After some soul searching, I fell in love with the Entrepreneurship through Acquisition (EtA) space where operators like myself could acquire and grow great cash flowing SMB businesses.
But there was a gap. While PE firms provide capital for larger deals, their models prevent them from focusing on the SMB space. Acquisition entrepreneurs looking for equity funding need to group a bunch of individual investors together to get a deal done.
I started SMB Fund to fill that gap and connect great acquisition entrepreneurs with great investors.
Why SMB Acquisitions?
Baby Boomers have $30 Trillion in business assets that they need to sell as they retire in the next 30 years (source: Forbes). 70% of them are not passing on to their children.
High Leverage Low Default
Access to high leverage (90% of enterprise value) available through SBA 7(a) acquisition loan with low default rate (2%)
Cash Flowing with Upside
Businesses are cash flowing and typically pay back equity investor’s investments within 2 years. Huge upside opportunity for a new tech-savvy owner to implement modern business practices and technologies.
What do you do?
SMB Fund makes minority investments in US-based entrepreneurs acquiring cash-flowing SMBs using SBA loans.
Acquisition Entrepreneur Criteria
Performed search to find acquisition opportunity and is currently negotiating an LOI
Will operate the acquired business full-time
Has the means to invest at least 25% of the equity (typically 2.5% of the purchase price)
Pre-approved by Tier 1 SBA bank for acquisition size
Strong operating background (consulting, corporate, tech startup, finance, military, etc.)
Business Target Criteria
Founder/owner led business
$750k to $2M EBITDA
Mature, high quality business
Clear path to growth with entrepreneur's skillset
We can put up to 75% of the down payment when the acquisition entrepreneur uses SBA financing to acquire the business.
Becoming an Investor
If you are interested in becoming an investor in our syndicates, please get in touch with us using the form on our website.