Why We Said No to a 7-Figure Investment

Since October 2015, our company has been in the due diligence phase of a large investment round. One that can speed things up, one that can change your life forever, one that can bring influential people to the table, one that can open up doors to a broader network and a subsequent larger investment round. For anyone that is not too familiar with the term “due-diligence”, it’s a series of steps that investors will take to make sure that whatever you pitched at the presentation is actually accurate (financial, operational and legal stuff).

Friday was supposed to be the closing date. We’ve passed all the necessary milestones to get the deal through until they decided to offer us a lower business valuation, something common in many deals, something still attractive for a start-up business but a bit lower than what was initially printed on the agreed term sheet.

A week prior to that, a thorough analysis and a complete due-diligence was finalized from a large institution. Guess what? They approved and recommended the deal even if they reduced the most catastrophic scenario by around 25%.

Now, I have to say this: when a 7 figure deal is offered on the table to have funds transferred on the spot by signing and moving forward, it can be easy to simply throw down the weapons and get things moving. Thoughts are running through your mind like: “we’ll be safe, we’ll be secure, and we’ll get to the next level with this.”

Well, we decided not to take the deal and not come back with a counter offer.

I know that some of you might wonder why. So, that’s what I want to address here.

I remember the day we signed the term sheets; we didn’t stop there, we didn’t relax, we didn’t wait for the investment to come. We didn’t start believing that we made it. We didn’t stop planting seeds, we didn’t stop developing new options, we didn’t forget about patenting a new feature, we didn’t slow down our partnering strategies with new providers and we certainly didn’t make our team believe that we can take it easy now. Instead, we doubled our efforts, we tripled our strategic moves and kept going with the starving mentality of an artic fox that hasn’t ate in weeks. In the end, staying on the hunt will create opportunities, and opportunities in the solar energy sector are endless in 2016.

Let me tell you something; when you analyze facts and realize that you have faith in your team, faith in your product, faith in the market and faith in your partnersknowing too damn well that all of you are not about safety and security (I know by checking out our psychometric test results), you have no choice but to believe in the true value of your company. When I and my two partners looked at each other after the meeting, I witnessed a beautiful moment; a moment where I knew that all of us were on the same page. Throughout the entire process of weighing in the pros and cons, never once, we had a disagreement on what needs to be done and where we are headed.

I truly believe in my team; we are strong, we are solid, and at this stage; I wouldn’t replace any of us just based on skills and pure dedication. We believe that accepting the deal or anything lower than what was initially agreed upon at signature would have not represented the true value of what we really have over here. It would’ve been a temporary relief to a minor pain but we’re all soldiers around here so we’ll keep marching together in a tight formation until the righteous treaty is signed.

This doesn’t mean that the bridges are burned; we made great contacts & great friends throughout this experience and will keep a tight communication in the near future for other possibilities. We learned so much about how to raise money and what investors are looking for. Overall, it was a great first investment ride!

Now, I would like to finish with this: for anyone out there that is being offered something lower than the real value of the product, no matter what the deal is, even if it’s to buy an old record collection; don’t be afraid to speak out and say it like it is. Getting what you want might not work every single time because egos may clash, but I guarantee you that sticking to what you truly believe in will always win respect and open up doors to greater opportunities.