Mezz Debt for the "Upper Lower" Market

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February 26, 2021

by a searcher from Lousiana State University in Houston, TX, USA

Looking for potential Debt (or Equity) partners interested in capital structures similar to mezzanine funds but for small deal sizes - $1M - $2M EBITDA or $4M - $10M in revenue. We are open to general feedback/input or references.

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commentor profile
Reply by a searcher
from Northwestern University in Evanston, IL, USA
Derek, would be interested in learning more, especially if the businesses are located in New Markets Tax Credit qualified areas in the U.S. Businesses HQ'd in yellow and red areas on this map would potentially work for my firm: https://www.policymap.com/widget?sid=117&wkey=4D2AFE10710D41918F180775F0A353F2

I'm at redacted or redacted
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Reply by an investor
from University of California, Berkeley in San Francisco Bay Area, CA, USA
Lisa, mezz lenders offer terms that are usually not available with senior debt. The most important ones are a) no or minimal amortization payments, and b) the ability to get leverage up to###-###-#### 0x EBITDA (75% or EV). In my experience most senior lenders max out at 40% of EV with 7 year amortization. From a searcher perspective, Mezz debt (if available) make sense for certain deals because less equity needs to be raised.
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