Brainforge Knowledge

josh-loi-approval-packet-draft

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Deprecated: moved to Olivo

This legacy file name is retained only to avoid broken links.

Use this file instead:

  • olivo-loi-approval-packet-draft.md

Status:

  • Deprecated
  • Do not edit here

Olivo Pilot Deal — LOI Approval Packet (One Page Draft)

Date: 2026-03-29
Deal: Olivo product analytics book transfer (fast-track)
Stage: Diligence -> LOI approval request

1) Decision request

Request approval to issue a non-binding LOI using the balanced seller-choice option with one certainty-biased fallback, subject to completion of open diligence items listed below.

Requested LOI issue window:

  • target: 2026-04-08 to 2026-04-11

2) Strategic rationale

  • Accelerates Product Analytics service-line depth with a founder-led book that can be expanded into Brainforge data and AI offerings.
  • Converts channel-dependent solo revenue into platform-integrated, more durable revenue.
  • Creates a repeatable micro-acquisition case study for future sub-$2M data consultancy tuck-ins.

3) Proposed LOI structure (for approval)

Reference framework:

  • ma-loi-playbook.md (active Olivo pilot lane)
  • olivo-indicative-terms-fast-track.md

Preferred option (Balanced):

  • term: 12-18 months target, 24 months hard stop
  • base share: 22%-28% of retained transferred revenue (monthly, collected cash basis)
  • growth kicker: 10%-15% of incremental transferred-account revenue above baseline
  • holdco equity: optional 5%-10% (second-bite alignment), case-by-case
  • payout cap: to be set from validated baseline and downside case

Fallback option (Certainty-biased):

  • higher base share certainty
  • lower growth kicker/upside
  • same metric definitions and protection gates

Protection gates (non-negotiable):

  • GRR <85%: payout pause
  • GRR 85%-89%: partial payout band
  • GRR >=90%: full payout eligibility
  • monthly payout ceiling tied to gross profit on transferred accounts

4) Current assumptions (to be validated before LOI send)

  • transferred annual revenue baseline: ~$500,000 (draft assumption)
  • gross margin baseline: ~60% (draft assumption)
  • target profile: sub-$1M founder-led specialist book
  • seller intent: open to transition and potential buyout under clear terms

5) Open diligence blockers (hard gate)

Must close before LOI issuance:

  • account-level trailing 12-month monthly revenue
  • account-level retention/churn evidence
  • top-client concentration and dependency map
  • contract assignability/consent scan
  • founder role + authority matrix for transition period
  • top 10 deal-risk register with mitigations

Status source:

  • olivo-indicative-terms-fast-track.md section 10.1 LOI readiness status

6) Top risks and mitigations

  1. Channel concentration risk
  • Mitigation: concentration stress-case pricing; tighter payout gates
  1. Founder dependency risk
  • Mitigation: role charter, named account transfer plan, key relationship handoffs
  1. Integration conflict risk (role ambiguity)
  • Mitigation: explicit authority matrix and Day 1 operating model
  1. Contract transfer friction
  • Mitigation: assignability review and client comms plan before LOI final terms

7) Approval recommendation

Recommend: Approve with conditions
Conditions:

  • approve LOI strategy and preferred option direction now
  • authorize issuance only after hard-gate diligence blockers are cleared

8) Required approver sign-off

  • Deal Lead (Sales): [ ]
  • Finance Lead: [ ]
  • Legal/Operations Lead: [ ]
  • Delivery/Integration Lead: [ ]
  • CEO / Final approver: [ ]
  • Approval date: [ ]

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