Quite simply: expect the new private equity (PE) owners to play a very active role in day-to-day management.
In recent years, it has been a common experience for private equity firms to acquire mid-sized technology firms and delist them from the NASDAQ or other exchanges. What is behind this trend, what is the logic of it? High-finance considerations aside, proponents of private equity argue that a concentrated shareholder base, and its associated strong governance, are critical to the next phase of growth.
I just finished reading a book by Jia Jiang called Rejection Proof: How I Beat Fear and Became Invincible Through 100 Days of Rejection. The premise was Jia put himself in situations in which he was certain to be rejected and then discussed what he learned. He did crazy things like try to borrow $100 from a stranger, or ask the Southwest Airlines flight attendant if he could make the announcements. Each time he got rejected he learned something and shared his knowledge.
I saw Jia speak at a Sales 2.0 Conference in San Francisco. He was funny and engaging. The audience loved this guy. You would have never known he had a fear of rejection. I learned a lot about rejection, but one lesson stood out for me that I would like to share with you: failure is only part of the journey. (more…)
When Words Fall On Deaf Ears
My wife doesn’t have a sports bone in her body—especially painful since she’s from the great sports town of Pittsburgh. She more than compensates with numerous qualities that actually matter, but it has been a source of miscommunication for over 20 years. And by miscommunication, I mean me talking and her not hearing a word I say—I’ve come to know how Charlie Brown’s teachers felt!
Putting myself in her shoes, she has suffered through 20+ years of my lips moving about the SF Giants, 49ers, Warriors, and pretty much any other sporting event that has been on or in the news at any given moment. Add to this a decade of fantasy football and, quite frankly, I’m lucky that we’re still married. And yet, as she is my best friend, I continue to move my lips on these very same subjects with the faintest hope of a different result—crazy, wouldn’t you say?
Case in point—during fantasy football season, I’m faced with weekly last minute decisions. The NFL Inactives report comes out and I’m obsessing over which set of wide receivers and running backs will help me win my head-to-head match. And most every week, I turn to my best friend for support on this last minute decision. “Wah waaah wah wah …” (more…)
So, you nailed the technical presentation and crafted a compelling enterprise license agreement (ELA) proposal backed by a very convincing business case. Your prospect is impressed by your technology and business case metrics, but pushes back on the capital expense and asks the dreaded question, “Can you also propose a usage-based option?”
Six months later, after using every delay tactic you can concoct and after setting ablaze more internal and channel bridges than you thought existed, you return to your prospect with a proposal that requires calculus to understand. (The associated contract draft puts a number of first born children at risk, too.)
Another two weeks pass and you find out from your original prospect sponsor that they have gone with an up-and-coming SaaS provider.
Meeting Customer Demand with Acquisition Options
The advent of SaaS and the cloud has increased the factors involved in meeting customer demand for acquisition options along the offer continuum.
Remember when KISS took off their makeup1 … and we wished they hadn’t? Sometimes K.I.S.S. (keep it simple, stupid) just doesn’t work. This is particularly true when it comes to lazy discounting—discounting in 5 or 10% increments.
The point I’m about to make is that a 1% decrease in average discount for an enterprise software company can yield a 7+% increase in operating profit! (Your mileage may vary.) If you are already sold and want to avoid math drool, skip to the next section. (more…)
I sometimes binge read and right now I’m on the 19th book in the Jack Reacher series by Lee Child (aka Jim Grant)—a guilty pleasure to be sure. There is much that I could discuss regarding this series (and the definitional miscast of Tom Cruise, who is nowhere near Reacher’s reported 6’5” & 250 lbs.), but I’ve been meaning to test a hypothesis regarding the protagonist’s approach to post-military life. Reacher doesn’t own anything but a travel toothbrush and the clothes he wears on a given day, acquiring all other life needs on demand—in other words, he lives his life like a cloud service.
Here is an excerpt regarding purchase of an outfit from “A Wanted Man”:
“Total damage was seventy-seven dollars in cash, which was well within target. Three days’ wear, minimum, maybe four maximum, somewhere between about twenty and twenty-five bucks a day. Cheaper than living somewhere, and easier than washing and ironing and folding and packing. That was for damn sure.” (more…)
Training a sales force to sell products and services to the IT department is hard, but training a sales force to sell a product and services to IT finance, procurement, or a CFO is a LOT harder. At TFP, we spend our days in the trenches with sales, system engineers and professional services teams justifying the value of your products to customers and providing financial options to facilitate the sale. Our teams are tasked with driving sales, improving deal economics and making it easier for customers to buy.
We know how to sell technology to business and financial decision makers. We teach sales teams how to overcome financial objections to a sale. Additional discounting is not a winning strategy. We give sales teams more successful ways to deliver better results. (more…)