The Interview That Never Happened — Part IV: The Power and the Partner
Private equity isn’t the exit—it’s the amplifier, if you choose wisely
Joe’s next question gets framed like a tool question: “What role can (and does) Private Equity play in selling a business?” Most people hear that and think about the end. That’s the mistake. Private equity, at its best, is not about selling. It’s about what becomes possible before the sale ever happens—and who you choose to make that possible with.
When Capital Becomes the Constraint
For us, private equity didn’t enter the picture because we were looking to sell. It entered because we were looking to grow—and had hit a wall. My bank account was empty. There was only so far we could go funding acquisitions through internal cash flow and sale-leasebacks of equipment. That worked for a while, but the environment was changing. Capital markets were shifting. The scale of opportunity in front of us was growing faster than our ability to fund it. If we wanted to acquire another business, I would need to write a check.
With money I didn’t have.
That’s when you realize something important: growth is not just about vision or execution. At some point, it becomes about access to capital—and more importantly, access to the right kind of capital.
Alignment Is Everything
Private equity can be a massive unlock, but only with the right alignment. That’s not a soft statement. That’s the whole game. PE firms are usually good at something—turnarounds, sector consolidations, specific industries, financial engineering, operational discipline. They are not generic pools of money; they are strategies with capital attached.
Your job is to understand exactly what they are buying—and why. Are they buying your business, your management team, your cash flow, your platform for acquisitions? And just as important, what do they want to do with you once they’re in? Some will require control. Some will take a minority stake. Some will want to roll you into something larger. Some will want you to lead that growth. These are not small differences; they define the future of what you’ve built.
When I partnered with First Atlantic Capital in 2004, we answered all of those questions before anything was signed. Not most of them. All of them. That clarity paid off. Later, when we were pursuing a roughly $150M acquisition—one we ultimately didn’t win—the final offer terms were settled in a 15-minute phone call. Not because it was rushed, but because everything that mattered had already been aligned. There was no negotiation theater left. Just execution.
The Outcome Everyone Focuses On
When the final sale of the family business came in 2008, I was more than happy to take a 10x return on the equity I had left in the business. That’s the headline people focus on, but that outcome wasn’t created in 2008. It was created years earlier, when the right partner made it possible to play a bigger game than I could have played alone. Private equity didn’t define the exit. It expanded the path that led to it.
The Part Nobody Wants to Say Out Loud
Now let’s address what you’ll hear over and over again: stay away from private equity, stay away from venture capital, they’ll take control, they’ll ruin your business. Look, the averages suck. That’s true in a lot of fields. Think about the legal profession. In my opinion, most lawyers suck. The jokes exist for a reason. But if you need legal work done, you don’t pick someone because they have a law degree.
You pick someone who has done what you need done before.
Would you hire a corporate attorney to sell your house? No. You find someone who understands not just the law, but the balance between protecting you and actually getting the deal done. You don’t want someone who protects your ass so aggressively that no one wants to work with you, and you don’t want someone who leaves you exposed either. You want the right mix.
Private equity and venture capital are no different. You are not looking for a great firm. You are looking for a great firm that’s right for you.
🌱 Seed Thought: Private equity is neither the hero nor the villain. It’s leverage, and like all leverage, it magnifies what’s already there—including the quality of the partner you choose
