- Posted: 20/10/2016
- Author: Mohit Jitendra
Why a Private Equity partner can make your business growth a success
Private Equity (PE) firms are becoming increasingly active in the International freight forwarding industry and Headford have found success engaging with a number of firms looking to invest in the freight industry in recent years.
Private Equity is sometimes viewed in a less appealing light especially during the recession in Europe which resulted in many companies being undervalued due to the economic downturn.
What we need to remember is many Private Equity Executives are on your side after all they have seen something in your company and you that they like enough to invest their time and money into your business, this is sometimes forgotten when people see them as cold money orientated accountants looking at the bottom line and nothing else.
This isn’t necessarily true. Many PE executive originate from a financial background and of course the bottom line is important to them as it is you but they also enjoy the growth that working with you means can be achieved.
Growth can be created by running a consolidation exercise via acquisition or a set of cold start-ups in new vertical markets or even countries.
For a deal to be a true success it is crucial pre-transaction to make sure you have the same goals and aspirations for the venture.
You should all be pointing in the same direction beforehand to guarantee a successful partnership moving forwards.
Where many people go wrong with Private Equity backing is they do not make their thoughts and aspirations clear at the outset, which can later lead to confrontation in the board room and a breakdown of relationship which is of no benefit to you as the shareholder or to the PE firm as the investor.
Private Equity backing is both exciting and rewarding, allowing a firm to work with you turning your operation from a £10 million company with 20 staff to an organisation valued at £100M with 200 employees or even floating on the stock market. It is a great experience for any company owner who achieved it successfully.
The comparison is clear – You may own 100% of a company worth £10 million now but with PE backing over 3 – 10 years there is a strong chance you could have 40% of a company valued at £100 million and who doesn’t find that exciting!
If you are interested in learning more about growing your business with a Private Equity partner please contact me on 01454 275 933 or email firstname.lastname@example.org