Frequently Asked Questions – Answered
F.A.Qs
When the final wave/tranche is completed.
We will have a contractual obligation to fulfill the agreement
3-5 years from the closing.
If the business performance goes down over the period from the first wave to the final wave, then there will be a diminished valuation and the buyout will be less than originally anticipated.
Up to 50%
They can. Final Payout will be based on company performance over the incubation period. If market conditions negatively impact revenue, profitability, or both, then the final buyout price could be impacted accordingly.
Absolutely. Privacy and confidentiality are at the core of what we do. We will not share any information provided without your prior consent.
We will review that on a case-by-case basis. There are some cases in which we will take a business that does not meet all the requirements if we feel they can make a positive impact to the overall team.
Soley Commercial or Residential is fine and so is a mix of commercial + residential.
Yes, you will receive 20-30% of the buyout amount in the first wave. This amount and timing will be mentioned in the formal agreement, and it will also mention the timing and metrics of the second/final wave.
Because we are assembling quality companies to get enterprise valuations with people, we have relationships and deal history with. We aren’t sending our critical mass out to the PE market. We have a very specific approach and will only work with groups that will do the deal as we have it structured and will close.
We will reach out once our final critical mass is assembled and ask for that information. You will have roughly 30 days to gather that information. We will send a list of what we will be asking for so that there are not any surprises and to help make it as smooth as possible for all.
- Increase profitability between first wave and final wave. This can be accomplished by:
- Implementing Processes + Procedures that add efficiencies
- Using the capital from the first wave to acquire competitors businesses
- Hiring talent to help execute more efficiently in key roles
- There is an initial wave of cash that can be used however the owner sees fit
- Our group has experiencing closing these deals with this structure
- There is not a change in Key Roles of Management
- We will get Enterprise Valuation versus private market valuation
Yes, we have successfully completed more than one with this model.