The 7 Elements of Every PE Deal

Every PE deal has a headline number. The number your banker puts in the pitch book. The number you tell your spouse. The number you start spending in your head before the ink dries.

Here's the thing. That number is a fiction.

Not a lie, exactly. More like a movie trailer — technically composed of real footage, carefully arranged to suggest something that isn't quite true. The headline is what the buyer wants you to anchor on. The terms underneath it determine what you actually take home.

The Deal Spectrum

Think of a seesaw on a playground. One side is the founder. The other side is the buyer. Every term in the deal shifts weight to one side or the other.

That's the Deal Spectrum. A 1–10 scale applied to every deal term, measuring one thing: who controls whether the founder gets paid?

A 1 means the founder controls how and when the money arrives. Money arrives on a schedule the founder can enforce, through structures the founder understands. A 10 means the buyer controls how and when the money arrives. Money exists on paper, but the path from paper to wire runs through the buyer's decisions and the buyer's timeline.

Most founders never score their deal. They read the headline, trust their attorney, and sign.

Crossfield Holdings

James and Dan built Crossfield Holdings over 24 years. A commercial facilities services company. 692 employees. $83M in revenue. $14.9M in adjusted EBITDA. A real business, built by real operators.

They sold to Ridgeline Capital, a mid-market private equity firm. The price was $119M.

That number felt like validation. Twenty-four years of early mornings, difficult employees, and customers who always wanted more for less — distilled into nine figures. James told his wife. Dan told his. Both started thinking about what came next.

Here's what came next.

$63M arrived at closing — 53% of the headline. The other $56M was scattered across four buckets:

• Seller notes only one founder could enforce.
• An earnout the buyer controlled.
• Escrow the buyer could freeze.
• Rollover equity with no protections.

Every dollar sat on the buyer's side of the spectrum.

Eighteen months after closing, $10M of the $56M had arrived. The $46M was stuck, disputed, or gone.

The Seven Elements

Every PE deal, regardless of size or sector, is built from seven structural categories. This series will walk through all of them:

1. The Deal Framework — How the deal is set up before terms are negotiated. The lock-in, the walk-away rights, the leverage mechanics.
2. The Money — What you're actually getting paid. The gap between the headline and the wire.
3. Deferred Consideration — Money promised but not delivered. Seller notes, earnouts, and the structures that control whether it ever arrives.
4. Risk Retention — Escrow, indemnity, and the mechanisms that let the buyer claw back money after closing.
5. Ownership & Control — Rollover equity, incentive plans, and liquidation preferences. What you still "own" versus what you actually control.
6. Post-Close Control — Employment agreements, restrictive covenants, and the dual-hat trap. How the buyer controls your life after closing.
7. Tax & Legal Traps — Structural risks that operate silently. Tax incentives that reward the buyer for not paying you.

Each post scores its primary term on the Deal Spectrum. By the end, you'll have a clear picture of deal terms and how they impact you.

Crossfield scored 8.5 out of 10. Every term favored the buyer.

The founders weren't naive. They were experienced operators who built a valuable business. They just didn't know the playbook. The PE firm did. That asymmetry is the entire series.

Read before you sign.