Recapitalization
A recapitalization (recap) is a transaction in which the founder sells part of the business, usually a majority, to a financial buyer and keeps a stake.
In a sale
How does a recapitalization work?
In a recapitalization the founder takes cash now and keeps a stake in the business alongside a new owner. If that owner grows the business and sells it later, the founder is paid again on the stake: the second bite. It suits founders who have already covered the number they need and who believe in the buyer's plan.
Where it comes up
Read it in context
In the articles
See the terms with your own numbers
The Go-To-Market Analysis (GTMA) builds the file a buyer would build on your business, before a buyer does.