A minority recapitalization can create liquidity for business owners who don’t want to sell their business outright. In a minority recap, the business owner retains control, selling a portion of equity to what is typically a financial buyer.
Business owners consider minority recaps when they want to diversify net worth, consolidate ownership, begin an ownership transition to the next generation, or finance a growth event.
Before entering into a minority recap, consider whether your new minority partner will bring value to your business. Typically, you want a buy-and-hold investor who will partner with your business and help it grow for the future.
But if minority investment is just a means to an end, consider whether other liquidity options might be a better fit with your goals. Talk to us about creating liquidity and how recapitalizations could work for you.
