Buyout firms might seem a bit daunting--but they can teach you some surprising things about how to fix your business.
Private equity investors aren't always the most obvious source of funding for startups and small businesses. But they're an increasingly important one, especially for entrepreneurs looking to scale beyond the startup phase. There comes a time when you need cash to grow--for new equipment, more inventory, and other resources to meet increased customer demand--and private equity has some of the deepest pockets.
Private equity firms have set their sights on a new wave of software companies hitting the buyout market. Although investments in such companies have the potential to generate high returns, success is far from assured. PE firms just getting into the game must rapidly “crack the code” of software deals in order to capture the outsize returns enjoyed by many investors with industry expertise.1