In a world where IPOs are an unlikely outcome and traditional M&A exits are difficult to manufacture, there is a new alternative for liquidity starved founders and investors — The PE exit. It’s an invisible ecosystem to most, but when you see a headline about a PE firm making an “investment” in a mature SaaS startup, and there is no mention of valuation, or even what series it represents, you’re most likely witnessing an acquisition, of sorts.
David Pierce has written an excellent post-mortem recording the last days of a hardware startup called Doppler Labs. The post carefully details all the challenges in launching a consumer product, and Doppler Labs co-founder Noah Kraft provides a colorful summary of the experience:
“I need to find a industry or product I’m passionate about.” I often hear this from entrepreneurs and it frequently means wanting to start a business in a consumer space that they love—music or gaming, for example. It’s an understandable impulse. If you’re going to start a business that will consume your life for years, why not make it something you’re interested in?
One of the questions a VC gets most often is “what are you interested in?” Many investors have developed “themes” that become a shorthand used to discuss the types of deals they like
