The Good, the Bad (and the Ugly) Of Selling to Private Equity
May 14, 2021 |
About this episode
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Marc Elkman built Fresh Meal Plan, a meal delivery service for healthy eaters, from an idea to $20 million in annual revenue in just three years.
Still in his twenties, Elkman earned a #70 spot on the Inc 500 list of fastest-growing companies in America. Then he caught the attention of New Heights Capital, a private equity group focused on the fitness industry. New Heights acquired the controlling interest in Fresh Meal Plan in 2016 and Elkman continues to hold a minority stake.
This interview is jam-packed with goodies, including:
- How Elkman leveraged gyms as a distribution point.
- The importance of your network in getting a deal done.
- The biggest mistake Elkman made in negotiating his exit.
- Why Elkman’s deal was re-traded and how he will defend against re-trading next time.
- A definition for a syndicate.
- How sophisticated angel investors structure their deals.
- Why getting “deal committed” can be dangerous.
Check out our article on Your Finish Line Is Their Starting Line.
Show Notes & Links
(04:22) LPGA
(09:09) John Warrillow: “a Built to Sell Radio episode I did a couple of weeks ago, a guy named Greg Alexander, who quickly shared equity with his co-founder, but it was kind of Greg’s idea and Greg was the driving engine of the thing.”
(13:58) Marc Elkman: “Dave Long, founder and CEO of Orangetheory Fitness”
(20:32) John Warrillow: “three years later you’re number 70 on the Inc 500 and 20 million in top line, that’s crazy. That’s incredible growth.”
(30:18) Marc Elkman: “I have no idea what I’m getting myself into. You learn about terms like re-trading.” Article: Do I Need a Broker to Sell My Business?
(32:20) Marc Elkman: “Even having done that now, if I go into a large sale again, I’m going to have a banker there. It’s sort of like selling your house without a realtor, right?” Article: When Should I Hire a Business Coach?
(33:38) Marc Elkman: “my banker could handle it differently, say, “You know what, we got so many other groups that are interested, maybe this is not the right fit for you,” right? I mean, I wasn’t prepared to do that, they saw how committed I was to the deal, and I think it was used against me.”
(34:16) Marc Elkman: “Grant Cardone.”
(51:20) Marc Elkman: “Tamiami Angels down here in Naples, these guys are, I mean, they function more like a private equity group than an angel group.”
(52:35) Marc Elkman: “I am a huge fan of Clubhouse.”
About Our Guest
Marc Elkman became an 8 Figure Entrepreneur in his 20’s via: Food Tech – Founder/CEO of Fresh Meal Plan, at 24 years old. 2015 & 2016 – INC500 (# 70 Fastest-Growing Private Company in the U.S, 200 employees). Sold to Private Equity firm in 2016 – raised money from all tranches of capital at a 10x multiple.
Marc is an Orangetheory Fitness Owner/Operator in the South Florida Region (8 units) since 2013.
He is also an Owner at NobilitySettlementFunding.com
Helping people every day cash out a portion or all of their structured settlements/annuities so they can buy a home, start a business, invest, and overall improve their quality of life.
Marc is a Private Hard-Money Lender, real estate asset-based lending.
He is also a Private Equity – IMPACT INVESTOR: “I vet and invest in businesses that I can add value and resources towards enhancing asset value. I Never invest my time or my money in anything that I’m not truly passionate about. I’m connected with several angel funds, private equity groups & access to the right people. My wheelhouse is anything health & fitness, CPG (consumer packaged goods) via major distribution outlets, and direct-to-consumer strategies. Sales & Marketing is my highest and best use in an organization. I’m a natural-born leader and most comfortable when the pressure is on me!”
Connect with Marc:
On Clubhouse
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