You’re Not Negotiating Against the Seller
If you ever feel the need to assign someone to be the bad cop ahead of a meeting with a
Hi, Niklas here 🙂📝
This is my journey as an independent sponsor & equity investor.
I publish tactical insights for deal-by-deal private equity.
Subscribe for my short-form content in your inbox (~3x/wk).
I publish tactical insights for deal-by-deal private equity.
Subscribe for my short-form content in your inbox (~3x/wk).
The 4th Constraint in Deal-by-Deal PE
2 founding partners see their capacity cap at 5-6 platforms as independent sponsors. I always say there are 3
When to write a CIM for your deal?
Right away! 1. Building a CIM uncovers gaps in your understanding & DD. 2. Socializing a CIM pressure tests the
Rollups Still Need Underwriting Discipline
If you're working on a rollup, and especially if you've raised a vehicle to do so,
When Do You Need an Anchor Investor?
An anchor investor is especially important when: • Your deal is larger (>$20m equity raise). • The equity check is heavy
AI Is a Feature, Not the Thesis
Boring Business + AI = Strong returns ? This thesis might suffice for VC, growth equity folks, and California angels, but it is
When Independent Sponsors Grow Up
Independent sponsor firms’ maturity goes beyond # of deals & MOIC-to-date. It is reflected in the operations, diligence, reporting,
NWC Can Swing Your Valuation by 5%. Here's How to Set the Peg.
NWC target (peg): "Like buying a car with sufficient gas to drive off the parking lot. But, what’s
Operating Partner 1.0, 2.0, 3.0, 4.0
The evolution of Operating Partners in Private Equity: Operating Partner 1.0 (1990-2010): Retired CEO. But weren't
The Buyer Is Still Selling
Buying a company is a sales process. Slight paradox: you're the buyer, but you're still selling.
The Post-Mortem Is Where Your Future IRR Is Built
If you’re a serial acquirer or sponsor, the post-mortem is where your future IRR is built. When: Within
4 Sources of Equity for LMM Deals
4 sources of equity for lower-middle market deals: (1) Rollover equity from seller. Usually 10-30%. Shows alignment, buy-
Rolling Up Tiny $400k EBITDA Targets
Independent sponsors claim they can buy companies anywhere in the US. Fine. Ziv Bendor has 9 holdings at Pinewell: 3
One Sponsor's Answer to 'why sell?'
"The seller had held back on capex for years. He dreaded the cash outlay, and over time he had
Share Mgmt Fee w/ Seller?
It can feel awkward to impose a ~$250-400k mgmt. fee on a newly acquired company, especially if (i) the
Fundless, Generalist, Still Doing Deals
Charles (Chad) Scripps has been running Black Lake Capital since 2013. They still sign ~500 NDAs per year, look at
The HVAC Company was pricing itself out of trust, not into it
"I was backing a sponsor buying an HVAC business in Tampa and the broker was marketing that their margins
AI-generated CIMs are Easy to Spot, and it's Getting Worse
AI-generated CIMs are woeful, and we naturally see more and more of them from (not-so-)independent sponsors. To
From Policymaker to Independent Sponsor
As a political appointee working directly for the Governor, Lisa Piercey led & shaped healthcare policy in Tennessee. Now she
The Rollup Maturity Ladder
Rollups go to market with different levels of maturity. A rollup thesis can be intellectually intriguing, but the idea alone
Don't Skip the Seller Representative Fund
Don't forget the Seller Representative Fund when closing your exit. When selling your business, post-close expenses are
Hire the CEO Before You Close the Deal
"We brought in a CEO & COO prior to closing anything as the first step in building this rollup.
Meet the SLB
SLB (acronym): Sh**ty Little Broker • Prefers phone calls due to low keyboard literacy. Email signature often longer than email
North Haven Capital's entire edge is Maine's 600k people
Drew Bagin and his partner Sam only buy businesses in Maine, New Hampshire, Vermont, and Massachusetts. Maine has 600k people.