I have several family and friend investors who are interested in putting in equity money for an acquisition, but I would like to show owners/brokers/bankers some level of preliminary commitment from these investors so that they take me seriously (considering my own net worth probably wouldn't warrant a multi-million dollar acquisition). So I'm wondering if anyone has any resources/templates for drafting a letter from equity investors showing their support and willingness to invest in an acquisition (assuming the right deal)?
To be clear, I don't have a specific deal that I am working on at the moment, but more interested in having this for future conversations.
Thanks
Support letter from friends and family?
by an investor from Florida Institute of Technology
More on Searchfunder
Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.
We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.
We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.
Second, just like an LOI, these letters are not worth the paper they are written on. However, they can help you check a box. If you have a wealthy investor or family office, i would simply draw up a short letter that outlines that they will support you in your acquisition of XXXX at a valuation of $10M and they are willing to commit between/up to $5M.
Then the letter should highlight who they are. i.e. We are a family office with assets of $500M, etc. we invest in deals of xxx and yyy. Etc.
Keep it to half a page. very simple.