Investment Criteria
There are some businesses ready for employee ownership tomorrow, and some that do not ever want to be employee owned. We are searching for a “medium” business—one in the middle, that can successfully transfer to employee ownership after Medium Orange Group operates it through a period of sustainable growth.
The criteria below are guidelines, not hard rules. We recognize that every business is different and no business is perfect, so please do not hesitate to reach out even if your business does not fit every criterion.
- We want sellers who are:guardianOwnership
- Looking to transition/retire (full or majority sale)
- Invested in the long-term success of their business (ideally open to 10-20% seller financing, to align incentives)
- Willing to stay involved throughout a 6-12 month transition process (to ensure transfer of knowledge and key relationships)
- We like industries that benefit from:graph_7Industry
- Low competition
- A high barrier to entry
- Primarily B2B (not B2C) orientation
- Macro trends like manufacturing reshoring, clean energy expansion, broadband expansion, etc.
- Geographically, we are:globe_location_pinLocation
- Primarily searching in our home state of North Carolina
- Open to relocating anywhere stateside if the right opportunity comes along
- We're looking for financials that show:financeFinances
- Consistent profitability over 5+ years of historical data
- Pre-tax profit margin of 15% or higher
- EBITDA between $400K and $3M
- Annual revenue of at least $2.5M
- We love businesses that operate with:engineeringOperations
- A high percentage of recurring revenue
- Excellent client diversity (with no single customer accounting for more than 25% of revenue)
- Strong operational infrastructure (5+ employees, established procedures, and solid internal documentation)