1. The Changing Funding Landscape for B2B SaaS Founders

• Challenges in raising VC funding for mature B2B SaaS companies

• Limitations of traditional VC path for founders: Why you're not getting funded

• Why PE might be right for your company: Incentives baby.

2. Understanding the Software Private Equity Landscape

• Overview of PE strategies (minority, majority, buyout)

• Convergence of late-stage VC and PE: They're not that different.

3. PE investments in sub $20m ARR companies

• Factors enabling PE to target smaller companies: Why your company might or might not be attractive

• Downside protection: Much more important than in VC

• PE incentives for earlier-stage companies:

  • 3-5x in 3-5 years

  • What's in it for you (and team, investors, clients)

• How PE minority growth investors seek to add value:

  • Enterprise sales!

  • Market expansion: Geographic, adjacent

  • Product expansion: Buy or build

  • Professionalizing and streamlining (aka prepping to sell to larger PE)

  • Adding systems and legal/compliance/IP

  • "Reverse AI add-on" / “Venture Roll Up”

• How Family Offices might differ

4. Software PE is Finance-First Thinking

• A gentle introduction to Discounted Cash Flow (DCF) analysis (no I won’t make you do it)

• PE value growth too: How growth rates impact DCF valuations

• PE are obsessed with churn: How churn impacts DCF valuations

• PE focus on profitable or near-profitable companies: How profit impacts DCF valuations

• How ARR multiples relate to DCF valuations (or not)

5. Understanding Key Valuation Drivers in Growth Equity for B2B SaaS

A. Quantitative Metrics

• ARR Growth Rate

• Gross Revenue Retention

• Net Revenue Retention

• EBITDA Margin

• Rule of 40

• Gross Margin

• LTV/CAC Ratio

• Magic Number

• Customer Concentration

B. Qualitative Metrics

• Revenue Model

• Type of SaaS

• Delivery Model

• Upstream Market Activity

• Enterprise Sales Readiness

• Customer Satisfaction/NPS

• Team

• Growth Potential

6. Crafting Your Pitch for PE Minority Growth Investors

• Key elements to include in your presentation

• Tailoring your story for PE minority growth audiences

• Common questions to prepare for

• Dos and don'ts of pitching to PE firms

7. The Pre-LOI Investment Process

• Initial conversations and relationship building: Best practices for founders

• Preliminary due diligence: How to prepare and what to expect

• Preparing and sharing high-level company information: What to disclose and when

• Valuation discussions and expectations: It won't be 100x ARR.

8. Key Terms in Letters of Intent (LOIs):

A. Financial Terms

• How much they're wanting to buy

• Primary vs Secondary

  • What is market terms for Primary?

  • How common is Secondary?

  • Who can sell Secondary?

  • How much Secondary is common?

• What they want to pay

  • ARR multiples:

    • What is ARR?

  • Profit multiples:

    • What is profit?

    • EBITDA, SDE, Net revenue, Free cash flow, etc.

    • Profit adjustments and pro-forma calculations

  • Undermining the foundations of the offer

• How they're planning to finance it

  • Committed capital?

  • Balance sheet?

  • Debt?

  • Do they need to fundraise?

• Certainty to close:

  • IC/Board/C-Suite approval?

  • Firm reputation

• Common areas of contention and how to address them as a founder

• Balancing valuation with terms.

• Speed to close and other DD dynamics

B. Legal Terms

• This section will be co-hosted by our friend Zack Shapiro at Rains law firm.

• What’s “Market” and what’s not?

• Specific things to look for, including:

  • Participating Preferred stock

  • Cumulative (Accruing) Dividends

  • Full-Ratchet Antidilution Protection

  • Pay-to-Play provisions

  • Warrant Coverage

  • Liquidation preferences and multiples

  • Drag-along and tag-along rights

  • Board composition and various rights

  • ROFRs

9. Debt/Non-dilutive Financing Options:

• This session will be co-hosted with our friend Mark Bakker at Coho Growth

• Options to consider:

  • Government Grants

  • Bank Debt

  • Venture Debt

  • SaaS Lenders

  • Revenue Financing

  • Short Term Lenders

  • AP Factoring

• Debt Structures

  • Revenue Based Financing

  • Term Loans

  • Interest Only Loans

  • Line of Credit

  • Asset Backed Loans

  • Factoring

  • Venture Debt

• Pros and Cons

• How to access

10. The Post-LOI Due Diligence Process

• Not over till it's over!

• Understanding the PE Minority Growth due diligence process: more rigorous than VC, less extensive than full buyout DD

  • Key areas of focus:

    • Financial

    • Legal

    • Technical

    • Operational

    • IP

  • Preparing your data room: essential documents and information

  • Common due diligence pitfalls and how to avoid them

  • Managing the due diligence process while running your business

• Why you should have a lawyer.

  • Definitive agreement negotiations

  • Common terms and structures in deals

  • Reps & Warranties

  • Closing process and conditions

• Walking away & BATNAs

13. Post-Investment Relationship with PE Investors

• Working with PE investors: higher involvement and control compared to VC

• Governance changes:

  • Board composition and voting rights (typically more seats/rights than VC)

  • Reserved matters requiring investor approval

  • Enhanced reporting and transparency requirements

• Value Creation Initiatives:

  • Enterprise Sales GTM improvements and value creation initiatives:

    • Assessing and improving go-to-market strategy for enterprise sales

    • Building and optimizing a robust sales team and process

    • Developing and enhancing enterprise-ready product features and roadmap

    • Improving customer success for enterprise clients

  • Implementing more sophisticated financial reporting and forecasting

  • Strengthening the management team and organizational structure

  • Implementation of new systems or processes for scaling

  • Market expansion: Geographic, adjacent

  • Product expansion: Buy or build

  • Professionalizing and streamlining (aka prepping to sell to larger PE)

  • "Reverse AI add-on"

• Potential tensions between growth and profitability goals

• Leveraging PE firm's expertise and network

• Balancing founder autonomy with investor influence

• Communication expectations and cadence

14. Exit Strategies and Long-term Planning

• Typical investment horizons for PE minority investors

• Potential exit options: other PE, strategics, IPO

• Aligning goals with investor expectations: Know what you're signing up for

• Might it make sense for you to sell right now instead?

15. Family Office Funding as an Alternative

• Introduction to family office investors

• Differences between family offices and PE minority growth

• Family office investor perspectives and approach

• Benefits and challenges of working with family offices

• Family office investment process and relationship

• When to consider family offices over PE minority growth