Buy-side brokers

November 16, 2022
by a searcher from Georgia Institute of Technology in Atlanta, GA, USA
Anyone have experience with buy-side brokers? Anything you can share…positive/negative? How long did it take to find a target opportunity? Would you be willing to give a recommendation for a broker you have worked? Thanks in advance.
in Dacula, GA 30019, USA
I’m an unusual animal in that I’ve personally done 21 deals MYSELF before I ever started offering M&A advisory.
I broker deals in an unusual way for sell-side in that I require a $50K deposit or monthly retainer, turn down 90% of deals, and prefer to be brought in 6 months at least before listing so that I can advise on any fixable “warts” and get them fixed to maximize exit. I built an entire program around that.
On the BUY side, I agree with comments above that I’d never consider a success-only fee because it creates a conflict of interest.
Not all deals are good and I’d never want to be incentivized to convince a buyer to take a bad deal just to make a buck.
I personally take a different approach all-together:
I will only JV deals on the buy-side with an included buyout clause for me.
So I source, structure and negotiate the deal and keep generally 10-20% equity.
I then allow a buyout of my share equal to a minimum amount OR a 3 years of what WOULD have been my profit cut to be executed at any time.
In the case of cashflow challenge, I will allow that amount to be converted to a debt payable monthly as opposed to lump sum.
There are limitless ways to work a deal like this in a win/win way…
It boils down to what is your brilliance, and what are your gaps?
I’m gifted at sourcing, negotiating, structuring, and turnarounds.
I DO NOT run daily ops.
So I work deals accordingly.
Hope that was helpful.
from Emory University in Marietta, GA, USA