Private Equity Activity and Why It Matters

Gaurav Bhasin is the founder and managing director of Allied Advisers, an M&A advisory firm whose principals have completed over 100 sell-side transactions for software and tech founders. After two decades in investment banking and tech M&A, Gaurav is a sell-side advisor to B2B software founders who have built successful businesses and want to explore selling their companies.

Allied Advisers typically works with founders selling their businesses for $20M–$200M, helping them prepare materials, run a competitive process, and negotiate terms.

We discuss how today's M&A market looks very different from the 2021 bubble. Valuations have normalized, deal timelines have increased, and buyers are more disciplined. But the demand for profitable, steadily growing SaaS companies is stronger than ever.

Gaurav breaks down strategic and private equity buyers, what metrics matter most, how AI influences valuations, and why most founders underestimate the emotional and operational effort required to sell. For practical founders thinking about an exit in the next few years, this episode provides clear expectations and tactical guidance.

Key Takeaways

• Profitable Growth Wins — Buyers prefer SaaS companies growing 20–50% with real profits over faster revenue growth fueled by burn.
• Metrics Drive Valuation — Net retention above 110%, gross retention above 90%, and >75% gross margins increase valuation and buyer interest.
• Run a Real Process — A single buyer gives you no leverage. Multiple qualified buyers improve pricing, terms, and closing certainty.
• AI Is Lipstick — But Real — You don't need to be AI-native. Practical AI that improves product, margin, or GTM still increases buyer interest.

Quote from Gaurav Bhasin, founder and managing director of Allied Advisers

"The good news for SaaS founders is that the private equity community has raised about $1.5 trillion of capital, and more is being raised. And they also have access to debt. So there's $7 trillion of dry powder to do deals. Private equity is not paid to sit on the cash. And they love recurring revenue software.

"Private equity investors will typically move much faster than strategic buyers. Strategics will take a while. You need a business unit sponsor to buy into the vision, and then they will push the corporate to do the deal. But with the private equity, they will look at your financial metrics and if you fit in, they can move pretty fast.

"The one caveat with private equity compared to strategic is they generally pay a little bit less than the strategics because strategics have established distribution and GTM for higher growth, so private equity will index more on the financials."

Links

• Gaurav Bhasin on LinkedIn
• Allied Advisers on LinkedIn
• Allied Advisers website
• 2025 Vertical SaaS Report - Allied Advisers

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