Today I am welcoming Sunny Vanderbeck, Co-founder and Managing Partner at Satori Capital, back to the show for a second conversation about his experiences in the world of private equity. Sunny started his career as an Army Ranger before working at Microsoft in the 90’s. He then founded Data Return, a provider of managed services and utility computing, where he helped grow the company 40% every quarter for three years. His decade at Data Return included a $3 billion market capitalization and multiple sales, giving him unique expertise as an entrepreneur. His current company, Satori Capital, is a private equity firm that focuses on long-term growth and investment, that keeps the principles of conscious capitalism at the forefront of their approach.
He is also the author of the book Selling Without Selling Out: How to Sell Your Business Without Selling Your Soul, which is about how business owners should navigate a sale or taking on a new partner.
In today’s episode, Sunny explains to us how the world of private equity operates, from the structure and lifecycle of the fund to considering a sale’s debt versus equity. Well be delving into how private equity firms raise money, where the money comes from, what types of investors they work with, how the general partners of a private equity firm get paid, how they start the fund and what the fund structure looks like, and what the timeline means for the fund.
What You Will Learn In Today's Podcast Interview
Sunny’s background in the military and business
Satori Capital
What is time horizon and how do they have indefinite life capital
Conscious Capitalism
Sunny’s explanation of PE Firms
The “customer” is the fund
What is the lifecycle of the fund
PE is buying a majority of the company with debt and equity
How Sunny started his own PE firm
His community of CEOs
Are You Growing The Value of Your Business
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Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?
Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?
About the Guest:
Sunny Vanderbeck is an investor, entrepreneur, best-selling author, and former military leader focused on accelerating the growth of mid-market companies and creating best-in-class, built-to-last businesses.
Sunny is co-founder of Satori Capital, a multi-strategy investment firm founded on the principles of conscious capitalism. By providing real-world insights from its experienced team and long-term funding with no fixed time constraints, Satori acts as a true partner for its portfolio companies as it challenges them to pursue extraordinary outcomes for all stakeholder groups.
Quotes:
14:31 – “If I can sell a stock tomorrow, it’s theoretically worth a little more than if I can’t sell it for years.” – Sunny Vanderbeck, on liquidity premium
16:28 – “To put some precise language on it, in our case: so we manage a billion dollars, we don’t have a billion dollars. They’re very different things, I promise you.” – Sunny Vanderbeck
32:11 – “By and large, as companies get larger, they are more valuable. The markets seem to play that out, not always but generally true.” – Sunny Vanderbeck
44:45 – “Deeply understanding how your business generates or consumes cash, understanding how variable your cost structures are. That can help you understand, ‘Is debt an appropriate tool for what I’m trying to solve for?’” – Sunny Vanderbeck
Links and Resources:
Intentional Growth #170: How One Week Killed the Perfect Billion Dollar Deal with Sunny Vanderbeck
Sunny Vanderbeck, website
Satori Capital
“Selling Without Selling Out” by Sunny Vanderbeck, Amazon
Mastering Your Cash Flow Digital Course
ARKONA Boot Camp
Reach out to me if you have questions about the boot camp!
You can also reach out to me via email at rtansom@arkona.io, on my LinkedIn.
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