Staffing Business Brokers

Mergers & Acquisitions and Business Brokerage Services for the Staffing Industry

Raincatcher’s Partners and Managing Directors have completed over a billion in combined transactions throughout their careers. We offer an investment banking style auction process to lower middle market companies.

Our award-winning team is largely comprised of former small business owners, public accountants, and middle-market investment bankers. Our clients have trusted us to sell over $500M in small and mid-sized businesses.

How We Work With Our Staffing Clients

If you are currently in the process of interviewing M&A advisors and business brokers for your staffing business, you have come to the right place. Our team not only understands the staffing industry but also boasts a strong buyer list consisting of investors, including family offices, private equity funds, search funds, and entrepreneurs. With a proven track record of successfully closing deals, we bring the expertise and experience you need.

While we pride ourselves on being industry agnostic, there are a few industries that we avoid, such as reimbursement-related healthcare, energy, life sciences, etc. Likewise, our team is well-versed in several sectors, including manufacturing, staffing, SaaS, tech, construction, and industrials. Rest assured. We have the knowledge and insight to guide you through the complexities of selling your business.

Have a look at our selling a staffing agency article or contact us today to discuss your specific requirements and learn more about how our M&A advisors and business brokers can support your exit goals.

Valuation Specifics for Staffing Businesses

Like many business service companies, human capital companies such as staffing agencies are in increasing demand from private equity groups and other business buyers.

Additionally, there are a handful of family-owned or publicly traded staffing companies that look to grow through acquisition. However, not all staffing agencies are created equally. Generally speaking, buyers favor staffing companies that:

  • Have a high bill rate. $100/hr.+ is ideal
  • Have a gross margin of 25%+. Agencies that have over 35% will sell for a premium
  • Have a long project length
  • Utilize the split-desk model and utilize their CRM
  • Focus on a specific industry / sub-industry that they have an advantage in
  • Short time-to-fill
  • Ideally less than 20% of revenue from direct hire.
The Raincatcher Process

Our Specialized M&A Advisory Auction Process for Staffing Companies

Our M&A Process is Specifically Designed to Maximize Transaction Proceeds and Terms for our Clients with $500k+ in Annual EBITDA

Sell-side due diligence

Due diligence is traditionally done by business buyers and not business brokers. However, our comprehensive sell-side process includes a diligence process before we bring a business to market. Learn more about diligence on our M&A consulting post.

Our comprehensive diligence process is designed to drive the highest value for the business owner as buyers know that there won’t be any skeletons in the closet once they submit an offer and start spending money on legal and financial diligence.

Specially designed brokerage or M&A auction process

Depending on the size of your business and industry your company operates in, we may recommend a traditional brokerage process with a listing price. Or, a competitive auction process with buyers submitting the price and terms for negotiation. 

Our buyer list is comprehensive and will be tailored to include (or exclude) and participants in your industry who may make great strategic buyers or who you want to avoid knowing the business is on the market.

Short-listing finalists

It isn’t uncommon for strong, sizable companies to get 5+ indications of interest (soft offers). We’ll then validate those buyer groups, attend dinners where they meet out clients, prepare further data on the business and negotiate the deal terms that buyers will propose in their final offer.

Negotiate LOI terms and facilitate diligence

Once LOI’s have been received from potential buyers we work with our clients to select the most attractive offer before executing the exclusive LOI.

It’s common for diligence to take 60-90 days before closing. This requires a significant time commitment from all parties. Additionally, final deal points are negotiated and contested during this period.

More Staffing Resources

To learn more about valuation, have a look at our staffing industry valuation article.

What Our Clients Have to Say

Request A Consultation

If you’re a business owner and you are currently entertaining selling your business in the coming years, we welcome the opportunity to get introduced to discuss our M&A, Exit planning and Advisory services.

Business Broker FAQs

We aim to provide complete transparency to our clients to help illuminate what can prove to be a complicated process of selling their business.

How Long is the Process to Sell A Business

Most of our clients are lower middle-market companies ($500k – $10M in EBITDA). Clients in this size range typically benefit from a full auction process as it will drive multiple bids for their business. This process takes 7-9 months on average.

The reason we typically opt for a full auction process when selling businesses is that it; does not cap what a prospective buyer is willing to pay, it allows for a thorough marketing process that typically culminates in receiving multiple bids for the business and allows buyers to table a price and structure that they feel comfortable with. We can then work with the seller to short-list final potential buyers, meet with them and decide which offer is most appealing after receiving letters of intent (LOIs).

Is The Selling Process Confidential?

Yes. We make every prospective buyer register with us, sign an NDA and go through a vetting process before they ever see the name of a business that is listed for sale.

We understand the importance of a confidential process and only communicate directly with our client, the business seller. We’ll never call your general business line or speak to any of your employees about the sales process without our clients “okay.”

Furthermore, we will only market your business to a competitor, supplier, customer or other business that you may work with if you “okay” that person from our list of strategic buyers that we work with you to prepare.

How Many Businesses Do You Sell Per Year?

We work as partners or as teams of three on most of our clients deals. On the average year each member of our team will be a part of 4-6 successful closings.

We are able to team up on deals which allows for our team members to fill into the spot of the business selling process that they are best suited for, be it financial analysis and recasting, deal marketing, negotiation, due diligence, etc.

How Do Business Brokers Get Paid?

Like most business brokers, we charge a small retainer when signing a client on, but primarily get paid by charging a success fee that is a percentage of what we are able to sell the business for. This fee varies based on the size of the business, how quickly it will sell, how much preparation work and sell-side due diligence will be required from us, etc.