Reddit reviews HBR Guide to Buying a Small Business: Think Big, Buy Small, Own Your Own Company (HBR Guide Series)
We found 3 Reddit comments about HBR Guide to Buying a Small Business: Think Big, Buy Small, Own Your Own Company (HBR Guide Series). Here are the top ones, ranked by their Reddit score.
Harvard Business School Press
this podcast talks about exactly the topic you mentioned. Interview with two Harvard Business School profs, who even wrote a book on the topic.
REALLY Private Equity, with Royce Yudkoff and Rick Ruback – Invest Like the Best, EP.33
HBR Guide to Buying a Small Business
Read HBR Guide to Buying a Small Business
It's very thorough and covers everything from valuation, to raising equity, how to split profits, etc.
In general, investors want to see a 25% return on their money for this kind of deal, maybe a little more in your case due to the turnaround nature of the deal.
Also, I echo the advice to draft pro formas-- what do the financials look like after your improvements and assuming everything goes as planned. Do the improvements yield a meaningful enough change?
Finally, the owner should be willing to finance a significant portion of the deal. It's very common in small business, but especially since you're looking at a much higher risk situation.
https://www.amazon.com/HBR-Guide-Buying-Small-Business/dp/1633692507/ref=sr_1_1?ie=UTF8&qid=1487885144&sr=8-1&keywords=buying+a+small+business
This is all good advice. In terms of structuring the deal, I'd agree that a 5 year buy-out makes sense.
Take a look at the HBR Guide to Buying a Small Business (http://amzn.to/2qoPMhn) for some good ideas on how to do this. It spends a lot of time talking about the sourcing process, but the second half of the book covers your situation nicely.