Sale of Business: Testimonial

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“Windigo Bay…negotiated the sale of my majority interest in a business. Keith [Bates] took over the discussions and negotiations at every stage. He worked hard to understand my priorities and to make sure I understood my options and the trade-offs involved in different kinds of deals. Everything was in plain English. I liked his insistence on having me imagine different outcomes five years down the road. Keith negotiated with the buyer, managed the lawyers, stayed on top of the formal documents, and kept my legal fees to a reasonable level. The result was that I got a great deal that made me very happy, and we closed it smoothly and on friendly terms.”

– S.M., client who sold half of a digital health business

Cal Critiques Convenience

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“…email and smartphones makes communication with colleagues ubiquitous and trivial. In response, however, non-industrial productivity stagnated. Making business communication more convenient seems to have made people worse at creating valuable things.”

– Cal Newport, in his blog post Tim Wu on the Tyranny of Convenience.

We heartily agree. At Windigo Bay, we like serious and productive conversations; we use email as little as possible, and avoid chat-messaging entirely. Calls and meetings are still the best ways to learn and get things done. There’s no school like the old school.


Windigo Bay Group is a merchant bank serving creative, consumer and tech companies. We finance and develop businesses, negotiate new markets, sell and acquire assets, and more. Based in Toronto, our clients are in North America and around the world. Contact us for a private discussion about your needs.

Gi Fly in Action

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Our client Bignay is behind the Gi Fly electric bike platform. Deep integration between software and the bike takes Gi Fly to the next level. We call it the Tesla of bikes: it’s that great.

Bignay is based in Córdoba, Argentina. The company pre-sold over one million dollars of Gi Fly bikes before starting production. The first production run shipped in 4Q17, to buyers in Europe, North & South America and elsewhere. Customer feedback has been excellent.

A few weeks ago, Argentina’s President Macri stopped by the Bignay offices, and went for a spin with CEO Lucas Toledo:

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Argentina’s President Macri with Bignay CEO Toledo. Gi Fly are clients of Windigo Bay.

We’re very proud to be serving Lucas, Agustín, Eric and the rest of the Bignay team.


Windigo Bay Group is a merchant bank serving creative, consumer and tech companies. We finance and develop businesses, negotiate new markets, sell and acquire assets, and more. Based in Toronto, our clients are in North America and around the world. Contact us for a private discussion about your needs.

Windigo Bay in January 2018

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Windigo Bay Update

We’ve been going hard-core from the beginning of 2018. Our focus continues to be:

New markets & channels for your products

We’ll help you find new customers, partners, distributors, and licensees.

② Negotiate strategic & challenging agreements

We expertly negotiate complex and difficult deals, including partner and shareholder disputes or buyouts, licensing & distribution, and other high-stakes negotiations. We’ve handled many of these, with excellent results for our clients. Our specialty is tough situations where leverage appears one-sided or where relationships have broken down. We work closely with your counsel on final documents.

Turnaround and re-invention advice

We help re-invent businesses and stale product lines. If you’re frustrated with where you are, and need new ideas and insights, we can help.

④ Grow your business: financing

We help suitable clients with equity and debt financings. Our work includes identifying prospects, developing presentation materials, and negotiating with capital providers. We also negotiate restructurings and follow-on rounds.

④ Investee reviews

We have helped VCs and angel investors with external reviews of portfolio companies. If you’re unhappy with the progress of an investment, or want a potential deal given a second opinion, we can help.

⑤ Sale of business

We can help you find the right buyer for your business, and negotiate a very good deal.


Windigo Bay Group is a merchant bank serving creative, consumer and tech companies. We finance and develop businesses, negotiate new markets, sell and acquire assets, and more. Based in Toronto, our clients are in North America and around the world. Contact us for a private discussion about your needs.

Seed Investing Bubble Pops

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Having talked about the seed implosion in the summer and fall, this will be our last post on the subject.

Victor Basta at Techcrunch recently published a startling graph showing the seed-stage financing crash. The red line is the number seed-stage deals—and what it shows is the growth and collapse of a bubble.

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Basta’s article, which is well worth reading, summarizes the hard realities:

  1. App funding is over. “Since 2014, early-stage funding for businesses with “mobile” in their description has fallen off a cliff.”
  2. SaaS startup funding is way down. “With so many SaaS companies having been created in the past 10 years, it’s hard to justify, let alone back, new SaaS startups, which are by now competing against established SaaS players, not legacy perpetual license vendors.”

VC Fred Wilson writes:

Many startup people reinvented themselves as angel investors, AngelListers, seed VCs, and early stage VCs. As I quoted Techcrunch in my tweet “2012-2016 was a bubble in early-stage funding.” I think the bubble actually started letting out air in mid 2015.

You could see all of this in the pricing of seed rounds. For most of my career, seed rounds were sub $1mm and they bought 15-25% of the company ($4-6mm post money). At the peak of the seed bubble, uncapped notes of $3-5mm were the norm for seed rounds. That wasn’t going to work. It was unsustainable.

We’ve long felt that VC was in a bubble. The disintegration of the seed-stage market became obvious to us earlier this year. Part of the problem is that software is now a saturated market. It’s very hard to find a new and exciting thing to launch in 2017. Every nook and cranny is jammed.

The market today favours proven solutions that have happy customers. Seed financing has collapsed.

Postscript: Read Fred Wilson’s blog post on seed funding “valuation inflation,” dated June 3, 2018. Compare today to last summer: what a difference a year makes!


Windigo Bay Group is a merchant bank serving creative, consumer and tech companies. We finance and develop businesses, negotiate new markets, sell and acquire assets, and more. Based in Toronto, our clients are in North America and around the world. Contact us for a private discussion about your needs.

 

Seed Investing is Drying Up

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As we outlined in a previous post, the seed-stage venture funding market is dropping fast. It’s cold out there.

In her October 18th post Seed-Stage Activity Fumbles Amidst Increases In Late-Stage Dealmaking, Joann Glasner writes that the drop-off is stark:

The total number of investment rounds for U.S. seed-stage startups hit the smallest projected quarterly total in five calendar years in Q3 2017… Investors have also put fewer dollars into seed deals this year compared to the prior two [years].

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And not only are there fewer rounds, but fewer dollars too:Screen Shot 2017-10-31 at 2.23.44 PM

Glasner wonders if hot job markets are one reason that seed funding is falling.

Our feeling is that the big startup wave of 2007–2017 is over. This wave really got moving with monetary policy after the 2008 crash. It coincided with three major developments, which fed each other: cloud, social networking, and mobile. Facebook (2004), iPhone (2007), and Dropbox (2007) all launched in the same time-frame. Amazon Web Services began in 2006. Ruby on Rails came out in 2005.

The combination of cloud, mobile and social fed itself into a hyper-growth feedback loop. But now the market feels saturated. Most software startups are doing small things that are not deeply technical or interesting. We generalize here, but it’s hard to escape the feeling of saturation.

And now, finally, the investing landscape reflects that saturation. Meanwhile the unicorn market is overvalued and due for a correction.

Interesting times ahead.


Windigo Bay Group is a merchant bank serving creative, consumer and tech companies. We finance and develop businesses, negotiate new markets, sell and acquire assets, and more. Based in Toronto, our clients are in North America and around the world. Contact us for a private discussion about your needs.