The Situation
The founder-led software company, in the single-digit million ARR range with a growing customer base and clear market position, was performing well operationally. But a combination of structural cash flow issues led to an acute liquidity crisis that caught the founder, the management team, and the shareholder base completely off guard.
The situation was serious. A traditional funding round would have taken months. Time that simply wasn't available. Venture debt and other external capital sources were off the table for the same reason. At the same time, there was a concrete insolvency risk with corresponding liability implications for the managing directors.
Making matters worse, the situation caused significant unrest and frustration among the shareholders, a comparatively large group of investors. Trust in the founder and the leadership team was damaged, even though the operational business was functioning.
Approach
Uhlig Capital worked at the core of this challenge. A highly emotional situation that required not just analytical rigor but above all a steady hand and sensitivity. At the center was not merely the question of financing, but something more fundamental: rebuilding trust while keeping alive the conviction and enthusiasm for the market, the team, and the product.
Shareholder Communication and Trust Building
The shareholder base was addressed systematically and individually. Each investor received a clear picture of the situation, the root causes, and, crucially, a realistic perspective. The goal was not to sugarcoat, but to combine transparency with a concrete path forward. In a situation dominated by frustration and disappointment, the priority was to stay composed, to listen, and to build a shared perspective.
Path to Profitability
Together with the management team and a specialized restructuring firm, a robust plan was developed showing how the company could reach profitability under its own power. This plan became the foundation for every subsequent conversation with shareholders, advisors, and potential capital providers.
Leadership Team Restructuring
The crisis made clear that changes within the leadership team were necessary. Working alongside the founder, the leadership team was restructured with the goal of placing the right competencies in the right positions for the company's next phase.
Legal Safeguarding and Coordination
In parallel, insolvency advisors and legal counsel ensured that every step was legally sound. The management had to act demonstrably and correctly at all times. That was non-negotiable.
On the basis of the profitability plan, the restructured leadership team, and the restored communication, Uhlig Capital initiated an internal funding round. Existing shareholders were given the opportunity to provide fresh capital under clear terms and with economic incentives.
Outcome
The internal funding round was completed successfully. A sufficient number of shareholders participated to bridge the liquidity crisis and execute the profitability plan.
The company continued to serve its customers and remained active in the market throughout. Cash flow was stabilized and the operational foundation secured.
Subsequently, the company completed a further capital round on the external market, a clear signal that investor confidence had been fully restored.
Today, the company is in a stronger position than before the crisis. The founder, the team, and the shareholder base have grown closer together. The crisis became a catalyst for sharper focus, a more resilient financial structure, and more mature leadership.
Key Takeaways
- Shareholder communication in a crisis is not a side issue. It's mission-critical. When shareholders lose trust, the best business plan in the world won't help. One-on-one conversations, transparency, and an honest perspective are the foundation for any solution.
- Operational strength alone doesn't protect against liquidity crises. Even companies that are performing well in the market can find themselves in existential cash flow situations. Early warning systems and a realistic liquidity plan are essential.
- Restructuring also means rethinking leadership. Anyone who wants to lead a company through a crisis must be willing to honestly reassess and restructure the leadership team itself.
- Crises can only be solved as a team. Uhlig Capital was one piece in an interplay of founder, management, legal advisors, restructuring experts, and the shareholders themselves. No single actor could have resolved this situation alone.
