Baird Capital had the pleasure of attending the 2024 GeekWire Awards. Held in Seattle, the event celebrates entrepreneurs and technology leaders shaping the future of innovation in the Pacific Northwest. We were joined by colleagues from Baird’s ever-growing presence in the region, including the firm’s wealth management and investment banking businesses.
At the event, Gordon Pan, President of Baird Capital, sat down with GeekWire chairman & co-founder Jonathan Sposato to talk about the outlook for venture capital in the balance of 2024. Gordon shared his perspective on the current environment.
A few highlights from the discussion:
Back to Fundamentals “Growth at all costs” is no longer the name of the game in a high-rate environment. Gordon shared for companies trying to grow in today’s market, it’s all about disciplined growth and a focus on fundamentals. Baird Capital looks closely at three fundamentals in potential investments, including growth rate, net revenue retention and the rule of 40. “If you have those three things, you have a very attractive business model. If you have an attractive business model, people are going to be interested in talking to you – then it's going to be up to you to find the right partner.”
A Light at the End of the Fundraising Tunnel? Gordon highlighted the towering amount of dry powder in both venture capital and private equity. “It's all looking to be deployed. The problem is that buyer-seller expectations have not converged yet,” he shared. That said, there are signs the market is starting to unlock. “Why? It’s because buyers are realizing we have a lot of money [and] we’ve got to spend it. Sellers, or people raising capital, are realizing we need to raise the capital to drive our business model.”
Market Momentum Gaining Strength Gordon shared Baird Capital anticipates a positive environment for deal activity. “Our team’s plans are that the back half of 2024, and into 2025, are going to be very, very strong investment in M&A markets. So, my words of encouragement to all the entrepreneurs out there are focus on getting your fundamentals right because I think the market’s coming your way.”
