- Case Study
‘’We have had regular interactions with TDM since our first meeting and continue to be impressed by their due diligence process and constructive feedback.’’
JONATHAN CORR FORMER PRESIDENT & CEO, ELLIE MAE
Ellie Mae’s Growth Story
Ellie Mae is a leading provider of loan origination software to US residential mortgage lenders, previously listed on NYSE.Â
Ellie Mae built an incredibly loyal customer base, with over 95% annual retention, by specialising in processing mortgage applications at scale. This allowed Ellie Mae to grow its dominant market share.Â
Ellie Mae was opportunistically acquired by Thoma Bravo in March 2019 for $US3.7b. This represented a 6x growth in market capitalisation since TDM first invested in 2013. Just 15 months after this, Ellie Mae was sold to Intercontinental Exchange for US$11b.Â
Our Ownership
TDM initially invested in Ellie Mae in May 2013 as a supportive long-term shareholder with an ownership of c.4% of the company. Â
At the time of TDM’s investment, Ellie Mae was out of fashion with investors – approximately 30% of its revenue was linked to residential mortgage volumes, which at the time had come under significant pressure. This created a short-term growth headwind and a clear value dislocation in the market. Conversely, our thesis was rooted in Ellie Mae’s unique culture and undeniable long-term value creation potential.Â
Over time, TDM developed frequent and open communication with Ellie Mae’s management team regarding strategic issues such as capital allocation, specifically in relation to their share repurchase program, as well as on their investor relations approach.Â
