Accelerate Your Company’s Growth

About the Episode

Looking to supercharge your business and unlock its full potential? This episode reveals how growth equity can be the key to rapid expansion, even if you don’t think you need the capital. Discover the strategic reasons why a growth equity investment can lead to a more lucrative exit in a shorter timeframe, and learn how to prepare your company for a successful partnership that fuels your future.

Growth equity is a great option for companies looking to accelerate their growth. They may or may not need this capital, but I certainly think if founders are focused on an exit or focused on a significant milestone or event, I would think of growth equity as a fantastic tool in order to accelerate the growth of their business.

Mittal Makadia and David Siegel

What You’ll Learn

• Types of Companies Suitable for Growth Equity: Growth equity is ideal for profitable, high-growth companies (20%+ year-over-year growth) that are less than 10 years old. It’s typically used to fund a growth initiative, such as product expansion, hiring, or marketing.
• Leverage and Risk Profile: Growth equity carries a moderate risk because it relies on high-growth ventures and the success of new initiatives. It uses little to no debt, unlike traditional private equity buyouts, which may use leverage and are generally lower risk due to their focus on stable, cash-flow-driven businesses. 
• Exit Strategies: Growth equity investors generally exit their investments within three to five years through an IPO, a sale to a strategic buyer, or by selling to another private equity firm.
• Negotiation and Control: In growth equity deals, the most debated points are a founder’s control and the use of capital. Founders in a minority investment keep control, whereas a majority investment shifts control to the investor. It’s vital that both the founder and investor align on growth plans and how to use the capital. 
• Assessing Company Scalability and Balancing Growth: To assess a company’s scalability, look at its revenue, profitability, and growth rates. A successful balance between growth and profitability requires alignment between the investor and the company on growth initiatives and a clear plan for using the capital. This alignment, along with a focused investment thesis, is key to a successful investment.

Topics Covered

Want More? Related Resources:

• Selling Your Company to a Private Equity Firm vs. a Family Office
• The Benefits of Selling Your Company to a Family Office
• The Role of Family Offices in M&A

Meet Our Guest

James Carey

Partner at Next Sparc Growth Partners | Miami, Florida

James Carey is a Partner at Next Sparc Growth Partners, a professional family office that makes direct investments in rapidly growing founder-led and family-owned businesses, and leads the Business Development efforts at the firm. Before joining Next Sparc, James was a Vice President and the Head of Business Development at Peterson Partners, a diversified private investment firm focused on growth equity and venture capital investments. Prior to joining Peterson Partners, James was a Director at H.I.G. Capital, a leading global private equity investment firm with over $50 billion of equity capital under management, where he sat across the entire family of funds. Earlier in his career, James was an Associate at New River Capital Partners, an affiliate of Huizenga Holdings, where he was responsible for Corporate Development. James received a Bachelor of Science in Business Administration from the University of Vermont in Burlington.

LinkedIn: http://www.linkedin.com/in/jamesjcarey