Reflection on the Parallels between Adventure Learning and (Adventure) Investing

I recently had the pleasure of spending 4 days at McCall Outdoor Science School (MOSS) with my 4th grade daughter and her class, and I came away from it with a couple of realizations. First and foremost: teachers are amazing!  Secondly, investing is a lot like spending time in the wilderness. Sometimes it is beautiful and everything goes right, like when we found a perfect stump and the kids were so excited to count all of the rings to see how old the tree was (102 years), and sometimes it is tough like hiking in the rain with seven 9 year olds. But, most of the time, it just requires a great deal of patience. 

After spending four days in a cabin with five 9 year old girls, my patience was definitely tested and I feel like that is similar to the current investing environment: everyone’s patience is being constantly tested. No one knows what the market will do and unpredictability makes it difficult for companies and investors to make decisions. This results in a wait-and-see mindset which demands a lot of patience.These larger market challenges are pushing down to the lower market where Sage invests. 

At Sage, we focus on investing in earlier stage businesses with revenue (minimum of $300k ARR) and great growth. We provide entrepreneurs with the ability to add fuel to their business without giving up equity which is incredibly important in a market that is requiring more patience than ever before. If a founder or owner can hold on to more equity (in any environment, but especially in one that is uncertain) and continue to grow their business, that can result in some of the best outcomes for the founder. They are able to take market share while competitors stay stagnant, which results in larger ownership potential and better positioning when the environment shifts. 

Periods of patience can be challenging as an investor as well because we want to be investing but the companies that we are seeing may not meet our investment criteria. I also find during periods of patience you need to be more involved with your portfolio providing guidance and oversight. 

Oftentimes, these environments require you to look at things from a different angle. While we were hiking in the rain and every child was complaining, it turned out that a funny song about Ripple Potato Chips that the boys made up changed everyone’s attitude and turned our group into a singing group and not a complaining group. This change in our group dynamic stuck with us for the next 3 days and culminated in a song as part of the kids’ final project. Challenging times can lead to the best results both in life and in business if you just have some patience (and are not afraid to be a little silly/innovative). 

I won’t be signing up for any new overnight chaperone roles in the near future as I need some time to sleep and recharge my patience. I can say that it helped me remember that good things can come from waiting,  leaning into and letting patience run its course. I think it could be a valuable reminder to both investors and entrepreneurs to not let anxiety get the best of us when all we need to do is let patience run its course.   

About Sage Growth Capital

Sage Growth Capital makes revenue-financed investments in companies at any stage who need growth capital. It is our mission to provide a more flexible funding option to growing companies who do not fit traditional equity or lending models. To learn more about Sage Growth Capital or to apply for funding visit: www.sagegrowthcapital.com.

About Revenue-Financed Capital

Revenue-financed capital (RFC), also referred to as royalty financing, revenue share or revenue-based financing (RBF), is a non-dilutive form of growth capital where investors receive a percentage of monthly revenues until a set amount has been paid. RFC differs from equity financing as the investor does not obtain ownership of the company and it differs from debt financing as there is no collateral required and payments are variable. RFC is designed to empower entrepreneurs to grow their businesses with non-dilutive capital that aligns with their sales cycles.