Small Business Optimism has declined

The NFIB Small Business Optimism index has declined for the six month period ended June 30, 2019 compared to June 30, 2018. In the first six months of 2018, the average monthly index was 106.5. In the first six months of 2019, the average monthly index was 102.75. This represents a percentage decline of 3.5%. The index appears to have gained ground in Q2 over Q1 in 2019, with the index improving from 101.5 to 104.0. Time will tell if the index continues to improve or decelerate.

In the acquisition financing arena, capital availability is destiny as companies require reliable access to capital to grow over the long term. Unforeseen capital needs usually arise when acquirers least expect it. This can cause some concern for the acquisition financing provider, especially when covenants tighten up and that working capital availability is utilized faster than expected.

Mezzanine debt borrowing is usually a straightforward activity that many companies use for funding of transitional growth. Mezzanine debt lenders are highly transparent about their due diligence approach and their post-closing loan management making it easy for companies to engage with.

Elections have consequences and positive ones at that for the acquisition financing middle market. While much media attention is paid to the direction of the yield curve and the Fed’s likely rate cuts, scant attention is paid to the more important drivers of the acquisition financing market – business psychology and regulatory climate.

Small Business Optimism has declined

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