B2B Services Deals: Indemnification Done Right
When the deal is B2B services and the question is Indemnification, the structure decisions in the first 30 days outlast the next five years. This is where Jason Powell works.
An independent sponsor closing B2B services transactions in the $8M to $90M EV range has a defined set of moves at the Indemnification stage. Most of them are not in a generic M&A textbook.
The typical B2B services platform sits at $8M to $90M EV with EBITDA in the $2M to $18M range. The thesis runs on recurring revenue service platform with bolt-on operators. Most B2B services deals look better in the CIM than in the data room. Skip the CIM, ask for the contracts.
How Indemnification actually gets structured.
Set general indemnity survival at 18 months, fundamental reps for the full statute of limitations.
Build a basket at 0.5 percent of EV, with a deductible structure, not a tipping basket.
Cap general indemnity at 10 percent of EV, with R&W insurance carrying the layer above.
Carve out fraud, tax, and intentional breach from any cap.
In B2B services, layer in MSA assignability mapped customer-by-customer as part of the Indemnification workstream.
Negotiating caps and baskets without first reading the disclosure schedules. The schedules dictate the real exposure.
"Indemnification only matters when the deal goes wrong. Draft it as if it will."Jason Powell · Indemnification
The deal is one thing. The capital that opens up after close is another.
After close, the call list for refinancing, recapitalization, and growth equity gets short and known. Jason carries that list.
Related deal pages.
Transaction Fee Structuring for B2B Services
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Working Capital Adjustments for B2B Services
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Representation & Warranty Insurance for B2B Services
A buyer-side insurance product covering breach of seller representations, reducing seller escrow and indemnit…
Quality of Earnings for B2B Services
The buyer's accounting diligence report normalizing earnings, working capital, and pro-forma performance.
Indemnification for Healthcare Services
roll-up of physician practices and ancillary service lines
Indemnification for Home Services
regional roll-ups of HVAC, plumbing, and electrical operators
An LOI on the desk, a B2B services target, and a Indemnification question worth a real conversation.
Twenty minutes of practitioner-grade input from a securities attorney whose first move is to read the deal, not the engagement letter.