One of Valor’s investing filters is seeking tech startups that we believe have high exit potential, because private markets often outpay public markets and that delivers dollars to investors. One of the ways to get a grip on exit options is to look at a track record for a sector, a geography, or a stage. If the thumb rule is, 80% of a fund is invested within 100 miles of the headquarters of that fund, its smart to look around the fund headquarters to see what the exits are like. After all, this isn’t Silicon Valley–so what are we dealing with?
Valor compiled Southeast regional acquisitions in the last 10 years within a few hours drive of Atlanta, $50 million or above.
- To get rid of the “noise” of legacy companies in the strike zone, like YP and Belk, which had acquisition events, I limited the data to companies that were founded after 12/31/1995.
- To share more info, I have not limited this to “software” or any other sub sector–this is “raw exits”
- Exits at $50 million or above are capable of venture-class returns, but that doesn’t mean any of these on the list had specific returns–each deal is unique.
- This data is far from perfect–I relied on Crunchbase, which is mostly crowdsourced. Please let the know any errors or omissions you find.
As you look at this, notice what you see around sector. Do one or two sectors dominate? There are themes. Notice headquarters–are one or two cities getting a bigger share of the exit opportunity? There are some take aways here. What’s fascinating to me is, our local story is often that “a sector fund” is a smart strategy. The data says diversified suits the terroir.
As Valor defines our investing hypotheses around deals, we paid careful attention to the types, sectors and sizes of exit that our region realizes. We are fans of hypergrowth tech that is not sector specific. When you look at the data, which trends speak to you?
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