Pushed Out by Anchor Investor
Neal recounts the moment his anchor investor retraded him at the five-yard line of a $7m EBITDA acquisition. The terms were gutted, leaving only a 2% closing fee. No management fee, no carry, no long-term involvement. The shock was real. But instead of burning the bridge, entering litigation, or walking away empty-handed, Neal took the deal. It gave him a track record, credibility, and sufficient capital to keep searching.
To avoid being blindsided again, Neal now builds leverage by running parallel investor processes. He secures signed term sheets before disclosing capital partners to sellers. He demands IC approval before advancing diligence. He calls other sponsors for references and expects the same from capital providers. Trust is essential, but so is structure.
Forged Capital screens 5,000 deals annually. 90% are discarded immediately, 50 IOIs are submitted per year, and 5 LOIs lead to 1-2 closings. They target "B assets," companies with gaps they can fix. Operational value creation, not leverage, drives returns.
Neal Doshi is part of the Independent Sponsor Alliance, a peer group. Quarterly Zoom meetings have helped him vet capital partners, pressure-test theses, and swap notes on industry trends. It reflects the deeper benefit of the independent sponsor model: flexibility, collaboration, and autonomy.
Check today’s new episode of the Minds Capital Podcast.
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