Public Relations Powering Technology Company Valuation
In that rather regulated world, an entrepreneur invents a concept
, defends it in some manner through patent or prototype, puts a presentation deck around it with a few projections, and starts passing the hat for millions to make it happen. It may not be that easy, but thats definitely the raw bones of the situation. Theres $2.2 trillion in private equity deals expected this year-- $821 B of them in the United States alone.
A third of that is generated by private equitythe traditional venture capital or investor-led company purchases. Two thirds of the activity is from the so-called strategic buyers corporations that are acquiring new technology, sometimes new geographies, key assets or intellectual property.
Joseph Ibrahim of Riverside, a global private equity investment firm which discovers the next generation of medical technologies and devices, shared with me at a recent Duane Morris event, that he plans another 40 investments globally in 2012. So how do these deal makers determine which company to invest in?
To find the right new media agencies or be the right companyJoseph counsels, Build your story from the beginningits money well spent.
As you create a living legend, Joseph says focus on why your company is special or unusualit can drive good valuation and make you easier to desire. If you are one of several media relations firms just like you, then you open yourself to price pressure at the closing table.
All investors, whether with private equity or with strategic buyers, focus on the strength of the management team when evaluating acquisitions.
Says Steve Voorhees of Rockten, If the management team is not strong, its very problematic. The general managers are a big part of the solutionthe assets end up being a function of how well they are managed. Robert Bryant with Roark, another investor relations firm, also says they prefer to back an existing, functioning team, although Roark does have experience backing existing entrepreneurs in environmental services.
Ronald Chang, who acquires companies for UPS, puts it like this. The two things that scare me the most about a potential acquisition are when one person knows everything, like the founder, or when a firm only has only one truly outstanding sales person. In either of these situations, UPS is generally not interested.
Whats interesting about this, is that investors are influenced as much by perception as reality. This is where the power of knowing how to rule your world comes into play. Im not talking about spin here, or vapor ware, or outright lies. But as the old witticism says, can you see the glass half empty, or do you see it half full?
Todays world rulers--particularly creative CEOs--arent afraid to see the world fullfrom their perspectiveand tell everyone about that in as engaging a manner as possible. Especially in the world of mergers and acquisitions, perception can influence company valuation by as much as plus or minus 30%, according to research by investment analyst Rivel. Is there anything else you can do that so powerfully influences the value of a company?
Saul Goodman is happy to tell you that we always will have wide open arms to help you in your public relationships, learn more about new media agencies, media relations firms and investor relations firm at write2market.com
by: Saul Goodman
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