Independent Sponsors Winnin... | Lippes Mathias LLP

Independent Sponsors Winning Auctions: Why They're Closing 27% of Lower Middle Market Deals

February 8, 2026 | Corporate Blog

Top reasons why independent sponsors are winning more auction processes in the lower middle market:

27% of closed auction deals (on the axial platform) were won by isponsors
iSponsors targeting more niche investment banks and main street brokers who have deals tied to the isponsor’s investment thesis
Building a relationship with business owners in the process (the more interpersonal feel of the isponsor is often quite appealing to a business owner, as well as the industry expertise of the isponsor / their operating partner)
Having support letters and a viable path to capital for the deal (i.e., concept often reflected in an LOI where the exclusivity period may have a date-based milestone tied to proof of funds)
Avoiding “last dollar” sellers, and focusing on sellers concerned about legacy and interested in rollover equity can be ideal matches for isponsors (ie, we recently closed an isponsor transaction where the founding sellers stayed in for a 44% rollover equity position)

John Koeppel's commentary on his interview "How to Win and Close Your First Deal as an Independent Sponsor" with the 51 Labs podcast.

Disclaimer: The information in this post is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from our firm or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.