The company set out to provide retainer-based consulting services to business doing sub $20M in gross revenues. Its concept was to provide an innovative retainer-based Board of Directory style advisory service carried out by an assemblage of 125 recent MBA graduates from top tier programs. Veld was confident that the uncommon, shared risk business model coupled with providing the passionate talent to implement the initiatives developed would be welcomed by the target client base as a refreshing results driven alternative to consultants who were paid in advance to merely delivery a report. The long-term vision was to cultivate a group of savvy operators that would be matched with participating owners that could leverage the talent pool to achieve results beyond their own abilities and bandwidth. An additional benefit was that these leaders could expand the client’s succession option should they elected to scale-down or even retire.

To accomplish the vision, The Veld Group targeted firms in fragmented industries poised for consolation. These initially included commercial printing, food manufacturing, and health and beauty care products and services. The concept failed as it turned out that veteran owners tended to not embrace implementing the strategic initiatives or if they did, they opted for what were perceived to be less risky half-measures. The silver lining of the exercise was that The Veld Group initially recognized an unmet client need for credentialled valuation work and pivoted to focus on valuation work that met clients where their needs were – which was in scaled down versions of the more formal, longer format and unnecessarily costly certified valuations.

Shortly after Veld team members became certified in Valuation work, they recognized another unmet market need. In several cases, their valuation clients went to market with dismal results. The team conducted a market analysis and discovered several reasons for this. The leading causes were a fragmented brokerage industry that either focused on smaller Main Street Opportunities or only larger $50M plus Lower Middle-Market enterprises. The smaller business brokerages that catered to smaller sales employed commercial real estate style tactics to market and sell a business, with little to no pre-planning, client and business preparation, company value assessments occurring, protections in place to ensure confidentiality is maintained or buyer outreach systems and sufficient qualifying mechanisms in place. Conversely, Mergers and Acquisitions firms had little interest in smaller opportunities and lacked an individual or small private company buyer pool. What’s more, while they may assist in capital raises on larger deals, they were wholly unfamiliar with obtaining financing for smaller deals or structuring sales for smaller business owners that would align with their concerns and alleviate the fears they possessed regarding a transition. Put simply, clients in the $1M – $5M EBITDA range were too large for the main street marketplace and too small for lower middle-market mergers & acquisitions and boutique investment banks to sufficiently cater or have an interest in. The team set out to tackle both distinct marketplaces, but most importantly, learn the nuances of how to help those clients in what they began to refer to as “No Man’s Land.” Their former consulting and valuation patrons that had not successfully transitions became their first clients.