We're a Merchant Bank
For the Lower-Middle and Middle Markets
Three Macro Economic Trends Impacting the Market
The lower middle and middle markets are being impacted by three forces converging at the same time: a historic wave of business owners exiting, a new class of buyers stepping forward, and a fundamental shift in how transactions are financed. Halifax West operates squarely in the middle of these three trends. We combine advice, capital, and execution to help independent sponsors and business owners navigate the complexity of this moment and reach durable, long-term outcomes.
Generational Ownership Transition
A large share of U.S. privately held businesses are owned by Baby Boomers nearing retirement. By 2030, all Boomers will be of retirement age, triggering an unprecedented transfer of ownership known as “The Silver Tsunami”. An estimated 12 million Boomers own stakes in private businesses (roughly 40% of small and lower-middle market businesses) and are expected to seek an exit, with more than 70% changing hands over the next decade.
This volume of supply far exceeds the number of qualified buyers, creating a buyers’ market. Many of these Boomer-owned businesses are profitable but lack a transition plan. While this presents meaningful opportunity for well-prepared acquirers, it also introduces complexity and friction. Many businesses were not built for a clean transition, and despite plans to go to market, only 20–30% are expected to successfully sell.
The Rise of Independent Sponsors
As experienced private equity professionals leave large funds in search of autonomy, independent sponsors have become a growing force in the middle market segment. They bring institutional-level deal experience, but operate with greater flexibility and alignment. Capital providers increasingly prefer direct co-investment alongside sponsors, and founder-owned businesses often view them as a more tailored alternative to traditional private equity. As the ecosystem has matured, specialized lenders and co-investment platforms have expanded access to debt, reinforcing sponsor credibility and deal execution.
Independent Sponsors are filling the Boomer business transition gap by acting as intermediaries who identify, structure, and finance acquisitions on a deal-by-deal basis.
The Expansion of Private Credit
Private credit is also playing an increasingly critical role in this andscape by filling the acquisition financing gap left by traditional banks. Private credit offers speed, flexibility, and customized structures to faciliate these acquistions. As private credit has scaled, it now competes with public markets on deal size and has become a central feature of how middle-market transactions are financed, where the middle market segment may often be too large for small business loans or to small for larger capital debt markets. Private credit also introduces added complexity around leverage, risk allocation, and lender alignment requiring a disciplined approach to structuring and underwriting every deal.
Halifax West sits at the intersection of ownership transition, independent sponsors, and capital raising with private credit and other debt solutions. We advise on the buyside, structure transactions, and lead creative debt solutions to help independent sponsors and business owners successfully acquire companies in a crowded, buyer-driven market. Our role is to reduce friction, align capital, and execute deals that can actually close.
Our approach is rooted in the original merchant banking model: partnership over transactions, disciplined structure over standardization, and long-term value creation over deal volume. That raises a simple question: What is a merchant bank?
What is a Merchant Bank?
Merchant banking is a financial model that combines strategic advice, capital raising, and investing firm capital alongside clients. Merchant banks work directly with business owners and investors on complex transactions, including acquisitions, recapitalizations, and customized financing solutions. Unlike transactional advisors, they are often long-term partners often investing their own capital alongside clients.
Traditional merchant banking activities can include:
-
Capital Raising – Structuring and raising debt and equity through private placements and bespoke financings
-
Financial Advisory – Advising on mergers, acquisitions, recapitalizations, and long-term capital strategy
-
Underwriting – Supporting new security issuances and placing them with investors
-
Principal Investing – Investing the firm’s own capital directly into companies
-
Corporate Finance – Providing tailored credit solutions beyond standard commercial bank loans
Large global institutions such as JPMorgan Chase, Goldman Sachs, and Citigroup all maintain merchant banking activities within their broader platforms applying these capabilities across corporate finance, private investing, and strategic advisory.
Merchant banks differ from retail and commercial banks by focusing exclusively on businesses and investors rather than deposits or consumer lending. And while the term is often used interchangeably with investment banking in the U.S., merchant banking has historically emphasized private capital, mid-market companies and long-term alignment, rather than purely transaction-driven execution.
Historical Roots: The Original Partners to Enterprise
Merchant banking traces its origins to medieval and early modern Europe in the 14th through 17th centuries, when merchant families financed trade, early manufacturing, and infrastructure. These firms did more than provide capital—they structured ventures, managed risk, advised business owners, and invested their own capital alongside entrepreneurs.
During the 18th and 19th centuries, this model expanded alongside industrialization. Merchant banks operated as long-term partners rather than transaction-focused advisors, providing patient capital and maintaining relationships that often spanned generations. Their work was grounded in a deep understanding of businesses, industries, and markets.
This approach took hold in financial centers such as London, Amsterdam, and Geneva, where merchant banks played a central role in funding commerce, industrial growth, and family-owned enterprises across Europe and beyond.
​​
​The Rise of Merchant Banks in the United States
The merchant banking model reached the United States in the late 19th and early 20th centuries as industrialization accelerated. Merchant banks helped finance railroads, manufacturing, energy, and trade, working closely with founders and industrial families as both advisors and capital partners.
As U.S. financial markets matured, these roles became more divided. Investment banks shifted toward large, transaction-driven advisory work. Private equity became fund-driven. Commercial banks focused on standardized lending. As a result, the original merchant banking model: integrated advice, flexible capital, and aligned ownership became less common, especially for founder-led and lower middle market businesses.
​
Halifax West - Adapting the Merchant Bank Model
We advise independent sponsors and private companies on acquisitions, recapitalizations, and strategic financings. Our work focuses on transaction structure, capital efficiency, and execution, supported by deep relationships across the debt market.
We lead debt structuring and capital raises, source flexible financing, and selectively co-invest alongside our clients. The objective is simple: acquire good businesses with aligned capital structures that can perform over the long term.
Our approach reflects the core principles of merchant banking:

Structure with discipline.
 Raise capital with intent.
 Co-invest selectively.
 Create lasting value.
Read more about Halifax West’s background and story.
​