Valuations & Acquisitions: Dealing With an October Surprise

Credit-hungry catalogers who’ve already tapped their “angel” investors — namely, family and friends — have limited options. Helman’s seen new financing methods wherein there’s only equity going into a deal for a minority recap or growth equity financing.

Private equity firms, Helman explains, assume they can achieve significant top line and bottom line growth if they’re willing to do a deal with all equity. Either that or they intend to refinance with debt when the market turns and might have the opportunity to recycle the equity they take out.