As an owner, you know it takes a dedicated team to build a business. You have created an enduring company that sustains your employees and their families, and now you want to leave a legacy. Inside that business are the people who helped you get there: the challenge with MBO’s is that management may not have enough capital to make it happen.
If you are a manager, or part of a management team, who wants to buy out an existing or retiring owner of the company you work for but you have limited resources, First West Capital can partner with you to buy the business.
We want to help great management teams take the next step by giving them the opportunity to acquire full ownership while ensuring that vendors have sufficient proceeds from the sale of their business to retire on their terms. All with the vision of supporting a thriving economy, where businesses stay in local hands and contribute back to the communities where we all live and work.
What we look for:
- Existing management with experience in the market and across various functional areas (preferred)
- A reasonable purchase price
- A meaningful equity contribution from the buyer
- A well structured succession plan
- Vendor participation in the succession financing is welcomed
First West Capital MBO Financing Package
The MBO Financing Package includes a combination of equity and debt to help great management teams buy the business they operate, even if they lack the personal resources to do it alone.
- Management partners with First West Capital to acquire the business
- We work with management and the owner to negotiate a business valuation and buyout structure
- We provide financing in the form of debt and equity, alongside management’s investment
- We welcome the owner’s continued participation if he or she wants to stay involved
- We help you to grow the business
- Together, we establish a governance structure that works for management, the owner and First West Capital
- We work with you to grow your business organically or through acquisition by providing capital, advice and connections
- We provide incentives to enable management to earn additional equity in the business based on achieving defined performance targets
- We provide management a pathway to full ownership
- Through a buyout option, we provide management an opportunity to acquire full ownership of the company over time at fair market value
- Alternatively, we can continue to grow the business together, as First West Capital does not have a mandated exit date
Learn more about how we finance MBOs with sub-debt, mezzanine financing and preferred equity.