Cherry Tree Advises SPARK on its Sale to Arcadea Group
SPARK
Cherry Tree Advises SPARK on its Sale to Arcadea Group
“Cherry Tree was instrumental in keeping the various parties involved in the transaction continuously moving forward. They were able to deliver a great result for all parties involved while dealing with turbulent markets on a short timeline. I can’t imagine how the deal process would have gone without their involvement, connections, expertise and guidance.”
— Nick Elders, SPARK CEO
INDUSTRY:
Technology, Software
DESCRIPTION:
SaaS-based Lending Platform
HQ LOCATION:
Minneapolis, MN
TRANSACTION TYPE:
100% Sale to Financial Buyer
Situation:
In June 2023, Arcadea Group acquired Saas-based lending platform SPARK from Community Reinvestment Fund, USA (“CRF”). SPARK was incubated within CRF more than 10 years ago and served as a vital technology tool for lenders during the PPP lending program, facilitating billions of dollars of SBA loans in 2020 through the CARES Act. Later in 2020, CRF spun SPARK out as a standalone entity, allowing the business to rapidly grow customers and revenue.
Cherry Tree’s Role:
Cherry Tree was engaged to advise SPARK, its board of directors and its shareholders in identifying the best partner to help the company achieve its next phase of growth, while maximizing shareholder value. It was especially important to SPARK and CRF that the process be swift so as to not disrupt SPARK’s momentum. Cherry Tree’s customized process included introductions and discussions with numerous potential acquirors in marketing the opportunity, soliciting proposals, negotiating terms, supporting due diligence, and facilitating the closing of the transaction.
The process generated broad interest from strategic and financial partners. SPARK was sold to Arcadea Group, a Toronto-based growth equity, long-hold software investor with additional FinTech holdings and experience building profitable, high growth software companies.
About SPARK
SPARK helps small business lenders take advantage of the FinTech ecosystem and thrive. SPARK is built, managed, and enhanced by a team of passionate experts across the globe and is focused on helping small business lenders succeed in an increasingly digital world. Founded in 2020, SPARK’s network of banks, credit unions, CDFIs and specialty lenders have used the platform to process over $25B in lending activity, targeting deserving small businesses owners across the U.S.
About Arcadea Group
Arcadea Group invests in high-quality, strongly growing, typically founder-controlled vertical software companies over durations of time that no traditional private equity or growth equity firm can match. With headquarters in Toronto, offices in Florida, and portfolio companies in North America, Europe, and Asia, Arcadea maintains a global investment purview. Arcadea leverages tailor-made, flexible strategies that prioritize value creation for all stakeholders, offering an alternative to the rigid playbooks of Private Equity or Software Aggregators, which prioritize owner returns at the expense of customers and employees.
About CRF
Founded in 1988, Community Reinvestment Fund, USA (CRF) is a national non-profit organization with a mission to improve lives and strengthen communities through innovative financial solutions. A leading Community Development Financial Institution (CDFI), CRF supports mission-driven organizations, increases economic mobility, and builds strong local economies through the development of solutions aimed at creating an equitable financial system. CRF has injected more than $3.5 billion to stimulate job creation and economic development and support community facilities.
Cherry Tree & Associates provides investment banking services through our FINRA-licensed broker dealer.
