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ATHENAEUM

PARTNERS

Acquiring and Building One Sector Defining Business

About Us

We are an experienced pair of entrepreneurs with deep operating and investing experience looking to acquire a single growth oriented family owned business. We spent the last decade of our careers building middle market companies through our experiences in investment banking, private equity, and founding our own companies. We are excited to spend the next decade growing your business into a sector defining platform.

Orlan Davies

Orlan Davies

I have a decade of experience operating, buying, and building middle market companies. I plan to apply my skillset towards building scalable operations and financial systems while John super charges revenue and volume growth.

Prior to founding Athenaeum, I ran a consulting practice helping companies raise capital, conduct FP&A and implement business intelligence systems. Previously, I led the finance, HR, and accounting teams...

John Rochefort

John Rochefort

I am entrepreneur at heart and successfully founded and exited my first business before graduating college. I spent the last 10 years further developing my skills as a manager and intend to apply these skills to grow your company into a sector defining business while Orlan makes sure the operations can support the growth...

Prior to founding Athenaeum, I was an Investment Professional at Spanos Barber & Jesse...

Our Partners

Athenaeum is fortunate to be backed by a group of institutional investors and proven entrepreneurs with successful track records in our targeted industries. Below is a list of a few of our investors:

What We're Searching For

We have collectively advised on or executed over 20 M&A transactions, so we understand what it takes to get a deal done. We have a flexible mandate from our investors but the deals that get us particularly excited typically exhibit the characteristics below.

Company Criteria

$5 to $75 million of revenue

EBITDA / Cash Flow positive

Headquartered in the United States or Canada

Transaction Dynamics

Founder seeking to retire or exit without a clear successor in place

Owner looking to reduce day-to-day involvement

Owner wishing to exit the business

Target Industries

B2B Services

Healthcare Services

Tech / Software Services

Why Partner With Us

Partnership is not just in our name, it’s in our DNA. We are not a private equity fund nor a strategic acquirer. We are two entrepreneurs backed by a group of institutional investors looking to buy and build one great business defined by a culture of honesty and hard work.

Athenaeum Partners
Private Equity
Strategic Acquirer
Pros
You would sell your company to a pair of entrepreneurs who will preserve your legacy for all your stakeholders (your team, vendors, customers, & investors)
Possibly a slightly higher valuation if they can put debt on your business
Possibly a higher valuation given they will cut team members
Cons
Will not outbid strategic buyers due to conservative use of leverage and desire to maintain the continuity of the team
Complicated transaction structures, significant debt leverage, onerous contracts, and clawbacks.
High likelihood the valuation was driven by “synergies,” which includes separating the business into multiple pieces and letting key employees go
Key Objectives
What are we trying to do?
We are looking for a single company to which we can add tangible value through building out the team, adding systems and processes, and driving topline growth.
Maximizing returns across their entire portfolio over a short timeframe by using leverage. Because of the portfolio approach they are ok with some companies failing due to leverage if it increases the returns on the ones that succeed
Achieve “synergies” by cutting costs (firing employees) and only keeping the assets of the business which fit in their organization
Value Creation Strategy
How are we going to do it?
We will take a mindful approach to build up your company’s team, provide capital for expansion and implement infrastructure to support new growth.
Implement “lean operations” (eliminating people) and financial engineering (high levels of debt and risk)
Rapid implementation of service consolidation and cost cutting initiatives
Source of Capital
How are we going to pay for it?
Our investment partners are patient investors and seasoned entrepreneurs that value building up companies and people.
Investors with stated goals to maximize returns within a short-term 5-7 year window.
Corporate debt or cash reserves
Time Horizon
How long will we be at it?
Long-term (for the rest of our professional careers)
Short-term (typically 5 Years)
N/A (your company may be dissolved / folded into their operations
Deal Terms
What is it going to cost you on the back-end?
We are flexible. We understand that no two companies are the same, so our goal is to achieve deal terms that are both fair and fit your needs.
Given the short-term timeline & expectations of high returns, they require very aggressive negotiations on company value & will often include major contingencies to get to the full sale price
Given the ability to quickly cut costs (by eliminating people), pricing may be higher but terms and process could be very bureaucratic, complex, and include contingencies to protect the parent company
Owner Transition
How will you fit in after selling?
We are flexible. We are happy to have you stay just for a quick transition period or stay on permanently to focus on the areas of the business you most enjoy.
Generally requires the current CEO to continue lead the company for 2-3 years to “earn out” the sale price after the acquisition
Most often replaces the current leadership team with their own teams or expect the current CEO to report in under a new boss
Employees
What about your team?
We view your employees as critical to our mission and will do all we can to help them succeed because their success creates our success.
Regarded as resources that either help or hurt the bottom line
Redundant departments and non-crucial leadership roles are often eliminated during the integration process

The Sale Process

We deeply respect your time (and ours), from our first introduction connection to the possible closing, we have structured our process to be completely transparent. Based on the complexity of the company and transaction, the sale process could take as little as 6 - 12 weeks to complete.

Introductions

We get to know each other
(~1 day)

Understand

We share some files so we understand more about your business
(~1 week)

Diligence

We dig deep and diligence everything we can about your company
(~2 weeks)

Close

We confirm everything we learned, draft the documents and close the deal
(~2 months)

  • Initial 30-minute call for mutual introductions and getting to know your business.
  • Discuss if and how your company fits into our search criteria.
  • Sign a Non-disclosure Agreement (NDA) to ensure that everything we discuss remains confidential.
  • Learn about your company’s services / products, customer base, market position, and financials.
  • Brainstorm on ideas for long-term growth opportunities and how we can add value.
  • Sign an Indication of Interest (IOI) as a non-binding agreement reflecting the high level terms of the deal and a valuation range.
  • Deep dive of your company’s operations, financial performance, team structure, growth opportunities and risks
  • Refine our thoughts on valuation and deal structure
  • Sign a Letter of Intent (LOI) as a formal non-binding offer to buy your company with a purchase price and specific deal terms.
  • Complete final due diligence steps with our lawyers and accountants.
  • Review the exact terms of sale and reach agreements on all points.
  • Sign final legal documentation and celebrate!

Origins of Our Name

Broadly, an Athenaeum (/ˌaTHəˈnēəm/ or “ath en A um”) is an institution for the promotion of literary or scientific learning, most often a Library or scholarly publication. Slightly before our time, the Athenaeum was a renowned school in Rome, founded by the Emperor Hadrian, for the promotion of literary and scientific studies. It was named Athenaeum in tribute the city of Athens, which was regarded as the seat of intellectual refinement at the time.

Old Athenaeum

More directly, we draw our name from The Marian Miner Cook Athenaeum at Claremont McKenna College, where we were both Robert Day Scholars. We think back fondly to our formative undergraduate years and the opportunities that were born from our time in Claremont so we thought it was only natural to pay our dues to the institution that helped kickstart our careers years ago. The “Ath” hosts weekly dinner and lecture events with speakers representing a range of disciplines and ideological perspectives each year, serving as the college's central intellectual and social hub.

We draw inspiration from both Emperor Hadrian’s and Claremont’s Athenaeum. We are dedicated to being ever learning, inquisitive, and humble leaders of each organization we are fortunate enough to join. To business owners and sellers – we want to partner with you because all the things you have done right and the legacy you have built. We aim to study the history of your success and we commit to preserving your accomplishments and culture while guiding the next chapter of you company’s story

Sherk (14 July 1988). The Roman Empire: Augustus to Hadrian. Cambridge University Press. pp. 181–. ISBN 978-0-521-33887-5.