Why ETA Investments Can Deliver 15–20%+ IRRs, Even with Zero Growth

Most investors assume strong returns require aggressive growth.

In ETA investments, that isn’t always the case.

In our latest Archimax research briefing, we explore how SME acquisitions can, in certain scenarios, deliver attractive double-digit IRRs even without operational growth – and why growth, when it occurs, is additional upside rather than a necessity.

Key findings from the research:

• Low entry multiples (3–6× EBITDA) can result in yields of 17–33% from day one

• Steady debt amortisation can double equity over a typical hold period without EBITDA growth

• Positive cash flow may allow early dividends, which can reduce capital at risk and improve IRR

• Returns in ETA are often driven by structure, discipline, and cash flow, rather than market speculation

• Compared to growth-dependent strategies such as VC or high-multiple buyouts, ETA may offer greater downside protection in certain contexts

Swipe through or download the PDF for offline reading.

At Archimax, through the B.O.R.I.N.G. Investment Club (Buy-Outs of Resilient INcome-Generating businesses), we work with experienced SME acquirers on transactions that meet defined criteria, accessed via Luxembourg SPVs structured by regulated partners. Our role includes strategic oversight through board participation.

The B.O.R.I.N.G. Investment Club is private and invitation-only. It does not conduct any regulated activity. Participation is limited to eligible professional or sophisticated investors.

Sources: Harvard Business School, Searchfunder, Corporate Finance Institute, INSEAD, IESE Business School, Clockwork

ETA Investments Can Deliver 15–20%+ IRRs — Even with Zero Growth

The ETA Secret – Low multiples and cash flow in ET

Low Multiples – 25% yield from 4× EBITDA acquisitions

Debt Amortization – ETA debt repayment doubling equity

No-Growth IRR – 15–20% IRR with stable EBITDA

Early Cash Returns – Dividends reducing ETA investment risk

Growth as Bonus – Growth as upside in ETA returns

Comparison Chart – ETA vs PE vs VC performance

Ideal Audience – Who benefits from ETA investments

ETA Advantage – Resilient returns from cash flow focus

Built-In Safety – High IRRs with downside protection