Criteria

Socius Capital understands that every business and every management team is unique, with its own strengths and weaknesses. That said, the ideal circumstance for us is to partner with a strong owner/manager with a significant personal stake in a business that fits the following criteria:

  • Stable or growing revenues (is not a turn-around or start-up)
  • Attractive industry fundamentals
  • Minimum EBITDA of $1.5 mm
  • Manufacturing, distribution or service sectors
  • Reasonable enterprise value based on historic cash flows
  • Capital needs of $3 mm to $15 mm
  • Critical members of management must be in place and have a significant ownership position at close
  • Based in the western or southern United States

Even if your situation does not fit all the criteria above, talk to us. We will treat all conversations with complete confidentiality and will provide an honest and candid response within a few days, if not immediately.

 

pmmDetailed Criteria

Transaction Characteristics

    • Buyout of retiring, passive shareholder
    • Recapitalization due to exit of private equity firm
    • Management led buyout
    • Growth especially via acquisition
    • Acquisition identified by new and highly experienced management team
    • Partial liquidity for estate planning or lifestyle reasons

Industries of Interest

    • Manufacturing
    • Value added distribution (10%+ cash flow margins)
    • Business services
    • Industrial services (especially repair and maintenance)
    • Healthcare services
    • No real estate, construction, restaurants or traditional retail

Typical Company Characteristics

    • Stable and growing revenue and earnings
    • Non-cyclical
    • Re-occurring revenue streams
    • EBITDA margins in excess of 10%
    • Defensible barriers to entry, high switching costs
    • Strong market position
    • Diverse customer base with no significant concentration
    • Reasonable enterprise valuation based upon historical cash flows
    • No turnarounds or distressed situations
    • Manageable capital expenditure and working capital requirements