Teamshares wants to dominate America’s SMB succession game - but do the numbers add up? 5 observations after digging through the SPAC docs

Disclaimer: Unless noted otherwise, views and analysis expressed here are the author's own and based on public sources. The article is intended for informational and entertainment purposes only. This is not financial advice. Please consult a professional for investment decisions.

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Very unusual to see an American company whose comp set is made up almost entirely of mid-cap European stocks. And the stocks in question are battle-hardened HoldCos like Chapters Group, LIFCO, Röko, Lagercrantz and others (and yes, we have covered most of them in the blog)  

Even more unusual is to see a programmatic acquirer that is not particularly acquisitive, or produces much cash flow. 

Teamshares is all of those things – and it’s going public via a SPAC. The SPAC, called Live Oak Acquisition, is affiliated with the investment firm T. Rowe Price (the same investor led Bending Spoons’ most recent round). 

In September 2024, we published a deep-dive on Teamshares that instantly became one of our most popular articles: Admired, copied, misunderstood: the incredible story of Teamshares. The equity story at the time revolved around buying Main Street businesses, cheaply, and converting them into captive customers of financial products. Put differently, the end game was not necessarily the companies themselves, but the platform that was being built out. 

In the year since, the narrative has decisively shifted. The revamped Teamshares pitches itself as a Swedish-style compounder (link to the SPAC deck) looking to ride the US SMB succession wave:

 
This volte-face is not necessarily a bad thing. 

For a while, Teamshares was on a trajectory that looked part Storskogen and part Thrasio (“7 companies closed in a single month” - according to the SPAC deck). A fast-paced but seemingly random M&A strategy (a butcher chain, a design firm, a fast-food restaurant!) overseen by an oversized central team. Despite the makeover, the SPAC presentation shows that Teamshares is still lossmaking (6 years in), weighed down by $40M in annual corporate costs and $30M in interest payments - against only $60M in asset level EBITDA (which is admittedly double last year’s levels). 

Teamshares is pricing the SPAC at a 36% discount to the 2024 Series E (source), valuing the company at $525M equity value / $746M enterprise value, with $333M in targeted equity proceeds.  

As we await further SPAC docs - basic things like a balance sheet are still missing - here are our initial thoughts around:

1. Revenue growth

2. Capital deployment

3. What does a central team do in a HoldCo?

4. Debt facility

5. Closing thoughts: implications for serial acquirers

Before we get into the weeds, please remember that all of this is for your education entertainment purposes and based on public information. This is not investment advice. 

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