Investment Criteria
Slack Water Capital seeks to provide equity gap funding to entrepreneurs, sponsors, or self-funded searchers in control buyouts of small and midsized businesses. We are seeking to invest in businesses and entrepreneurs featuring a combination of the following characteristics:
Industry
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Mature, stable, and growing industry
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Relatively simple product or service
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Low risk of technological obsolescence
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Demand is not highly impacted by changes in the economy
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Highly fragmented with opportunities for consolidation
Geography
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United States-based headquarters and operations
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Operating in a state/region with a favorable economic environment
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Growing population trends
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Ease of doing business
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Attractive tax environment
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Availability of high-quality employees
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Business
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Market leader or pathway market-leadership
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High level of recurring and/or reoccurring revenue
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Limited level of project-based or one-time revenue
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History of growth and profitability
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Opportunities for growth and/or operational improvement
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Low level of capital intensity
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No material customer or supplier concentration
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Strong management team and no key person risk
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EBITDA of approximately $800,000 - $4,000,000
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Fair purchase price and transaction structure
Operating Partner
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History of academic, professional, and personal achievement
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Highly motivated, passionate, energetic, persistent, and humble
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Strong analytical and financial acumen
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Excellent communication skills and ability to build rapport with people from diverse backgrounds
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“All-in” mentality with a significant personal investment and/or personal guarantee of acquisition debt financing
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Will manage the business full-time as their sole professional focus
