A close family member owns a LMM service business ($1-$3M EBITDA if I had to guess) and has been getting inbound interest from some rollups and tiny sponsors. They asked me to recommend some brokers and boutique banks but honestly I don’t have any experience that far downmarket. Anyone have good recs for one of these deals?
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For a lower middle market (LMM) service business with $1-$3M EBITDA, here are some recommendations based on the most helpful WSO content:
LMM Boutique M&A Banks: There are boutique banks that specialize in LMM transactions. These firms often have the expertise and network to handle deals in this EBITDA range. While specific names aren't listed in the context, you might want to explore firms that focus on LMM deals and have a track record in your industry.
Ultra-LMM Strategies: Consider brokers or bankers who understand the ultra-LMM space, where companies with $2-$5M EBITDA are often acquired at 4-6x multiples. These professionals can help position the business for a roll-up strategy, potentially increasing its value to buyers in the $5-$10M EBITDA range.
Industry-Specific Expertise: If the service business operates in a niche, look for brokers or banks with experience in that specific sector. This can help attract the right buyers and maximize valuation.
Brokerage Networks: Some brokers specialize in smaller deals and have access to a wide network of buyers, including fundless sponsors and roll-up groups. They can be a good fit for a business in this EBITDA range.
If you're looking for specific names, you might need to explore platforms like PitchBook or CapIQ, as suggested in WSO threads, to identify relevant firms. Alternatively, reaching out to boutique banks or brokers with a strong LMM focus could be a good starting point.
Sources: Consider ultra-LMM, Warning re: LMM PE, Alternative Lenders & the End of Risk Taking for Banks - Opportunity or Risk?, LMM Boutique M&A Banks
Got a few recommendations- feel free to pm me
OP here, can you shoot me a PM?
Depending on the vertical (i.e. HVAC, insurance, wealth, CPA, fire, etc) for services could speak to this. Feel free to PM.
Thanks, I’ll shoot you a message
What vertical?
Resi / Commercial access solutions, both new install and maintenance
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