Proof of Funds Gatekeeping
September 15, 2024
by a searcher from London School of Economics and Political Science, University of London in Delray Beach, FL, USA
My husband and I are waiting for our property sale to go though to help fund our acquisition, while we wait we don't have proof of funds and this is preventing us from reviewing two really promising deals in our target location. Does anyone have any suggestions on how to get around this? Equally if anyone is looking to invest in businesses with 500-700k EBITDA in South Florida that would benefit from revamped marketing and sales, women ownership, and operational improvements) please DM me.
from Vanderbilt University in Cincinnati, OH, USA
I am fully aware I am old school. I used to work in M&A for a bulge firm many years ago doing MM deals. Did I ever ask for proof of funds before sending out a CIM? No! I just wanted to get a deal done. I need to get the CIM in front of as many potential buyers as possible. Financing is always figured out after LOI and before signed purchase agreement. FYI, PE firms usually can’t prove financing/funds before an LOI with basic terms and company financials.
If it makes you feel better, I had this happen to me a few months ago as well. The broker wanted me to prove financing with a bank letter, but I had no idea what the financials looked like. No reputable bank is going to write a firm blind blanket commit to buy a business. I offered to prove funds, but I wanted the NDA in place first. I was told no. Bank letter first before NDA. At that point, it wasn’t worth wasting my time. If I did get over the hump, it was apparent any deal would be difficult with this broker and wouldn’t be worth it. Unfortunately, you may have just found another one because that one was in MN and you’re in FL. Move on.
from Rensselaer Polytechnic Institute in Tampa, FL, USA