Four Primary Financing Options

One way or another, there has to be some form of financing for an ownership transition to occur where one or more parties are putting capital at risk to make the deal happen.

D. Brown Management Profile Picture
Share
Succession: 4 Primary Deal Financing Methods.

There are four primary sources of financing and most deals will utilize a combination of these.  

  1. Seller financing where the current owner takes their money over time. This may come in the form of:
  1. Outside capital from the buyer with the most likely scenario for a significant amount of outside capital coming in from a strategic buyer.
  1. Bank financing of an ESOP.
  1. Bank financing on a term loan for buying the business. This will typically require some combination of outside capital and seller financing, along with proven financial performance, a proven management team, and all 5C’s met. 

Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Cash Flow and the 5Cs of Credit - Overview
Contractors need strong financial partners, including banking, surety, and insurance to grow sustainably. It is important to understand how they evaluate your contracting business.
8 Stages of Personal and Team Growth
Exploration expands our context. Learning and deliberate practice builds and demonstrates our individual productivity. Develop team productivity with four levels of leveraging yourself through others. Take an inventory of where you and your team are at.
CFMA: Talent Pipelining
Contractors will face continually worsening talent shortages through 2030. Those that want to continue sustainable growth must manage every aspect of their talent management processes with extreme rigor.