Library PE Deal Sourcing

Sarah Moore created a scrappy private equity firm using a university library as her office and unpaid interns to source deals, ultimately acquiring egg cartons.com with no money down through bank and seller financing.

Key Points:

• Unconventional PE Structure:

  • Solo founder with no fund or initial capital
  • Used university library as office space
  • Recruited 50+ unpaid interns from Craigslist
  • Screened 400,000+ private companies over 1.5 years

• Deal Sourcing Strategy:

  • Created fake student IDs for interns to access library
  • Faxed thousands of businesses daily with photo wearing "I want to buy your business" sweatshirt
  • Harassed potential sellers until getting responses

• Acquisition Structure:

  • 75% bank debt (uncollateralized loan)
  • 25% seller financing
  • No personal capital required except 2012 RAV4 as collateral
  • Rolled accountant fees into deal

• Target Business Criteria:

  • Stable historical cash flows
  • High barrier to entry (domain name portfolio)
  • Simple enough operations for inexperienced operator
  • Profitable since 2001
  • Revenue under $50M

• Current Business:

  • Evolved from pure egg cartons to specialty packaging
  • 40% revenue from non-egg related products
  • Clients include Boeing, SpaceX, Disney, Madison Square Garden, Crayola