In order to achieve the rapid accelerated growth Contegix, a company co-founded by Matthew Porter, built into its core values, the company needed to do something truly transformational. It tested the markets, but felt both the market and the company weren’t exactly ready. Contegix, Porter says, was having a hard time telling its story because of the technology behind what it was doing.
The company also had a cap table that wasn’t very forgiving, and was hindering the progress towards taking its next steps as a purely privately held self-funded organization.
“We had some minority shareholders that came in early on,” Porter says. “Great team, great focus, but they had a different priority than I did as a CEO.”
The company was eventually approached by a private equity firm. Porter says he spent a lot of time going through diligence, interviewing the suitor to see if they were qualified to take the company top the next level.
In November 2016, the private equity firm Strattam Capital made a majority investment in the company. As part of the transaction, Contegix got a new CEO, and Porter took on the role of Vice Chairman, one he continues to hold today.
A mentor of his who advised Porter through his transaction insisted that he take time off. So within a couple days of signing the documents, Porter took a full year off.
He dove headlong into family, and other interests and pursuits — running ultramarathons, fundraising for multiple sclerosis research, and more. Two years later he joined Invisibly, where he remains today as Senior Strategic Advisor. But he’s made it clear to the leadership at the company where his priorities are: His health, his family, the communities he serves and then the company.
Reflecting on his journey, he says entrepreneurs and business owners looking at an equity transaction or exiting their business should first understand who they are beyond their title.
“I’ve had, probably in the last three years, close to two dozen people come to me and ask me about the transaction,” Porter says. “I give them all the data and all the details that I can. And their question then is, ‘What advice do you have?’ And my only question to them is, ‘Who are you?’ And if they tell me that they are president, CEO, owner, and that’s how they start off, then I typically tell them that they might not be ready.”
Porter says a friend of his sold his business and made a significant amount of money, but then after the transaction went into a deep depression that persisted for eight years.
“Because he had been working so hard that he lost track of who he was somewhere along the way,” Porter says.
Today, Porter says he’s happy with how the transaction worked out. At the time of the event, he was still a member of the board, and says the firm is still aligned with the company’s culture and core values.
“It was just a phenomenal experience to the point that we had zero re-trading from our LOI ‑there was nothing that changed from our LOI to the day we signed. And that is fairly unheard of. But both parties committed to zero re-trading.”
After the transaction, Porter connected with a friend who agreed that taking a year off was the right move. The friend suggested that Porter had PDAF: Post Deal Adrenaline Fatigue. It comes after running the business, and yourself, at 150 mph. Disconnecting from that requires an adjustment — time away from business to re-calibrate and refocus before taking on the next venture. And in Porter’s case, using the long lengths of time he spends running to reflect.