The BizBuySell Small Business Community

  • Get Expert Advice

  •  • Find Local Service Professionals

  •  • Share Your Experiences

Est 13 yr Mfg business looking for investor/partner for expansion - fully secured

Looking for the right person to invest in our already established operation of 13 years. We manufacture durable metal and plastic goods with CNC equipment. We market our products through our long est. internet website using eCommerce. Current gross approaching 1million annually. We seek expansion capital, 600K min. long term investment, secured by assets and real estate. We are not looking for a loan but rather a serious long term investor/partner/silent with liquid capital that can help us grow without crippling the company.

No User Photo

Answer This Question

max 5000 characters

Web Reference (optional)

e.g., ""

Review Community Guidelines

Help keep our Community clean and on topic. The BizBuySell Community is a place where you can discuss your questions, concerns and knowledge with others you can trust. It is not OK to use this forum to solicit others for personal or financial gain, illegal activities, or to rant about personal issues. Please review the full guidelines if you have any questions.

Submit Your Answer
Answers (1)
No User Photo
Executive Capital
Business Finance
Fairfield County, CT

When you reach the exit event that the equity partner will require in 3 to 5 years, the cost of the buyout will most definitely cripple your cash flow or you will end up borrowing money to buy them out. The partner will want at least 5 to 8 times their original investment at the exit which averages out to 100% to 150% annually. Are you prepared to do that? It's much less expensive for your company to take on smaller amounts of debt in stages to accomplish the same growth pattern. Also, most equity investors do not remain silent if they see something that they don't like going on with management, production, manufacturing or distribution. They typically don't just sit by and watch as that would be foolish on their part. In addition, you will have to consider what you're giving up as a percentage of ownership for the capital. Are you ready to hand over 30% to 40% of the company? Don't be too hasty with your decision to take on an equity partner. You need to look long term and do what's best for the company. Secured debt capital is much easier on the bottom line in the long run.

Feb 26, 2014