Jalostamo7 Round – raising capital for next acquisition in Finland

Jalostamo7 is a Finnish Search Fund to help search, buy, continue and grow companies while creating stable and growing investment income for investors.

Search funds provide significant equity stakes for investors. We act below the reach of traditional private equity models. Search funds create approximately 8x ROI for investors.

Traction

Jalostamo7 gained €3.2M net annual revenues through Brushpainters (11% YoY) with €30k net annual burn in the last 12 months and 1100 customers, such as property owners and apartment hosting agencies in the Helsinki capital area. Jalostamo7 has raised €200k in private capital in 2022 from its founders to develop its MVP and validate the product market fit.

The Ask

Jalostamo7 is now looking to raise €500k bridge funding. The ideal investor would have expertise in entrepreneurship in small companies (Revenue below €10M / Year), in the renovation industry, high tech metal subcontracting and in the Entrepreneur Through Acquisition (ETA)-business model. The investment is needed to:

1. Buy one more company in Helsinki and thus reach###-###-#### more customers in Finland and €3,15M net annual revenues by Q3 2024.

2. Start the Jalostamo7 Phase 2. We will find 5 to 7 new Searchers, who will look for target companies to buy to the group. Phase2 will eventually bring 3 to 5 new acquisitions in 18 months.

3. Achieve the necessary traction for the next series A round in Q1 2026.

Jalostamo7 Website

Market

Within the next 5 years, Jalostamo7 is poised to capture a 7% share of the Finnish and Swedish Entrepreneur Through Acquisition market worth $770M. Since 1983, 258 U.S. search funds have returned aggregate ROI 8.4x and IRR 37%.

Business Model

Jalostamo7 is monetizing through a compounder entrepreneurship through acquisition business model (CETA-model) charged to acquisitions in the small business market, such as companies with €3 - 6M revenue, 18 to 30 personnel in Finland and in Sweden. Revenue growth is projected at 1,5x YoY (cashflow positive as of Q3 2022), reaching €40M by 2029 with EBITDA of €6M.

Team

Jalostamo7 team of 3 (1 full-time co-founder and ceo, 1 part-time employee, and 1 owner / advisors), based in Helsinki, with 100% (78% after this round's share issue) total ownership, and €700k in previous exits, combines 60+ years of managerial, commercial, B2B R&D expertise, industrial design and branding expertise from B2B industries in Finland such as Metso, Valmet, Thermo Fischer Scientific, Mitsubishi Forklifts, iloq, Kesko, Neste, PKC Group, Tracker, Ecolator, Conseptas, and Sebitti.

Competitive Advantage

Key USP versus competitors like True North Search and Helix partners in Finland is that we have a very hands on attitude on this enterprise. We have already bought one company and it is running well. We made quite a many improvements in the first two years at Brushpainters. We aim to empower people to release their full potential as ETA-Searchers. We support our searchers and are present in day to day work on the factory level. As scandinavians are not that eager to be entrepreneurs, there is room for multiple ETA-catalysators.

Round Details

At a €1,8M pre-money valuation, Jalostamo7 aims to close this €500k bridge round by 21 july###-###-#### The minimum investment ticket size is €20k.

Jalostamo7 is not seeking to exit, but some compounded business sectors of the group can be sold out separately in 5 years via buyout at a target post-money valuation of €36M (6x return of investment).

Get in Touch

Lauri Aaltio, Founder and CEO, and the other founders are speaking with potential investors over the next few weeks and are keen to pitch, demo and open up their KPIs and financial plans in detail.