What no one tells founders about liquidity

When Darrell Heaps started Q4 Inc. in 2006, he wasn’t thinking about liquidity.

Like many early-stage founders, his focus was survival, and conversations about ownership, valuation, and exit strategy felt like distant issues.

“When you start something, you’re really focused very much on the problem, the customer, how you’re going to make money,” he said. “It really does take 100 percent of your brain power to figure out how to create something out of nothing.”

Q4 is an investor relations platform used by public companies to manage everything from earnings calls to investor targeting.

By the time it went public in 2021, Heaps had changed his approach to managing his company’s liquidity, and with strategic thinking he spared himself the challenges often faced by busy startup founders.

“If you’ve raised venture capital you’ve raised growth equity, you’ve signed up for a liquidity event at some point in the future,” Paul McKinlay, Co-Head of CIBC Innovation Banking, said in a recent fireside conversation, Opens in a new window on pre- and post-liquidity planning.

“Oftentimes we hear from founders and executives that either it’s too early in their business for them to start thinking about it, or they just kind of neglect to think that it’s the right time, but that often becomes too late very quickly.”

Read more: What no one tells founders about liquidity, Opens in a new window (link is in english only)