FiscalNote Announces Sale of Board.Org Community Engagement Platform for up to $103 Million in Total Consideration

Rhea-AI Summary

FiscalNote Holdings, Inc. (NYSE: NOTE) divests Board.org to Executive Platforms for $95 million, with potential earnouts up to $103 million. This move significantly deleverages FiscalNote's balance sheet, strengthens its capital structure, and allows focus on AI leadership and global intelligence growth.

Positive

• Divestiture of Board.org for $95 million in cash provides significant deleveraging for FiscalNote
• Potential earnout opportunities up to $103 million further enhance the deal
• Transaction strengthens FiscalNote's balance sheet and capital structure
• Focus on AI leadership and global intelligence growth for long-term profitability
• Board.org represented 10% of FiscalNote's FY 2023 GAAP revenue
• Proceeds used to repay $65.7 million of senior debt and bring $15 million in cash to balance sheet

Negative

• None.

Provides Significant Deleveraging with $95 Million in Cash Consideration to Pay Down Debt and Bolster Balance Sheet

FiscalNote Enters 2024 with a Focused AI Product Strategy to Drive Long-Term Growth in Policy and Global Intelligence

WASHINGTON--(BUSINESS WIRE)-- FiscalNote Holdings, Inc. (NYSE: NOTE), a leading AI-driven enterprise SaaS technology provider of policy and global intelligence, today announced the divestiture of its Board.org business to Executive Platforms, a portfolio company of Falfurrias Capital Partners, for $95 million in cash, subject to customary adjustments, and post-closing earnout opportunities for total consideration of up to $103 million. Board.org represents approximately 10% of FiscalNote’s FY 2023 GAAP revenue, reported separately today.

The resulting proceeds of the divestiture of Board.org provides FiscalNote with a bolstered capital structure, allowing the Company to allocate capital and resources to expand its AI leadership, grow its base of global customers and, over the long-term, drive predictable, high-margin compounding growth in its core policy and global intelligence businesses. The transaction allows FiscalNote to materially delever its capital structure by reducing its senior debt and increasing cash to strengthen its balance sheet as it continues to build upon its decade-long leadership and innovation in AI-enabled intelligence solutions.

Board.org is a peer-to-peer executive community platform focused on structured collaborative insights and unbiased, actionable advice from domain experts and leaders of various industries and functions, including social media, health, talent marketing, corporate social responsibility, enterprise data, and diversity, equity, and inclusion.

Board.org was acquired by FiscalNote in 2021 for $10 million in cash and $4.3 million in convertible securities ($14.3 million in total consideration), and operated as an independent product offering of FiscalNote. The divestiture aligns with the Company’s refined product strategy and allows FiscalNote to focus on its core policy, regulatory and geopolitical intelligence products, which we expect to deliver strong, profitable growth long-term.

“The divestiture of Board.org is a clear illustration of the stark undervaluation of FiscalNote in the public markets. Further, it is evidence of our ability to deploy capital to drive the strongest return on investment over time,” said Tim Hwang, Chairman, CEO, and Co-founder of FiscalNote. “Over our three-year ownership period, FiscalNote meaningfully grew Board.org, launched new communities, and drove new innovation in community engagement, resulting in market share growth and sustained leadership within its niche market. We are grateful to the entire Board.org team for their contributions to FiscalNote and we look forward to their ongoing success in the peer-to-peer executive community platform sector and will continue to support the team through a successful transition. We have full confidence that management will achieve its $17.5 million earnout revenue target.”

Moelis & Company LLC served as exclusive financial advisor and Greenberg Traurig, LLP served as legal counsel to FiscalNote on this transaction.

Strengthens Balance Sheet

The proceeds of the transaction will significantly enhance the Company’s balance sheet. In addition to bringing approximately $15 million in cash to the balance sheet, the Company repaid $65.7 million of senior debt and amended its Credit Agreement with its lenders to, among other matters, extend principal repayments a full year to August 2026. Details of sources and uses related to the proceeds are noted in the Company's Investor Presentation dated March 12, which can be found here.

“In 2023 we reached the inflection point of Adjusted EBITDA profitability, rationalized our product portfolio, and aligned our sales and operations. Today, as we enter 2024, we have a stronger capital structure, product portfolio, go-to-market strategy, and organizational model to drive profitable growth. We are excited for the road ahead,” continued Hwang.

Separately, the Company announced its Q4 and FY2023 financial results. FiscalNote will hold an investor call today, Tuesday, March 12 at 10:00 am ET. To join To access this call, dial 1 (888) 660-6510 for the U.S. or Canada, or 1 (929) 203-0882 for callers outside the U.S. or Canada with the conference ID 1271923. A live webcast of the conference call will be accessible from the Investor Relations section of FiscalNote's website at https://investors.fiscalnote.com/, and a recording will be archived and accessible at https://investors.fiscalnote.com/. An audio replay of this conference call will also be available through March 26, 2024, by dialing 1 (800) 770-2030 for the U.S. or Canada, or 1 (609) 800-9909 for callers outside the U.S. or Canada, and entering 1271923.

About FiscalNote

FiscalNote (NYSE: NOTE) is a leader in policy and global intelligence. By uniquely combining data, technology, and insights, FiscalNote empowers customers to manage political and business risk. Since 2013, FiscalNote has pioneered technology that delivers critical insights and the tools to turn them into action. Home to CQ, FrontierView, Oxford Analytica, VoterVoice, and many other industry-leading brands, FiscalNote serves thousands of customers worldwide with global offices in North America, Europe, Asia, and Australia. To learn more about FiscalNote and its family of brands, visit FiscalNote.com and follow @FiscalNote.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240312080030/en/

Media

Nicholas Graham

FiscalNote

press@fiscalnote.com

Investor Relations

Sara Buda

FiscalNote

IR@fiscalnote.com

Source: FiscalNote Holdings, Inc.

What is the ticker symbol for FiscalNote Holdings, Inc.?

The ticker symbol for FiscalNote Holdings, Inc. is NOTE.

How much did FiscalNote receive from the divestiture of Board.org?

FiscalNote received $95 million in cash from the divestiture of Board.org.

What percentage of FiscalNote's FY 2023 GAAP revenue did Board.org represent?

Board.org represented approximately 10% of FiscalNote's FY 2023 GAAP revenue.

What is the total consideration, including earnout opportunities, for the divestiture of Board.org?

The total consideration for the divestiture of Board.org is up to $103 million, including earnout opportunities.

How does the divestiture of Board.org impact FiscalNote's balance sheet?

The divestiture significantly deleverages FiscalNote's balance sheet, strengthens its capital structure, and allows focus on AI leadership and global intelligence growth.

What was the purchase price when FiscalNote acquired Board.org in 2021?

FiscalNote acquired Board.org in 2021 for $10 million in cash and $4.3 million in convertible securities, totaling $14.3 million.

Who served as the exclusive financial advisor to FiscalNote on the transaction?

Moelis & Company LLC served as the exclusive financial advisor to FiscalNote on the transaction.

When will FiscalNote hold an investor call to discuss its Q4 and FY2023 financial results?

FiscalNote will hold an investor call on Tuesday, March 12 at 10:00 am ET to discuss its Q4 and FY2023 financial results.