Drop a confidential information memorandum. A deterministic pipeline does the parsing, extraction, and scoring you can check — and agents do the two things that actually need judgment: researching the market and reviewing their own work. Out comes an IC-ready screen memo, scored to your box.
Most of screening is deterministic work you want to be able to verify — parse, extract, score against the box. We use agents in exactly two places where iteration and judgment earn their keep. No agents for the sake of agents.
Verdict: CONDITIONAL — inside the deal box on the numbers; franchise control & carrier concentration cap the platform thesis
A genuinely on-thesis lower-middle-market target — fragmented, buy-&-build sector, founder-owned, cash-flow positive. Two structural issues keep it from being a clean control platform. Advance to IC only if the two gating conditions below can be met in diligence.
Scored against the deal box — < $50M revenue · $1–5M EBITDA (cash-flow positive) · healthcare / consumer / business services · fragmented & add-on-rich · control ownership with management co-investment. The box is a config file (deal_box.yaml); point it at another fund's criteria and the same pipeline re-screens.
| Criterion | Result | Evidence from CIM |
|---|---|---|
| Revenue < $50M | PASS | $11.0M FY22 (recast), $13.5M FY23E — comfortably inside. |
| EBITDA $1–5M, cash-flow positive | PASS | $1.47M FY22 / $1.81M FY23E · positive free cash flow. Lower third of the range, margin 13.4% and expanding. |
| Target sector (healthcare / consumer / business services) | PASS | Business services — insurance-funded property restoration. Squarely inside the mandate. |
| Stable-to-positive demand | PASS | Non-discretionary, claims-driven demand — recession-resistant. Matches "stable to positive underlying demand trends." |
| Fragmented & add-on-rich (Buy & Build) | CAUTION | Category is highly fragmented and roll-up friendly — but the franchise agreement constrains brand control and M&A flexibility, blunting the buy-&-build engine. |
| Control ownership attainable | FLAG | Founder will sell 100%, but franchisor consent-to-transfer means control is encumbered — a gating item for a control fund. |
| Management partnership & co-investment | CAUTION | Founder (65) is retiring; senior PM layer stays. The box requires management co-investment — a rollover/partner isn't yet identified. |
| Conservative structure / low-risk profile | CAUTION | Strong NWC ($2.8M), clean S-corp, no litigation — but carrier concentration ~68% and a related-party lease cut against the low-risk profile. Reconciled to Appendix B by the review loop. |
The research agent ran targeted queries to sanity-check the CIM's story against the outside world — the kind of context a deal team would otherwise pull by hand. Figures below are illustrative for this demo; the pattern is the point.
Before the memo was finalized, a review agent audited the draft for unsupported claims and math errors; a refinement agent resolved each finding against the source. This loop is why the verdict you're reading is not the verdict the pipeline first drafted.
"23.9% revenue CAGR (FY20–FY22) spans FY21, an above-trend storm year. Presenting it as organic durability overstates the run-rate."
Added the normalization caveat, noted organic CAGR ≈15%, and downgraded the growth read in the snapshot.
"Draft cites Top-5 carriers ≈ 71%, but the Appendix B carrier table sums to 68% for named carriers. Reconcile before IC."
Corrected to 68% named / ≈71% incl. affiliated programs, and tagged the 3% delta as a diligence item.
"Two HIGH flags (franchise consent, carrier concentration) are unresolved gating items. A clean 'Advance' isn't supported by the evidence."
Downgraded the verdict to CONDITIONAL with two explicit, testable gating conditions.
On-thesis on nearly every dimension — size, sector, demand stability, fragmentation — with real momentum and margin expansion. But two structural issues cap it as a control platform. Advance to IC only if (1) the franchisor grants multi-territory expansion rights and consents cleanly to PE control, and (2) a management co-investment / rollover partner is credible and second-tier carrier diversification is achievable within 24 months. Otherwise, revisit as an add-on to an independent (non-franchise) restoration platform, where the local reputation and carrier relationships are worth more than the franchise flag.