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Axial Radar: How Macro Trends Impact Due Diligence Priorities

Axial Radar

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Happy Friday and welcome to another edition of Axial Radar!

Every buyer of small and medium businesses will have their own prioritized laundry list of diligence items for assessing new investment opportunities. The order of those items in any given year can tell you a lot about macro trends and how they impact the private capital markets.

Labor shortages, as an example, are a trend that we’ve heard a lot about anecdotally from our members since the beginning of the pandemic. It’s no surprise that in Q2 of this year, employee retention ranked as the number one due diligence priority for businesses generating sub $2M of revenue, and third in businesses generating between $2M and $50M (financials and revenue ranked 1 and 2 respectively). Head over to this week’s featured Industry Trends article to read more about what’s top of mind for SMB buyers and how that’s evolved in tandem with today’s macroeconomic trends.

Our featured buy-side members this week include a third generation family office, a global PE firm headquartered in Korea, and a private investment firm targeting SMBs in the business services, healthcare, and software space. On the sell-side we’ll introduce you to a 30 year old M&A advisory firm and a full service advisory firm servicing businesses of all sizes, from start ups through middle market companies.

Click here to follow Axial on LinkedIn and stay up to date on the latest trends in the world of Lower Middle Market deal making.


Axial

Featured Members

Elmore Companies

Elmore Companies
Family Office

Now in its third generation, Elmore Companies was built on the ability to recognize and pursue business opportunity. Dating back to the late 70’s, Dave Elmore started by purchasing travel companies that were headed toward bankruptcy, taking them over and building them up. This repetition became muscle memory as he began to understand the industry and acquire several more businesses within that space, starting the legacy of Elmore Companies.

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CrossPointe Capital

CrossPointe Capital
M&A Advisory Firm

CrossPointe Capital is a middle market M&A advisory firm serving quality manufacturing, distribution, and business services companies in California and Oregon for over 30 years.

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Dreamstone Private Equity

Dreamstone Private Equity
Private Equity Firm

Established in February 2019 and currently registered with Financial Supervisory Service (equivalent to SEC in US) as General Partner for private equity funds, Dreamstone Partners is a global private equity firm based in Korea and a parent company of Dreamstone Private Equity and Dreamstone Aviation Partners. Dreamstone invests across alternative asset classes covering private equity and real assets including aircraft investments and real estate.

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Glover Park Capital

Glover Park Capital
M&A Advisory Firm

Glover Park Capital (“GPC”) provides strategic M&A advisory and capital raising services to start-up, emerging growth and middle market companies. The firm initiates, structures and negotiates mergers, acquisitions and divestitures (“M&A”), raises debt and equity in the private markets and develops in-depth financial and strategic plans. With over 30 years of collective corporate finance experience, GPC provides their clients with a combination of extensive transaction experience and industry specific knowledge.​​​

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Archer Growth Partners

Archer Growth Partners
Holding Company

Archer Growth Partners Ltd. (“AGP”) is a privately-held, entrepreneurial investment firm seeking to make control investments in small- to medium-sized businesses in the United States and Canada. The AGP team is seeking stable, cash flow-positive companies that have potential for long-term growth. AGP is sector-agnostic but have leaned towards opportunities in Business Services, Healthcare, & Software.

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This week from
Middle Market Review

How Selling Several Companies At Once Can Increase Multiples
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Don’t Break the Bank: 5 Budgeting Tips For Independent Sponsors
Read More

Owners: Keep Your Eye On Your Equity
Read More

Axial’s LMM Deal Digest: August 2021 Edition
​​​​​​Read More

Industry Trends

The IBBA and M&A Source Market Pulse

Due diligence factors ranked by importance to buyers:

Source: IBBA

Get in Touch

Reach out to dani.forman@axial.net to learn more

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