This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our PRIVACY POLICY for more information on the cookies we use and how to delete or block them.
  • Know what a PE can offer

Know what a PE can offer

There are many good reasons why almost half of all investments in technology companies come from PE firms - and why those technology companies, including many in the software space, say yes to the investments. 

To decide whether a PE deal is right for you and your company, you need to know what PEs can bring to the table. What their key strengths are and how they can help your business. The list of potential benefits from collaborating with a PE firm includes:

  • Market expertise: PE firms often have extensive market expertise and can help you identify new business opportunities, guide sales growth, help define marketing strategies and find new possibilities for upselling your solutions. Through working with other companies to grow their revenue and profitability, they also have practical experience of what does and what does not work. 
  • Access to new markets: Many businesses are looking for growth capital to expand into new markets. Having a growth-focus, PE firms have keen insights and expertise relating to entering new markets. Furthermore, they can leverage existing, extensive business networks to identify and engage new potential customers.
  • Funding: A deal with a PE firm often enables your company to raise more capital than would be the case for deals with most other types of investors. 
  • Business acumen: PE firms are often experts in the organisational and financial sides of running a business. Their skills and experience may complement those of your current employees as well as the leadership team. This includes in relation to areas such as process optimisation, accounting practices, formulating business strategy and daily management.
  • Objective insight: Software companies often start as companies run by individuals – for individuals. Said differently, the leadership and employees of a software company have built it from the ground up through passion and innovation. PE firms can offer an objective and data-driven evaluation of your business and help identify areas for improvement. 
  • Efficiencies: PE firms will be able to help you identify best practices, make you more efficient and maximise your growth and value. They can also help you execute to reach your full potential. 
  • Higher profitability: The likely result is that your business will grow and become more profitable. 

When considering PE investment, and what a PE Firm can offer, it is also important to consider where PE firm and management interests align – and where they may differ. Many potential collaboration challenges (described in detail later in the guide) arise due to interests not being aligned early in the negotiation process. In fact, initiating the alignment process can begin already before negotiations take place.