For private equity, family offices and acquirers

The financials prove the past.
Kestrel tests the future.

We test the thesis against how the business actually runs.

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DATA ROOM

Evidence enters

KESTREL INTELLIGENCE

The evidence connects

OWNERSHIP

The intelligence carries forward

DEAL SCAR TISSUE

The customer was really one relationship.~$1.5MThe margin expansion was already spoken for.~$12.5MThe cross-sell thesis had no delivery capacity.~$625KThe founder left. So did the operating system.~$2.5MThe add-on fit financially. Operationally, it fought the platform.~$1.5MThe cash problem started in operations.~$2.05MThe customer was really one relationship.~$1.5MThe margin expansion was already spoken for.~$12.5MThe cross-sell thesis had no delivery capacity.~$625KThe founder left. So did the operating system.~$2.5MThe add-on fit financially. Operationally, it fought the platform.~$1.5MThe cash problem started in operations.~$2.05M

The cash problem started in operations.~$2.05MThe add-on fit financially. Operationally, it fought the platform.~$1.5MThe founder left. So did the operating system.~$2.5MThe cross-sell thesis had no delivery capacity.~$625KThe margin expansion was already spoken for.~$12.5MThe customer was really one relationship.~$1.5MThe cash problem started in operations.~$2.05MThe add-on fit financially. Operationally, it fought the platform.~$1.5MThe founder left. So did the operating system.~$2.5MThe cross-sell thesis had no delivery capacity.~$625KThe margin expansion was already spoken for.~$12.5MThe customer was really one relationship.~$1.5M

AFTER THE WIRE CLEARS

The post-close uh-oh.

Six stories every deal team recognizes.

STORY 01

The customer was really one relationship.

DILIGENCE SHOWED

Customer concentration looked manageable. No single account appeared alarming.

WHAT WAS ACTUALLY HAPPENING

Several of the largest accounts were controlled by the same broker, referral partner, intermediary or internal relationship owner.

That person left after close.

THE UH-OH

The buyer thought it had diversified revenue. It had diversified invoices, but concentrated access.

~$1.5M

EBITDA exposure

10% revenue loss on $50M revenue = $5M at risk
At 30% contribution margin

* Illustrative only. Figures assume a representative middle-market business of roughly $50M revenue at 15% EBITDA unless otherwise noted. Not benchmarks.

THE KESTREL QUESTION

Who actually controls the revenue?

None of these were invisible.

The evidence was there. It just lived in different places.

Kestrel Way helps you find what the model cannot afford to miss.

HOW KESTREL WORKS