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Private Equity

Check Size Isn’t King: Insights from CEOs to Investors

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There is no “one size fits all” when it comes to CEOs. As barriers for entry decrease, the makeup of today’s CEOs is becoming increasingly diverse. Investors’ long-held preconceptions around business owners’ motivations for seeking capital may not always be relevant in this new economy.

At a recent Business Leaders Forum hosted by Crowell & Moring and ThinkCreative, we heard from two prominent female CEOs about their experiences starting and growing a business.

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Raegan Moya-Jones (pictured left) founded the muslin blanket business aden + anais after her first child was born and she was frustrated by the heavy fabrics used for baby swaddles. In 2014, the company reported a revenue of $54.9 million and experienced a 477% growth rate.

 

Danielle Weinblatt (pictured left) founded Take the Interview, a tech-enabled interview management and recruiting tool in 2010. The company has raised $12 million in venture capital to date.

 

Here are a few insights from Moya-Jones and Weinblatt that investors should keep top of mind.

They’ll take a smaller check…

… if the investor is the right fit.

Instead of pursuing the highest bidder, Moya-Jones and Weinblatt both searched for a partner with experience growing businesses in their industries. During a funding round aden+anais received over 30 indications of interest, but Moya-Jones said it was easy to delineate between those who had a firm grasp on the vision of the business and those who didn’t.

They’re thinking many steps ahead of you.

Moya-Jones has been planning for the success of the business ever she started making the blankets at her kitchen table in 2006. Even in the middle of a capital raise, CEOs are always thinking a few steps ahead in the growth story. Investors who are attuned to CEOs’ investment in and strategic vision for the future will find the most success.

Today, despite having sold a majority share of aden + anais in 2014 to consumer goods specialist Swander Pace Capital, Moya-Jones is still actively involved in the business’s future plans. She eventually envisions selling the company to a strategic buyer.

They’re fiercely protective of their employees.

“I see my business as my family,” says Weinblatt, who raised $5 million in a series B financing from 3TS Capital Partners in May 2016. Together Weinblatt, her management team, and investors plan to grow and expand into Europe.

Throughout the process, both Moya-Jones and Weinblatt paid special attention to whether or not the sponsor made an effort to get to know the existing management team and repeatedly inquired about their plans for the leadership team.

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