PE Firms are Looking For “Agile” Investments

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PE Firms are Looking For “Agile” Investments

By Generational Equity

10/26/2020

As many of you know, from time-to-time we like to give you an insider view of how professional buyers are approaching the market today.

A recent article on MiddleMarket.com provides some keen insights into the approach PE firms are taking and why you need to be aware of their thought process in today’s environment.

Entitled “Agility Matters: Four signs PE Firms Should Examine When Considering Acquisitions”, the piece was really eye-opening and speaks to what we have been saying for months: Firms that will be more attractive to buyers are those that have adapted, improvised, and overcome the challenges we have all faced since March.

The point of the article was this: If you and your company are agile, PE firms will have tremendous confidence that not only will your organization survive at this time, it will thrive on the other side.

You need to take stock of how your firm is approaching these challenging times and see if you pass the “agility” test. Agile firms often have these traits in common:

They foster open communication between employees and management
They thrive on a culture of accountability
They have the ability to adjust and fail quickly
They continually invest in and rely on technology

Although each of these alone is vital, the firms that we work with that are generating tremendous buyer interest right now, are the ones that adjust, adjust, adjust and then adjust again, and doing so without fear of failing, learning from these failures, and adapt to them.

If your firm has one or even all of these agile characteristics, congratulations! Now when you present your documentation to buyers in today’s environment, it is vital that you clearly tell your story of successful adaptation so that buyers will have confidence in the long-term viability of your company.

You see many PE firms that we work with will look at hundreds of opportunities every year. However, they pass on most and, in many cases, only make a handful of acquisitions each year. In 2020 they have become even more intimate with analyzing not just the financials of a target, but also its culture, because now, more than ever, it is your culture that is critical to success.

Thankfully Generational is well on its way to another record year in terms of deals closing. In fact, last August we closed more deals than any month in our history. Our success is due to having GREAT clients and having extremely EXPERIENCED deal teams that know what buyers are looking for and how to present our clients in the most professional manner.

This skill is even more valuable in today’s M&A market.

If you would like to learn more about what professional buyers are looking for today, I would encourage you to attend a Generational Equity growth and exit strategy conference. These highly educational events are complimentary and while there you will have the opportunity to meet with one of our professionals and confidentially discuss your business and its attractiveness to buyers.

To find out more about our meetings and services, use the following links:

And above all else, remember to stay AGILE!

Carl Doerksen is the Director of Corporate Development at Generational Equity.

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PE Firms are Looking For “Agile” Investments