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Private equity firms value businesses in growing markets with strong management and defensible IP. Honestly assess your business and address weaknesses beforehand. Consider getting a quality of earnings report to avoid surprises in due diligence.
Owners who want to prepare their business and make it look more attractive to a financial buyer
How Do Private Equity Funds Evaluate Businesses?
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Suggest questionWe interviewed Mark Mansour, Managing Partner at MCM Capital Partners, to shed some light on private equity and how private equity firms evaluate potential investment opportunities. Among other things, Mark discusses:
•What is private equity? (0:17) • What exit options are available to a business owner? (1:22) • How do private equity firms value a business? (2:53) • What two attributes hold the most weight when assessing the value of a business? (6:28) • In what circumstances does private equity become the best exit option? (6:58) • What should a business owner look for in a private equity partner? (8:42) • What protection does a business owner have after selling to a private equity fund? (10:20) • What type of reporting does a private equity firm require? (13:07) • What are the advantages/disadvantages of partnering with a private equity firm? (15:46) • What do private equity firms look for in a management team? (18:47) • Advice for business owners looking to sell their business? (21:51)
MCM Capital Partners is a Cleveland, Ohio based lower middle market private equity firm focused on partnering with niche manufacturers and value added distributors generating over $10 million in revenues and between $2-$8 million in EBITDA. We aim to drive value creation and top line growth at our portfolio companies through deep industry experience, operational expertise and business development support. For more information, visit our website at Thank you for watching!
About MCM Capital
How does life at a family owned business change after becoming a private equity portfolio company? In this episode of Well Capitalized, MCM interviews Marc Calcaterra, CEO of Torsion Group Corp., a manufacturer and distributor of garage door parts and accessories that was acquired by MCM Capital Partners in 2016. Among other things, Marc discusses:
• Management's reasoning for pursuing a transaction. (1:15) • Why he chose private equity over other options? (2:13) • What was his biggest fear in partnering with a private equity firm? (4:05) • Are Marc's challenges/concerns different 2 1/2 years into the transaction? (5:42) • What has been the most dramatic change after the acquisition? (6:42) • What are the reporting requirements like under private equity ownership? (7:34) • Benefit of having a sounding board to make strategic decisions. (9:08) • Why did he reinvest/retain equity in the business when he no longer had "control"? (10:42) • What are the advantages and disadvantages of partnering with a private equity firm? (11:55) • What advice would you give to a business owner looking to sell their business? (13:32) • What is the biggest difference between being family owned and private equity owned? (14:54)
MCM Capital Partners is a Cleveland, Ohio based lower middle market private equity firm focused on partnering with niche manufacturers and value added distributors generating over $10 million in revenues and between $2-$8 million in EBITDA. We aim to drive value creation and top line growth at our portfolio companies through deep industry experience, operational expertise and business development support.
www.mcmcapital.com