Insights into Value Creation and Exit Trends for Technology Companies
This Edition's Topic
Bill McAleer of Voyager Capital Shares His Guidance on Achieving a Successful Exit
Bill McAleer is a Co-Founder and Managing Director at Voyager Capital. The firm focuses on investments in technology throughout the pacific northwest, has a long list of successful exits, and recently announced their fifth fund. Bill has extensive experience in the investment and technology industries and took time to share his guidance on achieving a successful exit with us. In this edition we include the four most relevant questions we discussed and a concise version of his responses.
Q&A with Bill McAleer
What do the most successful exits have in common?
The solution is ahead of the hype curve for the sector
Pre-revenue companies are in a very hot sector
The company has relationships with the right connections (typically an operating sponsor) at one or more of the companies in the bidding process
There are multiple buyers interested in the company
The company is the 2nd or 3rd to be acquired in a hot space (and definitely not the last)
How should an unsolicited offer be handled?
An unsolicited offer is an opportunity to test the waters for an exit. If the offer seems reasonable kick off a process and assess the conditions. Go forward with the exit or use what is learned to make positives adjustments for an exit down the line.
What leads to disappointing exits or shutdowns?
Not achieving revenue traction or gaining market share (possibly missed the opportunity window)
Unable to effectively communicate the value of the solution (not selling themselves well)
Poor execution of the company as a whole
Board and leadership team out of alignment
Owner expectations of exit valuation exceed current market conditions
What is the most important advice you give to your portfolio companies
to ensure a successful exit?
Focus on these three elements:
1 – Build a company that has value to someone
2 – Build something that has disruptive potential
3 – Build the right team to execute the plan
And One Last Suggestion:
Build relationships with strategic partners. They will likely be the first ones to make an offer.
Thank you to Bill McAleer for taking time from his very busy schedule to share his wisdom for this article.