The M&A Blueprint
If you want to go fast, go alone. If you want to go far, go together - African Proverb
Why do black CEOs struggle to engage in M&A activity? Lack of capital is an element but not the full story. The M&A expertise is there. Anyone on wall street knows that there is plenty of black M&A talent. The pool isn’t massive at the senior levels. Definitely under 3-5% of executive talent at most mid-market banks, bulge bracket banks, and VC/private equity funds (excluding the few black-led firms). But there’s plenty of junior to mid level talent that has strong M&A experience. What’s the real driver of this lack of M&A activity? Black ego.
What is black ego?
“Black ego” is a made up term we’ve created at Dymnd. We’re not hypocrites to be clear, we admit that we’ve had our moments of black ego ourselves. We define black ego as the inability to prioritize the advancement of the black community due to personal trauma that has not been dealt with. The crabs in a bucket mentality is very high in the black community. Higher than every other community. If it wasn’t, the wealth distribution stats would look very different.
Black ego emerges through two common mentalities.
“I need to be the CEO, I cannot answer to anyone”
“Selling your business to a non-black company means you’re a sell-out”
Let me ask you a question. Please read this question with your logic brain and remove your emotions. If you have two of the following options and you can only choose 1 option, which would it be?
Option A: You are the #2 executive reporting to an innovative CEO who is a good leader and running a high margin cash flow positive business that does $20M in revenue and has been/currently is growing. To get here you had to sell your business for $5M post tax. You come from humble roots. You are 33 years old. You now make an annual salary $1M/year, have a solid amount of equity in this company you’ve sold to and you have a healthy work-life balance. Your previous business did $1M in revenue but was cash flow negative (~$100K/year) so you needed occasional debt and equity funding.
Option B: You are CEO of a business that does $1M in revenue but has ~$100K in negative cash flow annually and margins are getting worse. Your competition is heating up every day. You have a solid customer list and a good product. But you don’t see an easy path to break even if you grow revenue fast. To grow you need more capital. You are 33 years old.
If you’re using your logic brain you’re taking option A. But tragically many black founders drive towards option B. Black ego is to blame. It’s rooted in slavery. The ability to trust was destroyed and never fully rebuilt. Black ego drives the mind to focus on staying in control even if it’s a sinking ship. Even if there’s a nice boat nearby who is willing to pick you up and make you a key part of the staff with cushy accommodations. Even if you can carve out your own legacy on this new boat by constructing a new part of the boat or repairing something that none of the current staff have the expertise to address.
Black ego drives the mind to assume the worst in your potential business partners. Instead of bringing a win-win mentality to the table, you’re focused on survival with the assumption that your potential partner is here to eat your lunch. In 2025, scale matters is any industry that’s worth something. Synergies can come out of so many avenues. Better to combine forces than to run solo into the ground. To be clear, some industries are niche enough where boutique operations make sense. In those cases we 1000% support keeping a lean team, healthy cash flows, and enjoying the ride into the sunset. Typically these are businesses that top out at ~$3-10M in revenue. But if your specific section of the market attracts the big dogs, you need to be ready to combine forces to survive.
Selling your business to non-black businesses
Totally fine to sell to non-black businesses if it’s the best objective offer your have on the table. Key criteria when evaluating a potential acquirer include:
Valuation and deal structure
Closing diligence process
Management earn out periods (or lack of them)
Non compete dynamics
Vision alignment
If you find a white, asian, arab, latin, etc. business owner who hits on all of the above, go ahead and press the sell button ASAP my fellow black founders. There are plenty of good (and bad) businesspeople across races. When you press the sell button you generate significant wealth for you and your family. That can flow through the community. That is a very good thing. That is not selling out. That’s called being smart.
What is selling out?
When you sell to someone (regardless of race) and fail to evaluate the key criteria laid out above. That’s just the destruction of business value and money flow dynamics. That is a sin. Don’t do that please. If you’re evaluating an M&A deal and you don’t have M&A experience, get some help!
A plea to pushed out black bankers and investors
Please start your fractional CFO side hustle ASAP if you’re getting pushed out of one of the major banks or PE/VC funds and don’t have an exit lined up. This way the SMB black founder market has solid options to get advice from. If you want to get really meta, someone can roll up all of these boutique fractional CFO businesses into a larger one. Think Upwork or Toptal but tailored for black M&A/strategic finance professionals. Someone with a marketplace and/or FIG background should be good for this. IYKYK.
“Why would I want a pushed out banker/investor to advise me”? Good question. For those not familiar, wall street is a highly political environment. It starts at the intern level. Black interns have a much higher bar for performance and receive less tolerance from superiors when they make a mistake. This data is not public, but well known to everyone who is in the industry. This goes further to your analyst years where you’re typically given less technical assignments and deals. Then you get hammered in end of year reviews for not being technical enough even though you’ve never had a chance to prove it and get the needed reps to ramp up. This goes further into the client facing years. You go to less client meetings and get less reps on client management. You’re not even allowed to contact clients without going through many hoops/guardrails. You’re discouraged from building relationships with your client counterparts at your level.
The job shifts at the senior associate/VP level. After pushing hard through your associate years you become extremely technical (oftentimes more technical than your peers due to behavior overcompensation). Now you’re judged on bringing in clients. You’ve been paid less than your peers so aren’t able to save quite as much. Your peers also have generational wealth. They can afford to be in the same social spaces where the clients are. You generally cannot for a few more years. When you do make it to those spaces you’re forced to adopt their cultural norms. Why? Because the clients generally don’t come from your culture. Eventually you are told you’re not bringing in enough revenue. You are pushed out. A few of your black peers do a good enough job integrating and they hang on, but still make less than their non-black peers. Always on edge. Traveling and working harder to build client relationships. The few that make it to the top become trapped. They want to speak out on all of the BS they see in the industry, but if they speak out, they get black balled. They walk the tightrope doing the best they can.
How will Dymnd help?
The Dymnd marketplace will feature potential M&A advisor and investor options to diligence if you’re stuck. To be clear, we’re steering away from offering financial advice. Everything we’re suggesting in our blueprints and the app are opinions. You need to do your own research. We’re here to make that research more efficient. Just like we’re here to give you the infrastructure to improve your habits. We’re not going to do the actual work for you. Only you can take action. But we’re here to help you glow up. We love to see a good glow up. We live for the glow up.