Financing options for self funded searchers planning to hold permanently?
I'm a self-funded searcher planning to acquire and hold permanently, then continue growing through additional acquisitions over time.
The challenge I keep running into when thinking about bringing in outside investors is that most LP structures assume a sale event to deliver IRR. If I'm not selling, traditional equity terms don't really fit, assuming an IRR between 30%-40%.
A few things I'm trying to figure out in regards to financing options:
- Do most permanent-hold searchers stay away from outside investors entirely and stick with SBA + seller notes + other forms of debt?
- Are there investors out there who prefer consistent cash flow over a terminal sale? If so, what do their terms look like?
Appreciate any perspective from those who have financed a permanent hold deal.