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May 2, 2024

The Exit of Komartek: “Don’t try to overengineer your life” – Ari Korhonen reveals the true story behind Komartek's unplanned exit

By Evli Growth Partners
Ari Korhonen
Growth Partner
By the early 2000s, Komartek had successfully solidified its presence in both national and international markets. However, the idea of an exit had never been strongly considered within the company. Ari Korhonen, the co-founder of Komartek, had pondered the idea of passing the company to the next generation, but it was a rather serendipitous twist of fate that eventually led him to exit.

This blog post is part of The Founder Files series, exploring the human side of entrepreneurship, where the distinction between success and failure is often a fine line. From founding and scaling, all the way to the exit, we reveal the unfiltered, authentic stories behind entrepreneurial journeys. Ready to hear the truth?

By the early 2000s, Komartek had undergone quite a journey: from the booming 80s, through the 90s depression, and then rebounding into a new upturn. Komartek had successfully solidified its presence in both national and international markets, earning numerous awards and recognitions. 

The idea of an exit had never been strongly considered within the company. Ari Korhonen, the co-founder of Komartek, had pondered the idea of passing the company to the next generation, but it was a rather serendipitous twist of fate that eventually led him to exit. 

“There were two options to resolve it: either they would acquire us, or we would buy them out.”

The initiation of Komartek’s exit process stemmed from its acquisition of certain business units from Novo Group Oyj, which complemented Komartek's operations. 

“We did not have much money, so we paid them with our own shares”, Korhonen says. 

However, complications arose when WM-data, a Swedish IT consultancy giant, decided to acquire Novo Group Oyj. Suddenly, Komartek was in a situation where its subsidiary in Sweden was in direct competition with WM-data, Komartek’s parent company, in the Swedish market in the Energy & Utilities vertical.

“There were two options to resolve the situation: either they would acquire us, or we would buy them out. Raising funds for such a purchase within such a short time was beyond possible in 2004, so WM-data’s acquisition of us was the only realistic solution, especially considering the company was already a minority shareholder of Komartek and held two board seats", Korhonen explains. 

The exit process, however, posed its own set of challenges. One-third of Komartek's employees were also company owners, introducing an air of tension here and there. Additionally, the aftermath of the dot-com bubble affected Komartek's sale price, marking a shift in the company's traditionally fortunate timing.

“For a long time, luck had favored us with timings, but then the tables turned. The timing could have been better, but in the end, you need to have a buyer to make a deal happen. There is no optimal time for selling or buying in the public market, and it's even more difficult in the private market. Don’t try to overengineer your life.”

After the acquisition, Korhonen worked at WM-data for 2.5 years as Vice President after which he left the day-to-day operations and started working as an angel investor. In a way, the exit was a relief to Korhonen, especially since Komartek managed to survive the brink of bankruptcy during the difficult years of the 90s depression. 

However, similar to many founders who have successfully exited, he found himself struck by a feeling of emptiness when he realized he didn’t have to head straight to the office first thing in the morning anymore. 

“But I still quite often ponder where we could have gone if we had continued independently. Starting from 2007 the startup ecosystem in Finland started to really evolve, and the next generation of VCs were established. Komartek was bootstrapped and financed by loans, grants, and sweat equity all the way, so we did not gain any money, knowledge, or networks that VCs had.”

But Korhonen hasn’t stopped working. In fact, as an investor, he is still working almost round the clock.

“My parents were farmers, so I grew up working in the sugar beet fields every day. I got used to hard work since childhood, and I have followed the same work ethic as an entrepreneur and investor – and it has paid off.”

Today, at Evli Growth Partners, Korhonen guides young and innovative teams through the challenges of scaling and exiting. Korhonen sees himself as a help desk for entrepreneurs – aiming to always be available but refraining from offering unsolicited advice, as he explains. 

“Many people ask if I am a hands-on or hands-off investor. I reply I am hands-if. If needed, I will be there”, Korhonen sums up and continues: “Having personally built and sold my own company, I have been able to help many other entrepreneurs on a similar journey in my current role as an angel investor and Growth Partner at EGP. I understand the stress, tight deadlines, and all the difficult decisions founders have to make”, Korhonen says.

“If something is bothering you now, it will likely bother you even more a year later.”

Korhonen is an investor in 20 venture capital funds and 50 companies, including 10 successful exits from direct investments, and has been recognized several times as one of the most influential and successful angel investors in Europe. But, like any angel investor, Korhonen has faced both ups and downs during his career, which is why he follows one key principle when investing in new companies: when in doubt, leave it out.

"If something is bothering you now, it will likely bother you even more a year later. Take the time to get to know the team behind the company and make your investment decisions deliberately. Although companies are often in a hurry, only time will reveal whether the team can truly deliver on its promises or if it's all just talk”, Korhonen advises. “Ultimately, it’s a game of trust." 

The upcoming fall marks 20 years since Komartek’s acquisition. For Korhonen, the entire episode was a serendipitous twist of fate and one that left him with invaluable lessons. Drawing from Komartek's journeys, Korhonen has one crucial tip to give to current and aspiring entrepreneurs: “A very important part of the strategy is to be able to say no to the things in your business that are not working. Stay focused and don’t let your business meander everywhere. You don’t need to seize every opportunity that comes your way.”

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