#70, Eric Idiahi – Optimising for exits and high investment multiple

My guest today is Eric Idiahi. Eric is the co-founder and partner at Verod Capital, a private equity firm based out of Lagos Nigeria. Verod is one of the top PE firms in the continent with a significant number of successful exits as well as admirable money multiples record from their previous fund. Eric is someone I’ve known from a distance, so when we met at a dinner late last year I invited him to be a guest on this podcast and he graciously obliged. In this episode, we discussed how he and his partner, Danladi, started Verod in 2008 by working with other investors on a deal by deal basis. We talked about the fundamental differences between PE and VC model, especially the way it’s done in Africa, how to maintain a balance between portfolio support, value creation and investor control. We discussed exits and how investors can think about it and position their portfolio companies for that event. And of course, we discussed COVID, what it means for businesses in Africa and how to frame its inherent challenge and opportunity. I hope you enjoy this conversation as much as I did.

Time stamp

(2:01) How Eric got started 

(4:44) How to raise funds as a first time fund manager

(7:18) How to convince entrepreneurs to work with you as an investor

(21:46) What attracts investors to a business 

(33:40) How to determine whether to hold on to an investment or exit

(35:13) How COVID19 will shape businesses going forward

(42:46) Eric’s current reading list

(45:25) Eric’s advice to his younger self

Books

Blitzscaling: The Lightning-Fast Path to Building Massively Valuable Companies – Reid Hoffman and Chris Yeh

What It Takes: Lessons in the Pursuit of Excellence – Stephen A. Schwarzman

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Episode 70