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Is a Management Buyout the Right Choice for Your Business?

By: Harrison Menaker

Throughout the life cycle of a business, ownership’s goals change on both an individual and company-wide level. After dedicating themselves…


Cash Flow: What Does it Mean for Your Business?

By: Harrison Menaker

Do you struggle to balance your business expenses and cash every month? Do your monthly expenses outweigh the cash your business brings in…


Purchase Price Allocation in Small Company Acquisitions

By: Ryan Hanley

In the sale of a small company, the allocation of purchase price for tax purposes creates important considerations for sellers and it is…


What Every Business Owner Needs To Know About Senior Debt

By: Scott Dickes

Senior debt, also commonly called a senior term loan, is a loan received from a traditional commercial bank that has a specified repayment…


Enterprise Value vs. Equity Value: Everything You Need to Know

By: Paul Wormley

Enterprise value is the value of a company that is available to all of its debt and equity holders while equity value is the portion of…


What are Indemnification Baskets and Caps in M&A?

By: Paul Wormley

Baskets and caps establish limits on the amount a buyer can claim against a seller for certain claims of indemnification.  An…


Asset-Based Valuations: Benefits and Pitfalls

By: Paul Wormley

Asset-Based valuations are a form of business valuation that is centered on the value of a company’s assets. Asset-Based valuations are most…


Full EBITDA Guide: What is It & How Investors Use It (Formula)

By: Paul Wormley

Simply put, EBITDA = a company’s Earnings (net income on its income statement) + any Interest, Taxes, Depreciation and/or Amortization also…


What are Fundless Sponsors? [FAQ + Guide]

By: Clay Brock

Private equity funds are pooled investment vehicles that are raised from a group of sophisticated investors to pursue a specific investment…


The Guide to Exit Strategy for Small Business Owners

By: Sean Fegan

Following the recent adversity felt by small businesses across the country, we are hearing from a lot of business owners regarding the…


Seller Notes: What Are They Are and How They Work

By: Fitz Dickes

What is a Seller Note? A seller note, also commonly known as seller paper and seller debt, is a form of financing used in small company sale…


How To Calculate a Customer’s Lifetime Value [Ultimate Guide]

By: Scott Dickes

Customer Lifetime Value Definition: Customer Lifetime Value is the present value of the future cash flow contribution from a single customer…


Entrepreneurship Through Acquisition Models Overview

By: Paul Wormley

Entrepreneurship through Acquisition (ETA) is the path to becoming an entrepreneur by buying and growing an established small business. For…


Private Equity vs Venture Capital: What’s the Difference?

By: Clay Brock

The difference between private equity and venture capital can seem confusing but is actually fairly straightforward:  Private equity…


EBITDA Margins: What Every Small Company Owner Needs to Know

By: Clay Brock

EBITDA margin is a popular term but it can't be found on any financial statement. It has to be calculated and is a great way for owners to…


Business Succession Planning in the Era of Baby Boomer Retirement

By: Paul Wormley

Business Succession Planning has always been a process that requires careful consideration and research prior to implementation. This is…


How to Sell A Small Business With or Without a Broker (Advice for 2021)

By: Paul Wormley

When the time comes to sell a small business, small business owners may engage a business broker to sell their business much like a…


COVID-19 Small Business Relief Checklist [January 2021 Update]

By: George Malone

Like most small businesses in the US, Hadley Capital and its portfolio of small businesses faced unprecedented challenges resulting from the…


EBITDAC = EBITDA in COVID Times

By: Paul Wormley

In the early days of COVID-19 my brother texted me a photo of a coffee cup with the acronym “EBITDAC” printed across the front. We shared a…


Hadley Capital Acquires Equustock

By: Paul Wormley

Hadley Capital recently acquired Equustock, a manufacturer of premium animal bedding and litter products, predominantly horse bedding…


Hadley Capital Opens Satellite Office in Dallas, TX

By: Scott Dickes

Hadley Capital recently opened a satellite office located in the Turtle Creek neighborhood. While all Hadley Capital employees will…


Hadley Capital Acquires New Age Cryo, Inc.

By: Scott Dickes

Hadley Capital recently acquired New Age Cryo, Inc., a fast-growing provider of industrial cleaning services based in Northern Illinois…


Hadley Capital and Gillinder Family Recapitalize Gillinder Glass

By: Scott Dickes

Gillinder Glass, a sixth-generation custom glass manufacturer, and Hadley Capital, a Chicago-based investment company, are partnering to…


Hadley Capital Acquires Pneumatic Conveying, Inc.

By: Scott Dickes

Hadley Capital recently acquired Pneumatic Conveying, Inc., a manufacturer of  turnkey and custom pneumatic conveying systems.  Hadley…


Hadley Capital Raises Third Small Company Fund

By: Paul Wormley

Earlier this year Hadley Capital announced the closing of our third small company fund. For nearly 20 years, we have focused exclusively on…


Hadley Capital Acquires GT Golf Supplies

By: Paul Wormley

Hadley Capital recently acquired GT Golf Supplies in partnership with its founder, Craig Pollard, and the company's management team. Craig…


Acquisition Profile & Value Added Distributor

By: Scott Dickes

Hadley Capital is working with an experienced executive to identify and acquire value added distributors with the following characteristics…


Guide to Mezzanine Debt & Financing (With Examples)

By: Scott Dickes

My last post on acquisition financing covered senior debt. This post will cover Mezzanine debt. Specifically, I’m going to talk about:  What…


Financial Reporting Requirements in Small Company Acquisition

By: Scott Dickes

Small business owners are often apprehensive about the changes that may occur when their business is acquired by a private equity firm…


Salary Versus Draw and the Impacts on Small Company Valuation

By: Scott Dickes

Earlier this week, I had a long conversation with an owner of a small business regarding his annual draw and how this draw, unlike a salary…


Hadley Capital Sells JRI Holdings

By: Scott Dickes

Hadley Capital is pleased to announce that it sold JRI Holdings in April 2015. Terms of the transaction were not disclosed. JRI Industries…


Hadley Capital Supports Management Buyout of Centare Group

By: Paul Wormley

In late August, Hadley Capital and the management team of Centare partnered up to acquire the assets and business of Centare Group from its…


Additional Benefits of Leverage

By: Scott Dickes

In our previous post we outlined how using debt in a transaction is often maligned by the media and gave one benefit of leverage. Here we…


The Benefits of Leverage

By: Scott Dickes

Using debt (borrowing) to finance a leveraged buy-out is often maligned by the media or politicians and frequently positioned as risky…


Investing in Existing Portfolio Companies

By: Scott Dickes

Business investment can take many forms. Hiring or upgrading personnel, purchasing additional equipment, expanding IT systems, etc.  Each…


Is It Time to Sell Your Business?

By: Scott Dickes

We often talk with small business owners who are struggling with the decision of selling their business. It is a very difficult and…


The Importance of a Finance Team in Small Business

By: Scott Dickes

Privcap recently released a video of private equity professionals discussing the importance of having good finance talent within portfolio…


Hadley Capital Acquires W.C. Rouse & Son

By: Scott Dickes

We are pleased to announce the acquisition of W.C Rouse & Son. W.C Rouse is based in North Carolina and is the southeast's leading provider…


What is Depreciation Recapture?

By: Paul Wormley

Yesterday I got the email below from a good friend who is considering selling his small business and is concerned about the potential tax…


Open Sky Media Acquires Gulfshore Life Magazine

By: Paul Wormley

Open Sky Media, a Hadley Capital portfolio company, recently acquired Gulfshore Life Magazine, the premier lifestyle magazine serving the…


How the Lehman Fee Structure Works (Example)

By: Scott Dickes

We recently got an email from a business broker asking us what type of finders fee structure we typically use. Our standard finder's fee…


How to Use Data to Manage a Small Business

By: Scott Dickes

The title of this blog post is most commonly attributed to management guru, Peter Drucker. I saw it again recently in a venture capitalist's…


Selling to a Private Equity Firm

By: Paul Wormley

Brent Earles, an advisor for small company M&A at Allegiance Capital recently wrote an article in President & CEO Magazine about selling a…


Hadley Capital Acquires StorFlex

By: Scott Dickes

Hadley Capital has completed the acquisition of StorFlex Fixture Corporation. We are excited for Storflex to join the Hadley family and look…


How to Keep Up With Demand: Customer vs. Skill Demand

By: Scott Dickes

One problem we often hear from small business owners is "I'm having trouble keeping up with demand". The business owner is typically talking…


Improving Small Businesses

By: Paul Wormley

This week's issue of BusinessWeek has a good article about how Monomoy Capital Partners, a private equity firm, uses operational…


The Importance of Managing Working Capital in Small Business

By: Paul Wormley

Working capital is the short term liquidity (read: cash) required to operate a business. Working capital is defined as Current Assets…


Should Your Company Do An ESOP or Sell?

By: Paul Wormley

Over the years we have evaluated a number of small company acquisitions where the target company was deciding between doing an ESOP or…


Assisting Family Businesses in Generational Transitions

By: Paul Wormley

We have worked with a number of families to pass a family business from the first generation to the second generation. In each case, the…


The 45/70 Rule in Small Company M&A - Revised and Updated

By: Scott Dickes

75 is the new 70. The basic tenants of this blog post from 2012 remain - is the owner a sincere seller? But, as the baby boomers age, and…


Exclusivity in Small Company M&A Transactions

By: Paul Wormley

I spent an hour on the phone today explaining to a small business owner why it is important to a buyer to receive a period of exclusivity…


What is a Recapitalization?

By: Scott Dickes

Hadley Capital has had a lot of success acquiring small businesses in recapitalization transactions. In a recapitalization, the selling…


Hadley Capital Sells Portfolio Company to Public Company

By: Scott Dickes

Hadley Capital portfolio company, Kelatron Corporation, a leading provider of bioactive mineral nutrients, has been acquired by Innophos…


Small Company M&A Due Diligence & We're Sellers, Too!

By: Scott Dickes

Before Hadley Capital invests in a company we conduct due diligence.  We seek to learn as much as we can about the business to avoid…


Networking with Small Company Intermediaries

By: Paul Wormley

A couple weeks back I was in Richmond, VA to attend the local Association for Corporate Growth (ACG) Capital Connection conference and last…


Managing Service Providers in Small Company M&A

By: Scott Dickes

Hadley Capital relies on various service providers to help us do our jobs – attorneys, accountants, environmental consultants, etc.  We have…


Non-Compete Agreements in Small Company M&A

By: Paul Wormley

Non-compete agreements are a standard part of the small company sale process. Buyers need to be assured that sellers (and their key managers…


Anatomy of a Small Company Recapitalization

By: Paul Wormley

I spent today in Minneapolis talking to a couple of business partners in their late-50's. They had two competing goals: (1) decreasing…


Private Equity Finder's Fee Agreement: What is it and Do You Need it

By: Paul Wormley

What is a Finder’s Fee? A finder's fee is compensation paid to an individual or firm (often called an intermediary) for a referral or…


Evaluating Leadership Transition Risk

By: Paul Wormley

In light of Steve Job's resignation from Apple, I thought it would be a good time to write about how Hadley Capital evaluates leadership…


Partnering with Executives to Buy a Small Company

By: Paul Wormley

Earlier this week, I got a call from a successful former executive that I've known for awhile (let's call him Jim). Jim called to discuss…


Using Earnouts in Small Company Acquisitions

By: Scott Dickes

Barbara Taylor, a business broker and NY Times blogger, wrote a good post yesterday that describes how a well structured earnout can be a…


Baby Boomers and Small Business M&A

By: Clay Brock

About 79 million Americans make up the Baby Boom generation.  This generation has presided over a period of tremendous economic growth, so…


Hadley Capital Acquires International Specialty Supply

By: Scott Dickes

Hadley Capital, in partnership with Bob Rust, is pleased to announce a management buyout of International Specialty Supply (ISS). ISS is a…


Inventory Not Sold Separately

By: Paul Wormley

I spent some time today explaining to an entrepreneur why inventory is not sold separately in the sale of a small business. His proposal…


Preparing to Raise Capital or Sell a Small Business

By: Clay Brock

If you are considering raising capital or selling your company, here are a few of the items you should consider having on hand; they will be…


Operating Without Personal Guarantees

By: Clay Brock

Business owners often tell us that one of the reasons they want to do a transaction is to avoid having personally guaranteed bank debt. We…


What is Private Equity?

By: Paul Wormley

We frequently meet with small business owners who aren't familiar with private equity – how it works or why a private equity firm would be…


When to Let Go: Keeping vs. Selling a Company - Part 3

By: Scott Dickes

The same intermediary who introduced the box game I described in my last post also referred me Jason Cohen's blog on the topic. Cohen sold…


When to Let Go: Keeping vs. Selling a Company - Part 2

By: Scott Dickes

A few weeks ago I blogged about a business owner who said he'd prefer to keep his company another 5 years rather than sell it today.  Well…


The Importance of Tax Return Due Diligence

By: Scott Dickes

A business owner recently asked me, "Why do you need to meet with my accountant and review the tax returns?"  It's a good question.  Why…


Private Equity Fund vs. Fundless Sponsor

By: Clay Brock

There are generally two types of buyers for small companies:  Strategic buyers (like a larger competitor) and financial buyers (like Hadley…


Small Business Private Equity - 'First, Do No Harm'

By: Paul Wormley

This week I was having BBQ and beers with a successful small business owner who wanted to learn more about our ‘first, do no harm' approach…


When to Let Go: Keeping vs. Selling a Company - Part 1

By: Scott Dickes

I recently heard these words from a business owner in his early 70's. This is not unusual. Of the 25 – 30 business we seriously pursue in…


Working Capital Adjustments: 4 Common Questions Answered

By: Paul Wormley

Working Capital Adjustments are purchase price adjustments in small business acquisitions. They are often a source of confusion in the sale…


What Is the Difference Between an Asset Sale and a Stock Sale?

By: Paul Wormley

In Part I of the Anatomy of a Letter of Intent post I suggested that a buyer benefits from buying assets versus buying stock in the…


Incentive Program Structure for Interest Alignment

By: Paul Wormley

In an earlier post I wrote about how the partners at Hadley Capital eat our own cooking. The investors in our funds appreciate this…


Private Equity Buyers: Think and Act as An Owner

By: Paul Wormley

My partners and I think and act like owners because we are owners. As a group, the three of us are the second largest investor in our…


Anatomy of a Letter of Intent Part I

By: Paul Wormley

Most small business owners only sell a company once so the process of selling a company can be opaque & to put it kindly. One of the most…


Anatomy of a Letter of Intent Part II

By: Paul Wormley

In the first post on the Anatomy of a Letter of Intent we covered the form of the transaction, how a seller is paid and what a buyer buys…


What Makes a Good Acquisition Candidate?

By: Paul Wormley

My partners and I are frequently asked this question by small business owners and their advisors.  In most cases, they are looking for a…