At Zwick Partners we look for high caliber people we can trust, as well as businesses & industries that we can understand, and where the transaction provides a demonstrable value-add to the business.
We look to make direct investment in the lower middle market by partnering with:
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independent sponsors
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traditional funded sponsors
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search fund entrepreneurs
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business executives
We explicitly avoid start-ups, venture capital, pre-revenue companies, and traditional blind pool fund vehicles.
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INVESTMENT CRITERIA
Investment Criteria
We typically do not invest in co-mingled funds or funds of funds. The investment opportunities we seek are usually below $10MM in EBITDA (with our sweet spot in the $1-5MM range) and have demonstrable business stability and economic durability, which tends to preclude highly cyclical companies and industries influenced by rapid technological change.
Although we are generally industry agnostic, we prefer B2B companies and have particular interest in the following industries: industrial and business services, health care, and specialty finance. High-tech start-ups, bio-tech, pharmaceuticals, or other industries requiring specialized knowledge are not within our area of expertise.
Durability
We only seek businesses that provide essential products and services, or are a clear value-add for their customers. Companies should possess defensible competitive positions within their industry. We are not interested in investing in commodity businesses, highly cyclical markets, or emerging high-tech startups.
Stability
Companies should have a demonstrable track record of cash flow stability, largely recurring revenue streams, or sticky customers and high switching costs. We especially target businesses that have large amounts of contractual revenues.
Quality Management
We believe that a solid management team is of the utmost importance. Incentives among owners, operators, and investors must be clearly aligned from the start. We only look to partner with ethical, talented, and driven managers.
Financial Profile
Zwick Partners does not invest in startups or turnarounds. We focus on businesses that have an established financial track record and a strong growth trajectory or clear catalysts for growth.