Finding online articles to help you with your business is pretty easy. The problem is that most of the time you need personalized help to secure investors, advisors or partners. So where should you go? Try Axial. The all-in-one network for private companies to connect and grow with all of the resources available to fuel your company expansion. With over 22,000 customers, Axial is allowing companies to close deals faster than ever before
Today we sit down with with Axial CEO Peter Lehrman to get the inside scoop on their growing network as well as their latest round of funding.
Who were your investors and how much did you raise?
Our Series C was a $14M growth financing led by Edison Partners and joined by our existing investors Comcast Ventures, First Round and Redpoint Ventures.
Tell us about your product or service.
Axial is the largest online capital market for private companies. Since our launch in 2010, Axial’s network has grown to include 11,000 capital providers and private companies who use its online capital market to identify, connect to, and close M&A and growth financing deals. In 2015, Axial’s members signed over 11,000 non-disclosure agreements and closed 672 deals, representing $5.8B in revenue and $1B in closed deal volume.
What inspired you to start the company?
I’ve always been inspired by what I call America’s “original” entrepreneurs – owners and operators of private, middle market companies whose companies they have built over decades and across generations. These entrepreneurs focus on pursuing deliberate, profitable growth. Rarely if ever in the news, these entrepreneurs and their teams form the backbone of the U.S. economy, the most important and largest economy in the world.
Axial aspires to be a champion and resource for all of the world’s entrepreneurs, but it is for this vital category of under-served entrepreneur that Axial uniquely seeks to serve.
How is it different?
The key difference is the market we are targeting. There are hundreds of platforms, crowd-funding and otherwise, that focus on enabling access to capital for the Main Street market (local businesses) and for the start up community (pre-revenue companies). Our core focus is on entrepreneurs running profitable, growing companies and seeking partners to help them accelerate that growth or provide an exit opportunity.
What market are you targeting and how big is it?
We have three core customer segments: middle market entrepreneurs/CEOs, boutique investment bankers/M&A advisors, and capital providers who invest in or acquire private, middle market companies.
Each year, there are about 10,000 recorded transactions in this market in the U.S.
What’s your business model?
We charge annual subscriptions to our members for tools and solutions that help them identify great investment opportunities. We offer both free and subscription-based tools for CEOs and qualified M&A advisors depending on their objectives.
Do you have plans to expand into startup financings?
No, it’s not our focus right now.
What was the funding process like?
We’re in a very challenging funding environment right now. Companies must have proven models and real momentum to raise capital in this environment. We are very excited to be working with Edison Partners, we share a lot of the same philosophy for how to grow companies and we think we can learn a lot from their experiences.
What are the biggest challenges that you faced while raising capital?
Axial’s marketplace is elaborate and nuanced. It takes time to understand how it works, and it takes time to understand the market niche we’ve chosen. Many investors want something simpler.
What factors about your business led your investors to write the check?
We are the market leader and category creator in a niche that they understand and that they believe is attractive to pursue. They also have confidence that they can be a great partner to us in scaling certain parts of our business and we agree w/ them — they’re thorough and deliberate thinkers and bring good perspective on how to grow profitably and correctly.
What are the milestones you plan to achieve in the next six months?
The growth capital we raised will lets double down on two focus areas, scaling the size and diversity of the Axial network and improving the quality and precision of every user’s experience. We believe these are the two areas where we should be obsessed. There are milestones associated with these goals. For example, earlier this quarter, we celebrated the 5000th CEO joining Axial, and we’re setting our sights on even larger benchmarks for gaining marketshare in our three core customer markets.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Have a real plan, no matter how painful it might be, for what you must do and how you can survive if you don’t raise capital. As the founder / CEO, it’s your job to have this plan in your hip pocket no matter what. Work on it w/ your head of finance.
Where do you see the company going now over the near term?
Like I said, we are obsessed over the near term and the long-term scaling the size of the network and radically improving the precision and quality of the user’s experience. We think this focus network size and quality of experience is the only thing that matters.
What’s your favorite restaurant in the city?
Heidi’s House in the Upper East Side.