How Private Equity Really Buys Companies
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Guest Introduction
Ariez Dustoor is Managing Partner of MB Group, a Miami-based private equity firm he co-founded in 2017. MB Group focuses on two core sectors: healthcare and multi-location services businesses—consumer or business services companies where growth is tied to geographic expansion or physical locations such as clinics, gyms, or service branches. MB Group operates as an independent sponsor, raising capital on a deal-by-deal basis rather than from a blind pool fund. Since founding, the firm has completed four platform investments with one successful exit, targeting founder-owned and family-owned businesses as their first institutional investor.
Summary
In this episode of the Power Exit Podcast, John Marsh sits down with Ariez Dustoor—Managing Partner at MB Group—to pull back the curtain on how private equity firms actually evaluate, structure, and close acquisitions of founder-owned businesses.
Ariez walks through MB Group's independent sponsor model, explains why they review 500–600 opportunities per year to close just one or two, and shares exactly what separates the deals that get funded from the ones that get passed. From sell-side quality of earnings reports to equity rollover expectations, deal structures, and the red flags that kill transactions, this episode is a masterclass in understanding the buyer's perspective before you ever enter a process.
Whether you're years from an exit or actively exploring options, this conversation gives you a rare, candid look at what institutional buyers are actually looking for and what will make them walk away.
You'll Learn
- The independent sponsor model explained: How MB Group raises capital deal-by-deal and why that flexibility often benefits sellers more than a traditional PE fund structure
- Deal funnel reality: MB Group reviews 500–600 opportunities annually, signs NDAs on roughly 150–200, and submits IOIs on 30–40—to close just one or two deals per year
- What gets their attention first: Growing niche industries, consistent or accelerating revenue trends, industry-leading retention metrics, and a believable 5-year growth plan backed by early execution
- Why the sell-side QofE is non-negotiable: Ariez calls a sell-side Quality of Earnings report his single top recommendation—it pays for itself and prevents retrades during diligence
- Deal structure breakdown: Roughly 50% of MB Group's deals are clean structures (equity rollover + cash at close); the remainder incorporate 12–24 month EBITDA earnouts or seller notes—full cash-outs are rare
- Equity rollover expectations: MB Group requires 20% or more equity rollover in almost every deal; sellers who want a 100% exit are not their target buyer
- Instant deal-breakers: Customer concentration above 30–40%, volatile or declining financials, below-average industry metrics (e.g. gym membership retention), and no team infrastructure beyond the owner
- What kills deals in diligence: Overstated EBITDA that doesn't account for needed hires or systems, and incomplete or inaccurate financial records that don't tie out
- How to prep 6–12 months out: Clean your financials, define your post-sale role clearly, develop a detailed and executable growth strategy, and begin filling key team gaps before a buyer is ever in the room
- Why advisors matter—even to buyers: Ariez confirms that MB Group actively prefers sellers to have qualified advisors; they've even walked deals back to owners and said "go find an advisor, then come back"
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