Our Approach to The Scuttlebutt Method
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Welcome back to another edition of Atlasview Insights.
If you’re a new reader, welcome! Every other week we share industry insights and thought leadership on all things software and investing.
For those who may be unfamiliar with us, Atlasview Equity is a private equity firm specializing in software and tech-enabled businesses. To learn more about our experienced team and investment criteria, visit us here.
In this edition of our newsletter, we cover:
The scuttlebutt approach to due dilligence
Recent insights from our team on pricing power and optimizing cash flow
Fellow investor and operator perspectives on all things SMB and PE
If you enjoy what you read, please be sure to subscribe and share with your network.
If you are a business owner, deal intermediary, or advisor with a company that could be of interest for a transaction in 2023, feel free to reach out!
Atlasview has ample dry capital and LP relationships excited to invest alongside us! Here’s a quick overview of our investment criteria ⬇️
Our Preferred Investment Criteria
We look for the following characteristics in our partner companies:
Industry: Software and tech-enabled businesses
Business Profile: Sticky B2B customer base
Size: Minimum $1m EBITDA or $5m ARR
Geography: The US & Canada
Whether you’re a business owner interested in working with us, or an intermediary with a deal to share, always feel free to reach out and get in touch with us!
Investor Insights: The Scuttlebutt Method
If you are not familiar with the Scuttlebutt Method- it’s an informal method of due diligence where you speak with customers, employees (current & former), competitors, and other people that are associated with the company. You can gather valuable insight, anecdotes, and other information that will help you evaluate the company. Scuttlebutt is meant to be supplemental to the usual due diligence stuff (financials, product, legals, etc).
Why is it so useful for investors?
Scuttlebutt is powerful for a few reasons:
Firstly, it will give you important details about a company that just won’t be reflected in the financial statements, presentations, or any other readings. Things like morale, satisfaction, motivations, loyalty to the company or its products, etc. All of these are important to truly understanding a business.
Secondly, top-level executives and management will often paint the rosiest picture possible when presenting to investors. But it’s the customers and employees (involved in the day-to-day) that will paint you a much more accurate picture.
Lastly, it’s a way to stress test your thesis. Whether it’s a growth projection, an ambitious strategy that management is planning, or some other major operational change/improvement – employees/customers will know exactly how reasonable or realistic it is.
Final Thoughts
At Atlasview Equity, the scuttlebutt method is a part of our research and due diligence process. Though typically, as an acquirer, we can’t speak directly with customers and employees until much deeper into the deal process… we use some other unique techniques that suffice as scuttlebutt research. It’s remarkable what you can learn about a company through informal channels.
If you’re an accredited investor or qualified purchaser and interested in learning more about Atlasview’s investment opportunities, please inquire here:
We work closely with family offices, high-net-worth individuals, and institutions to make control investments in profitable software and tech-enabled businesses.
Insights From Our Team
Pricing Power
Pricing power is the ultimate measure of a business moat. The stronger the moat, the more durable the business is, which leads to higher returns on invested capital.
How To Make Cash Magically Appear In Your Business
As both an operator of businesses and an allocator of capital, Atlasview is constantly assessing portfolio company cash and where it’s being parked. We hope this post inspires you to do the same. If you have any questions about working capital for your business, always feel free to reach out to us.
Preferred Investment Criteria
We look for the following characteristics in our partner companies:
Industry: Software and tech-enabled businesses
Business Profile: Sticky B2B customer base
Size: Minimum $1m EBITDA or $5m ARR
Geography: The US & Canada preferred
Whether you’re a business owner interested in working with us, or an intermediary with a deal to share, always feel free to reach out and get in touch with us!
Deal Maker Perspectives
Operator Perspectives
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About Us
Atlasview Equity is a private equity firm specializing in software and tech-enabled businesses. We combine patient capital with proven operational strategies to deliver predictable results for our stakeholders.