Skaalerud: Outlining transformation opportunities speeds up acquisition deals for sellers
Kjael Skaalerud · Startup Acquisition Stories with Kjael Skaalerud, President of Skaling Ventures · Jun 27, 2023 · at 12:36
Kjael Skaalerud, President of Skaling Ventures, discusses acquisition negotiation strategies with Acquire.com founder Andrew Gazdecki.
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“The more you can kind of hint Or foreshadow what a transformation play would look like, and then rationalize why you're not the one to execute it. It'll speed up your ability to transact.”
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Skaalerud: Skaling Ventures uses debt and fractional teams for transformations
“We used that in our acquisitions and to finance some of the transformation pulling in my team, which is all kind of fractional folks.”
Skaalerud: Acquirers should expect to rewrite 20% to 40% of SaaS code
“Like I think our assumption is that, you know, call it on average, 20 to 40% of the product needs to be enhanced or rewritten in some way. But beyond that, you start to play a game around technical debt and it kind of changes your ability to move fast.”
Skaalerud: Skaling Ventures targets an average 3x ARR multiple for acquisitions
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“So if you think about traditional OG private equity and it's like, hey, we have a data room and this data room is stuffed full of like spreadsheets that have P and L's and, you know, customer concentration and personnel and salespeople and quotas and headcount…”