We fell in love with you guys, your team approach, and your whole enthusiasm and passion.
We lead founder-led companies through the full M&A process—from prep to close—combining financial precision, buyer-side insight, and operational understanding to maximize your outcome.
Selling your business is one of the most important decisions you will make. MidCap Advisors manages the process confidentially and strategically so you never have to navigate it alone.
We bring industry insight, disciplined execution, and proven M&A expertise to handle complex transactions. Recognized for industry-leading analysis, exceptional valuations, and one of the highest close rates in the market, we guide every step—from preparation and financial modeling to connecting with buyers and managing negotiations—so you achieve the best outcome for both your business and your long-term goals.
We set clear goals and manage the full process so you so you stay focused on your business.
We dig into the general ledger to normalize financials and surface true drivers of value.
We support buyer diligence, so we know their priorities and prepare you to meet them.
We have sat in your seat and guide you with an owner’s perspective.
Strong buyer relationships and a top close rate deliver trusted outcomes.
We guide you through the entire transaction with structure, strategy, and transparency. While every deal is different, most engagements follow this proven path
Conduct pre-sale valuation analysis. Define go-to-market strategy. Prepare marketing materials Review valuation parameters. Identify and prioritize potential buyers.
Approach strategic and financial buyers. Receive initial interest and Indications of Interest (IOIs). Narrow the buyer pool to the most aligned parties
Conduct buyer meetings and Q&A sessions. Provide supplemental documentation. Pre-negotiate key terms and assess buyer fit Coordinate best-and-final offers or run a structured “auction” process.
Finalize preferred buyer. Negotiate Letter of Intent (LOI) and major deal terms. Align on employment agreements, rollover structure, and post-close plans.
Open data room and manage diligence requests Coordinate legal, accounting, and HR reviews Finalize Purchase Agreement Close transaction and support transition.
Week
We fell in love with you guys, your team approach, and your whole enthusiasm and passion.
We fell in love with you guys, your team approach, and your whole enthusiasm and passion.
Several buyers had expressed interest in my firm but conversations weren’t progressing at the valuation expected. I got serious and hired MidCap and
Several buyers had expressed interest in my firm but conversations weren’t progressing at the valuation expected. I got serious and hired MidCap and we closed the transaction in less than 100 days. The MidCap analytics and analysis added several million dollars to my sale price and their help on the purchase and sale agreement was invaluable.
It’s an understatement to say it’s a difficult decision to sell an agency that has been in business for nearly a century. We turned to MidCap Advi
It’s an understatement to say it’s a difficult decision to sell an agency that has been in business for nearly a century. We turned to MidCap Advisors to help us assess the opportunity. MidCap has an excellent reputation as an advisor to the insurance industry and an extraordinary grasp of the bottom-line objectives of independent agencies.
I retained MidCap when I purchased York from AIG and was so delighted with their work that I hired them again five years later to represent me in sell
I retained MidCap when I purchased York from AIG and was so delighted with their work that I hired them again five years later to represent me in selling York in a private equity transaction.
We retained MidCap as our advisor because we were uncertain on how the market would value our agency and who would be the right partner for us and our
We retained MidCap as our advisor because we were uncertain on how the market would value our agency and who would be the right partner for us and our employees. Overall, their deal team was exceptional in obtaining management meetings, negotiating offers, and in getting us through the finish line. MidCap was able to exceed our pricing expectations and they helped us navigate uncharted territory. We appreciate their efforts and would highly recommend their services to any agency owner.
MidCap spent the time to understand our business and helped us select a buyer to achieve maximum value and to ensure a good fit for our producers and
MidCap spent the time to understand our business and helped us select a buyer to achieve maximum value and to ensure a good fit for our producers and employees. Their team continued to guide us through the complexities of diligence and documentation to ensure our deal got across the goal line.
Frank and Ryan guided us through a complex transaction involving five owners at different stages of their career and life. I couldn’t imagine going
Frank and Ryan guided us through a complex transaction involving five owners at different stages of their career and life. I couldn’t imagine going through the process without their support.
I could not have completed the transaction without Midcap’s intelligence, expertise, and perseverance. I am energized by the potential for growth
I could not have completed the transaction without Midcap’s intelligence, expertise, and perseverance. I am energized by the potential for growth this will afford my practice. MidCap’s team was great.
Being a reproductive endocrinologist in private practice for several years, I connected with the Healthcare Group from MidCap Advisors because of thei
Being a reproductive endocrinologist in private practice for several years, I connected with the Healthcare Group from MidCap Advisors because of their experience in the healthcare industry and specifically in the fertility practice space. As investment bankers, they understood my goals and objectives and spearheaded the effort to find the best partner for me and my practice. I highly recommend MidCap Advisors if you’re thinking about the future of your practice. They are knowledgeable, understanding and care about the results, both financial and personal.
We selected MidCap after interviewing three investment banks and are very happy with our decision. MidCap executed the transaction just as they said t
We selected MidCap after interviewing three investment banks and are very happy with our decision. MidCap executed the transaction just as they said they would and exceeded expectations of valuation.
MidCap provided thoughtful and practical solutions to real-world problems, while simultaneously providing strategic guidance for our long-term plannin
MidCap provided thoughtful and practical solutions to real-world problems, while simultaneously providing strategic guidance for our long-term planning. They dug deep into our daily operations and provided impactful results that benefited our entire team – from sales to lab operations to billing.
As a busy physician whose focus was on my patients, when I decided to seek a merger partner I realized that I needed to have a knowledgeable and trust
As a busy physician whose focus was on my patients, when I decided to seek a merger partner I realized that I needed to have a knowledgeable and trustworthy advocate. For me, that need was fulfilled by MidCap Advisors. The process of identifying and evaluating a viable partner is time-consuming and my familiarity with it was limited. Going at it alone would have been detrimental, if not disastrous for my ongoing practice. Having the guidance and expertise of the people I worked with from MidCap Advisors proved to be invaluable and I highly recommend them.
We had engaged in a previous acquisition with another company and their team’s approach was the reason we backed out. Our company was acquired by a
We had engaged in a previous acquisition with another company and their team’s approach was the reason we backed out. Our company was acquired by a much larger organization and MidCap Advisors worked closely with us to make sure the transition went smoothly. Chip Loeb of MidCap Advisors was extremely helpful in working with our team to make sure all of our information was transferred properly and in a timely, efficient manner. Our company’s acquisition was one of the fastest HUB has seen, and everyone was pleased with the outcome. The team at MidCap is very professional and great to work with. MidCap went above and beyond and we are incredibly pleased with the outcome.
We had an excellent experience working with MidCap on the sale of our businesses. We did a rollup which involved the sale of five firms, simultaneousl
We had an excellent experience working with MidCap on the sale of our businesses. We did a rollup which involved the sale of five firms, simultaneously. We worked with Tony, Ryan and Brandon and thought they did a great job. They brought a lot of experience to the table and gave us some great advice.
Their diligence created a phenomenal outcome for our group of companies and working with Gallagher is a win-win. Tony Leonard and Ryan Sanford were ex
Their diligence created a phenomenal outcome for our group of companies and working with Gallagher is a win-win. Tony Leonard and Ryan Sanford were excellent and professional, easy to work with, and reached back in a timely manner.
We had worked with a number of banks and advisory firms post our recovery from the effects of the 2009 financial crisis but none of these deals worked
We had worked with a number of banks and advisory firms post our recovery from the effects of the 2009 financial crisis but none of these deals worked out. We hired MidCap late in 2014 to assist us and not only did our transaction close the following year, but the valuation far exceeded any prior offer.
Our investors were ready for an exit and had an offer that I was not comfortable with. Our board allowed me to retain MidCap to pursue another option
Our investors were ready for an exit and had an offer that I was not comfortable with. Our board allowed me to retain MidCap to pursue another option and together we were able to raise equity and merge with another firm. We couldn’t have accomplished this without MidCap.
The team at MidCap provided expert, hands-on, senior-level negotiation and support before, during, and long after the transaction.
The team at MidCap provided expert, hands-on, senior-level negotiation and support before, during, and long after the transaction.
We retained MidCap to negotiate an unsolicited offer our company received. Following their advice we decided to run a full marketing campaign process.
We retained MidCap to negotiate an unsolicited offer our company received. Following their advice we decided to run a full marketing campaign process. As a result of trusting MidCap’s advice to run a full process, they sourced and executed another deal that was much better aligned with our strategic goals and exceeded any prior valuations way beyond our expectations!
I would highly recommend MidCap Advisors. My dealings with them were always cordial, professional, and steadfast. Our acquisition process ran into com
I would highly recommend MidCap Advisors. My dealings with them were always cordial, professional, and steadfast. Our acquisition process ran into complexities, yet they never lost their focus and ability to advance the conversations to a satisfactory conclusion. I retain the utmost respect for their assistance – especially valuable in a process which can be nerve-wracking and emotional for an individual who has spent over forty years building a company. Their advocacy was immensely valuable.
I couldn’t have asked for a better partner than MidCap. They ran a competitive process that brought in multiple strong bidders and gave us great opt
I couldn’t have asked for a better partner than MidCap. They ran a competitive process that brought in multiple strong bidders and gave us great options. Their team was involved every step of the way, helping us position the company, manage buyer conversations, and get through diligence. Their expertise and genuine care made all the difference and led to a great outcome for our team.
Just like in your business, our people are what make us great
Undoubtedly, COVID-19 has changed many aspects of our daily lives, but has it changed the value of your business? Find out how MidCap helps clients evaluate the risks and
opportunities in these uncertain times.
Learn about MidCap’s Transaction Roadmap – how we work with our clients at all phases of the process, and why the most important step could be the one you take now, even if a potential sale is in the distant future.
Find out how the MidCap team found hidden value and helped agency owners achieve outstanding returns in these unique transactions.
Download our latest analysis on The Impact of Interest Rates and Capital Gains Tax on Net Proceeds for Insurance Agency Owners.
When considering the valuation of your company, discussions often revolve around EBITDA multiples. Business owners, investors, and bankers throw around terms like “7x,” “10x” or “15x” for company valuations. While multiples are undeniably crucial in the valuation discourse, business owners must not overlook a fundamental question: “What EBITDA is that multiple being applied to?”
EBITDA (Earnings before Interest, Tax, Depreciation, and Amortization) is a common metric used to estimate a company’s operating cash flow. Despite what seems to be a simple equation, understanding the differences between transactional vs. accounting/reported EBITDA is vital for maximizing the value of your business and positioning the business for growth and success.
The accounting/reported EBITDA provided by your accountant is a historical look at a company’s performance. It provides a starting point for a business valuation, but it does not incorporate a company’s performance outlook. That is where an experienced investment banker comes into the picture. Companies are continually evolving and responding to industry dynamics. When determining transactional EBITDA, an investment banker incorporates factors such as a company’s strategy, recent investments, strength of leadership talent and changes in key management, new service or product expansions, changing cost structure, market trends and how all may affect EBITDA. It is from this forward-looking transactional EBITDA that business owners want to sell their business, not the typically lower accounting/reported EBITDA that buyers prefer.
Every dollar of transactional EBITDA that your investment banker confirms and can support through a buyer’s due diligence results in the seller receiving an EBITDA multiple of that dollar! An investment banker’s thorough forensic analysis of your business may help identify EBITDA enhancements by:
An investment banker’s ability to identify EBITDA enhancements and to benchmark operating margins enables a business owner to maximize its transactional EBITDA and enhance value. For instance, through collaboration with an investment banker well versed in the lower middle market, the business owner in our example managed to boost revenue by $200,000, which, at a static 9x multiple, increases the value of the company by $1.8 million. In the example below, negotiations and strategic processes further contributed to potential increases in the EBITDA multiple by 1x-2x. An increase in the multiple from 9x to 11x, along with analysis showing increased revenue of $200,000 and reduced expenses of $375,000, would result in a valuation increase of $12.3 million.
MidCap Advisors’ quality of earnings process for business owners considering a sale ensures that the EBITDA multiple a business owner receives aligns with the maximum EBITDA of the entity. While business owners understandably focus on the received multiple and its comparison to competitors, it is essential to recognize that this assessment is only one side of the equation. A comprehensive understanding of the underlying EBITDA and margin dynamics is equally crucial for making informed decisions and optimizing deal outcomes.
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We spend a lot of time talking to business owners about what to expect during a sale transaction. For most, this their first time selling a company, and the amount of effort and detail involved can seem endless. And then there’s the emotional adjustment. Giving up control of a company that has been built through years or decades of hard work, sleepless nights, and enormous investment in personal relationships with employees, customers, and business partners is a huge shift in mindset.
At MidCap, we’ve developed a few recommendations to help business owners prepare for a sale and the transition period that follows:
So, while a business sale is complex and brings with it tremendous change, a strategic and well-executed plan can help business owners avoid potential pitfalls that can threaten the transaction or lead to a suboptimal outcome. By following these guidelines, business owners can position themselves for a smoother and more lucrative sale and post-sale satisfaction.
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Concerns around rising interest rates have caused many private equity firms to hit the pause button with their buyout funds by holding onto their assets historically longer. As the cost of incurring debt increased, PE firms saw their buyouts scaled back. Further, a widening chasm between buyers and sellers regarding valuation led to deal stagnation at a time when the cost of debt rose.
Private equity firms averaged hold periods of more than seven years for buyouts in the US and Canada in 2023. This is a substantially longer time frame than from 2014 to 2023 when the average holding period was 5.8 years. In the preceding decade from 2003 to 2013, the holding period of PE buyout funds averaged less than five years. The lengthened time horizon for buyouts has had a precipitous effect on overall North American exit values amongst private equity firms, from $450 billion in 2021 to $303 billion in 2022. As of November 2023, the exit value was $175 billion.
Now, as the Federal Reserve has halted interest rate increases, private equity firms that have grappled with high borrowing costs are expected to benefit. With fears of a recession dissipating and an expectation that interest rates will come down, M&A activity may escalate in the second half of 2024. As interest rate increases are halted, optimism is anticipated to return to the private equity market, driving stability and a narrowing of the bid/ask spreads between buyers and sellers. It may be wise for owners considering a near-term sale to ready themselves for more intensive opportunity in the second half of 2024.
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Business owners contemplating an eventual exit are more likely familiar with their traditional options regarding a prospective merger or sale: a sale to a partner, family member, employees, a strategic buyer, or a private equity buyout. However, they may be less familiar with a type of buyer that often presents a very compelling option: an independent sponsor.
Independent sponsors, formerly called fundless sponsors, are experienced dealmakers who often possess deep industry knowledge in finance, operations and management within their acquisition sector targets. Unlike private equity firms, these investors source, structure, and manage transactions without first assembling a pool of capital. In short, they target a specific company, create an operations and management structure to optimize its performance and then locate investors to purchase it. They earn their compensation by taking a percentage of closing costs (typically two to five percent), a management fee for ongoing operational engagement in the acquired business, and/or via carried interest in the project, earning a share of the partners’ return on investment. They sometimes invest a small portion of the purchase price or roll their fee into the transaction. This emerging trend has gained traction as a viable alternative to traditional private equity models, offering unique advantages for both buyers and sellers as well as investors.
Independent sponsors operate by leveraging their industry expertise, extensive networks, and deal sourcing capabilities to identify attractive opportunities. As noted, independent sponsors don’t fundraise and then figure out where to deploy capital; instead, they focus on tailored financing solutions on a deal-by-deal basis. Such investment latitude is particularly appealing in the lower middle market, where deal sizes can be smaller and the investor community is often more diverse. Investors in independent sponsors are generally the same parties that invest in traditional private equity funds (family offices, high net worth individuals, university endowments, etc.). More often today, even private equity firms invest in deals controlled by independent sponsors, saving PE firms time focused on executing smaller yet viable transactions. Further, individual investors often favor the independent sponsor model because it avoids management fees associated with uncommitted capital, enables investors to know and approve exactly where their money will be invested, and they are not locked into a binding commitment of several years, as most PE investment necessitates.
In a 2022 independent sponsor survey published by law firm McGuireWoods, 75 percent of independent sponsor deals occurred in the lower middle market. Further, approximately two-thirds of all the transactions surveyed had a purchase price less than six times the target company’s EBITDA (earnings before interest, taxes, depreciation, and amortization). More than 80 percent had a purchase price less than seven times EBITDA and 90 percent had a purchase price less than eight times EBITDA.
Independent sponsors have recently been active buyers across competitive sectors such as healthcare, business services and technology. Yet they are also active in less favored areas such as manufacturing. Their success can be credited to a targeted approach, deep market knowledge and a hands-on operational focus, all of which enable swift deal execution with motivated sellers and far less red tape on the way to closing. Conversely, selling to a traditional private equity fund frequently involves a lengthier and more complex process, typically requiring a seller to navigate multiple layers of decision-making within the fund structure over many months. The streamlined, more direct, efficient, and usually less costly transaction process in a sale to an independent sponsor explains their increasing prevalence, especially within the lower middle market.
For business owners contemplating a near-term sale, there are several notable benefits to selling to an independent sponsor:
Independent sponsors are adroit; they can offer more creative deal structures as well as customize financing solutions to meet the unique needs of a business inclusive of seller financing, earn-outs, or other flexible arrangements that may be more challenging to negotiate with traditional private equity funds.
In the ever-evolving M&A landscape, the growing prevalence of independent sponsors reflects a shift towards more flexible and personalized deal structures, which can be especially appealing to lower middle market companies. The tailored approach, sector expertise, and a less arduous closing process that characterize the independent sponsor model make it a compelling alternative for sellers that is likely to continue to gain momentum and permeate many business verticals in the years ahead.
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The business of investment banking is complex in many facets – it runs at a pace where quite a lot seems to happen at once and yet the deal process can be a long game…a very long game. Being an investment banker is about the willingness to make a trusted advisor relationship with a client prospect, sometimes years ahead of a potential sale.
Before investment bankers can be dealmakers, they must be relationship-makers. That is, they must work to become trusted advisors, immersing in the business of a prospective client and offering advice, guidance and connections that may one day make the company an attractive acquisition target. When engaging with companies far before they are even considering a sale or a capital raise, patience emerges as a crucial trait for the investment banker who is willing to be a sounding board for entrepreneurial organizations that have selling the business on their horizon.
While investment bankers may lead transactions, skilled investment bankers are never transactional when building relationships across the industry sectors they serve. Successful investment bankers recognize the importance of taking the long view, seeing the big picture, and establishing connections with companies even when they are not actively seeking an exit plan or driving toward a liquidity event. By doing so, bankers position themselves as allies and advocates rather than mere deal facilitators. Nurturing a relationship with a business that one day may be ready to go to market positions the investment banker to cultivate additional high-value connections that will help the business achieve an optimized valuation when the time for a sale arises. In the interim, the investment banker has a wealth of knowledge to impart to the business. By offering guidance and resources to empower an entrepreneurial organization to elevate its operational strategy, customer/client base, and key industry alliances, an investment banker is often rewarded with loyalty from that company to take it to market, identifying the ideal M&A opportunity that aligns to achieve the company’s quantitative and qualitative objectives.
The Journey to a Sale
Companies typically go through various stages of growth and transformation before considering a sale or any significant financial transaction. A patient investment banker recognizes these stages and understands that timing is crucial. Instead of focusing on a near-term opportunity or advising a prospect to sell prematurely (before optimal valuation can be achieved), a wise investment banker devotes time to fully understanding a potential client’s business, growing a relationship with the leadership team, offering advice, and even opening doors to new relationships that will help the company mature towards an eventual sale. Further, an investment banker who is both intellectually and emotionally intelligent will stay informed about industry trends and potential challenges that could have a material impact on a prospect’s business, its market position, and its valuation. That investment banker becomes a sounding board when the company finds itself navigating choppy waters.
Building Trust and Credibility
Patience in relationship-building with prospects allows investment bankers to elevate their credibility and earn the trust of many businesses. By demonstrating a commitment to a company’s long-term success, bankers become valuable partners rather than opportunistic vendors. When the client eventually reaches a stage where financial advice is needed or a transaction appears an attractive option, the investment banker that has been a trusted advisor frequently becomes the preferred M&A advisor.
Strategic Advisory Role
Exceptional investment bankers don’t just react to current market conditions or immediate needs — they proactively offer strategic advice. By nurturing relationships over time, bankers gain a deep understanding of a company’s goals, challenges, and vision. Positioning themselves to provide tailored advice that aligns with the client’s long-term objectives, builds trust and rapport.
Mitigating Risks and Challenges
Patience allows investment bankers to identify potential risks and challenges well in advance. By cultivating a relationship with a company before it is ready to sell, bankers can work alongside the future client to address issues, strategize for growth, and implement measures that enhance a company’s market position.
For the investment banker, patience is not simply a desirable character trait, it’s an authentic strategic advantage. Building relationships with companies far before they may even contemplate the prospect of a sale requires a forward-thinking approach and a commitment to the prospective client’s future success. The investment banker who embodies patience in relationship-building becomes a trusted partner, offering strategic insights and guidance that extend far beyond an immediate deal. It is this quality that sets apart exceptional investment bankers and ensures lasting success for both clients and advisors alike.
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For a business owner, one of the most critical steps in a sale is determining the strategy and timing for informing employees about the impending sale. Effective communication is the key to maintaining trust, morale, and productivity during this transitional period.
Determining the Right Time
We’re often asked by clients when is the best time to tell employees about a pending sale. Some may hope the answer is: after the deal closes. But that is rarely, if ever, the case. Deciding when to inform employees about a company’s sale is a delicate balancing act. Share the news too early, and it might lead to uncertainty, reduced morale, and even potential talent defections. On the other hand, informing employees too late can make your team feel blindsided, eroding trust that could have a damaging effect on productivity. Striking the right balance is crucial. Here are a few tips for a seller to determine the right time to share that the company is being acquired:
Strategic Communication
How the news is delivered is as important as when it is delivered. Crafting a clear, positive, and empathetic message is essential to managing employee reactions.
Informing employees about a company sale is a process that requires careful planning and a clear communications strategy. By considering the timing and method of communication, business owners can minimize disruptions, maintain employee morale, and ensure a positive environment throughout the transition.
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When it comes to selling your business, you want to be sure you are prepared. A business exit should always be a well-strategized event, structured to help you get the highest return on all the time, energy, and money that you have poured into your business over the years. The process of selling your company needs to be intensively planned to ensure that the entire organization and all its internal and external stakeholders are aligned for sale with intentionally and strategically pre-determined terms. Having the luxury of time allows you to choose the ideal buyer out of multiple offers.
But what about when the sale of your business is not planned?
The truth is that you may not always know when it’s time to sell your business. And, many financial advisors will suggest that timing the market is not the best of investment strategies. However, certain circumstances that are typically out of your control can disrupt, stress, or even force a sale of your business. These circumstances could lead to the devaluation of your assets, talent, trade secrets, real estate, everything . A pressured sale could cause you to lose your leverage in the sale and force you to sell for a lower valuation – that is, if you aren’t prepared.
What Could Cause a Forced Sale of Your Business?
We call them D- risks. These are risks that are a part of everyday life. Owners manage business risk very well, but D-risks are usually curve balls that owners may have a blind spot to. When they occur, D- risks can have a detrimental impact on the value of your company and, in some circumstances, may cause you to have to sell your business. Some D-Risks to highlight include:
Death – If an owner passes suddenly, without proper estate planning and managerial preparedness, an owner’s heir(s) may rush into a sale, especially if they are not able to assume management of the company. If the owner, as is often the case, is the “face” of the company, significant concern about the longevity of the business may be perceived.
Disability – If the owner or other “key person” are unable to perform the duties of leadership due to sudden and catastrophic illness, concerns about the stability of the company may develop. As valuations reflect both historical and projected performance of a business, this could pressure value of the company at an ill-opportune time.
Divorce – A marital breakdown can force an urgent sale of a business, compounding an already personally and financially stressful time. This can happen if the spouses own the business together, or if one spouse owns a business and a legal mandate is made to equitably divide assets. Buy-Sell, Prenuptial and Postnuptial agreements potentially mitigate these risks, but the emotional toll on an owner may reduce focus on the business and result in underperformance that could pressure valuation.
Disagreement – If partner owners of a business are dead-locked in conflict, a company can stagnate, reducing value in the process, and potentially the only way to resolve the dispute may be to sell the business and divide the proceeds.
Disillusion – Sometimes years of building a company just take its toll, and unexpectedly an owner loses their zeal for the business. Maybe it is an interesting new industry or development that catches an owner’s eye. Or, it is a life event, such as the passing of a loved one or friend that makes an owner assess life. Or, it is just time. Unless a succession plan has been established, selling a business with one eye towards the next chapter usually results in a suboptimal outcome.
Disruption – How long before technology changes a traditional industry structure and, in the process, establishes new winners and losers and respective valuations? With artificial intelligence infiltrating so many aspects of life, predicting the future of an industry is rife with speculation. A company can become shackled by a development or an event out of their control that makes it difficult to continue its productivity (such as a technological challenge, an industry-wide supply shortage, a widespread pandemic, etc.) and be forced to look for strategic alternatives for its survival – not a strategy to optimize valuation.
Departure – When a key member of an organization unexpectedly decides to leave to pursue other interests or moves on due to disagreement over a myriad of potential issues such as compensation or strategic vision for the business, a company could be greatly impacted and, in extreme cases, ownership can be forced to sell the business.
As you can see, many circumstances can lead to a hurried sale — and this isn’t even the only possibility. While you ideally want the sale of your business to be planned and formulated to create the best possible terms for all stakeholders, we can see from the examples above that sometimes that may not be the case. A catastrophic event can cause you to drastically reduce control over your business and exit planning.
This is why you need to plan for the sale of your business. Even if the thought of selling your company is far on the horizon – be prepared for the unexpected and protect your business.
How Do I Plan for the Sale of My Business?
Being proactive and well-informed is crucial. You don’t want to wait until you have to sell to get started. Working with an investment banker to obtain an up-to-date valuation for your company that incorporates your strategic outlook can help prevent you from being forced to sell your business for less than its worth under strict timelines. You have the opportunity to identify growth opportunities, areas to strengthen or improve, and to align all stakeholders with a well-thought-out strategy to sell the company on your terms.
What Are the Benefits of Hiring an Investment Banker to Sell My Business?
As discussed, it’s a good idea to meet with an investment banker to get an updated, improved valuation for your company. Investment bankers use your accountant’s financial statement as a starting point, as it only reports historical results and develops transactional value for your company. The transactional value incorporates factors such as your company’s strategy, recent investments, new service or product expansions, changing cost structure, market trends, and how your company mitigates D-risks. Armed with this transactional value will enable you to be prepared to proactively sell your business and minimize value destruction that could occur from some of the D-risks highlighted earlier. There are many other benefits to having an investment banker involved in the process of selling your business.
Investment bankers are typically heavily involved in the selling process and can help negotiate complex deal terms on your behalf. They can also help facilitate the due diligence process and work extensively with your accountant and attorney on optimizing a transaction for you.
Equally as important, working with a financial advisor like an investment banker can help you plan what to do with the profits after you sell your business. Taxes and inadequate planning can take up a large portion of your proceeds from the sale of your business. Having a team of qualified financial advisors, such as estate, trust, and wealth advisors, can help you strategize to avoid massive financial mistakes and reduce tax liabilities.
Bottom Line
Even if you have no plan to sell your business in the near future, meeting with qualified investment banking firms, like MidCap Advisors, can help you stay in control of the sale process when the time is right and be prepared for any of the unexpected D-risks. You don’t want to wait until you are forced to sell your company immediately to start strategizing your exit plan.
If you are looking to protect your best interests and prepare for the sale of your business, our team would love to set up a call to ensure that your company is in good hands with a well-structured exit plan in place.
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Achieving success in an enterprise is never a matter of chance or mere good fortune — it’s a calculated endeavor guided by strategic insights and informed decisions. At the center of this strategic framework are Key Performance Indicators (KPIs) — indispensable metrics that gauge the effectiveness, competitiveness, and overall health of your firm. KPIs play a critical role in achieving operational excellence, aligning organizational objectives, and ultimately, fueling growth and profitability.
What Makes a Good KPI?
Before discussing the importance of KPIs, it’s essential to distinguish between a good KPI and a mediocre one. A good KPI is:
How to Implement KPIs Effectively
To implement KPIs effectively, adherence to a systematic approach and a commitment to continuous improvement is essential. Here are some steps to guide the implementation process:
Key performance indicators serve as guides on every enterprise’s journey toward success. By defining clear objectives, selecting appropriate metrics, and implementing robust monitoring and reporting mechanisms, every business can harness the power of KPIs to promote performance excellence, optimize resource allocation, unlock new avenues for growth and innovation, and ultimately, increase the value of the business for shareholders.
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Within the insurance industry, perpetuation planning is a crucial endeavor for firms intent on navigating leadership transitions that ensure their legacies. Perpetuation planning encompasses a range of initiatives designed to foster the continuity and longevity of an insurance firm’s operations. In other words, savvy insurance firms enable enterprise continuity through strategically managed transitions. These initiatives often involve intricate financial maneuvers, strategic partnerships, and meticulous risk management strategies — all activities where an investment banking firm can be a vital trusted advisor.
Perpetuation planning is multi-step, highly nuanced undertaking. Most insurance firm leaders may believe that having a financial plan and performing marketplace quantitative analysis is all that is needed to ensure they maintain their competitive edge, yet the record shows that is decidedly not the case. When it comes to creating a plan that is thorough, flexible, and feasible, insurance firms need to examine their operations through a plethora of questions, not a simple review of basic managerial processes. As insurance firms navigate the complexities of succession, capital management, and strategic growth, an investment banker can be a resource to firms seeking to devise optimal perpetuation strategies.
When deciding if an investment bank can be an effective partner, the following key strategy concepts should be considered:
For any organization, its perpetuation process ensures the enterprise can withstand the test of time. Though transitions can be challenging, investment banks can serve as strategic partners in evaluating and devising perpetuation strategies. By leveraging their expertise in capital optimization, M&A advisory, valuation, financial modeling, and risk management, investment banks empower insurance firms to navigate succession, capitalize on growth opportunities, and safeguard their legacies for generations to come. This innovative and crucial collaboration between insurance firms and investment banks is reimagining the perpetuation planning landscape, ensuring resilience, continuity, and prosperity across the industry. Investment banks can ensure that whatever the objective of a firm’s perpetuation plan may be, the business will have the tools and resources required to achieve it.
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Our Vice President, Tony Leonard, was recently quoted in a Wealth Solutions Report article.
Tony addresses how a financial advisor can help their business owner clientele when succession through M&A is a priority. With a CPA, an attorney, a financial advisor, and an experienced investment banker who can provide end-to-end guidance, these parties can supply business owners with the appropriate resources and advice. Together they will ensure a timely and successful closing of their client’s company.
Our Vice President of Healthcare, Our Team, was featured in a Healthcare Business International article that further speculated about Fresenius’ strategy to offload its expansive fertility asset, The Eugin Group, to the M&A market. It is through the courtesy of Healthcare Business International that we can share this information with our audience.
Robert shared insights related to The Eugin Group’s partnerships with prominent IVF clinics across 3 continents, he assessed the overall U.S. M&A market, and he explained the market from an investor’s perspective. Also, with experience as an administrator and CEO of a hospital, Robert observed that even though European hospitals are selling “non-core” fertility assets, U.S. hospitals are not doing the same currently. Robert cited higher concentrations of older patients with critical needs, nurse shortages, and wage demands as possibilities for why hospitals would need liquidity.
Currently in its 90th year of operation, PMA provides commercial and personal lines customers risk management solutions.
“EMG retained MidCap to identify a qualified buyer with the ideal cultural fit while maximizing enterprise value,” said Douglas Hendrickson, Partner at MidCap, who led the deal team along with MidCap Vice Presidents Brandon Bisack and Michael Gorlick, and Analyst Gabriella Walker. “The ideal buyer had to respect EMG’s entrepreneurial vision to operate independently and retain its full staff while availing itself of the advanced technological resources and elevated marketing opportunities an acquisition could provide. SMS checked all the boxes.”
SMS represents top Medicare Supplement, Medicare Advantage, annuity, life, long-term care, and travel insurance in all 50 states. The firm was founded in 1982 and joined parent firm Alliant Insurance Services in 2020.
The leading national BGA to benefit from well-established insurance platform’s proprietary technology, marketing capabilities, and top carrier solutions. EMG, founded in 1972 as a Texas-based brokerage firm, assists financial advisors in navigating the insurance marketplace by locating the right products for their clients.
The BGA supports a national network of more than 3,000 agents across all 50 states. The Company offers life insurance plans, critical illness, long-term care, disability, travel, dental insurance as well as annuities, group benefits, life settlements and Affordable Care Act (ACA) plans. SMS represents top Medicare Supplement, Medicare Advantage, annuity, life, long-term care, and travel insurance in all 50 states. The firm was founded in 1982 and joined parent firm Alliant Insurance Services in 2020.
Senior Market Sales® (SMS), one of the industry’s premier insurance marketing organizations (IMOs), has acquired EMG Insurance Brokerage, one of the oldest and most well-respected IMOs in the country. SMS President Jim Summers touted the new partnership as a major win for SMS and parent company Alliant Insurance Services as they build a network of companies that work together to grow, spark industry innovation and impact advisors’ and their clients’ lives.
“EMG joins a network of acquired partners who celebrate individual entrepreneurship while fostering collaboration — that’s a unique and exciting culture,” Summers said. “At a time of rapid consolidation in our industry, we’re not just expanding to get bigger. We’re carefully selecting strategic partners who can help us achieve our vision of building the premier health and wealth distribution network in the industry.”
The leading national BGA to benefit from well-established insurance platform’s proprietary technology, marketing capabilities, and top carrier solutions. EMG, founded in 1972 as a Texas-based brokerage firm, assists financial advisors in navigating the insurance marketplace by locating the right products for their clients.
The BGA supports a national network of more than 3,000 agents across all 50 states. The Company offers life insurance plans, critical illness, long-term care, disability, travel, dental insurance as well as annuities, group benefits, life settlements and Affordable Care Act (ACA) plans. SMS represents top Medicare Supplement, Medicare Advantage, annuity, life, long-term care, and travel insurance in all 50 states. The firm was founded in 1982 and joined parent firm Alliant Insurance Services in 2020.
MidCap Advisors LLC is pleased to be a sponsor of the 12th Annual Brach Eichler New Jersey Healthcare Market Review (NJHMR) September 28-29 at the Borgata Hotel Casino Spa in Atlantic City, New Jersey. NJHMR provides a unique opportunity to connect with over 200 attendees comprised of hospital and ambulatory surgery centers executives and stakeholders, physicians, practice owners and managers, and healthcare administrators. During the two-day event, industry experts will discuss timely topics and trends in the healthcare and legal space ranging from legislative issues to operating and business strategies for greater profitability. Our own Robert S. Goodman (Bob) will be a panelist for the Friday, September 29th 11:00 a.m. to 12 noon session General Practice Management Panel of Experts: Hot Topics Relevant to Your Practice.
If you are contemplating selling your practice and have an interest in learning more about the M&A market for physician practices and ambulatory care centers in New Jersey, be sure to attend Bob’s panel and meet the MidCap Healthcare team at the conference.
MidCap Advisors’ Vice President of Healthcare Robert S. Goodman offered comment to Inside Reproductive Health regarding investment bank KKR’s move to acquire Fresenius’s Eugin Group. The prospective transaction would make KKR one of the largest players in the global fertility space, following its acquisition of IVIRMA earlier this year.
MidCap Advisors’ Vice President of Healthcare Brijinder S. Minhas was quoted by Inside Reproductive Health following the appointment of new CEOs at both The Fertility Partners and First Fertility.
The Fertility Partners (TFP) announced Derek Larkin as its new CEO on August 16, the same month that Cara Reyman took over as CEO of First Fertility, Larkin’s old post. Reyman was the CEO of a different fertility clinic network, Fertilitas, from July 2022 to July 2023.
Andrew Meikle, founder of TFP, served as the company’s first CEO from September 2019 to August 2023. Meikle will continue to serve as founder and executive chairman as the transition occurs to supporting partner relationships, corporate development and strategic decision-making.
The Fertility Partners, founded in 2019, is a network of fertility practices with 36 clinic locations across North America, including 14 IVF centers. With more than 75 physicians and 1,000 employees, TFP operates in six provinces in Canada.
Larkin’s experience extends beyond his time as CEO of First Fertility from May 2020 to July 2023. He held various leadership positions over a span of 12 years at Boston IVF, including CEO. In his roles at Boston IVF, Larkin demonstrated developed expertise in managing operations and guiding strategic direction, according to TFP.
This background places him in an ideal position to lead TFP and further enhance its offerings to partner clinics, according to TFP.
“My life’s work has been in fertility, striving to improve the patient experience along their journey of family building,” Larkin said in a statement. “I am excited to continue to lead this amazing organization with that purpose.”
“This is a transformational time in our business, and we are very excited to have Derek guide the TFP team as we continue our growth across North America,” Meikle said in a statement. “We have a tremendous alignment of vision and values, and his extensive operational expertise, sector knowledge and leadership will enhance our offering to partner clinics.”
Dr. Brijinder Minhas was a partner and COO at NewLIFE in Florida for 22 years before it was acquired by First Fertility in 2022. MidCap Advisors were investment bankers. After the sale, Minhas joined MidCap as vice president of healthcare.
“It is important that management companies truly understand the nuances of the practice they are dealing with,” Minhas said.
“Having managers and C-suite folks with prior fertility experience, in my opinion, is essential and leads to a much more productive and profitable relationship … The reasons for the shake-up at First Fertility are not known. A good warning for other CEOs: ‘Hire the right team and keep both the practices and private equity bosses happy.’ Ultimately, clinicians want to provide the best patient care, and management partners want to maximize profitability. A good balancing act is required.”
Meikle and Larkin declined to comment on the transition for the purposes of this article.
MidCap Advisors is a New York-based M&A advisory firm providing sophisticated financial advice and M&A transaction services to private companies. MidCap Advisors offers industry-leading analysis that integrates both quantitative and qualitative factors to accurately assess the total value of a transaction, ensuring it meets the client’s definition of success. Over the past 20 years, MidCap has become a recognized leader in insurance M&A and transactional support services. The firm also has extensive M&A expertise in other sectors such as healthcare, manufacturing, business and technology services. The MidCap team’s deep experience as investment bankers has enabled additional focus on due diligence, consulting, and direct investing.
To learn more about MidCap’s healthcare M&A experience, visit Healthcare M&A .
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Mergers and Acquisitions reported on the promotions of three members of the MidCap Advisors team: Brandon Bisack, from Associate to Vice President; and Chloe Noto and Sterling Price to Associate from Analyst
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