Principle 4: External
We will ensure buyer’s gender alignment at the time of exit.
Seek out buyers who are committed to gender-smart investing and conduct due diligence with gender lens and explore ways to bring women on the cap table and consider management/ employee buyout as an option.
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At GP level: Explore innovative ways to bring in women LPs by e.g. pooling smaller tickets
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Conduct an initial assessment of GLI aligned co-investors for follow-on rounds and exit routes, and develop a high level plan on how to build relationships early on. This may include strategies to educate the market and build the investment and business case for a strong gender lens.
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Aim to intentionally attract buyers who are committed to gender-smart investing and actively monitor the market for aligned buyers well in advance of your exit horizon
Make investees and investors aware of gender-smart trends at major stock exchanges globally increasingly requiring gender diversity policies, corporate governance provisions and reporting, and prepare companies well in advance
Explore creative ways to bring women on the cap table
Consider management or employee buyout as an exit option and be creative about funding mechanisms
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Don’t sell to anyone you wouldn’t invest in. Make sure your DD on buyers at exit is as rigorous as your DD on the company at entry.
Consider a two-stage screening process for potential bidders, with the first stage focusing solely on non-financial criteria. Screen out buyers that pose a risk to gender-smart impact continuity and then evaluate in stage two all bids financially.
Assess buyers against the 2X criteria and ask for their own internal gender diversity, gender-smart policies and practices; assess the buyer’s culture.
Choose an aligned buyer; understand the details of the buyer’s rationale for purchase and assess how this may impact on gender outcomes achieved
Conduct explicit DD on gender risks and the background of prospective buyers (e.g. accusations of GBVH, treatment of female leadership and staff in previous/current investees, how they have handled previous acquisitions, etc.)
Exit at the right time, i.e. when both financial and gender objectives have been achieved and a suitable exit opportunity is on the table. (Have the gender outcomes of your investment been achieved? Are they institutionalised to be sustained beyond exit? Which exit options add long-term value and allow the company to achieve long-term success with a strong gender lens?)
Practitioner insights
Shuyin Tang
Partner
Beacon Fund / Patamar Capital
Further along our investment journey with the company, we held several discussions with potential investors. We emphasized the “secret sauce” which we believed allowed this company to achieve both their early traction and rapid scale-up - the predominantly female team that had a sharp understanding of customer needs and sector trends. As we brought on more investors to the cap table and worked towards an exit, we made sure that the story of “gender as a value driver” was being showcased in this business.
Maisy Ng
Managing Partner
Delight Capital
The company went on to a very successful exit, led by this same CEO. We helped on the exit as well, because she wanted to plan for a more tax-efficient exit. The board supported her and we are very pleased with the outcome.
At one time, this company was likely the only startup in all of Europe which had a female chairman, a female founder CEO, and also a female VC on the board. We never spotlighted or publicised this - it was business as usual. It was a strong outcome for everyone in the end.