Surge PE Closes Legal Tech-Enabled Services Platform Avalon

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On September 30th, 2022, Dallas-based Surge Private Equity, LLC (Surge) closed its 11th platform investment Avalon Document Services, Inc .

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Business Wire, Inc.Business Wire, Inc.
Retrieved on: 
Monday, October 3, 2022
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Tags: 
Legal, Software, Finance, Small Business, Outsourcing Business, Professional Services, Technology, Security, Avalon, COVID, KPI, JP, History, Technology, CAGR, EBITDA, LLC, Acquisition, Investment, BakerHostetler, Surge, Woodforest National Bank, Company, Bank
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TEXAS, UNITED STATES, NORTH AMERICA
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Summary
Key Points: 
  • On September 30th, 2022, Dallas-based Surge Private Equity, LLC (Surge) closed its 11th platform investment Avalon Document Services, Inc .
  • (Avalon), a technology-enabled services company providing E-discovery, cybersecurity, business process outsourcing, and document services primarily to thousands of law firms and corporations.
  • Founded in 2000, Avalon has built an extensive platform with 145 employees serving clients through its eight regional offices across the country.
  • Avalons highly integrated services, high-touch approach, and use of effective and appropriate technology help them retain an exceptionally sticky customer base.


On September 30th, 2022, Dallas-based Surge Private Equity, LLC (“Surge”) closed its 11th platform investment—Avalon Document Services, Inc. (“Avalon”), a technology-enabled services company providing E-discovery, cybersecurity, business process outsourcing, and document services primarily to thousands of law firms and corporations. The transaction, valued at around $36MM, closed with debt financing provided by Woodforest National Bank’s TMT team and BakerHostetler acting as lead counsel.

Founded in 2000, Avalon has built an extensive platform with 145 employees serving clients through its eight regional offices across the country. The Company has achieved a 23% CAGR over the past 20 years without any sacrifices to profitability, both organically across all lines of business and through strategic acquisitions. Avalon’s highly integrated services, high-touch approach, and use of effective and appropriate technology help them retain an exceptionally sticky customer base. Avalon owner JP Midgley retained equity in the transaction and will remain on as a senior executive.

Sanjay Gulati, Principal at Surge, said, “We are honored to partner with JP on the next exciting chapter of this company. Avalon’s world-class management team and strong KPI systems serve a diverse customer base of over 2,400 clients. With a ~90% revenue retention rate, 92 Net Promoter Score, strong free cash flow profile, and history of sustained performance through both recessionary and COVID environments, we find the asset exceptionally attractive in these volatile times. We are eager to work with him and the company to help continue its trajectory and execute on an addon acquisition campaign.”

About Surge Private Equity LLC

Surge Private Equity is a Dallas-based private equity firm that typically seeks majority investments in growing businesses with $2-$15MM of EBITDA. Together with its lending partners, Surge provides entrepreneurs with liquidity and investors with higher yields and greater accessibility. Surge primarily invests in companies where the seller will remain in an ongoing capacity.

About Woodforest National Bank

Woodforest National Bank is a leading privately owned bank that has provided excellent customer service since 1980. Woodforest offers a wide variety of services to their customers and has extensive experience in lending with over $5 billion in loans on their balance sheet. The bank offers loans such as lines of credit and term loans to commercial customers.

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