The CFO Centre USA’s Post

Let’s discuss how to deal with a declining company valuation. A Down Round. Now, a company has several rounds of financing, series A B C and so forth. And each time, that company raises valuation, that’s the normal expected trajectory. And as a company takes in bigger investments, it grows. But then suddenly, it hits a bump on the road, a Down Round. This happens when a company raises capital at a lower valuation than its previous funding rounds. This could occur due to various reasons. Maybe the company isn’t meeting its projected milestones, maybe they’re facing increased competition, it could be some kind of macro-economic condition that’s shifted unfairly for the company. A Down Round can be a bitter pill to swallow. It offers a cheaper share price for investors to buy in and it dilutes existing shareholder ownership stakes even more including founders and early investors who were the original believers that invested way back before the company saw any success. However, for new investors, a Down Round can present an opportunity. They might see potential in the company’s underlying business especially if they believe all this a temporary setback. Now in the end, a Down Round might sting in the short term. But it doesn’t necessarily spill doom for the company. With the right strategy and execution, it can bounce back stronger than ever with new investment funds and a fresh investor network to tap into. #investment #strategy #resilience #businessgrowth

Fascinating session to kick off the Criticaleye Growth Company Retreat, this morning! A couple of points that stuck with me: - There has been an uptick in companies considering listing on overseas markets. A key benefit being that this could raise the exposure of the organisation. - Public to Private is forecasted to be popular this year, as private structures provide more freedom to navigate the markets. AlixPartners #Growth #privateequity

Interesting article from Harvard Business Review examining what the boards of public companies can learn from Private Equity. What are your thoughts? #privateequity #harvardbusinessreview #ned #boards

Great article on Director roles and how to best serve on a board. What you can learn from private equity on building a team and supporting a company.

We have entered a new governance era in private equity. Long gone are the days when PE firms could simply buy companies and saddle them with massive debt. Capital costs have soared, and financial engineering can only go so far. In their search for more enduring advantages, innovative private equity firms and their portfolio companies are increasingly embracing a more entrepreneurial governance model in which board members, with deep operational experience and more skin in the game, work side-by-side with portfolio company executives to co-create the new strategy, shape the culture, and develop future leaders. If the past decade is any indication of the future, private equity will continue to be the financer of first choice in the real economy. Public companies should be questioning their approach to governance — which hasn’t evolved all that much since the collapse of Penn Central half a century ago — and thinking about what they can learn from private equity.

Found out yesterday that my good friend, and great friend to Diversity-X, Kayode Odeleye, is now providing fractional CFO support to scale-up and growth companies. This is great to see as his experience and skills can support so many. He's been helping so many early-stage companies, including many from the Diversity X community through Caena with the mission of levelling the playing field in entrepreneurial finance, providing every founder, irrespective of their background, with equal opportunities to bring their innovative ideas to life. I am so pleased to see him using his deep pool of skills to help founders and businesses further on in their journey with strategic financial advice. If you are a founder of a Series A+ company (or a VC that needs fractional CFOs to support their portfolios) - it is worth your time having a conversation with Kayode to see how he can help you. Tag anyone you think should speak with Kayode in the comments. #fractionalCFO #SeriesA #VCs #growthstage #finance

CEOs working with private equity firms are under fire to hit their revenue growth numbers. So they need more leads, right? Wrong. Watch this short video and learn: - Why more leads don’t equate to more revenue - What changes CEOs need to make to grow their business --- CraigGroup.io/

At Carmel, our due diligence process for investing in private markets includes a comprehensive analysis of each company's operating status and growth potential to help us select companies poised for long-term success and value generation. Read Part 3 of our private equity series, "Creating Growth Through Operational Improvements" here: https://hubs.li/Q02rKMN20 #PrivateEquity #StrategicInvesting #InvestmentManagement

Specifically, boards of PE companies focus on a handful of guiding rules: 1. Don’t just review the company’s strategy. Help create it. 2. Don’t just expect trust. Build it. 3. Don’t just assess the company’s culture. Help shape it. 4. Don’t just receive information. Provide it. 5. Don’t just look different. Think different. 6. Don’t just fire CEOs. Get to know future ones. We have entered a new governance era in private equity. Long gone are the days when PE firms could simply buy companies and saddle them with massive debt. Capital costs have soared, and financial engineering can only go so far. In their search for more enduring advantages, innovative private equity firms and their portfolio companies are increasingly embracing a more entrepreneurial governance model in which board members, with deep operational experience and more skin in the game, work side-by-side with portfolio company executives to co-create the new strategy, shape the culture, and develop future leaders. If the past decade is any indication of the future, private equity will continue to be the financer of first choice in the real economy. Public companies should be questioning their approach to governance — which hasn’t evolved all that much since the collapse of Penn Central half a century ago — and thinking about what they can learn from private equity.

Research has shown how powerful investing in culture and engagement can be for profitability. But until we have a way to hold private equity firms accountable based on their reputation for either building great companies, inside and on paper, or mirage companies, great on paper but awful inside, it will be difficult for private equity and company culture goals to align. Do you like more topics like this? Schedule a conversation with Garrett to learn more. Click here:https://lnkd.in/eQ89k5Y #leadershipgrowth #executivedevelopment