How to manage LPs Influence on Acquisition Targets?

searcher profile

May 16, 2025

by a searcher from Vanderbilt University in Nashville, TN, USA

I've been passively courting investors for my eventual acquisition. One thing that has really been throwing me for a loop mentally is having investors that want to steer the acquisition to their preferred verticals. For example, I know a SAAS-focused PE firm owner that I think would be interested in up to $200K toward a tech business like a SAAS or MSP, but he's not big on franchise retail - wants more of the bigger exit opportunity than a 1-2 unit franchise would have. I also know a top residential real estate brokerage owner and he wants me to lean toward a home services type franchise so he can send referrals from his hundreds of house transactions that he's involved in. I was mentored by the founder of Domino's Pizza for years while being an owner/operator - so fast food is practically in my bones. As my mentor would say about top franchisees, "he's got pizza sauce in his veins!" My corporate background was MSP/Information Technology so I'm strong there and MSP would be a good target because not everyone can run that business, but I just plain love the fast food business. Problem is I can't seem to align with LPs that have any interest in me slingin' pizza or burgers for our acquisition target. I know that growing to 5+ units in QSR can bring consistent dividends for investors - how do I find those investors who are looking for more of a cash flow play than an exit play? Thoughts?
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commentor profile
Reply by an investor
from Belmont University in Nashville, TN, USA
I personally love the idea of a guy doing what he is good at. Weird that LPs would want you to do something you're not familiar with or built for. Sounds misaligned to me.
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Reply by a searcher
from Boise State University in Boise, ID, USA
I mean, can you blame them? Restaurant concepts are very hard. Thin margins and crowded with competition and alternatives. If you can make money backing “easier” things, why would you choose to put your money behind something objectively more difficult. IMO you’re talking to completely the wrong people if you’re having this problem. You need to be talking to strictly restaurant people - idk who those people are but I’m sure they exist.
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