Advisory built for the long term.
Purple Iguana is an independent M&A advisory firm focused on privately held companies, combining direct principal involvement with a long-term view before, during and after a transaction.
Built around the transaction. Designed for the long term.
Our involvement often begins before a transaction and continues long after it closes.
Purple Iguana Investments advises exclusively on transactions involving privately held companies.
Our work often begins before a transaction and continues after it.
We prepare companies and their owners for acquisition. We advise on the transaction itself, through structuring, negotiation, diligence and closing. And we frequently remain afterward as board members or standing advisors to the business.
These roles reinforce one another.
Preparing a company teaches us the business and its management from the inside. That is how we develop a genuine view on a transaction involving it.
The transaction creates the reason, and often the standing, to remain involved afterward.
A board seat is where the outcome we advised on is actually built.
A firm paid in equity has to think in years rather than in closings.
We are an advisor.
The advisory relationship, and the transaction the client asked us to advise on, are at the center of what we do.
What distinguishes how we practice is the form our compensation can take: equity in the transaction we advised on.
That requires conviction and creates alignment.
Structuring decisions are taken together with the parties’ own legal, tax and accounting advisors. Our role is to design the commercial architecture of the transaction, coordinate the process across jurisdictions and, on a small number of transactions, commit our own capital to the outcome.
Our function is to carry a transaction from thesis to closing, to stand alongside our clients when we do, and to remain useful to the business afterward.
How We Engage
From transaction readiness to execution and long-term involvement, each mandate is structured around the needs of the business and its owners.
Practice
We are intentionally small.
A mandate is handled by the principal from the first conversation onward, and clients deal with a principal directly.
We are geographically anchored but jurisdiction-neutral.
Our offices are in Chicago and São Paulo, and we act in both markets on their own terms as readily as we act between them.
We are confidential by construction.
Information relating to a transaction, client or counterparty is compartmentalized internally and disclosed only where required by law, by the terms of the engagement or on the client’s instruction.
Before accepting a mandate, we consider the proposed role, the parties, the structure, the counterparties and the jurisdictions involved.
Mandates
Our work follows the life of a transaction and generally falls into three stages.
Before
We prepare the company to be acquired well, and we prepare its owners for what a sale process will ask of them.
During
We advise on the transaction itself, from thesis to closing.
On transaction mandates, our fee may be paid in the equity of the deal we advised on.
After
We frequently remain with the business as a member of its board or as a standing advisor.
A client may engage us for one stage, two stages or all three.
Each mandate is agreed separately, and none commits either side to the next.
Where appropriate, we work jointly with local counsel, licensed institutions and other authorized professionals in the relevant jurisdictions.
Readiness
Most privately held companies are not ready to be sold on the day their owners decide to sell.
The accounts may be built for tax rather than for a buyer.
Governance may be informal because the owner is the governance.
Contracts, licenses or intellectual property may sit in the wrong entity or in an individual’s name.
Customer concentration may never have been examined.
And the company may never have answered a diligence request list.
None of this makes a company unsellable. It makes it cheaper.
Value is lost in the discount a buyer applies to what it cannot verify, in the indemnities and escrows demanded for problems discovered late, and in the months added to a process that has to fix issues while negotiating the transaction.
Readiness is the work of addressing those issues before the process begins.
We look at the company as an acquirer will look at it and tell the owners what we see.
Then we work through it with them, including:
- the quality and presentation of financial information;
- the corporate structure and where the assets actually sit;
- governance and the separation of the business from the household;
- contracts, permits and intellectual property;
- contingencies and how they are provisioned;
- customer and supplier concentration;
- the information a buyer is likely to request; and
- the account the company will need to give of itself.
Owners are prepared alongside the company.
The principal works directly with shareholders and senior management on what a sale process will ask of them: how a buyer reads what they present, which questions will be asked and why, how diligence operates from the inside, where negotiating leverage is created and where it is given away, and what the owners themselves want from the transaction and from the years that follow it.
Readiness is agreed as its own mandate and commits neither side to what comes next.
Some companies complete it and go to market.
Others complete it and keep the business, better run than before.
Either is a legitimate outcome.
Advisory
We advise principals, whether sellers, buyers or holders of significant equity positions, on mergers, acquisitions, divestitures, joint ventures, minority investments, buyouts and secondary transactions in privately held companies.
The mandates we accept are typically mid-market in scale and closely held on at least one side.
Many are cross-border. Many are not.
We are engaged for our judgment on structure, price, terms and process, not for a proprietary product or placement network.
A typical advisory engagement may include:
- review and refinement of the commercial thesis for the transaction;
- valuation analysis and price benchmarking;
- structuring, including the design of holding, acquisition or joint-venture architecture, coordinated with the client’s legal and tax counsel;
- preparation of transaction materials, including confidential information memoranda, teasers and management presentations;
- identification and approach of counterparties, where the mandate calls for it;
- negotiation support on term sheets, letters of intent, share purchase agreements, shareholders’ agreements and ancillary documentation, in coordination with legal counsel;
- coordination of due diligence across legal, financial, tax, labor, regulatory and operational workstreams; and
- management of the closing process, including conditions precedent, regulatory approvals and post-closing adjustments.
Board & Standing Roles
A closing ends the transaction process.
It does not end the work of creating the value the transaction was intended to produce.
Our involvement therefore frequently continues after closing.
The principal serves on the boards of a small number of companies the firm has worked with and acts as a standing advisor to others.
Where our advisory fee was paid in equity, continued involvement is a natural consequence of how we were compensated: we hold shares in the business and remain interested in what happens next.
Where it was not, the role may be undertaken because the company asks us to remain.
In either case, the post-closing role is agreed separately from the transaction mandate.
Board Service
Where invited, the principal may accept a seat on a board of directors or advisory board.
A board seat is held by an individual, not by a firm.
The duties arising from it are owed personally to the company and its shareholders and take precedence over any commercial relationship between that company and Purple Iguana Investments.
We accept board positions only where the company maintains directors’ and officers’ liability insurance and provides indemnification on customary terms.
Standing Advisory
Where a board seat is not wanted or appropriate, or between one transaction and the next, we may act as standing advisor to the business.
That role may include continuing advice on strategy, growth through acquisition, governance, preparation for an eventual sale or capital event, and the questions that arise between transactions.
A standing advisory mandate is documented separately from any transaction engagement and stands on its own terms.
Cross-border Execution
Not every transaction crosses a border, and domestic transactions are not the lesser work.
But when a deal involves more than one country, the nature of the process changes.
A shareholder in one country may sell a subsidiary in another.
An investor may acquire an operating company abroad.
A joint venture may involve parties from three jurisdictions.
A family reorganization may be triggered by relocation, marriage or inheritance.
Cross-border transactions often become difficult not because of any one jurisdiction, but because of the seams between them.
Tax assumptions made in one country are tested in another.
Representations and warranties drafted under one governing law are read by a party accustomed to another.
Regulatory approvals in one jurisdiction alter the timing of every other workstream.
We work as the coordinating point across those seams: convening the parties’ advisors in the relevant countries, testing assumptions made in one jurisdiction against the others and translating the resulting decisions into transaction terms.
Legal, tax and accounting advice is delivered by qualified professionals in each jurisdiction.
Our role is to ensure that the commercial architecture of the transaction survives contact with all of them.