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Our Partnership Criteria
A PARTNERSHIP-FOCUSED APPROACH FOR BEST-IN-CLASS COMPANIES
At NSP, we focus on partnership-based, non-control majority recapitalization and full-buyout transactions with our management team owners, where we are the First Institutional capital provider.​
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Let's explore our four (4) approaches to Partnerships:
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Partnership Criteria
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Partnership Dynamics
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Industry & Sector Focus - Healthcare Services and Business Services
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Deal Structuring Characteristics
Partnership Criteria
Flexible, Patient Capital for Best-in-Class Businesses
We seek to Support, Propel, Steward, and Govern our partnered companies to its' Next Level. We approach partnerships with Flexibility and Patient Capital, and seek to partner with and invest in growing, best-in-class lower middle market companies, that exhibit the characteristics of growing into a market-leading company.
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While every investment and partnership is different, we look for companies that fit the following parameters:
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$5 million - $75 million
Revenue
$1.5 million - $8 million
EBITDA (or Cash Flow)
$10%+
Healthy Net Margins
Partnership & Transaction-Types
We help Business Owners realize four liquidity solutions and objectives that can be tailor-made to their goals
Generational Recapitalization
Suited for owners looking to ensure their business continues to part of their family.
Next Steward will support your family in acquiring your business, while providing you with liquidity for retirement.
Private Equity Recapitalization
Suited for owners looking for a partner to support growth of their business.
Next Steward will acquire a majority stake in your business, while you retain substantial minority equity stake.
Private Equity
ESOP
Suited for owners looking to ensure their employees have majority ownership stake.
Next Steward will support a tax-efficient structure that marries PE recap + ESOP, that allows full cash proceeds at close.
Private Equity
Legacy Buyout
Suited for owners looking to transition ownership via a 100% sale and retirement.
Next Steward will acquire 100% of your company, with minimal disruption to the team, culture, customers, and community.
PARTNERSHIP DYNAMICS
The Foundation of every successful partnership
starts with the right Partnership Dynamics
Partnership Dynamics
Highly entrepreneurial, family-owned and founder-led businesses
USA-based businesses, with a focus on Southeast, Midwest, and Mid-Atlantic
Businesses with long-term growth prospects with recurring or reoccurring revenue
Resilient & Mission-Critical businesses with sustainable competitive advantages
Strong owner and non-owner management teams seeking long-term partnerships
We believe in Great Partnership Dynamics beyond just providing capital.
At Next Steward Partners, we believe that successful partnerships are built on the foundation of the right company ingredients, dynamics, and culture that are in place today.
With the right dynamics in place, we prefer to work with entrepreneurs, founders, families, and management teams who exhibit the following characteristics:
(1) Closely-held businesses
(2) USA-based businesses
(3) Long-term growth prospects
(4) Resilient and Mission-Critical business
(5) Solid teams in place
INDUSTRY & SECTOR FOCUS
A Sector-Focused and Thesis-Driven strategy
drives specialization and expertise for our partnered companies
Healthcare
Healthcare Services
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Behavioral & Mental Health
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Home Health & Homecare
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Outsourced Support Services
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Continuing Education & Training
Healthcare Tech-Enabled & Software
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Payer Tech & Services
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Healthcare IT & Software
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Employer Services​
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Specialty Networks
Medical Products & Distribution
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Medical Products
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Specialty Distribution
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Diagnostic Products & Services
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Contract Manufacturing
Life Sciences & Pharma Services
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Clinical Lab Services
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Life Science Regulatory Affairs
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Outsourced Pharma Services
Business Services
Industrial Services
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Facility & MRO Services
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Testing, Inspection & Compliance
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Automation, Motion, Flow Control
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Safety & Engineered Components
Critical Infrastructure Services
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Water & Wastewater Services
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Digital Infrastructure & Data Center
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Critical Repair, Maintenance, Upgrade & Deployment Services
Power & Utilities
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Utility, Telecom, and T&D Services
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Vegetation Management
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Energy Management Services
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Specialty Services
Waste Management & Environmental
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Waste Management & Recycling
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Environmental Services
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Testing & Analytical Services
DEAL STRUCTURING CHARACTERISTICS
The Heart of the Deal is where partnerships can be
mutually-structured in a flexible way for both parties
We provide our partnered companies that opportunity for flexibility, where our private ownership and long-term view allows us to structure partnership transactions in many forms...
that's Suitable, Friendly, and Mutual for both parties.
Let's briefly explore four (4) key deal components that support Generational Recapitalizations, Private Equity Recapitalizations, and Private Equity Legacy Buyout transactions:
(1) Retained seller equity
(2) Seller financing
(3) Earn-out provisions
(4) Employment agreements
Key Deal Components:
Retained Seller Equity
Allows the Sellers to retain a minority stake in the company, while sharing in the success of the company when the company is sold at a higher value in the future (aka "second bite of the apple").
Seller Financing
Allows the Sellers to receive a monthly, or quarterly payment plus at a fixed-rate interest rate, in exchange for the Buyer financing a portion of the purchase price of acquisition.
Earn-out Provisions
Allows the Sellers to receive a future payment of the value of their business (above the negotiated purchase price), based on a performance-based approach. Earn-outs can help align the interests of the Buyer and the Sellers.
Employment Agreements
Allows the Sellers and management team members to stay engaged and aligned in the transition and/or continual operation of the business.
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