What I Learned Last Week 10.25.2024
Curating the best M&A, SMB, and EtA-related content since 2020.
Hello Friends!
In this week’s issue of What I Learned Last Week:
📰 Articles
🧵 Best of X (Twitter)
🤔 Other - Podcasts, EtA Going Global
🗓️ Events
⚒️ Tools & Resources
💡 How I Can Help
This issue of The Business Inquirer is sponsored by:
Close Your Deal Quickly and Efficiently: M&A Legal Solutions Integrating Automation and Project Management
At Sterrett Law, we’ve developed a streamlined process using cutting-edge automation and project management techniques to maximize speed and efficiency. Using templates and a client-centered collaborative process we’ll keep your deal on track and on time.
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📰 Articles
I summarize, so you capitalize.
A Look at Search Funds and Section 1202 Qualified Small Business Stock
The article explores how Section 1202 of the Internal Revenue Code, which offers tax benefits on "qualified small business stock" (QSBS), can be advantageous for Search Funds in the U.S. These benefits, allowing for significant capital gains tax exclusions if held for over five years, align well with the Search Fund model, where C corporations are used to acquire, grow, and eventually sell small businesses. Key considerations for leveraging Section 1202 include structuring acquisitions to meet QSBS requirements and managing equity issuance and rollover arrangements to avoid disqualification.
Key points include:
Requirements for QSBS eligibility and exclusions under Section 1202.
Structuring Search Fund investments to maximize tax benefits.
Considerations for entity structure and rollover equity in acquisitions.
Implications for investor returns and tax liabilities on exit.
🧵 Best of X (Twitter)
I scroll, so you don’t have to.
Top investors back successful searchers, med spa rollups are booming, and searchers are focusing deeper on fewer targets…
ETA isn’t for the faint-hearted — this former banker-turned-business owner shares hard truths on risk, resilience, and rewards…
Buying a business can be life-changing or life-ruining — here’s a no-nonsense roadmap to succeed without losing everything…
Why go brick-and-mortar when you can build high-margin, scalable, “boring” online businesses that thrive globally…
Big returns lie in small deals — while big buyers overlook them, hands-on searchers reap the rewards with solid cash flow…
Thinking of buying a business? Get real operational insights first — struggling owners prove it’s harder than it looks…
Down payments in business acquisitions can be flexible — learn how standby seller notes, investors, and SBA rules can help you scale…
🤔 Other
Podcasts
I saw a post on Searchfunder asking for a list of the best podcasts related to EtA, business ops, and M&A. Here is that list….
Business Buying Masterclass
Buy and Build
Acquiring Minds
Acquisitions Anonymous
Let’s Buy a Business
Owned and Operated
Think Like an Owner
The SMB Ops Show
Business with Beers
How to Sell a Business
DealLab
The Tech M&A Podcast
M&A Science
Marketplace
Mergercast
The Deal Room
M&A Views - Deloitte
Circle of Competence
The Fort with Chris Powers
In the Trenches
Built to Sell Radio
Top M&A Entrepreneurs
The Deal Board
Business Buying Strategies
Small Business and Deal Making
Permanent Podcast
Right in the Middle Market
Search Funded
Indie Acquisitions
Deal Talk
Buy and Build
The Search Fund Podcast
— — — — — — — — — — — — — — — — — — —
EtA Going Global
Moonbase Capital Launches US$15 Million Global Fund for SMEs
Moonbase Capital, a Spanish search fund investment firm, recently launched a $15 million investment vehicle to support the acquisition and growth of small to medium-sized enterprises (SMEs) globally. This fund, Moonbase's second, aims to help around 15 SMEs over the next three to four years, with a focus on emerging markets such as Latin America, Southeast Asia, and the Middle East. Leading the initiative are Tamer El Bahay and Tarek El Gammal, who bring deep expertise in finance and operations. The firm expects its first fundraising close by Q1 2025, with backing primarily from European, Egyptian, and Gulf family offices and wealthy individuals.
The SME retirement dilemma: What to do with my business?
The article addresses the succession challenges faced by Thailand's aging SME owners, with many nearing retirement and lacking successors, threatening business continuity and local economies. The search fund model is presented as a solution, enabling young entrepreneurs to acquire and manage these businesses, ensuring legacy preservation and job security. This approach supports economic stability by facilitating SME transitions while also fostering a new generation of business leaders.
🗓️ Events
National Summit for Middle Market Funds (Oct 27-29) - Palm Beach, FL
Booth-Kellogg EtA Conference (Nov 4) - Chicago, IL
University of Minnesota ETA Conference (Nov 15) - Minneapolis, MN
iGlobal Independent Sponsors (Dec 4) - New York, NY
SBIA Northeast PE Conference (Jan 8-9 2025) - New York, NY
SBIA Southeast PE Conference (Feb 13-14 2025) - Nashville, TN
iGlobal Independent Sponsors (Mar 4-5 2025) - Miami, FL
SBIA West Coast Capital Summit (Mar 25-27 2025) - Los Angeles, CA
HoldCo Conference (Mar 31-Apr 3 2025) - Sundance, UT
🎵 Listening: “Sun Come Up“ by Sofi Tukker, John Summit 🎵
How did you like this issue of the newsletter?
⚒️Tools & Resources
I want to share some tools & resources that I have found helpful. Please note that some of these are paid sponsors or affiliates of the newsletter.
PrivSource - PrivSource helps you source deals and connect with transaction partners without ever paying a success fee.
X5 Deals - Proprietary deal sourcing for a great price. They do the outreach and send you relevant, actionable deals directly into your inbox.
Rejigg - Platform that connects searchers/investors directly with owners of off-market small businesses ($200k - $3M EBITDA) considering exits. All deals are sourced by the Rejigg team. Their team adds 15 to 20 new deals each week.
Kumo - 100,000+ deals sourced from thousands of brokers and marketplaces. Plus, AI-powered listings, robust data & analytics, and more.
DealFlowXchange - The premier private capital funding community for raising and deploying capital. Use discount code DUEDILIO for 20% off your lifetime membership.
Sterrett Law - At Sterrett Law, we offer Manhattan and Boston experience at Vermont prices. Specializing in deals under $10 million, we're your go-to partner for navigating the complexities of mergers and acquisitions without the hefty price tag
BizNexus - Marketplace + off-market origination in one platform. The marketplace averages about 10k active listings & pre-CIM opportunities, and the off-market origination focuses on data & multi-channel.
Secret - Say goodbye to overspending on SaaS. With Secret, you get access to up to $1,000,000+ in savings on the best software to run your search, operate, and scale your business.
Search Fund Coalition - community for the Entrepreneurship Through Acquisition ecosystem. Monthly events and meetups for acquisition entrepreneurs.
Deal Sourcing Guide - a comprehensive list of business marketplaces, brokers, deal origination firms, and more.
💡 How I Can Help
Whenever you’re ready, here are a few ways for us to work together…
Schedule 1:1 consulting on deal sourcing, due diligence, M&A ecosystem, newsletters, entrepreneurship, or anything else you’d like to discuss
Promote your brand to business buyers, investors, SMB owners, and other M&A participants by sponsoring this newsletter
Assemble your M&A deal team with DueDilio
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