Straight answers for owners considering capital.
The equity process rewards prepared owners. These are the fundamentals we find ourselves explaining most often — free, because informed owners make better partners.
Majority vs. minority: which transaction are you in?
A majority sale is a succession decision; a minority raise is a partnership decision. Owners who conflate them negotiate against themselves. Decide which conversation you want before taking the first meeting.
What equity investors actually evaluate
Four questions drive everything: is the revenue durable, do the books tell the truth, does the business survive your absence, and why do you win? Prepare answers with evidence and diligence becomes a formality rather than an interrogation.
The transaction timeline, honestly
From first conversation to close, expect four to nine months: initial discussions, a letter of intent, sixty-to-ninety days of diligence, then documentation. The variance is almost always preparation — clean companies move fast.
Preparing for due diligence
Three years of financials, customer concentration data, contracts, org chart, and the known-issues list — assembled before anyone asks. Surprises found by the buyer cost more than problems disclosed by the seller.
Management rollover: staying invested
Rolling part of your proceeds into the go-forward business keeps you at the table for the second bite. It is also the strongest signal an investor can receive about what you believe.
Growth capital without losing the company
Structured correctly, outside equity funds expansion while you keep operational control. The terms that matter are governance rights, not just the ownership split.
Succession when there is no successor
A generation of owners is retiring without a family or management buyer. Investor-backed succession — often with the second layer of management stepping up — preserves the business, the jobs, and the legacy.
Choosing an investment partner
Reference-check investors the way they reference-check you. Ask for an owner whose deal went sideways and call them. How a firm behaved when the plan broke is the only diligence that matters.
What changes after the investment
Reporting rhythm, board conversations, budgets that mean something. Good partners add discipline without adding bureaucracy — and the first ninety days set the tone.
Want the long-form version? Start with Preparing Your Company for an Equity Investment, then browse all insights. Common questions are answered on the FAQ.
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