in Annapolis, Maryland—Kleinberg mentors at the local chapter of the global accelerator and launch program, the Founder Institute, and is an ambassador at The Center for Advancing Innovation. He is also a member of an exclusive forum of tech space CEOs, the MindShare Alumni Network, since 2015.

“Usually, start-up founders don’t know what to look for in a mentor,” he says. “Part of the message I tell them is to don’t try to please everyone. Don’t make adjustments according to the last person you listen to. Find one lead mentor who is proven in your space and who is consistent in their approach from business concept all the way through building and growing your company—rather than multiple mentors with a mixed bag of advice.”

That continuous exposure to diverse, groundbreaking ideas fuels Kleinberg as he builds his elite FinTech M&A company. From an overarching corporate perspective, in addition to core productivity and efficiency, creativity and effectiveness is a central component to DiliVer’s brand mission of delivering M&A due diligence solutions to its varied customer base, which includes strategic acquirers, financial acquirers, and all growth stages of sellers. It inspired DiliVer’s cultural mantra, “Science for the Art of M&A,” which Kleinberg cites as one of the company’s key differentiators as it pursues FinTech M&A integrated solutions.

“As a leader, it’s critical that I properly motivate our creative team of superstars to embrace the company strategy for visibility and accountability,” Kleinberg says. “Only as a team working closely together can we innovate and accomplish great things consistently for sustainability and prosperity.”

“Only as a team working closely together can we innovate and accomplish great things consistently for sustainability and prosperity.”

The DiliVer team is gradually enlightening M&A advisory firms and ecosystem software vendors about the new ways to incorporate its purpose-built FinTech M&A tools into their best financial, legal, and operational M&A due diligence practices. DiliVer also uses its own scorecard software to measure how it is achieving its goals and meeting its objectives.

“What we provide to customers is exactly what we do for ourselves,” he says. “It all comes down to authenticity. The best leaders walk the walk with their team and their customers. And you must be credible. You have to get things done, but you have to do things right. The personal integrity of each individual creates the overarching integrity of the business.”

Kleinberg’s own credibility is evident. His expertise in business optimization, performance measurement, and data analytics is paving the way for new verticals and geographies in DiliVer’s lineup. Looking ahead, he anticipates DiliVer will reach about fifty employees serving more than six hundred customers and generating more than $20 million in revenue within the next few years.

“The long-term vision is to integrate DiliVer’s M&A due diligence software with other M&A software packages under one tent,” Kleinberg says. “That’s the unicorn opportunity.”

As the early stage company expands, DiliVer will continue to cure some of the most significant pain points in the M&A community as the new gold standard of due diligence.

“We’ve already been approached about being acquired once our next version of software gets us into the cloud with mobile extensions and third-party integrations,” he says. “From a potential acquisition viewpoint, it’s mainly the question of finding the right partner so we can achieve not just the mission of making DiliVer a hallmark of the FinTech M&A market, but also making the new integrated solutions a norm for this market.”