Code User Group Blog: July 2025
Many thanks for all those who attended and contributed to a lively user group meeting. It was clear this was a topic that resonated with many of you and provided some additional useful insights and ideas. It was interesting to see quite a varied approach to identifying companies who might sell in the future with several of you identifying best practice and ideas for other to consider.
The session started off with discussing the importance of identifying companies before they sell and taking on the mindset of a private equity / venture capital analyst. Making gift requests after a company has sold is likely to be too late, and establishing a relationship / gift promise well before a sale in most cases must be done. Jon also reiterated the need to establish whether PE/VC involvement was providing money for the business or buying out an existing shareholder. Seeing a large increase in a firm’s cash balance in their financial accounts accompanies by the issue of new equity is a tell-tale sign funds have been invested in the company as opposed to a buyout.
Jon then wont onto discuss the main exit routes for owners, noting the differences between liquidation and bankruptcy along with the role of seed capital, VC and PE. Focus was given to the different funding rounds (Seed, series A, B and C) and the importance of identifying companies at seed or latest series A as anything later owners have typically given away 50% of their ownership. Details of the typical equity dilutions are given on the slides emailed to everyone.
There was then a discussion on the key sectors / companies which should be the focus namely"
1. Smaller companies with revenues under 25-40m
2. Companies operating tech, defence and healthcare
3. Also a note to not forget core sectors such as food and transport
Jon reiterated the importance of looking within the sub-sectors of these sectors, giving an example of green tech falling out of favour recently and AI, big data etc seeing. lot of activity (buy out and acqui-hiring).
The session then worked through some examples of private equity firms (Westbridge and their staff) and Nothing technology to give examples of buyout activity and series funding, along with data sources such as Crunchbase. Some key traits of companies looking to sell were discussed such as:
*Window dressing
Directors leaving and joining
Increased disclosure
Directors establishing new companies
Share options being granted quickly
SEC registration (US)
High sales activity in the sector
Increased social media / LinkedIn activity
The session ended with a lively discussion and Q&A
Thanks for all those who attended and as a reminder the next user group is in September as it is holiday season in August.
Any questions about the session please contact us at team@pyro.solutions
