2023 Marketing Strategies That Drive Successful Exits
By Peggy Tierney Galvin, chief strategy officer, Force4 Technology Communications
Preparing a tech company for sale takes several steps with a single objective: maximizing value at exit. As VCs, private equity firms and acquirers look for solid tech investments that yield a good ROI, it’s important to create a business that’s “built to sell” — even if you’re not wanting to sell now.
Companies often are challenged by thinking about their benefits not only from a technology perspective, but also from the perspectives of a customer, a partner, a funder and an acquirer. But you need to be able to look at what factors would make your company attractive to an acquirer; specifically, that it can help bring on more, bigger or different deals than it could do on its own, and more efficiently than attempting to do so in-house.
You’ll have to address the challenges of standing out in a crowded field when many of your competitors are saying the same thing you are and targeting the same customers as you. Read on to understand what options you have and to learn useful marketing strategies that can help facilitate a successful exit.
Exit choices in the current market climate
An IPO is often the first option that comes to mind. But due to inflation and market tightening, investors are far more cautious than they were during the booming past five years. As a result, the potential payout that an IPO could offer VCs has deflated considerably.
For context, a recent report from Silicon Valley Bank found that for fintech companies specifically, there’s been a 24% decrease in “pre-money valuations for Series C+ deals from the recent peak.” Public listings hit record lows in 2022; exits are down almost 50% against historical norms. There have been only 59 public listings thus far, compared with 303 in 2021 and 145 in 2020.
Likewise, increased regulatory attention on special purpose acquisition companies (SPACs) has cooled investor interest in this approach as an alternative route to market. In December, in fact, a veteran of the SPAC industry and a potential serial backer saw deals worth $10.6 billion evaporate in under an hour.
This leaves mergers and acquisitions (M&A) as the best chance a VC has of making their ROI back from a B2B tech company investment. And that means making your company look indispensable to a potential acquirer.
So how do you get started?
How PR Drives Successful Exits
As you think about your exit strategy, one of the first elements to consider is how public relations will play a part. For tech companies, it’s almost impossible to execute an exit strategy without a B2B PR team highlighting your successes, promoting your thought leaders and showcasing your intellectual property and differentiators.
Here are five PR and marketing techniques we’ve employed for our clients to increase brand awareness and market value.
Strategic Messaging: The messaging used for acquisitions is different from that used for sales and public relations. The corporate vision, differentiators, market opportunity, intellectual property, proven market share and breadth of your firm’s leadership bench should be the main points of emphasis when positioning your business for purchase.
Analyst Relations: Industry analysts, relied upon as third-party experts, communicate constantly with acquirers. That means an analyst relations (AR) program is essential for ensuring these influencers are being kept up to date on your business benefits and technological differentiators. Set up briefings with the analysts in your sector to inform them about your business. Obtain their opinions and build relationships. This way, you will ensure that your business comes to mind whenever potential buyers contact analyst firms in quest of background data and leads.
Collateral: Supporting documents and content are another key tool for highlighting business value. Collaborate with analyst groups and content development firms to develop market research reports, white papers and customer success stories. We’ve found this collateral reveals your industry expertise, verifies market potential and gives acquisition teams information they can show to other decision makers.
Media Engagement: Acquirers look for news articles and media attention that can identify candidates for acquisition. Therefore, it’s necessary to appear in the relevant business and industry media venues. To place positive, on-message coverage regarding your company’s products, customer or partner wins, intellectual property, market momentum, funding and awards, target reputable journals and industry magazines.
Press Releases: Press releases offer newsworthy information about your company to your key audiences. Releases establish a timeline of your company’s achievements and momentum. They demonstrate what you have accomplished to potential acquirers. One to two significant press releases each month is best for maintaining awareness and interest.
Help with your exit journey
Executing an exit strategy has always been a multi-faceted, high-effort task, and the current market hasn’t made it any easier. Building in the right PR and marketing strategy as soon as possible is essential for success in the B2B high-tech sector. Keep the above best practices in mind as you begin this journey, and remember that expert help is available at any or all stages. Force4 has helped many clients make successful exits – feel free to contact us here to start the conversation.