Investor Profile
Investors who want to broaden their portfolio, invest in growth and desire returns of ~25%. An investor will have a minimum of $10,000 and receive a preferred equity stake. If you are interested in talking with Jon to have an in depth conversation, click the link below to contact him.
Investment Highlights
Because of the value proposition in small businesses, valuation growth can be much higher than traditional stock and real estate investments. Keys to this high value proposition are: Valuation Multiples, Large Organic Upside, Strong Invested Leadership, Niche Markets & Sticky Clients
Valuation Multiples
An S&P 500 stock typically sells for 11-14x its EBITDA, with many speculative stocks north of ~50x. Small Businesses typically transact at 3-5x EBITDA. Two primary reasons for this disparity of valuations are 1) the less liquid market for small business and 2) the uncertainty of strong leadership teams and earnings potential. I will do the work to find the right deal and invest 100% of my efforts into the company, alleviating the two primary roadblocks to tap into this lower valuation market.
Large Organic Upside
Many typical investments are very mature in their industries and now only able to maintain low single digit, much of which comes for add on products and increased prices. Other companies are highly speculative, based on unproven profitability, but potential to reach huge markets. The small business acquired will have proven profitable products or service and room for double digit annualized growth.
Strong Invested Leadership
Once acquired, I will invest 100% of my time into this company. I have years of experience operating a small profitable and growing business, along with almost a decade of experience in finance at a fortune 20 company. This skill set will allow me to transition daily from a strategic mindset to a tactical doer as the needs of the business demand.
Niche Market
The target business will have a unique capability to deliver its products or services. It may operate in a business with many players, but it will have found a profitable and successful formula to stand out from competition.
Sticky Clients
A large part of revenue will come from repeat clientele, who have on ongoing renewed value of doing business with the same company. The company will have a track record of treating their clients well and providing the right solutions.