What Makes a Business Attractive to Acquirers with Arthur Petropoulos of Hillview Partners

The Exit Plan: Mergers and Acquisitions for Creative Entrepreneurs

Arthur Petropoulos, the managing partner at Hillview Partners, discusses his work in mergers and acquisitions and capital advisory for middle market companies. He shares how he got into this line of work and the process of setting up and growing his own firm. Petropoulos explains the importance of building infrastructure and processes in businesses to reach the one million EBITDA mark, which is a key threshold for attracting buyers. He also highlights the factors that make a business attractive to acquirers, including fundamentals, access, capabilities, people, process, and product. Petropoulos shares his experience working with video production companies and the types of buyers in that industry. Arthur Petropoulos of Hill View Partners discusses the number of transactions his firm works on each year, the current state of the market, and the types of companies they typically deal with. He emphasizes the importance of consistent, profitable businesses that generate cash and provide real-world products and services. Petropoulos also explains the split between strategic buyers and private equity in the transactions he has worked on. He provides an overview of how private equity works, their objectives, and the success rate of private equity deals.

Takeaways

• Mergers and acquisitions and capital advisory firms help companies sell themselves and secure capital.
• Building infrastructure and processes is crucial for businesses to reach the one million EBITDA mark and become attractive to buyers.
• The attractiveness of a business to acquirers is determined by fundamentals, access, capabilities, people, process, and product.
• Video production companies can be attractive to buyers, especially if they have specialized capabilities or access to specific industries. Hill View Partners typically closes around 10 to 12 deals a year, but is aiming to increase that number to 20 as the team grows.
• While flashy early-stage companies and mega deals may get attention, the majority of the market consists of consistent, profitable businesses that generate cash and provide real-world products and services.
• Private equity firms typically look for businesses they can buy, improve, and sell within a 5 to 9 year timeframe, aiming for a return of around 20%.
• The split between strategic buyers and private equity in transactions is roughly 40% each, with the remaining 20% being family offices and search funds.
• Private equity deals have become more institutionalized and professionalized over the years, with a focus on consistent returns rather than high-risk, high-reward strategies.

Connect with Arthur on LinkedIn: https://www.linkedin.com/in/arthur-petropoulos/

Watch his YouTube Channel here: https://www.youtube.com/@HillViewPartners

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