Tag Archives: Finance

How Do You Manage A Late State Private Tech Company? Four Topics

A late stage private high-tech company wants to know what questions are most critical for managing the next stages of growth. This includes factors that can help differentiate good opportunities from poor ones. What questions would you ask about managing a late stage private high-tech company?

Advice from the CEOs:

  • Team
    • Never compromise on your team. Is this a team of individuals who will be effective together, and can you make changes where necessary to build and manage the team that you need?
    • There is no room for someone who is not a cultural fit – do the team members work well together and does everyone see and support a win?
    • Who are the key stakeholders, and what drives them? Are these drivers compatible or in conflict? Can you bridge potential conflicts, or will they defocus your efforts?
  • Market & Strategy
    • Are your market projections realistic or fluffed?
    • Will your value proposition appeal to a large enough market to justify the investment of time and resources?
    • Is there a strong, realistic plan?
    • If you do a full SWOT (strengths, weaknesses, opportunities, threats) analysis, is the net positive?
  • Finances & Capital markets
    • Are the revenue and financial projections done correctly and achievable?
    • Raise money when you can, not when you need it – will the timing of your deal or opportunity, given existing financial markets, allow you to raise the funds necessary to bring the opportunity to fruition?
    • Is there openness to all potential capital or financing options? Financing is a personal relationship – how strong is the relationship?
  • Boards & Governance
    • Investors are investors; don’t overestimate their industry savvy. Are they aligned or in conflict? Are they fresh or tired? Will they support your efforts, and do they have the ability to generate extra funds as required?
    • It is impossible for a CEO or deal to be successful without the full support of the board – will you have full board support for your opportunity?
    • Is there clear differentiation between governance and management?
  • Looking over these questions, is the balance positive or negative? That balance will help you to accurately assess whether a given strategy or opportunity makes sense for the company.

How Do You Know Your Team Can Handle Planned Growth? Six Steps

Interview with Gene Tange, President, PearlHPS

Situation: An acquired company is poised for dramatic growth. The corporation that acquired them has questions about the current team’s capability to realize planned growth, and achieve their financial and operational targets. How can they assess whether the existing team is up to the task?

Advice from Gene Tange:

  • Think of this as an assessment process that accurately predicts the ability of the leadership team to realize planned outcomes while maturing key business processes. The leadership team is tied to both financial and operational outcomes that cover competence, continuity and alignment. This enables proactive management of organizational changes to support planned growth of the business. A real life example will illustrate the steps of the process.
  • The starting point was whether the current CEO had the right compliment of skills and capabilities to lead a high performance team. Could this leader see beyond the current stage of growth in terms of the talent and processes required for growth? Could he build a high performance team, align them and retain them to achieve results?
  • The CEO then laid out the future state organization. The essential question was whether he had teams of leaders in each of the key functions to assure success.
    • Specifically, the Product Development Team generated a competitive analysis comparing the current product with all others to assure a 2 year competitive advantage.  They were also tasked with improving cost of manufacturing.
    • The Sales Team installed an integrated CRM system to support large orders, including internal cross functional communication to increase customer visibility and satisfaction scores.
    • The Operations organization moved from a traditional batch manufacturing process to a state of the art, focused factory organization, eliminating WIP, reducing operational costs and increasing the speed of order to delivery.
    • Finally, the Finance and Administrative functions were assessed.
  • As a result, in 16 months the company grew 5x in revenue and increased margins. Time from order to delivery was reduced by 16x. Headcount was reduced while shipping volume increased by 5x.
  • A disciplined assessment process that predict business outcomes and ties your talent to the bottom line can provide a significant advantage in today’s highly competitive environment.

You can contact Gene Tange at gtange@pearlhps.com

Key Words: Growth, Experience, Assess, Capability, Processes, Predictive, High Performance, Competence, Continuity, Alignment, Organization, Structure, Manufacturing, Sales, Marketing, Customer Relationship, Finance