Why founder liquidity matters
Owners of successful businesses often face a situation where their net worth on paper grows significantly, yet their access to that wealth is limited and tied up in the business.
At the Australian Business Growth Fund (ABGF), we believe that if a business has reached a certain level of success over several years (i.e. achieved profitability milestones), and it has significant growth potential, owners should be able to ‘take money off the table.’
Opting to take money off the table through a partial sell down of shares to a minority investor, rather than a majority sale, allows an owner to secure both an immediate financial benefit while also maintaining the potential for significant financial gains from the future success of the business.
Furthermore, this success is likely to be achieved sooner with the support of an active and experienced investor.