Management Fee Structuring Counsel for B2B Services Acquisitions
Securities and M&A counsel for independent sponsors structuring B2B services transactions, from LOI to close to the capital markets that open up afterward.
Management Fee Structuring on B2B services deals is one of those workstreams that looks routine on a checklist and decides outcomes in practice.
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 Management Fee Structuring actually gets structured.
Set the fee at 2 percent of invested capital, stepping to 1.5 percent after year three.
Carve out portfolio-company services so add-on diligence is reimbursable.
Allow accrual if cash flow does not support payment, with later cash catch-up.
Make the fee subordinate to debt service, not to LP preferred return.
In B2B services, layer in MSA assignability mapped customer-by-customer as part of the Management Fee Structuring workstream.
Pricing the fee on enterprise value instead of invested capital. EV-based fees punish you on the first add-on.
"The management fee pays for the firm. Underprice it and you will run a hobby, not a platform."Jason Powell · Management Fee Structuring
The deal is one thing. The capital that opens up after close is another.
The capital that opens up post-close, from refinancing to growth equity to strategic exit, runs through a small set of Wall Street relationships. That network is built in.
Related deal pages.
LOI Negotiation for B2B Services
The 4 to 8 page agreement that frames the deal economics, exclusivity, and diligence period.
Independent Sponsor Economics for B2B Services
The package of deal-by-deal carry, management fees, and transaction fees that compensates the independent spo…
Equity Rollover for B2B Services
The portion of seller proceeds reinvested into the post-close entity, aligning seller with buyer.
Earnout Structures for B2B Services
Deferred purchase price contingent on post-close performance, used to bridge buyer-seller valuation gaps.
Management Fee Structuring for Healthcare Services
roll-up of physician practices and ancillary service lines
Management Fee Structuring for Home Services
regional roll-ups of HVAC, plumbing, and electrical operators
An LOI on the desk, a B2B services target, and a Management Fee Structuring 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.