By Evgeni Kouris, Founder of New Mittelstand

Here’s something I see repeatedly in our community across the DACH region: the deals that fall apart rarely fall apart because of valuation. They fall apart because the owner looked across the table, and simply couldn’t picture this person inside their company.

I’ve been building New Mittelstand since 2017. For the first seven years, we focused on organic transformation, helping Mittelstand owners innovate from within. Since 2024, we’ve been building the leading three-sided community in the DACH region: connecting Mittelstand owners who need a trusted successor, searchers who are looking to acquire and operate exactly those businesses, and long-term investors who want to back the right operators in European SME transitions.

What I’ve learned from sitting at all three tables might save your deal.

The number you need to understand

Germany alone has over 500,000 companies expected to change hands by 2027. Around half of them have no family or internal successor ready. That’s not a future problem, it’s now.

For searchers, this sounds like opportunity. And it is. But raw numbers create a dangerous illusion: that demand from sellers is high enough to make execution easy. It isn’t. Because most of those owners aren’t just looking for a buyer. They’re looking for a custodian.

What “successor” actually means

Mittelstand companies are not built on spreadsheets. They’re built on decades of relationships, with employees who’ve been there for twenty years, with customers who shake hands before they sign anything, with suppliers who extend credit because they trust the family name.

When an owner considers an external successor, they are not primarily asking:

“Can this person grow my EBITDA?”

They are asking:

“Will my people be okay? Will my customers still trust us? Will what I built survive me?”

This distinction sounds soft. It is not. In our community, we consistently see owners walk away from higher bids because the preferred buyer understood this, and showed it.

Three things owners evaluate that most searchers underestimate

1. How you talk about their people.

In your first meetings, how often do you ask about the team, not as a due diligence checkbox, but with genuine curiosity? Owners notice when a searcher spends the entire first meeting asking about margins and exit multiples. They also notice when someone asks:

“Who is the person this business couldn’t run without, and what do they need to stay?”

That question signals something no financial model can: that you understand a Mittelstand business is a community of people, not a cash-flow machine.

2. How you handle what you don’t know.

Most Mittelstand owners have been operating for 20, 30, sometimes 40 years. They’ve seen consultants come and go. The fastest way to lose an owner’s trust is to act like you understand their business better than they do, in week one.

Intellectual humility is not a weakness in a succession process. It’s a competitive advantage. Ask more than you assert. Stay curious longer than feels comfortable.

3. Whether they believe you’ll still be there in ten years.

This is the one searchers are least prepared for. In ETA structures built around 5–7 year hold periods, “long-term” has a precise meaning. But for a Mittelstand owner, long-term means generational. You don’t have to commit to never selling. But you do need a credible, personal story about why you, specifically you, want to build something durable, not just deploy capital efficiently.

If you can’t answer the question “Why this business, in this region, for the next decade?” with genuine conviction, an experienced owner will feel it.

The community edge

One reason New Mittelstand invests in building a three-sided community, bringing Mittelstand owners, searchers, and long-term investors into the same rooms, the same events, the same conversations, is that trust doesn’t scale through cold outreach alone. It builds through repeated, low-stakes contact over time.

Some of the best succession deals I’ve seen in our network started not with an LOI, but with a founder attending a New Mittelstand event and watching a searcher engage thoughtfully in a panel conversation. Then a coffee. Then a follow-up three months later. Then, eventually, an exclusive process.

That’s not a slow path. It’s actually the fast path, once you understand how Mittelstand owners make decisions.

The honest question for your search

If you’re operating in the DACH market, or planning to, here’s the question worth sitting with:

Are you building a track record of trustworthiness, or just a track record of outreach volume?

The succession wave is real. The opportunity is generational. But the searchers who will win the best businesses in the next five years won't be the ones who sent the most letters.

They'll be the ones owners actually looked forward to calling back.

The small business M&A market is structurally inefficient, and that's the whole point. Grant Hensel from Entrepreneurial Capital shared data from 200 deals mapping EBITDA, industry and acquisition multiple. The key takeaway:

The inefficiency of the lower middle market is not a bug to be fixed. It is the structural feature that makes the asset class work.

Reference: Grant Hensel, Entrepreneurial Capital. LinkedIn, April 2026.

𝗘𝗠𝗖 𝗕𝗲𝘁𝗲𝗶𝗹𝗶𝗴𝘂𝗻𝗴𝗲𝗻 - 𝗗𝗘 

Marco El Manchi's self-funded vehicle EMC Beteiligungen closed the acquisition of ST-Profile, a German manufacturer of tile-laying systems. Link

𝗔𝗽𝗲𝘅 𝗣𝗮𝗿𝘁𝗻𝗲𝗿𝘀 - 𝗜𝗧 

Davide Orso Giacone and Edoardo Selmi launched Apex Partners, a sector-agnostic search fund dedicated to acquiring and developing an Italian SME. Link

𝗜𝗻𝘁𝘂𝗶𝘁𝗼 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 - 𝗘𝗦 

Sergio Palau launched Intuito Capital, a search fund targeting Spanish mid-market companies across light manufacturing, B2B logistics, healthcare and education. Link

𝗕𝗿𝗲𝗻𝗻𝗣𝗼𝗶𝗻𝘁. - 𝗗𝗘 

Lucas Brenninkmeyer launched BrennPoint., a search fund focused on acquiring profitable B2B companies in the German Mittelstand, targeting revenues between €5M and €50M. Link

𝗜𝗡𝗦𝗘𝗧𝗔 - 𝗗𝗘 

INSETA closed INSETA II at €60M, hitting its hard cap in three months in an oversubscribed round. The fund, now the largest ETA investment vehicle in Europe, invests globally with a European focus across search funds, HoldCos and roll-ups, and maintains a partnership with INSEAD's ETA & Search Funds Hub. Link

Most podcasts about buying businesses focus on the deal. Simon Plummer focuses on what happens after. Co-founder of Arbor Permanent Owners and operator of three founder-led SMEs, Simon shared his post-acquisition playbook on the Buyers & Builders podcast:

Full interview on the Buyers and Builders YouTube channel.

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