Is there really no better solution than closing down large companies’ non-core operations? How can growth companies be helped to improve sales, marketing, international expertise and financial management so that they can succeed globally?
I gave these questions a great deal of thought when I was working as head of Mergers and Aquisitions at Nokia Siemens Networks. My job involved acquisitions and business restructuring, among other undertakings. We acquired companies on a broad scale, from small technology companies to international giants.
Large companies always have operations that are not given opportunities to grow. There are many reasons for this. Management and sales are focusing on the core operations, which also take up most of the resources. The businesses may still be in so early stage that they do not get the full attention of sales. And the company’s clients may not be the right target group for the business. Non-core operations usually arise from a technological invention, but assets are not allocated to business development and international expansion.
We are looking for operations of this type. We want to carve out businesses from large companies and develop them into independent growth companies.
We are Verso. In 2012, we established our first fund, which focused on IT and telecommunications companies. We have made six investments from the EUR 10 million fund so far, out of which two companies have already been exited.
There clearly was a need for Verso, but its operations called for a strong team.
Marko Järvinen, Jukka Rauhala and Mika Suomela joined the company as partners. I wanted people who are familiar with the financial sector and corporate logic and know how to help companies grow and go international. In 2017, Vesa Jormakka joined the team to bring over his 20 years of investment experience in the German market.
We removed all sector restrictions from our second fund. We invest in European B2B businesses that have bottlenecks hindering their full growth potential. We take a very active role as the majority owner in our portfolio companies, solving those growth bottlenecks. The equity of the fund we established in autumn 2014 is around EUR 50 million. So far, we have invested in seven companies: four carve-outs and three growth companies.
“We want to actively help companies grow internationally in cooperation with the operative management and other owners.”
Helping companies grow
What are our values?
First of all, we are entrepreneurs who have made considerable investments in our fund. Verso – Finnish for “sprout” or “shoot” – means growth, but it also means the other side, turning the page: a new opportunity seen from a new perspective.
We want to actively help companies grow internationally in cooperation with the operative management and other owners. We believe that we are able to build international growth through financing and our input. We also make sure that the right people are in the right places.
Our values are integrity, transparency and reliability.
We are aiming for reasonable returns, not quick wins or tenfold growth. We invest in companies and business operations that have net sales from EUR 2–50 million.
Our goal is to double or triple each company’s net sales profitably over a period of 2–5 years.
It is an ambitious goal, but we have achieved it.