Stage GP Krista Morgan was a featured guest on The Private Equity Podcast hosted by Alex Rawlings. In this episode, Krista and Alex talked about:
– How PE firms take over companies and lead them to growth
– What it’s like to work in a female-led investment fund
– Why most start-ups fail
– The publicity and business that comes with winning awards
Tough times means investors are likely to become more assertive across the board, and the question of replacing founding CEOs is going to come up more often. Early-stage investors are usually reluctant to get involved, but as companies face difficulty raising cash, fiduciary responsibility becomes more important and board members will feel increasingly accountable to the other shareholders.
The decision to acquire a company is often lead by spreadsheets and numbers. Some of the questions that may go into the decision might include: Does the company have an advantage in the market? Is revenue on the right track? Can any financial missteps be solved?
Payments players PayPal, Klarna and Bolt all recently moved to restructure their businesses in the face of new economic pressures, and another peer, Fast, shuttered altogether, highlighting the emerging macro-economic perils for fintechs. Stage GP Krista Morgan comments on Lynne Marek’s recent Payments Dive piece on payment fintech firms.
Most startups don’t make it. While some companies fail because they are trying to solve a problem that doesn’t exist or trying to target a market that’s too small to produce profits, many falter because they aren’t growing quickly enough to attract or retain VC backing.
A venture studio is a model for entrepreneurship that combines company building with venture funding. Given the success of venture studios for startups and investors, the number of studios has grown to over 560 worldwide. What differentiates the venture studio model? And what is the next innovation of the venture studio model?
Stage Fund is raising $50 million for its second fund to buy startups that are struggling to raise their Series B rounds.
About half of the companies that raise Series A never go on to raise another round, but between 20% and 30% are still good businesses, according to Stage’s Krista Morgan.
2021 was a banner year for early-stage investments; venture funding doubled year over year to $200 billion across 8,000 startups. The uncertainty and disruption of a global pandemic did not compress valuations as initially expected, and the amount of funding per round means an average Series A company has now raised over $20 million. And yet, amidst this investment fervor, 50% of Series A companies will fail to raise a Series B round, taking them off the venture path.
Dan Frydenlund, Founder, Chairman, CEO & General Partner of Stage Fund, joins us for our third episode in our “Meet the GPs” series.
Dan speaks about
– developing the Stage Fund model
– building a female-led private equity fund and
– the evolution of Stage for their first and second fund
A 2019 report from the Bureau of Labor concludes that 21.5% of startups fail in the first year, 30% in the second year, 50% in the fifth year, and 70% in their 10th year. We talked with Brett Jurgens, CEO & co-founder of Notion, about his advice for other founders looking to make it to past Series A.
