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By Erik Doucette – Vice President, Commercial Banking, Signature Bank for Milwaukee Business Journal

Acquiring a business is one of the most exciting — and complex — milestones in a business owner’s journey. Whether you’re a first-time owner or a seasoned investor, how you structure the financing can have long-term implications for value creation and risk.

One of the most reliable and cost-effective tools available to business buyers is bank debt. Sometimes bank debt is discussed less than equity or alternative financing sources; however, it plays a foundational role in well-structured acquisitions. Based on my experience working with a wide range of buyers — from individual entrepreneurs to private equity groups — it’s clear that bank debt offers a powerful and affordable path to growth, especially when paired with a true banking relationship.

Understanding bank debt in the acquisition landscape

In acquisition financing, “bank debt” refers to loans provided by traditional financial institutions, often secured by the assets or cash flow of the target business. This type of financing is generally less expensive than equity or subordinated debt and can help preserve ownership while supporting strategic expansion.

You may also hear the term “senior debt” used interchangeably. In technical terms, senior debt refers to the portion of a company’s capital structure that has priority in repayment — typically bank loans. For most business acquisitions, especially those led by individuals or family offices, the practical distinction is minimal. What’s important is that bank debt represents lower-cost capital with a clear repayment structure.

Structuring an acquisition: Real-world examples

While no two acquisitions are alike, common patterns emerge in how deals are financed — often combining several forms of capital. Here are a few recent Signature Bank examples that illustrate the versatility and impact of bank debt:

• Accelerator-backed individual buyer. In one case, a buyer backed by an accelerator program — typically composed of experienced professionals, often with MBAs or military backgrounds — identified a promising acquisition. The structure included personal capital from the buyer, equity from the accelerator and a senior secured loan from the bank. The result was a disciplined capital stack that preserved flexibility and maintained growth capacity after closing.
• Entrepreneur-led purchase with seller financing. Another example involved an individual purchasing a Wisconsin-based business valued at $7 million. The buyer contributed $700,000 of equity, obtained $5 million in bank financing, and negotiated a seller note for the remaining balance. This structure balanced risk between parties and created a clear path to ownership transition and debt service.
• Institutional acquisition with layered capital. In a larger transaction, an investment group acquired two long-standing food production manufacturers for $50 million. The group raised $20 million in equity, obtained $20 million in bank financing and secured an additional $10 million through mezzanine debt. The depth of historical cash flow and the group’s operational experience supported this multi-layered structure.

Across each of these scenarios, bank debt served as the foundation — anchoring the deal with cost-effective, repayable capital and enabling the buyer to avoid overleveraging or unnecessary equity dilution.

Why relationships still matter

Financing a business acquisition is about more than balance sheets and interest rates — it’s about trust, timing and having a strategic partner who understands the full picture.

One of the greatest advantages of working with a real relationship banker is that business owners don’t just receive financing — they gain a relationship with a banker who is committed to helping them succeed. If your banker is only discussing cash flow and collateral, you might not have a real relationship.

When I work with a client, I focus first on listening:

• Who are you as a buyer?
• What is the story behind the business you are acquiring?
• What is your vision for the next stage of growth?

That understanding helps us structure deals that match real-world business goals, more than just financial formulas. It also allows us to move quickly when timing is critical, which can make or break an acquisition opportunity.

Sometimes we lightheartedly joke with clients, “We’re the only partner in your acquisition journey who doesn’t send a bill.” A genuine banking partner adds value in numerous ways — such as providing access to a trusted network of legal, accounting and advisory professionals who can assist with due diligence, transaction execution and post-close planning. Because our involvement continues well beyond the closing, clients benefit from an enduring relationship they can rely on, not merely a one-time transaction.

Financing the next chapter of your business story

There’s no one-size-fits-all approach to financing an acquisition. Some deals require simplicity; others call for layered capital. What remains consistent is the role bank debt can play in anchoring the structure — offering lower cost, reduced dilution and a clear repayment path supported by the acquired business’ own performance.

For business owners evaluating their next move, it’s worth considering bank financing not just as a source of capital, but as part of a broader strategy to grow with discipline and preserve value.

To learn more about structuring smart acquisition financing, contact Erik Doucette at Signature Bank.

Founded in 2006, Signature Bank is a privately held state-chartered bank in Illinois and Wisconsin. As a relationship-based commercial bank, we provide unmatched customer service while operating our business carefully and conservatively. Technology-driven and well-capitalized, Signature Bank is one of the fastest-growing independently owned business banks in the Midwest and has been named on American Banker’s list of “Best Banks to Work For” for seven consecutive years. Reach out to info@signaturebank.bank to learn more.

Erik Doucette is vice president of Commercial Banking at Signature Bank. He brings more than 20 years of experience helping business owners and investors structure financing solutions for acquisitions, growth and succession. Based in Milwaukee, Doucette specializes in relationship-based banking with a focus on thoughtful, tailored capital strategies.

By Penny L. Foust – CTP, Senior Vice President, Signature Bank for Milwaukee Business Journal

With 80% of businesses experiencing payments fraud in recent years, treasury management is more critical than ever. Yet, many companies overlook key questions when selecting a banking partner. Choosing the right banking partner isn’t just about the loan, rate and processing transactions — it’s about optimizing cash flow, reducing risk and ensuring your business remains financially agile.

These functions are all supported by the commercial banking treasury management team. The right banking partner acts as an extension of your team, providing insights, automation and security that safeguard your financial future.

Beyond the basics: What to ask your treasury management team

All banks offer treasury management services, but not all provide the same level of expertise and efficiency. To ensure a smooth partnership, ask potential banking partners these key questions:

1. What is the onboarding and implementation timeline? Some transitions take days, others take months. Timing and the ease of transition can significantly impact your operations.
2. Does the bank’s technology integrate seamlessly with your ERP or accounting software? Integration reduces manual processes, prevents errors and improves cash management.
3. How does the bank handle treasury management discovery? A strong banking partner should not simply mirror your current setup but also reduce fees, identify new efficiencies, mitigate risk and improve cash flow.
4. Can the bank tailor its services to meet the needs of mid-sized and privately held companies? The ability to deliver customized digital treasury management solutions with high touch customer service is key to long-term success. You need a local treasury management team with experience and knowledge that understands your business.

Look for a banker who will roll up their sleeves, conduct a thorough analysis and create solutions that fit your business — not just provide off-the-shelf services.

Automation and AI: The future of treasury management

The fewer manual steps in your treasury management processes, the lower the risk of fraud and error. Businesses should assess:

1. Automated payment processing. Can the bank streamline electronic payments for vendors and payroll, reducing reliance on checks?

• Virtual card payments. These one-time-use digital cards provide greater security than traditional checks by generating unique card numbers for the amount specific to each vendor payment that cannot be altered or reused for future transactions
• ERP integration capabilities. Many banks claim to offer automation, but without true ERP connectivity, businesses may still need to manually upload and reconcile payments. For example, Signature Bank’s customized, automated payables platform integrates with over 400 accounting softwares.

AI is also transforming treasury management, bringing both opportunities and risks. While AI-driven efficiencies improve payment processing and fraud detection, they also open the door to new cybersecurity threats. Today, it is very easy to impersonate someone on the phone or online. Vet your banking partner on:

2. Fraud prevention measures for AI-generated risks. How does the bank authenticate users in an era where voice and digital impersonation are growing threats?

3. Multi-factor authentication. Does the bank implement layered security beyond basic login credentials?

4. Ongoing security training. Will your bank help educate your team on emerging fraud tactics and how to minimize risk?

Security first: Vetting a bank’s fraud prevention measures

Fraud risk, both external and internal, is a growing concern for businesses. Unlike consumers, businesses only have one business day to identify unauthorized transactions before they become unrecoverable. Ask your banking partner:

• What fraud detection and prevention tools are in place? Beyond basic positive pay fraud protection, does the bank offer real-time monitoring and alerts?
• How does the bank help businesses mitigate internal fraud risks? Employee theft is a common issue in privately held companies — your bank should offer internal controls to reduce this risk.
• Does the bank provide a cybersecurity checklist? This should include steps for preventing phishing attacks, ransomware threats and online banking takeovers.

Banker turnover: A hidden risk to your business

A strong banking relationship should be built on continuity. Many banks experience high turnover among commercial banking professionals, forcing businesses to start over with a new banker every couple of years. When vetting a treasury management partner, ask:

• What is the average tenure of your relationship managers? A revolving door of bankers can disrupt service quality.
• How does the bank ensure multiple team members understand your business needs? A team-based approach provides stability and ensures continuity even when individual bankers change roles. Your commercial banking and treasury management team should understand the ever-changing needs of your business.

Managing international treasury needs

Almost every company has some portion of its business that includes international payments, even if it’s just cross border payments to Canada and/or Mexico. The complexities of global transactions require expertise in:

1. Global payment solutions
2. Foreign currency administration and exchange rates
3. Risk management
4. Strategic advisory services

The rules and regulations for business transactions differ greatly from consumer banking, and your bank must be well-versed in compliance requirements for international commercial payments. A knowledgeable treasury management team should guide you through cross-border transactions, ensuring efficiency, security and regulatory compliance tailored to mid-sized and privately held businesses.

Value-added banking: More than just transactions

Your bank should be more than a service provider — it should be a strategic partner.

A true relationship-based banking experience means:

1. Proactive advice and industry insights. Your bank should bring new treasury solutions aligned with your strategic goals before you even know you need them.
2. Regular strategy check-ins. Schedule quarterly or semi-annual meetings to discuss changes in your business and evolving treasury and cash management needs.
3. Service, support and availability. In times of crisis, your banking partner should be accessible, knowledgeable and ready to help, becoming an extension of your team.

Final thoughts: Take the next step

Choosing a treasury management banking partner isn’t just about services, it’s also about partnering with a trusted advisor who can help your business navigate financial risks and opportunities. Before making a decision, schedule a strategy session with potential banking partners. Ask the tough questions about fraud prevention, automation and ERP integration. The right partner won’t just manage your treasury — they’ll enhance your business’s financial future.

Learn more about Signature Bank’s personalized treasury management services. Connect with Penny Foust at pfoust@signaturebank.bank.

Founded in 2006, Signature Bank is a privately held state-chartered bank in Illinois and Wisconsin. As a relationship-based commercial bank, we provide unmatched customer service while operating our business carefully and conservatively. Technology-driven and well-capitalized, Signature Bank is one of the fastest-growing independently owned business banks in the Midwest and has been named on American Banker’s list of “Best Banks to Work For” for seven consecutive years. Reach out to info@signaturebank.bank to learn more.

Foust is a certified treasury professional with more than 25 years of experience helping clients optimize their financial operations while mitigating risk. She specializes in fraud solutions and advanced cash management structures and is active in the Wisconsin Association for Financial Professionals. As a Wisconsin native, Foust appreciates the state’s open countryside and strong sense of community.

By Bradley Kranich – Senior Vice President, Division Head – Commercial Banking, Wisconsin Market, Signature Bank for Milwaukee Business Journal

Uncertainty is part of business. Economic shifts, industry disruptions and global events can shake even the strongest companies. But in times of challenge — or opportunity — the right banking partner can be your greatest asset, providing financial support and strategic insight to settle nerves and create a sense of security during highs and lows.

A true banking relationship goes beyond transactions. It provides stability, expertise and proactive guidance that can make all the difference in your business’ success. So, how do you build a strong partnership with your commercial bank?

Know your business, know your bank

A solid banking relationship starts with a deep understanding of your financial needs — both now and in the future. Instead of being just a service provider, your bank should be a strategic partner that supports your business with lines of credit, cash management and treasury services, evolving with you as your needs change.

As a business owner, keep asking yourself and your leadership team:

• How are we managing cash flow?
• How are we preparing for the next seasonal business cycle?
• What would an acquisition look like?
• What is our succession plan?

Be open to having these conversations with your banking partners. Your bank should not only help you answer these questions, it should anticipate them. A proactive commercial banker will guide you toward financial solutions tailored to your company’s growth trajectory.

Deal with decision-makers, not bureaucracy

When it comes to business banking, the lowest loan rate isn’t always the best deal. What truly matters is access to decision-makers who understand your business and can act quickly.

Many banks operate with layers of bureaucracy, slowing down decisions when you need them most. Instead, seek out a banking partner with direct decision-making authority — someone who can provide real solutions in real time.

Your story matters — make sure your bank is listening

Numbers are meaningful, but so is your story. A good banker doesn’t just look at your financial statements — they take the time to understand your company’s journey, challenges and aspirations.

Does your bank understand the nuances of your industry? Whether you manufacture specialized components, manage a multi-location restaurant or grow seasonal products like Christmas trees, your banker should have industry expertise and insight into your financial cycles.

The best banking relationships are built on in-depth conversations — not just about net income and collateral, but about your vision for the future.

Trust: The foundation of a strong banking relationship

Trust isn’t built overnight — it’s earned through consistency, transparency and support in both good times and bad.

A true banking partner anticipates your business needs, rather than reacting to them. Whether you’re selling assets, adjusting payroll or navigating economic uncertainty, your banker should provide proactive guidance and flexible solutions.

If your bank only calls when it’s time for a loan renewal, that’s a red flag. A strong commercial banking relationship means regular check-ins, strategic discussions and an advocate who champions your business’ needs. Can you remember when your banker most recently called you?

Consider the Paycheck Protection Program during the COVID-19 pandemic. Many business owners found themselves scrambling, filling out online applications without direct support. The No. 1 comment we heard was: “I couldn’t speak to a live person.” But those with strong banking relationships had an advocate in their corner — someone guiding them through the process, ensuring they got the funding they needed.

If your banker wasn’t there for you then, what makes you think they’ll be there for you now?

Go beyond the numbers

A strong banking relationship isn’t just about financial statements — it’s about aligning with a partner who understands your vision. Clearly communicating your business objectives while staying true to your story fosters a deeper, more strategic financial connection. The right banking partner offers both stability and flexibility, adapting to your needs through economic shifts.

Keep the momentum going

Business isn’t static and bumps in the road are common. That’s why your banking relationship needs to be active, not passive. Your commercial banker should be a constant presence, not just someone who shows up when it’s time to renew a loan.

Now is the time to assess your current banking relationship — does it truly support your growth? If not, it may be time to explore better options.

Achieve your business vision with personalized commercial banking. Contact Brad Kranich at 414-539-5694 or bkranich@signaturebank.bank.

Founded in 2006, Signature Bank is a privately held state-chartered bank in Illinois and Wisconsin. As a relationship-based commercial bank, we provide unmatched customer service while operating our business carefully and conservatively. Technology-driven and well-capitalized, Signature Bank is one of the fastest-growing independently owned business banks in the Midwest and has been named on American Banker’s list of “Best Banks to Work For” for seven consecutive years.

Bradley Kranich is senior vice president, division head – Commercial Banking for the Wisconsin Market for Signature Bank. Kranich brings 20+ years of experience in commercial banking and privately held industrial businesses. He is a graduate of the University of Wisconsin, Graduate School of Banking.