Building an Effective Teaser: Insights From Axial Investors
In lower middle market M&A, the teaser is often the first introduction a potential buyer has to a company. This…
The Middle Market Review Insights on the Middle Market.
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Welcome to the 2nd issue of the Winning M&A Advisor, the Axial publication that anonymously unpacks data, fees, and terms from the winning M&A engagement letters of professional M&A advisors using Axial to win new sell-side business.
We are excited to continue surfacing meaningful data and best practices from the top M&A advisors and capital partners transacting in the American lower middle market.
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| Engagement Letter Details | |
|---|---|
| Retainer Required | No |
| Retainer Amount | n/a |
| Retainer Applied to Success Fee | n/a |
| Engagement Duration | 12 months |
| Success Fee | 5% flat fee on total consideration |
| Minimum Fee | No |
| Special Terms | |
| In the event the business is sold to a buyer during the term of the agreement without the assistant of the advisory firm, the advisory firm will receive the same fee as to which it would otherwise be entitled if sold with the assistance of the advisory firm. | |
Behind The Win:
As part of every Advisor Finder process, we ask business owners to provide a rationale for why they hired a given advisor. The following attributes contributed to the business owner selecting the Winning M&A Advisor:
- Management Expertise: A Managing Director at the firm has recent experience successfully representing similar company profiles.
- Favorable Fees & Terms: Engagement letter terms and fee obligations are strictly success-based and do not include a retainer fee.
- Experience: The firm has significant experience in B2B services and the transportation industry, parallel to that of the business owner’s company. Specifically, one of their past clients had faced the same regulatory and licensing issues and considerations that this business was facing.Â
- Financial Profile: The firm focuses explicitly on $2M-$10M EBITDA businesses.
- Relationship: The advisor made an effort to visit the business owner in-person as they were nearing the final stages of solidifying their engagement.
Looking to exit your business? Find an advisor you can trust.
| The Business Owner | |
|---|---|
| Timeline | |
| Owner Reaches Out To Axial | October 4th, 2023 |
| Owner Begins Interviewing M&A Advisors | October 17th, 2023 |
| Owner Signs The Winning Engagement Letter | December 12th, 2023 |
| Owner | |
| Age Range | 40 - 50 |
| Tenure With Business | < 10 years |
| Business Data | |
| Industry | Transportation |
| Revenue Range | $4M - $5M |
| EBITDA Range | $2.5M - $3M |
| Desired Transaction | |
| Change of Ownership | Targeting 100% sale |
| Reason For Transaction | Use proceeds from sale to invest in new ventures |
| Advisor Recommendation #1 | |
|---|---|
| Firm Type | Investment Bank |
| Generalist / Specialist | Industry Generalist |
| Deals Marketed on Axial L12 | 13 |
| Deals Marketed on Axial All-Time | 166 |
| Average Revenue of Deals | $23,126,070 |
| Average EBITDA of Deals | $3,603,840 |
| Advisor Recommendation #2 | |
|---|---|
| Firm Type | M&A Advisory Firm |
| Generalist / Specialist | Industry Specialist |
| Deals Marketed on Axial L12 | 2 |
| Deals Marketed on Axial All-Time | 7 |
| Average Revenue of Deals | $12,774,285 |
| Average EBITDA of Deals | $2,821,428 |
| Advisor Recommendation #3 | |
|---|---|
| Firm Type | Investment Bank |
| Generalist / Specialist | Industry Generalist |
| Deals Marketed on Axial L12 | 6 |
| Deals Marketed on Axial All-Time | 24 |
| Average Revenue of Deals | $21,325,875 |
| Average EBITDA of Deals | $3,103,000 |
The Winning M&A Advisor – 1, 2 or 3?
Recommendation #3
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