Launching: The Big Exit Show


Launching: The Big Exit Show

Founders, listen closely👂

Peak is launching our very own podcast series: The Big Exit Show! In this series, journalist and podcast-host Remy Gieling and our managing partner Johan van Mil, will talk to successful European tech entrepreneurs about the exit of their company.

Sure, we will talk numbers – what really everybody wants to know, like the exit value 💶 – but more importantly – What did they learn? And what will they do differently in the future?

Our aim with this podcast is to energize⚡️ ambitious founders on their bumpy ride to success. We want to inspire entrepreneurs by telling the stories and lessons learned of the people that have already walked the walk.

Remy Gieling, Geert-Jan Smits and Johan van Mil

In this very first episode we talk to Geert-Jan Smits who sold his furniture e-commerce company Flinders Design in 2021 to the Danish company Nine United. In this episode you will learn all about the advantages of founders personally investing, why involving the founders is key in successful negotiations, how to get multiple potential buyers around the table, and much more.

Episode on Spotify

We will launch an episode every two weeks. You can find them at your favourite podcast platform. If you are really interested listening to the big exit of specific founders, reach out to us so we can invite them for a next episode!

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You can find the transcribed version of the first episode below:

Remy: Ladies and gentlemen, welcome to the very first episode of The Big Exit Show. The podcast brought to you by Peak, where we talk to successful European tech entrepreneurs about the exit of their company and the path, how they got there.

My name is Remy Gieling, journalist, public speaker, and podcast host. And, our co-host is, as always, the co-founder and managing partner of Peak Johan van Mil. This is our very first episode: Why this podcast?

Johan: I think the main reason is that I’m personally a frequent listener of podcasts. And what I like, especially in podcasts, is that you can find topic based relevant subjects.

If you want to hire a VP sales, or want an international reseller network, or whatever –  that’s a very easy way to get some information. And what I found is that the most important thing in life for a founder, but also for a VC of course, is that the most important moment is of course an [00:01:00] exit. And it’s very hard to find relevant information from podcasts on exits.

So that’s the main reason why we as Peak have started this podcast. To spread out the good news on exits, not only content on this topic, but also to share learning from founders, who’ve done it, and who recently sold their company.

Remy: What’s our promise to the listeners? What do we hope they get to learn?

Johan: Exiting more of course. But apart from that, I think it’s mainly learning from others, how they can exit the company, and always realize that there’s always a sun behind the clouds, right? Because, I think we all as entrepreneurs know that it’s very hard to run a company these days, and it can be really struggling.

And once you hear, you know, energetic stories of other companies, other founders, which just sold their company, I think it’s a massive motivation. So it’s also, for me, that part is important.

Remy: And we know your time is limited, so we try to keep it to 40 minutes or less. And we start with the beginning, what’s their origin story. Then we move on to their growth phase and we end with, as you guessed – the exits. [00:02:00]

And for the very first episode we asked Geert Jan Smits, co-founder of the very successful Dutch furniture store Flinders to join us. Johan,  you have a close relationship with Geert Jan, how did that came to be?

Johan: Yeah, because we at Peak we’re the first institutional investors in Flinders. So we’ve been on that path with Geert Jan, partly.

Remy: Yeah. I interviewed Geert Jan last year for an article about starting businesses during crisis, which he did twice. And what struck me was that he thrives on head wind. He says a crisis is the best time to start a new company. Do you agree with that statement Johan?

Johan: Fully. I think it’s because a lot of successful companies we see nowadays, like whether it’s Uber or Airbnb, I think the best moment to start a company is when things are really changing. Not only, you know, in society, but also in terms of funding, also in staff needed, and so on. So it’s the best time to start, and to kickstart your company.

Remy: Let me introduce our guests. After a few years of working with a consultancy firm, he knew it was time to venture on his own to start Jungle minds [00:03:00], a leading Dutch internet consultancy firm in the Netherlands and Belgium. He made an exit in 2010 to start Flinders, the design furniture store that sells beautiful interior products that make you smile everyday.

Flinders has about 120 employees, about 36,000 items in stock, a warehouse of over 9,000 square meters and over 23 million euros in revenue. We will talk to him about scaling companies and making exits at the right time. Ladies and gentlemen, Geert Jan Smits. Welcome.

Geert Jan: Thank you.

Remy: Hey Jan, we always start with a very simple question.

What’s the heroic origin story of the name Flinders?

Geert Jan: Well, that’s a pretty good one. Maybe you know Matthew Flinders? He discovered, a long time ago, Australia. And we thought just like Matthew Flinders, we want to discover the unique design furniture industry, for everybody so that we can make it accessible.[00:04:00]. Good story, isn’t it?

Johan: That’s the heroic story. What is the real story here?

Geert Jan: Journalist liked it, you know, that we are discoverers. But the real story is that me and Matthijs Kanis, my older partner who founded the company as well, we drank some whiskey at night, and we were thinking, okay, we’re going to start a company. Let’s look at a name, and we don’t know it yet. So another sip, and another one, and another one. And I think after a few hours, we discovered Flinders as a name. Yeah. Well, of course we looked at the URLs if it was still available, and I think for $5,000, we bought a new URL.

Remy: The first thing you remember about starting Flinders, what was it? Was it the first day?

Geert Jan: First day. Well, I was still in the office of Jungleminds. I rented a small area, and it was easy because then we had at least [00:05:00] lunch. Um, yeah, it was pretty opportunistic because I knew nothing about design, nothing about the industry. Uh, I knew no brands, no labels. I just thought, well, I know a lot about digitals, so it should be easy to start a fresh new web shop. So the first day was full of energy and well, let’s do it in a few weeks and, uh, start a company.

Johan: And then, one year later, how was the first year?

Geert Jan: I can say it was pretty tough.

It took about a year to build the web shop. That was, uh, pretty intense. I think we were pretty good in estimating the costs of the company, but the revenues were less than 50% of what we expected. So yeah, we didn’t make any profit the first years. So it was pretty tough.

Johan: Okay. And you mentioned that it took you a long time to get a webshop, right? Those days you didn’t have any Shopify solutions, etc.

Geert Jan: No, it was own built based on the Magento platform [00:06:00], but still a lot of own built software. Even the check-out, it was fully built by ourselves.

Remy: Most entrepreneurs start with that they see as a problem in the market – Which problem were you trying to solve?

Geert Jan: Well, I think it was pretty clear because especially in the design furniture business, when you try to buy, say a vitra chair, you have to go to the local store and together with an advisor, you said, okay, I want to pick that one with a wide shelf and the nice wooden legs. And then the guy says, okay, that takes eight to 10 weeks. And then, then it will be at your home.

So that’s the problem. You know, in those days it was normal to wait six to 10 weeks for your furniture.

Remy: So you wanted to design furniture the next day delivered, basically.

Geert Jan: Yeah, basically like the kubelet model where you order online today and it gets delivered tomorrow. And it wasn’t in those days. [00:07:00] Definitely not.

Johan: How did you handle that at that time? Because I think the producers, the brand owners were very strict, especially on who would sell these kinds of brands online. How did you do that?

Geert Jan: Yeah, it was pretty difficult because all the nice brands said, “How many meters do you have for me?”. And I said “How many meters? I’m going to build a web shop”. The brands: “Uh, no, no, no. I want to know where the store is, and how many meters do you have for me?”. Yes, physical meters, yeah, they were thinking meters. And I said “Well, we are based in Amsterdam”. “Oh no, no, no, no, there are a lot of stores already in Amsterdam, so it’s definitely not possible to become a dealer.” ”But I’m going to be an onliner”.

And they said “Online, we don’t know anything about it.” Especially the guys from Italy, you know, the internet penetration there was like 5% or something. So they didn’t appreciate the internet.

Remy: But the Scandinavians did, luckily?

Geert Jan: They did, yes. And they were pretty new. And happily for us, big brands now, Scandinavian brands like Hay, Muuto, Normann Copenhagen [00:08:00], were then very small. And I think we were one of the first dealers in the Netherlands selling those products online as well as offline. And that helped us to start. We really started as a startup. So we started with a lot of young people. I think the average age was like me, 24 or something. No, I was a little older, but the average age was about 24, 25.

Remy: You actually started out with one developer?

Geert Jan: Yeah. I still know his name because after one year he told me “Hey John, it’s okay to stop. It’s okay. It’s okay that you stopped playing this because it’s not working”. And he left the company because he didn’t believe in it anymore. But it gave me a lot of energy to continue the journey, and not to stop.

Remy: It takes some guts to tell the founder of a company, as an employee “Well, maybe you should quit. You should quit”.

Geert Jan: Yeah. He said, it’s okay to stop, you know? He was a little older than [00:09:00] me, and got some more experience. And in those days it was pretty tough. You know, we lost about €400,000 a year and I had to pay it for myself.

Remy: You actually had to sell your house?

Geert Jan: Yeah. Yeah. It’s not a good story. Especially when you have children and wife, that’s not really happy with the fact that you’re selling your house, but, the only way to go on was to invest in inventory. So it was more inventory and continue doing what we were doing, or stop the company.

Johan: To pre finance the furniture, right?

Geert Jan: Yeah. That was the basic model. So first you finance the furniture to stock, and then it’s possible to sell and convince people to buy with Flinders because they get it the next day.

Johan: How much money did you personally invest in Flinders?

Geert Jan: 1.2 million.

Johan: Wow.

Geert Jan: Yeah, I had to look it up when I exited. Yeah. And that was enough for me back then. Yes.


Remy: And based on your reaction, Johan, it’s not the case with all entrepreneurs?

Johan: No, certainly not. No, no, no. I think normally you would say everything between 10 and 200K max, but normally not 1.2 million euros. You’ll never see that.

Remy: That’s pretty crazy.

Johan: Yeah. It’s pretty crazy. That’s a firm belief.

Remy: The growth phase. When did you notice that you really started to get traction, when you figured out “Wow, we really got something here.”.

Geert Jan: I don’t know if it’s clear to really point a date. Uh, you know, the first year we did 300,000 euros, the  second year 900,000, and a year after one and a half million. So we grew all the way from the start, where we didn’t make any profit.

Um, but more and more people were talking about Flinders. We got some returning customers, visitors. So I think after three years we could say, we’ve got something that’s here to stay, [00:11:00] I would say. And we were reaching towards profitability, always reaching to where she could say.

Johan: And you already sold your house, right?

Geert Jan: Yeah, there was only one. I think a year later it was time to look for external capital. Yeah, in 2014 I believe it was.

Remy: Because retail is a low margin business. How did you manage to scale up?

Geert Jan: The conclusion was you need external capital for that, to really be able to scale up, is the only way.

And what we saw in our market is there will be only one winner in every country, and we want it to be the one, in the luxury segment.

Remy: How did you figure out where to find the money? Because you can always maybe go to a bank and say, we need inventory. So just give us the money and we’ll pay you [00:12:00].

Geert Jan: Yeah. You could say that, but you know, it was 2010., Even in those days, 2010, 2013, the after days of the financial crisis. So banks didn’t lend anything. We couldn’t get any money because we also didn’t make any profits.

Remy: So did you try it, did she call him?

Geert Jan: We tried everything, you know, and the only guys that didn’t say no, of course, were the VCs.

Geert Jan: I think I made a round of, I think about 20 different venture capital firms and we all told the story. And then you find, okay, this one is not really interested in the sector we’re in, or in the phase that we were in.

Remy: What made you decide whether this was a good venture, Johan? Because these days Peak is more or less a SaaS company. You’re looking for young, ambitious SaaS companies.

Johan: And platforms and marketplaces.


Remy: Yes. But Flinders was an inventory company?

Johan: Yes. Yeah, we did this investment from our second fund, from Peak Two.

And at that time we had a broader scope than we currently have with the fourth fund. So we also did e-commerce in addition to marketplaces, SaaS companies, etc. So a different, and a broader angle. But what was really convincing to us, was Geert Jan as a founder. Because I think if you want to invest in a young company like this, you want to see the energy, the belief of the founder, right. And if a founder, as you just mentioned, right, put in 1.2 million Euro of his own money, yeah.

And therefore, – I still remember when you did the pitch at my office at that time, because we didn’t have a Peak office because we are all running our own companies. So, you’re pitching at my, uh, I don’t know which company it was actually, but one of the companies I started, and I remembered that you had a product guy doing the pitch. And he wasn’t, I still remember that, he wasn’t a shareholder. And he was very young guy, but really [00:14:00] ambitious, and had a though belief in the company. Right. And I think as an investor, as an early stage investor, you want to see that, you want to feel that. And I think that’s completely… that’s what happened, right.

Remy: That’s interesting, because I, as a simple journalist, imagined these pitches go, as the founder goes in and he’s as convincing as he can be to pitch the company.

But you decided to let one of your employees do it?

Geert Jan: So, we did it together, but I wanted to show that Flinders wasn’t just me, you know, there were more people involved and they were also enthusiastic and full of skills. So that’s why I decided to bring someone along.

Remy: Is it a common practice?

Johan:  No, never seen it.

Never seen it afterwards, that somebody lets one of his employees do the pitch, but I think it’s very smart, right? Because I think mainly all VCs want to invest in, you know, a multi-founder team. So, not a single founder. And Geert Jan was a single founder. Of course you had a co-founder who was not active in the [00:15:00] company, but more an investor in the company at that time.

But by presenting himself also with another employee in this case, you got past that point also, right? You pitch yourself as an entrepreneur with the entrepreneurial vein in the blood of your employees also. And I think that’s a really smart way to pitch your company.

Geert Jan: That’s what we always try to do, you know, to get the feeling to all the people around you and make them as energetic as yourself.

Remy: What’s the biggest (I always like failure stories), a big failure in the growth phase of the company?

Geert Jan: Ah, there are too many.

Remy: What were some of the hurdles you faced back then?

Geert Jan: Yeah, a lot of hurdles and, uh, but that’s okay – I always say fail fast. So, you know, try everything, especially in the starting phase of your company, and see what works and what doesn’t work.

Remy: You tried a lot – you opened stores at some places?

Geert Jan: Yeah, I think we tried a little bit too much in hindsight. Uh, we started in China, actually. I think that was too opportunistic afterwards, when you look back, but you know, [00:16:00] I live in Amsterdam and when you went on the bike, or if you saw all those buses full of Chinese people to buy all that expensive stuff.

So I thought, well, why do they go all the way to the Netherlands? Why don’t we sell beautiful stuff in China? So we started a T-mall Flinders store, with of course, a beautiful design. But it had nothing to do with our strategy of becoming a market leader in Europe.

It was an amazing, good idea. So why not do it? But you know, we started and then you find out that the transportation from Amsterdam all the way to a local Chinese person, that’s almost impossible. You know, we don’t know the language, so we didn’t have any customer servers in China. In Chinese. We didn’t have local online marketing.

We couldn’t do that. Uh, yeah, we all had to do that locally in China, but we had no presence in China. So it was all from here that we had [00:17:00] to hope that it was going well. Well, there were some sales, but especially during a, a double 11, uh, without any profits. So yeah, I think after two years we had an amazing time.

We learned a lot and we thought, well, that’s, that’s enough.

Remy: Well, you could say you were multinational back then, so that’s definitely something.

Geert Jan: Yeah, it was a good story I think. I think after Ahold, we were the second company active in China on T-mall. Well, not successfully, but we were second.

Johan: But I think this is good, right. To do, to just test it as an entrepreneur, right. Test and validate to see how it works and stop it.

Geert Jan: Exactly. And then when it doesn’t work, stop it immediately. Don’t cry about it. Just learn from it.

Johan: What is a decision you should have taken faster?

Because there is a decision you’ve taken, right? This decision where you look now back, and think I should’ve acted on that faster.

Geert Jan: Um, we also were active in Germany and we thought it was our dream to become the [00:18:00] market leader in Europe. So, Germany is a very big country and very interesting, but we also heard a lot of web shops from the Netherlands failing in Germany actually.

It’s yeah, pretty difficult to be successful there. It’s such a big country and transportation costs are twice as high as in the Netherlands or Belgium. The returns are twice as high as in our own country. Uh, so I think we could have decided earlier to stop there. And purely focused on the Benelux.

Remy: You are a single founder, or at least you had a co-founder, but he wasn’t, uh, especially involved with the company, just as a shareholder.

Who did you go to for advice, or for inspiration? Some people have a coach, some people go through growth programs. What did you do?

Geert Jan: Yeah, I’ve actually a small group of friends that were also entrepreneurs, three of them, and they were almost in the same phase as I was with Flinders.

And I think we talked to each other on the phone [00:19:00], by chat, or in the restaurant, with too many drinks of course. And then the bills, they were always too high. And I don’t know why, but they really helped me. And I think we help each other.

And, uh, that really helps, you know, to be able to tell a story or ask a question or a problem to two guys that have the same experiences. That’s really, really good, yeah.

Remy: Find some people around you who are going through the same motions.

Geert Jan: Yeah. And in a totally different sector, but you know, in the same phase of growth.

And of course next to that, the external investors also can really help. Have a good network and can contact other people that have the same experience.

Remy: The exit phase. Jan, what was the moment you decided for yourself, you wanted to make an exit [00:20:00] out of this amazing company that you built?

Geert Jan: I’m not sure if it’s a decision you make yourself. I think you make it with a team. And also Johan played a pretty big part in that. Um, but it was okay.

You know, you have conversations about the next phase of your company, and we decided there were two different routes to take. We could do a buy-and-build strategy, or sell a hundred percent of the shares. And for me, the second route of selling a hundred percent of the shares was something I had to digest first and think about – is it the right timing?

But you know, after a few weeks, I thought, yeah, what the fuck? This is good timing. I’ve been doing this for 10 years. And, well, maybe that’s good timing.

Johan: And when did you decide, when did you start thinking about, you know, preparing that buy and build?

Geert Jan: It was like January, 2020.

Yeah. Um, and I think the good thing was I started with a round [00:21:00] again, drinking coffee with all the various parties involved, like the strategic partners, venture capital parties, and I found out that they really appreciate to talk to the founder first, before getting a deck, you know, from a financial advisor and with a big story and all the things.

So I think in the first month, I just drank a lot of coffee, and I could already feel if there was any interest from the VC, but also get to know the different parties a little bit better. I think that was excellent.

Remy: Thank you. Did you have a few companies in mind who would be able to acquire Flinders and then take over the legacy?

Geert Jan: Yeah. I think there was a list of, say five to 10 different companies. And in the end, those companies were the ones that were really interested. And although we hired an advisor that contacted maybe a hundred extra different companies and VCs, but in the end it is that [00:22:00] personal contacts you have that really makes a difference.

Johan: Yeah. I think that’s also very relevant, right? If you sell the company, I think you should have enough appetite for getting the right price for the company. So if you have then only one potential buyer, then you have a limited price effect there. So you want to talk with as many buyers as you can.

Remy: How do you go in with these talks? Did you do it together with Johan?

Geert Jan: Uh, I just did it alone. We went to a lot of cafes and just, you know, had a coffee, and I found out that they really like to do it and it was interesting.

Johan: I think that’s really great how Geert Jan handled that. A big compliment to him.  Because, I think the founder should always have these talks, right?

But I think Geert Jan’s big benefit is, you know also in this podcast  – he’s a very nice guy, always very energetic, but also very friendly to people. So if there’s one guy or girl who can sell the company, right. It’s the founder.

Remy: How did you, how does that feel for you? Because it can also make me [00:23:00] feel a bit lonely that you are there on your own making these big decisions for lots of people back at the office.

Geert Jan: Yeah. Yeah. But on the other hand, I think as an entrepreneur, you’re always a little bit lonely, you know, in the company nobody ever will give you a, how do you say it? A compliment. Yeah. It’s pretty lonely. ButI’mused to that I think.

But of course there are always friends around you, but within the company it’s yeah, I think you’re pretty alone.

Remy: Moving up to the, to the part that realizing: Well, maybe it is time to start to sell a hundred percent of the company to another one. It must feel a bit… Like, did you have a process of mourning at any point?

Geert Jan: No, I think it’s more of a process of liberation you could say, because I think every person has his own sweet spot, and where  it fits the best in the company. [00:24:00] And for me, it’s, it’s in the starting phase. That’s where I get the most energy, but also where my role is the best, I think. So after 10 years of working for a company, although it’s your own company,I think my personal involvement is less. So, for me it was more like a liberation not to have all the talks and the daily meetings anymore. Yeah, for me, it was good.

Remy: You didn’t feel sad at any point, that you were leaving the ship behind?

Geert Jan: Uh, at one time, yeah. One day you’re the big CEO of an interesting company, and the next day you’re just alone and nobody’s looking at you.

And so that’s something, yeah, you have to digest I guess, but, um, it is good. That’s healthy, I think.

Johan: To me it sounds, or feels more like an emotional decision, right? When you sell your company, but you somehow didn’t take it emotionally, right? You take it pretty rational.

Geert Jan: The whole process took one year.

So you have one year of time to digest it. But I think for me personally, [00:25:00] it was a good step. And I think you also helped me learn that it’s a good step too, you know, when one sells the company.

Johan: What was your personal motivation to sell the company at that time? Because I recall the discussion that we had, right.

To go either for a buy a build route or for a sale of the company. What was your motivation then?

Geert Jan:  I think for me buy-and-build was good as well, because then I could be entrepreneurial again, you know, buy other companies, becoming larger and bigger. But more and more the talks went into selling a hundred percent of the shares.

So more and more, I felt, well, that’s a good way to go.

Remy:  You talked to a lot of people about this process, what did your entrepreneurial friends say? What did your wife say about it?

Geert Jan: Yeah, follow your heart and follow your instinct. And you know, you can make it as rational as possible and look at the valuation and the price, but within the end I don’t think that that’s the thing that makes you most happy. For me it’s to be an [00:26:00] entrepreneur, and to start a company is what really motivates me. So the first thing I did when I sold the company was to set up another one.

That’s what all the fun is.

Johan: How did that process go? Because you just mentioned, right, you took the decision in January 2020. The deal was done in December, 2020. So it was a year. How did, roughly, that process go?

Geert Jan:  Yeah, I think for a month or three, there were coffee talks, and my personal talks with potential investors or buyers. Uh, and then Drake star for us came into play and they made the deck that took us two to three months – pretty long, but I think it ended, it was the summer. So we decided to start the actual process after summer, and give the potential interested companies two months to talk to us, to [00:27:00] the management, to look at the deck and to make a potential evaluation, all at the same time.

It was in September, October, and then we had two months of negotiations.

Remy: What were some of the non-negotiables for you?

Geert Jan: Non-negotiables… That was probably stopping the store. What we did. No, for me personally, the buyer was only interested in online. But actually Flinders was a multi-channel operation, and I was pretty proud of the store that we set up in 10 years time with a lot of sweat and work.

Remy: Yeah. Very cool interior as well.

Geert Jan: Yeah, we had a great name, but still the buyer said we only want to buy the online part. So it was my personal thing to understand that we had to close the store and also say [00:28:00]  bye-bye to the store personnel who were 14 people that had to look for another job.

Johan: I have a feeling that was the toughest decision for you, right? Not to sell the company for the amount, not the term, but I think really closing the stores?

Geert Jan:  Yeah, closing the store, and especially the people that I worked with, for some of them nine years, and to say, “I’m sorry, there’s no room for you anymore here”.

So that made me decide after the exit, for three months, I was involved in helping these people find a job. Yup.

Johan: Yup. I think you handled it really well, also to get an understanding from the board of employees. Sorry, the works council.

Geert Jan: Yeah. We got a positive advice from the works council, even though we had to close the store. I think that’s a pretty good accomplishment.

Remy: You eventually decided to sell to Nine United. Um, what was the reason you chose them, or they chose you? What was the reason for this marriage?

Geert Jan: Hmm. [00:29:00] I think it’s especially a strategic decision because we see in e-commerce that it will be one winner in Europe.

So you have to become the biggest in Europe because of the inventory, the cash management, and all the things. Like Zalando, there’s only one winner. In every sector you see the same. And I think together with Nine United, a group is created of e-commerce parties that will become the market leader in Europe.

So to become part of that movement, of that company is very interesting. And it’s probably the best way to keep Flinders alive.

Remy: How long do these negotiations take? Finally, when you knew, okay, this is the people we want to sell to. How long did it take for you to get to an agreement?

Geert Jan: Well, I think there are two different agreements. The first agreement is about pricing and evaluation, and I think that was [00:30:00] done in a few days, actually a few weeks.

Remy: And, and how did that go in COVID times? Did you zoom, did you send emails?

Geert Jan: No, we never saw each other in real life. Pretty crazy. Yeah. It was a few couple of phone calls and sometimes a teams meeting, yeah.

But after the agreement on the valuation, then, you know, the real stuff happens and all the talks with the lawyers and about terms and conditions and that, actually took two to three months. It is a little bit the boring part.

Remy: Is that a long time, Johan?

Johan: No, no, it’s not a long time. I think it’s really bizarre how long it normally takes, but you see this a lot.

Remy: And maybe without going into the details too much, what are some of the points you, you negotiate about with these lawyers? And I’m asking, because I’m gonna imagine that a lot of the listeners are wanting to get this sort of feeling. What are the points on the table?

Geert Jan: Yeah, I think to put it very [00:31:00] simply, is that the buyer is putting a lot of money on the table, and wants to be sure as much as possible that what they buy is really there.

So, if you say it’s a great company, they want to know it’s a great company. Also two years later, that there are no dead bodies in the closet, or something. A lot of things can go wrong, also after the selling part. And you want to have that in writing….

Johan: I think it’s mainly certainty, right?

It’s also about that the cash is in the company, that they’re the right contracts, the right IP, etc. I think that’s the most important one. Valuation is just a pretty small part.

Remy: It’s interesting, because that’s all the media writes about.

Johan: Fully agree. I think if you sell, or even buy a company, evaluation is important, but there are other things which are at least as important as well. So yeah.


Johan: Can you tell us about the negotiation, because that also went a little bit different than what we normally see at Peak. How did it go? Especially with the last buyer eventually buying the company, Nine United.

Geert Jan: Yeah. Uh, Nine United is owned by a pretty eccentric guy. He’s very well-known in Denmark, and is pretty rich too.

We can say that I think I can say that. And he actually said “I always want to talk only to one person. I only want to negotiate with one person and it can never be an advisor. It can never be a lawyer. Only want to talk to one guy, or girl. You can pick who it is, but most of the time it’s the founder”. So, it was me. I actually did all the negotiations, also about the shitty stuff, I had to do it all myself together with him. So that’s pretty amazing. [00:33:00]

Johan: That’s pretty bizarre, right? Because, uh, if you sell your own company, that’s logical, but as a founder, you will sell your own company, but also a company which is owned by other people. And not always the interests are fully aligned, right? Because we also have other interests, in a lot of cases, then in this case Geert Jan has. So we are trusted as a VC, but also RTL. Also from the other shareholders. We had so much faith in Geert Jan doing these negotiations on behalf of us.

Remy: Because normally you would want to have the seat on the table?

Johan:  Yeah. Or normally we would have a seat on the table, or our investment banker, that we hire for this, but normally not a founder, but in this case, this trajectory went so strange. And also this guy, buying the company is pretty eccentric, also in his approach. So, we decided to go for that route, which also says a lot about the trust that we have in Geert Jan, because we depend fully on him as a founder.

Geert Jan: And I know the best advice in, at one point in a negotiation. Okay, Geert Jan, stop negotiating. Because I know I like it, I see it as a game, but we [00:34:00] knew altogether that if we would go on and on and, you know, asking more of them, this guy was able to go out, and stop, walk away and never come back.

Remy:  One of the rules of exit negotiations, which I have read in a lot of books,  is that you always have to walk out at one point to make a statement.

Geert Jan:  That was my idea as well.

Remy: You want to put your hand on the table and say, I’m going out. This is it.

Geert Jan:  I definitely have become angry sometimes. Not at this person, but as colleagues, I didn’t cry, but I was a little angry, but no.

Remy: It’s hard to walk out in a digital meeting as well.

Geert Jan: Yeah. That was pretty strange. Right.

Remy: Um, what’s your personal plan for the future? What’s your next step? And you’re a free man.

Geert Jan: I’m a free man, [00:35:00] so I can do what I like most to do. And that’s, uh, start a new company, become an entrepreneur again.

Johan: Always, entrepreneurs start back there again.

Geert Jan: Yeah. Also a little bit of investing in young companies, but, I just started two companies already in the first month.

I am especially to say I can do it a little bit differently than I did with Flinders, because I have a little bit of money now, so I can hire good people. Um, I won’t be too operationally involved, so that’s making it even more fun.

Johan: That’s always what they say, right? When an entrepreneur sells his first company or her first company, then the second company, he will do completely the opposite, what he did of the first company.

So what’d you see a lot is that the second company fails, and the third company is the company that you typically should invest in. So I wonder what’s the third idea that I should invest in?

Geert Jan: I think we’ll go now for worldwide dominance. So yeah, this will be a good one.


Johan: Yeah. Can you tell me something? What will the company do briefly?

Geert Jan: Um, simply said it will be a circular wholesaler, so we will sell bio-based circular materials to them. The furniture industry and the interior business.

So we’re not doing retail anymore, but we want to supply better materials that are circular and actually bio-based, instead of all the toxic, shitty materials that are being used at the moment, right.

Johan: And more and more woods are used for that. So you bring it back.

Geert Jan: Yeah. So we make it circular. And actually, I just started together with a few friends, a SaaS company – but that’s another thing.

Johan: Ah, that’s the second one! The one I was hoping for.

Remy: I think you will just continue this conversation later.

Geert Jan: In a year, I’ll get back to you, right.

Remy: Now it is the final segment. We make an educated guess about the valuation. Um, and you Geert Jan can only reply with the words correct, higher or lower. [00:37:00] Let’s listen to one of the members of Peak, who reads a column about the valuation in the Dutch finance.

Valuation: All right. All right. All right. The moment we’ve all been waiting for, or rather the juicy stuff. What everybody wants to know, the valuation. The purchase price of Flinders was actually not disclosed. So the leading financial newspaper here in the Netherlands pronounced, excuse me, Het Financieele Dagblad, or simply the FD, for all my fellow English speakers, decided to try and figure out how much Flinders was acquired for. So, they looked at different documents, and they created a little calculation, and they ultimately arrived at an valuation. I looked in to see what steps they followed, and I’m going to present them here.

We can follow their logic and then see, okay, how much was Flinders bought for?

First the FD dug up the annual report from [00:38:00] RTL Netherlands, the investor who invested in Flinders in 2017. At the time RTL invested 3 million for 20% of the company, that put Flinders at a 15 million Euro evaluation in 2017. Then the FD looked at Flinders revenue in 2017. At the time Flinders had a 10 million euro turnover.

So, a 10 million euro turnover, and a 15 million euro valuation, means that Flinders was valued by RTL with roughly a one and a half times multiple. So a 1.5 X revenue multiple. Fast forward to last year, Flinders sold 27 million euros of goods. They had a 27 million euro turnover. If we take the same revenue multiple as before., one and a half times, or 1.5 X – that would put Flinders at around 27 times 15 million at around a 40 million euro valuation at the time of exit. The FD also looked into their competitors. [00:39:00] Flinders is after all, not alone in the market. So the FD researched into the IPO performance of West Wing, which is the German based competitor.

West Wing went public in 2018. Their share price is roughly two times higher, so two X than their turnover. Which is a pretty big step up. So, one and a half X compared to a two X revenue multiple.

Assuming Flinders was valued by the market similarly, their two X 27 million turnover, puts Flinders at around a 54 million valuation.

Remy: So, Geert Jan, Johan, what is it?

Geert Jan:  Of course, you know, I cannot say anything about it, but I would say it could be a little bit lower.

Remy: Ladies and gentlemen. Thank you so much for listening to this very first episode of The Big Exit Show. We hope you enjoyed today’s program. If you did, please subscribe to our show at Spotify, or your [00:40:00] local podcasts platform. And if you have any feedback, please send a message to [email protected]. My name is Remy Gieling and my co-host today was Johan Van Mil.

Thanks again for listening, and we hope you join us at the next episode!