The Investor With Joel Palathinkal

The Investor with Joel Palathinkal is a global omni channel show which highlights institutional investors from all walks of life and supports the continuing education for the next generation of allocators

Krista Morgan: Stage Fund

S1 E59 • May 22, 2025 • 50 mins

In this episode, Joel Palathinkal chats with Krista Morgan about her transition from private equity to launching Stage Fund. They discuss the challenges of starting the fund, the role of family dynamics in business, and Stage Fund's acquisition and restructuring strategy, highlighted by a retail tech case study. The conversation covers founders' roles post-acquisition, creative deal structures, and asset disposition strategies. They also explore roll-ups in private equity, control investments, and leveraging platforms for deal sourcing. Krista shares insights on engaging Limited Partners, syndicating with high-net-worth individuals, and future fund structure trends.

Key Points

Investing in distressed venture-backed companies that fail to secure series B funding can yield significant returns by restructuring and revitalizing their business models and cap tables.
Maintaining transparency and regular communication with LPs, even when performance isn't ideal, builds trust and enhances long-term investor relationships.
Effective deal structuring, including setting clear non-negotiable terms and understanding the economic thresholds for profitability, is crucial for protecting downside risk and ensuring sustainable fund performance.

Speakers

Krista Morgan

Guest • 67%

Joel Palathinkal

Guest • 33%

Chapters

0:00	Introduction and Christa Morgan's early career in private equity
2:28	Launching Stage Fund and overcoming challenges
6:02	Family dynamics in business operations
7:37	Stage Fund's acquisition and restructuring strategy
10:16	Case study on a retail tech company
16:12	Post-acquisition role of founders and cap table restructuring
21:07	Creative deal structures in distressed investing
25:35	Asset disposition strategies in software companies
28:39	Utilizing roll ups in private equity
30:28	Leveraging platforms for deal sourcing and innovation
32:15	Control investments and deal structuring techniques
34:26	Lessons from fund management and firm building
37:47	The role of founder retention during acquisitions
42:34	Engaging and growing the LP community
45:31	Strategies for effective LP communication and networking
48:17	Syndication with high net worth individuals and episode recap
49:04	Future trends in fund structures and closing thoughts

Transcript

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