Post-Close Cap Table Design for IT Services & MSPs Independent Sponsors
Independent sponsor counsel for IT services and MSPs, focused on Post-Close Cap Table Design and the deal mechanics that protect sponsor economics and LP alignment.
The economics on a IT services and MSPs platform deal usually hinge on a handful of structural decisions. Post-Close Cap Table Design is one of them.
The typical IT services and MSPs platform sits at $8M to $100M EV with EBITDA in the $2M to $18M range. The thesis runs on MSP platform with regional or vertical-specific bolt-ons. An MSP at 70% recurring revenue trades at one multiple, at 90% trades at a different one. The mix is the deal.
How Post-Close Cap Table Design actually gets structured.
Reserve a 10 to 15 percent management incentive pool, vesting on time and performance.
Document profits interests in the LLC operating agreement with a clear strike value.
Build anti-dilution mechanics for the rolled-equity sellers, narrowly.
Plan for add-on equity issuances with pre-approved dilution mechanics.
In IT services and MSPs, layer in MSA assignment review with carve-outs noted as part of the Post-Close Cap Table Design workstream.
Designing the cap table for day one only. The cap table you sign at close is the cap table you live with through year five.
"Cap tables are forecasts. Build them for the deal you want in year five, not the deal you signed in week one."Jason Powell · Post-Close Cap Table Design
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.
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Post-Close Cap Table Design for Healthcare Services
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Post-Close Cap Table Design for Home Services
regional roll-ups of HVAC, plumbing, and electrical operators
An LOI on the desk, a IT services and MSPs target, and a Post-Close Cap Table Design 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.