We’ve some exciting success stories to tell in the coming weeks, however, in the meantime we sat down as a team to identify and analyse the common ingredient to these successes and concluded that so often it’s that underrated element – Founder-Investor Fit. So contrary to the usual M&A mantra of “it’s a numbers game”, we discussed the nuanced dynamic that goes beyond mere financial backing to prioritise aligning visions, values and cultures.
Perhaps Warren Buffet nailed it when he said, “Never invest in a business you can’t understand.” A principle that has served him well, guiding investment in companies with clear, understandable operations and objectives and therefore more predictable outcomes. In the course of securing raises and helping companies exit we see it all the time, that when founders and investors are well-matched and work in partnership, they are much better at navigating challenges, and driving growth and innovation.
We’ve seen founders that are in advanced, higher value exit talks favour a lower offer from a better aligned partner as they wish to preserve the values and the staff that they have worked hard to build up over the years. So therefore, when we are retained to find investment or identify exit partners, a core consideration is cultural compatibility, not least because earnouts requires old and new management working together to meet earnout targets. This is not easily done with warring factions.
So while Founder-Investor Fit is not always top of the priority list, our experience is that identifying investors who understand your space offers the fastest and most efficient route to scale and exit.
#FounderInvestorFit #VentureCapital #M&A #mergersandacquisitions #earnout #fundraise
CEO bei Findyouronedayjob
3moThank you for considering this message. I look forward to the possibility of connecting. Warm regards, Steven Smith Www.Findyouronedayjob.com