COMPANY SPECS
15-year-old fitness company with locations across the Western, Southwestern, and Southeastern United States. The business comes from humble beginnings as a bootcamp class in the park, opening its first brick and mortar location in 2008, quickly followed by other locations.
The business consists of four divisions (each an individual entity) of the company: two individual Southern California locations, a nutritional supplement and workout apparel company, and a franchise program (with 23 franchise gyms and counting).
We are already pre-approved for SBA loan and have term sheet issued. We are seeking an equity partner to contribute the 10% required capital injection for the SBA loan. Since equity ownership is less than 20%, investor(s) will not be on the loan or have to personally guarantee the loan.
FINANCIALS
Revenue 2022: $4.2MM
Net SDE 2022: $1.1MM
Projected Revenue 2023: $4.5MM
Projected Net SDE 2023: $1.2MM
DEAL SPECS
Purchase Price: $5,445,891
Due at Closing: $4,792,384
Deferred Payments (Seller Note): $653,507
- Fixed payments of $3630.59 monthly with balloon payment after 8 years of repayment, with a 2-year standby before any seller note payments are due.
Capital Injection Needed: $600,000
Cash Needed to Close: $546,500
Prepaids and Professional Fees to be recouped by me: $13,500
Working Capital: $40,000
Equity for Sale: 14% (negotiable)
ARR = 161%
IRR = 15%+
Initial Payback Period = 4 years
Year 1 = $110,000 in distributions
Year 2 = $130,000 in distributions
Year 3= $154,000 in distributions
Year 4 = $166,000 in distributions
Debt Service Cover Ratio = 1.6
Total Repayment (P&I): $708,246 annually or $59,020 monthly.
Total Repayment (After 2 years when our seller note payments begin): $751,938 annually or $62,661 monthly.
EXIT STRATEGY:
- Grow to $10MM in total EBITDA across all companies (roughly ~8-10x growth from where we are today)
- Exit to Large Investor, Trade Buyer, Private Equity, or IPO
- Target Exit Maturity Date (Worst Case Scenario): 2028-2030
- Exit Price: 12x - 15x multiple = $120MM - $150MM
- 14% Equity = $16.8MM - $21MM
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