Ensuring 5-year exit timeframe
How can LPs be sure that independent sponsors will actually exit in ~5 years? 1) debt maturity. Most deals have
M&A
242 posts
Seller suddenly changing it all
After 5 months under LOI, the seller suddenly asked my friend to secure the seller note with a PG. The
Board meeting scheduling
Board meeting scheduling: best practices. • Schedule at least 6 months in advance. People feel really important when you send them
Avoid $2m EBITDA deals
A $2m EBITDA deal is treacherous. At 5x, it's $10m EV. If you double EBITDA, which is a
Rollup without additional equity
UK-based Sam Turner overcame a challenged first deal by pivoting the business model and eventually built a thriving facilities maintenance
Deals should never go to $0
Craig Dupper, based in Park City, Utah, founded Elan Growth Partners after years of seeing how the traditional fund model
Independent sponsors have become a real force
Independent sponsor royalty Michael Kornman details how he built NCK Capital out of Dallas with his brother Grant, acquiring 5
30% IRR is the right benchmark
Robert Graham, based in Dallas, graduated from HBS in 2018 and acquired his first company the year after as a
Put options are ominous
If your investor demands a put option, then consider countering with a request for a call option. On one of
Raise convertible debt
Instead of raising debt + equity, raise convertible debt from equity investors. Instead of being at the bottom of the waterfall,
Non-obvious attributes of the independent sponsor space
After 15 years of experience as an investor in the independent sponsor ecosystem, Nick Russell points to several non-obvious attributes
Include the wives
Include spouses in your reporting, especially with retail investors. Most of our investors at Minds Capital are HNWIs, predominantly males.
The impact of the seller's age
The seller's age colors both the target company and your deal process. • Bargains are most common among very
Pay up for a strong mgmt team
If you don't pay up for a strong management team, then the buyer of your business will have
How to unwind a dead deal
How to unwind a dead deal: • Maintain a good relationship with the seller (unless they screwed you). They might come
Mixed feelings about virtual data rooms
I have mixed feelings about investor portals / virtual data rooms (VDR). Yes, they are useful for organization and real-time document
Discontinue other convos when under LOI
Should you discontinue ongoing business owner conversations if you're under LOI with someone else? Yes, kind of, if
Private Equity Podcast: The importance of differentiation
Alex RAWlings invited me on the Raw Selection show (YouTube, Spotify, etc.), which aired earlier this week. I appear border-line
Benefits of no cross-collateralization
“What is really attractive about the independent sponsor model is not having investments cross-collateralized,” says Nathan Chandrasekaran. A PE Fund
Deal of the Year Award
Sep 12, 2024: Malia Funk submitted Willistown Capital's new deal via the Minds Capital website. Oct 23, 2024:
11th hour, seller changes his mind
Your seller changed his mind in the 11th hour. The deal is gone. Not on pause, but dead. You have
Catchups are usually included in the waterfall
Catchups (100%) are almost always included in the waterfall. The exception is when the carried interest is set significantly above-market,
Buy the real estate w/ company
Say YES to buy the real estate associated with the target company. Often a business owner will prefer to retain
Purpose-driven independent sponsorship
Quinten Griffiths of GoodCapital in Canada bought his first business, a struggling Govt SaaS carveout from a bigger (healthier) enterprise
