Lower middle market equity and direct lending investor
Source Capital
- HeadquartersAtlanta, GA S1
- Founded2002 S1
- Websitesource-cap.com
- Last verifiedOctober 27, 2026
At a glance
| Latest fund | Source Capital fifth direct lending fund (second SBIC fund), $315.5M (2024) S6 |
|---|---|
| EBITDA range | $2M+ S2 |
| Revenue range | $10M+ S2 |
| Check size | $8M to $30M S6 |
| Deal types | Platform, Add-on, Minority, Growth S2 |
| Geography | United States, Canada S2 |
| Sectors | IT Services & MSP, Auto Services & Collision, Environmental & Waste, Property Management & HOA, Construction Services, Dental, Industrial & Manufacturing, Distribution |
What Source Capital buys
Source Capital is an Atlanta firm, founded in 2002, that puts both equity and debt into lower middle market companies. It reports more than 150 closed investments, including over 30 equity platforms and more than 60 add-ons. For equity deals it looks for US companies, and some Canadian ones, with more than $10 million of revenue and more than $2 million of EBITDA. It favors asset-light, service or tech-enabled businesses in fragmented markets where add-ons are possible, across business and industrial services, niche manufacturing, healthcare services, distribution, consumer services and logistics.
Much of its recent activity runs through SBIC funds that lend money and take a small equity stake when another private equity firm or independent sponsor buys a company. Its fifth fund, closed in 2024 at $315.5 million including expected SBA borrowing, invests $8 million to $30 million per deal. Source also makes its own equity investments, as with KeyMark in 2025, and finances management buyouts. An owner may meet Source as the money behind another buyer.
Recent deals
Announced in the 24 months before October 27, 2026.
| Date | Company | Type | Sector | Source |
|---|---|---|---|---|
| June 2026 | KCI TelecommunicationsDebt and equity, alongside two other SBIC funds, for independent sponsor Tricorner Group's purchase of a telecom engineering, data center support and network services firm | Investment | IT Services & MSP | Source |
| December 2025 | Rent to RetirementDebt and equity for Calidant Capital's purchase of a Denver marketplace for turnkey rental property investors | Investment | Source | |
| October 2025 | RidgeRock Retaining WallsDebt and equity, with Everside Capital Partners, for Cornerstone Capital Partners' recapitalization of a Charlotte retaining wall block distributor | Investment | Distribution | Source |
| October 2025 | Micro Control Systems and Sensing TechnologiesFort Myers, Florida controls and sensor makers for HVAC and refrigeration added to Kitchen Brains | Add-on | Industrial & Manufacturing | Source |
| September 2025 | Don Young CompanyDebt and equity for Lockeland Capital Partners' purchase of a Dallas window and storm door maker founded in 1978 | Investment | Industrial & Manufacturing | Source |
| June 2025 | Snow Fox DataWisconsin AI and analytics consultancy added to data consulting firm Amplifi | Add-on | IT Services & MSP | Source |
| May 2025 | Archway Service GroupDebt and equity for Canopy Capital Partners' purchase of a Shelby, North Carolina repair and maintenance provider for grocery foodservice equipment | Investment | Source | |
| February 2025 | Pilot PaintingDebt and equity for Platt Park Capital Partners' purchase of a southern California painting and reconstruction contractor serving HOAs and apartment communities | Investment | Construction Services | Source |
| January 2025 | KeyMarkDirect strategic investment in a Liberty, South Carolina provider of intelligent automation and document management software and services | Investment | IT Services & MSP | Source |
| December 2024 | CollectiveCare DentalDebt and equity for the recapitalization of a 10-location dental support organization in the Philadelphia area | Investment | Dental | Source |
| December 2024 | MGroupDebt financing for the management buyout of a LaGrange, Georgia supplier of interior building products to hotels and apartments | Investment | Distribution | Source |
Portfolio by sector
From the firm's portfolio page S4.
Automotive
- Puget Collision
Business Services
- KCI Telecommunications
- RidgeRock Retaining Walls
- Archway Service Group
- World Water Works
- Pay4Leads
- Rapid Prep
- The Management Trust
Commercial Services
- Pilot Painting
Consumer Services
- Rent to Retirement
Design & Manufacturing
- Artisan Custom Closets
Distribution
- MGroup
Healthcare Services
- CollectiveCare Dental
IT Services
- KeyMark
- Amplifi
Manufacturing
- Don Young Company
- Kitchen Brains
Residential Services
- Sam The Concrete Man
- Septic Blue
Services
- Property Rate
Transportation
- Guardian Fleet Services
Greymont’s take
How Source Capital fits a seller
Source Capital is best seen as a capital partner rather than a typical control buyer. Most of its 2025 and 2026 deals paired a loan with a small equity stake to fund a purchase led by another firm, so an owner selling to an independent sponsor may find Source financing that deal. It also makes direct equity investments and has funded management buyouts, such as MGroup in December 2024, which can suit an owner who wants to sell to the existing team.
The firm is busy with add-ons. It reported 28 follow-on or add-on deals in 2025, in areas including collision repair, HOA management, septic services, towing and dental. Owners should ask whether Source would hold equity or only debt, who controls the board, and how the loan terms would affect the company's cash flow after closing.
Questions owners ask
What size companies does Source Capital invest in?
Its equity and direct lending criteria both call for more than $10 million of revenue and more than $2 million of EBITDA. Its fifth fund, closed in 2024, invests $8 million to $30 million per transaction.
Is Source Capital a lender or an equity investor?
Both. It runs an equity strategy for buyouts, recapitalizations, buy-and-build platforms and growth capital, and a direct lending strategy offering senior, unitranche and second-lien loans of up to $30 million, often paired with an equity co-investment alongside another sponsor.
Has Source Capital invested in collision repair, septic or HOA management companies?
Yes. Its portfolio includes Puget Collision, Septic Blue and The Management Trust, and its 2025 and first-half 2026 reviews list add-on deals in auto collision repair, septic tank services, HOA management and wrecking and towing.
How active is Source Capital?
Very active. It reported 36 investments in 2025, made up of 8 new platforms and 28 follow-on or add-on deals, and another 21 investments in the first half of 2026, including 3 new platforms.
Sources
- S1Source Capital home page Accessed October 27, 2026
- S2Source Capital: Equity investment criteria Accessed October 27, 2026
- S3Source Capital: Direct Lending criteria Accessed October 27, 2026
- S4Source Capital: Portfolio Accessed October 27, 2026
- S5Source Capital: News Accessed October 27, 2026
- S6Source Capital Successfully Completes Fund Raise Accessed October 27, 2026
- S7Source Capital: FY 2024 Year in Review Accessed October 27, 2026
- S8Source Capital: FY 2025 Year in Review Accessed October 27, 2026
- S9Source Capital: 1H 2026 Mid-Year Review Accessed October 27, 2026
- S10Source Capital Invests in KCI Telecommunications (June 2026) Accessed October 27, 2026
- S11Source Capital Supports Eagle Merchant Partners' Investment in Puget Collision Accessed October 27, 2026
- S12Source Capital Supports Georgia Oak Partners' Investment in Septic Blue Accessed October 27, 2026
- S13KeyMark Announces Strategic Partnership with Source Capital (January 2025) Accessed October 27, 2026
- S14Source Capital Invests in MGroup (December 2024) Accessed October 27, 2026
Compiled by Greymont Advisors from public sources, including the firm’s own website and press releases. Greymont is not affiliated with Source Capital. Figures are as reported on the dates shown and may have changed. Request a correction