Frequently Asked Questions

The valuation of PE minority growth investments typically ranges between the exit/buyout value of your SaaS company and the multiples commonly seen in traditional VC investments. Growth is the primary determinant of these valuations, closely followed by churn/retention metrics like Net Revenue Retention (NRR). Recently, we've observed valuations for minority growth investments ranging from 5 to 15 times Annual Recurring Revenue (ARR). To discuss what you might expect in your specific case, please get in touch below.

Our experience shows that the majority of investors are open to this strategy. Often, your investors understand that an initial public offering (IPO) is not an immediate prospect for your company.

For minority deals (less than 50% equity), we levy a fee based on the percentage of capital raised potentially with a small warrant at the raised valuation. Should you later decide to enlist our services for selling your business, this fee will be credited against our future charges. If you eventually sell a majority stake or the entire company, our standard M&A terms will apply.

We are more than happy to help - that is our bread and butter and we’re very good at it. Get in touch to discuss.

Yes.

Unfortunately not as this is a new program. We can put you in touch with other founders who have gone this route though.

Right now, you’re unlikely to be a good fit, but do get in touch to discuss.

If your business generates less than $1 million in Annual Recurring Revenue (ARR), it may be challenging to attract the level of interest from the types of investors we specialize in connecting with.

Next Catalyst is Discretion Capital program. Discretion Capital is the leading M&A firm for helping sell B2B SaaS between $2-10m ARR, founded by YC alumni Einar Vollset

Get in touch! This first program is for YC founders only, but we’re open to YC founders with non-YC companies that fit, and the plan is certainly to run non-YC specific batches in the future

Maybe. Get in touch.

Candidly, we’re not sure. We will run the first Demo Day in late August/early September 2024, and you can expect that there will be weekly information sessions in the month leading up.

In general, we can’t assist each company as much as we normally do in the bespoke M&A process we usually run, but we’re extremely motived to make this a success so we’re confident we can make this work almost whatever your time constraints are.

Nothing from your team, possibly with the exception of your CFO/finance lead (mostly to get financials in order). Really, it’s up to you how much you want to reval to your team at this time.

Yes. Email: einar@discretioncapital.com

Pretty normal! We often see these situations and can help you navigate to a win-win for everyone involved.

We hope so! There will definitely be a slack channel for people to get to know each other, and we may arrange in person events if it makes sense.

Of some kind, yes.

That’s okay. We often work with companies over months and years to get ready to go to market on the sell side, and this is no different. If you are far away from being ready, then we may advise you of that of course.

That’s fine. We still hope you chose to use us if/when you decide to run an M&A process.

No. The only connections are that a earlier incarnation of this (with other people involved) was the “Next Chapter Accelerator” and that Einar is a YC alumni

Send it: einar@discretioncapital.com