It really is amazing how resilient the lower middle-market M&A tends to be. Despite a slowdown in larger transactions (valuations over $100 million), the niche that Generational Equity operates in has been fairly stable. In fact, so far this year, we are on pace to close just as many deals this year as we did in our record-setting year of 2015.
First, it is easier to locate financing for a transaction valued at $25 million versus one valued at more than $100 million. It is far less risky, from a lender’s standpoint (and a buyer’s as well), to acquire several $25 million targets than trying to hit a home run with one over $100 million. Thus making the time it takes to close a smaller transaction shorter AND, most importantly, making the integration into the new entity that much less complex as well.
Secondly, the factors driving the buyers in our niche are much more strategic and long-term than those that focus on very large transactions. Buyers we deal with are looking for new products, new geographies, new markets, access to new technology and skilled people. These features tend to make our buyers insulated from other issues that may affect billion-dollar transactions.
Finally, our success as a team is driven by our process, which creates fully vetted, highly committed sellers. Buyers know this and find our clients highly desirable because of this. One thing that all buyers lack is excess time. Nothing can be worse for them than to spend months and months with a seller only to have the deal fall apart at the 11th hour due to a seller getting cold feet. Or, worse yet, having a buyer discover some unforeseen weakness or issue that destroys the deal.
That is why the first step in our process is a full business valuation. We examine and drill into our client’s historic financials, operations, growth strategies, strengths, weaknesses, opportunities, and threats. This 90 - 120 day program can be quite grueling for many clients. But it really is helpful in that we can, at the end of the analysis, provide our professional opinion on what the value range would be in the current market for our client.
This vetting that we do, a mini-due diligence is how some clients describe the process, really weeds out those business owners that are not personally ready right now to sell AND those businesses that are not quite buyer ready yet, those that need to enter our hold-and-grow program to improve or enhance their value.
Despite what you may read, for some deal flow may be down, but Generational Equity is on course to have another record year. This is great news for our clients.
If you own a business and would like to find out how our services might be of benefit to you, please reach out to me at email@example.com or 972-232-1125. Our proven process has helped hundreds of entrepreneurs achieve their financial goals. We might be able to do the same for you!
By Carl Doerksen, Director of Corporate Development at Generational Equity.
© 2016 Generational Equity, LLC. All Rights Reserved.
it all started with a conference.
start your story today,
speak directly with one of our senior advisors +1-972-232-1121
The information we learn from customers helps us personalize and continually improve your experience. Here are the types of information we gather.
We receive and store any information you enter on our Web site or give us in any other way. We do not sell or rent your personal information to others without your consent. We use the information we collect only for the purposes sending promotional information, enhancing the operation of our site, serving advertisements, for statistical purposes and to administer our systems. We DO NOT use third parties to provide customer service, to serve site content, to serve the advertisements you see on our site, to conduct surveys, to help administer promotional emails, or to administer drawings or contests, but reserve the right to do so in the future without advance notice.
Generational Group’s affiliates are all part of one corporate family, they work with one another and may work together to provide services to you. The sharing of your information among affiliates enables Generational Group to serve you more efficiently and makes it more convenient for you to do business with Generational Group. Generational Group is permitted by law to share information with its affiliates. All of our affiliates follow similar privacy policies.
For reasons such as improving personalization of our service, we might receive information about you from other sources and add it to our account information.
Generational Group may license the use of its intellectual property including but not limited to its name, likeness, and logo for the use of affiliated offices. Such affiliated offices may not be owned, controlled, managed, supervised or staffed by employees, officers, or agents of Generational Group. Affiliated offices may be independently owned and operated. For more information about a particular office, please contact Generational Group at its office in Dallas, Texas.
This page may contain other proprietary notices and copyright information, the terms of which must be observed and followed.
Information on this web site may contain technical inaccuracies or typographical errors. Information may be changed or updated without notice. Generational Group may also make improvements and/or changes in the products and/or the programs described in this information at any time without notice.
Generational Group does not want to receive confidential or proprietary information from you through our web site. Please note that any information or material sent to Generational Group will be deemed NOT to be confidential. By sending Generational Group any information or material, you grant Generational Group an unrestricted, irrevocable license to use, reproduce, display, perform, modify, transmit and distribute those materials or information, and you also agree that Generational Group is free to use any ideas, concepts, know-how or techniques that you send us for any purpose.
Our computer system protects personal information using advanced firewall technology.
Information Generational Group publishes on the World Wide Web may contain references or cross references to other products, programs and services that are not announced or available in your country. Such references do not imply that Generational Group intends to announce such products, programs or services in your country. Consult a Generational Group representative for information regarding the products, programs and services which may be available to you.
Generational Group makes no representations whatsoever about any other web site which you may access through this one. When you access a non-Generational Group web site, please understand that it is independent from Generational Group, and that Generational Group has no control over the content on that web site. In addition, a link to a non-Generational Group web site does not mean that Generational Group endorses or accepts any responsibility for the content, or the use, of such web site. It is up to you to take precautions to ensure that whatever you select for your use is free of such items as viruses, worms, Trojan horses and other items of a destructive nature.
IN NO EVENT WILL Generational Group BE LIABLE TO ANY PARTY OR ANY DIRECT, INDIRECT, SPECIAL OR OTHER CONSEQUENTIAL DAMAGES FOR ANY USE OF THIS WEBSITE, OR ON ANY OTHER HYPERLINKED WEBSITE, INCLUDING, WITHOUT LIMITATION, ANY LOST PROFITS, BUSINESS INTERRUPTION, LOSS OF PROGRAMS OR OTHER DATA ON YOUR INFORMATION HANDLING SYSTEM OR OTHERWISE, EVEN IF WE ARE EXPRESSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Furthermore, all information contained within this website is the property of Generational Group.
Success, you have been added to our list.