Key Takeaways

  • Inflexion closed the buyout of events operator Easyfairs in 2024 after a decade of continuous contact with founder Eric Everaert.
  • Kassai treats the vast majority of prospective founder outreach as sunk cost, accepting that only a fractional percentage ever yields a signed deal.
  • During the COVID-19 lockdown, when live events stalled and rival sponsors stopped calling, Inflexion continued feeding Everaert competitor data and operational intelligence from its portfolio.
  • Sourcing discipline in mid-market buyouts requires treating founder meetings as sector research rather than near-term pipeline tracking.

The Cost of Asymmetric Conversion

Private equity origination metrics usually punish patience. Deal teams operate under quarterly pressure to show live pipeline, meaning unreturned calls or distant exits get pruned. Flor Kassai runs the buyout practice at Inflexion with an opposite rule: expect nearly every relationship to fail commercially, and pursue it anyway.

“The vast majority of the relationships that our team builds don't go anywhere, and you can get hugely frustrated, or actually you can accept that that's part of what we do,” (play from 0:28) Kassai noted. “You build lots of relationships and a very, very, very small proportion of them are gonna flourish.” (play from 0:39)

This math requires junior and mid-level dealmakers to approach conversations without transactional pressure. If an associate enters a meeting needing an immediate mandate, the founder detects the fee incentive. Kassai insists that deal teams enter discussions strictly to build market intelligence. “You have to enjoy it and you cannot go into it thinking, 'I'm gonna get something out of this conversation. I'm gonna get something out of this meeting.' You have to go into it just for the sense of what you're gonna learn, the good time you're gonna have and how you're gonna progress your learning on that specific basis or on that specific sector.” (play from 3:30)

Surviving the Downcycle Test at Easyfairs

The 2024 acquisition of Brussels-based events organizer Easyfairs proves how this posture works when market conditions crack. Inflexion first initiated dialogue with founder Eric Everaert roughly a decade before signing a transaction. A decade of contact creates severe internal friction inside conventional PE models: models ask how many hours were logged against zero booked EBITDA.

“It would have been very easy during the course of 10 years to give up and say, 'Oh, you know, this relationship is not leading anywhere. You know, what is the ROI on the time I've spent on this?' But we insisted, and in fact, that business went through COVID,” (play from 4:17) Kassai said.

When live entertainment and corporate exhibitions stopped globally in 2020, financial sponsors dropped live-event operators from their priority sheets. Inflexion did the reverse. “During COVID, the phone stopped ringing, but we were the only ones still there and sharing. We were sharing what we were picking up, what his competitors were doing, other things that we were learning from our portfolio companies and being value additive to him.” (play from 4:52)

Hugh MacArthur pointed out that this persistence alters the closing dynamics when market conditions normalize. “So it's the investment in the relationship and the persistence of that when you find what you believe is a class A manager or owner or management team that ultimately gives you a lot of information and influences your ability to win the deal.” (play from 5:15)

Proprietary Alpha vs. Broad Auction Friction

When assets enter broad banking auctions, mid-market pricing converges. Bidders rely on standard lender packages, standard third-party market studies, and compressed management presentations. The winner often suffers the winner's curse, paying the peak multiple to clear the room.

A ten-year running relationship inverts that dynamic. By the time Everaert evaluated liquidity options, Inflexion had stress-tested the management team across a macro crisis. They possessed proprietary operational knowledge accumulated across multiple industry cycles. That data asymmetry allows an investment committee to underwrite execution risks that an outside bidder meeting management for the first time in an auction room simply cannot price with confidence.

Why It Matters

Sponsor access to quality mid-market assets is deteriorating as intermediated auction processes run by boutique banks commoditize standard deal diligence. Firms that win off-market transactions or secure preferred status in limited auctions are decoupling origination from immediate underwriting cycles. Building decade-long holding patterns with founders transfers intelligence capture to the pre-signing phase, giving patient capital an information edge that outbids auction speed.