Beyond the Case
A podcast where global leaders from the Harvard Business School Owner/President Management (OPM) community join in a personal capacity and share the real decisions, failures, and mental models behind building enduring companies.
This podcast is independent and not affiliated with Harvard Business School.
Beyond the Case
Exits, Term Sheets, and the Real Cost of Raising Capital - Alejandro Diez Barroso
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Alejandro Diez Barroso explains how bootstrapping two early e-commerce businesses in Mexico taught him the real constraint in many markets: access to growth capital. He sold not because he wanted to, but because scaling required funding and institutional readiness. That experience shaped DILA’s mission of investing across the Spanish-speaking world and helping founders build venture-backable companies with clear liquidity paths.
He breaks down how exits actually happen , why governance/financial hygiene determines deal certainty, and why many founders misunderstand term sheets, especially preferred shares, liquidation preferences, and drag/tag rights. He also shares how LatAm is evolving from “copycats” to “tropicalized” models and increasingly global products, while still needing more liquidity events. Personal themes: know your business type (sell vs lifestyle), match capital to incentives/time horizons, make customers “heroes” (even when you have two), practice patience/compounding, and master selling as a foundational founder skill.
Here are the Top 10 Takeaways from the conversation:
- Build type matters: “Built to sell” and “lifestyle” businesses require totally different strategies and only some are venture-fit.
- Capital is a commodity; alignment isn’t: Choose investors by incentives, timeframes, and behavior in bad times—not just valuation.
- Don’t raise money “because”: VC brings an implied exit clock and shared control; many founders accept this too late.
- Liquidity is hard, so be prepared early: Deals fail less from price and more from messy governance, weak reporting, and diligence surprises.
- Valuation is only one term: Preferences can make a “big exit” pay founders little or nothing if the pref stack is heavy.
- Avoid toxic structures: Participating preferred (and high multiple prefs) can be brutally expensive for founders.
- Board/control discipline: Don’t lose board control too early; it can force decisions (including sales) you didn’t intend.
- Drag/tag rights are not fine print: They can compel a sale or force you to buy out investors at offer terms—know what you’re signing.
- Selling timing is often opportunistic: Great companies attract unsolicited offers; the “right” time is when risk-adjusted certainty is compelling.
- Founders who compound can sell: Selling isn’t just customers. It’s vision to hires, cofounders, investors, partners, and the market.
