Inside the Mind of a Private Equity Investor


Frank Cottle led an investor group to buy Hi-Mark Software for 10 times EBITDA.  Cottle then sold a chunk for 15 times and ultimately sold his last tranche of equity for more than 16 times EBITDA to Lufthansa.  In this interview, you’ll get deep inside the mind of a private equity buyer and learn:

– three reasons acquisition deals fall apart.

– the difference between your reputation and your brand and which one acquirers value most.

– the definition of “suicide by investor” and the dangers of getting into bed with a private equity group.

– how stock clawbacks can dilute your position to zero in the company you started.

– how a stock re-capitalization works.

– one key decision every entrepreneur must make in growing their company.

– why cross-selling as an investment thesis is flawed.

Listen now for all of Cottle’s lessons.

Selling to a Private Equity (PE) firm can be a high-risk proposition.  While a PE firm may pay cash, more often a PE deal involves you staying on and risking your equity alongside the PE firm, albeit as a diluted and potentially less powerful owner.  The key to getting a deal that works for you is to have some leverage going into a negotiation with a PE buyer and that’s what we focus on with The Value Builder System™.  We want you to enter a negotiation from a position of strength, so you end up getting the very best deal you can when you go to sell your life’s work.

The Latest Built to Sell Forbes Column

Sellability Tracker: Worldwide Trends In The Liquidity Of Privately Held Businesses: The Sellability Tracker is a quarterly study designed to track worldwide trends in the liquidity of privately held businesses.  The Value Builder System team has analyzed data from over 25,000 users of The Value Builder Score from around the world between July 1, 2012, and September 30, 2016.

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