What is a Platform Company?
A platform company is a company that a Private equity group (PEG) views—when investing through acquisition in a new industry or market space—as a starting point for follow-on acquisitions in the same area
This is the first investment a PEG makes in certain industry or market. Depending on the PEG, the typical platform company has EBITDA of approximately $2M and must be scalable.
Why it Matters to You
This is relevant to business owners when we start the buyers search. If the business is above $2M in EBITDA then we would approach PEGS in a way that would position the company as a potential platform acquisition.
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