Pre-IPO or Strategic Sale

Rahul ran two businesses under one roof. A fast-moving consumer goods distribution company. And a cold storage facility that rented refrigerated space to businesses dealing in perishable goods. Both businesses had real revenue. Real customers. Real growth potential. But also — real debt. By 2022, the debt had piled up. Working capital was stretched. The business needed fresh funds urgently. Three options were on the table.

Option 1: More Debt Banks were willing. But adding debt to an already leveraged balance sheet would have made things worse, not better. Higher interest outgo. Lower profitability. More pressure on cash flows. This option was ruled out quickly.

Option 2: Strategic Sale A strategic buyer would have brought capital. But it would have also meant Rahul stepping back — or out. The business was at an early stage of its growth curve. Selling now meant selling cheap. Worse, it meant someone else capturing the upside that Rahul had spent years building towards. This option felt like giving up at halftime.

Option 3: Pre-IPO Fund Raise This is where Mergedeck came in.

What We Did We evaluated the business. The fundamentals were sound — recurring rental income from cold storage, an established FMCG distribution network, and a promoter who understood his market deeply. The problem was structural, not operational. We raised growth capital through a pre-IPO round at a 10x PE valuation. The funds served two purposes simultaneously: A portion went towards retiring high-cost debt — reducing interest burden and cleaning up the balance sheet The remaining was deployed as working capital — giving the business room to breathe and grow Rahul did not lose control. He did not take on more debt. He brought in investors who believed in the business and were aligned with its growth. ** What Happened Next** Two years later, the numbers tell the story. Profits are 2 to 3 times what they were at the time of the raise. The PE multiple has expanded — meaning the valuation today is significantly higher than what early investors paid. Investors who came in at 10x PE are sitting on returns that far exceed what any fixed income or debt instrument could have delivered. The promoter retained control, participated fully in the growth, and emerged with a stronger balance sheet and a more valuable business.

The Lesson Not every business needs an IPO. Not every business should be sold. Sometimes the right answer is bringing in the right capital — at the right stage — structured the right way. Pre-IPO funding, when done correctly, solves what debt cannot and preserves what a strategic sale would have surrendered.

Is Your Business at a Similar Crossroads? If your business has strong fundamentals but needs capital to grow — and you are not sure whether to raise debt, sell a stake, or explore a structured fund raise — we will evaluate your business for you. Free of cost. No obligation. This is a limited offer from Mergedeck.com DM us or list your business at mergedeck.com We will tell you what your business is worth — and what the right capital solution looks like.

Mergedeck is India's deal marketplace connecting businesses, investors, and advisors for acquisitions, fundraising, and pre-IPO transactions.