Fundless Sponsors

I am in lower middle market M&A and there are a ton of fundless sponsors.

Some are even getting pretty nice deals done.

Do you think this is a fad that will see a lot of failure? Or is this a viable model for a career?

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It's viable. Especially if you get good deals and exits done. That said though, most fundless sponsors hope to get a a couple good exits under their belt and use that success and track record to go out and raise a fund. That always makes life easier, both in terms of committed capital (don't have to line up equity financing on a deal by deal basis) and the management fee keeps the lights on. So you should try and pick a fundless sponsor as close to raising a fund as possible to maximize chances of success.

 
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