Sell services to PE
Hi Everyone,
New at WSO and wanted input from qualified individuals in the PE world. I did a few searches and didn't found an answer, hence, this posting.
So what is my product? I am an IT broker, meaning I am able to find you the best solution and the cheapest on the market for your infrastructure needs in no time. My product is almost fully automated which enables me to deliver results in 45 days. When my competition is about 3 months and up. Moreover, my business model is about charging a fee upon the savings generated for the customer (instead of billing by the hour).
My value prop: - I will make you save more than 20% yearly of the IT vertical cost ( Telco, servers, networking, BI, cloud...) of any companies in your portfolio.
Now we had multiple success with end customers and was looking at private equities who have a controlling interest in their portfolio as 1 sale will enable me to generate multiple projects ( kill 2 birds with 1 stone) for repeat business...
I have been contacting a few PEs and talked to (managing partners / partners / principlas) and straight up they told me : not interested.
But in my mind, it would make sense for a PE who bought a company to transform it / make it lean to extract as much revenue as possible.
OR I am missing something / I do not have the right approach?
If anyone can comment on the above and provide some insight, it would be greatly appreciated.
Best,
At the PE firm, they/we are a little more removed from that level of decision making process. Think more along the lines of a board telling executives that gross margins should be x% and fixed costs should be $xx... Some PE firms are more active than that, but more or less executive teams have freedom to find their own way to hit the targets.
We often recommend accountants, branding agencies, law firms, etc that our investments have used before. But never something as in-the-weeds as IT brokerage..
Your approach is correct, but I would target the portfolio companies directly. Often the executive team have equity incentives in the company, so they are looking for every $ to save too.
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