Clearwater Partners
Clearwater PartnersMinneapolis · since 2006

You spent twenty‑five years building this.We are not going to spend twenty‑five months taking it apart.

Controlling stakes in family and founder-owned businesses across the upper Midwest — distribution, light manufacturing, B2B services. Thirty-one of them since 2006, and the leadership team stayed in twenty-nine.

Fund V
$1.1B
Operating profit we buy
$5M – $30M
Businesses owned since 2006
31
Median hold
6.5 years
The interior of a working plant, overhead gantry cranes and machine bays lit from above.
Arrowhead Bearing & Drive, Duluth · owned since 2021 · 158 people
01Letter

To the person who owns the business.

You have had the call from someone like us before. You know the shape of it: a number that sounds larger than you expected, and vagueness about what happens to the people who work for you.

I ran a distribution business in Rochester for nineteen years and sold it in 2004 to a fund three time zones away. They were not villains. They had simply never met anyone on my floor, and eleven of my forty-one people were gone inside two years. I learned about most of it afterwards.

Clearwater is the version of that transaction I did not get. We tell you in the first meeting what we will change and what we will not, and both go into the letter of intent rather than staying a reassurance. We have never re-traded a price after diligence. And you stay on, paid, for two to three years, because most of what we are buying is in your head and none of it is in the data room.

If that is not what you are looking for, say so and we will stop. We would rather lose a deal in the first week than take up your summer.

Tom Halvorsen Founder · Clearwater Partners · Minneapolis
02How it goes

Four moments, in the order they happen.

A welder at work on a steel section, sparks falling, seen close.
We come to you, and the first meeting is on the floor
Gloved hands guiding a cutting torch along a steel plate.
Diligence is quiet, and it is done before the number
A long-serving machine operator making an adjustment to a running machine.
The people stay, and so do you
The length of an industrial hall with daylight from a saw-tooth roof.
The building stays. We hold longer than we are supposed to
We come to you, and the first meeting is on the floor
1Before we make an offer

We come to you, and we walk the building.

The first meeting is at your business, not in a hotel conference room, and it is two of us — one of whom will still be on this in year six. We want to walk the floor during a normal shift, to understand what the business is, which is rarely what the financials say it is.

We will ask about your three biggest customers, the last person who quit, and what you would fix with two million dollars. Then we go away and do arithmetic for two weeks.

Meetings before an indication
2
Typical time to a number
14 days
Diligence is quiet, and it is done before the number
2The offer and the diligence

The number we say first
is the number we close at.

We have never re-traded a signed letter of intent across thirty-one transactions, because the work that produces surprises happens before we give you a number. That is why our indication takes two weeks rather than three days.

Diligence is deliberately quiet. Your team should not know it is happening. We interview customers under a neutral name, we do not call your competitors, and we do not ask for a management presentation.

Deals re-traded after signing
0 of 31
Median days, LOI to close
71
The people stay, and so do you
3The first year after

Almost nothing changes, and that is on purpose.

The name stays. The building stays. Across thirty-one businesses in twenty years we have made two redundancies, both at a company that had already lost its largest customer before we owned it. Your leadership team keeps running the business, and you stay on as a paid adviser for two to three years on terms we agree before the close.

What does arrive is a monthly close that lands on the fifth working day, a cash forecast, and someone whose whole job is helping you hire. Owners tell us the reporting is the part they wish they had had ten years earlier.

Sellers still advising at year two
17 of 18
Leadership teams retained
29 of 31
The building stays. We hold longer than we are supposed to
4The years after that

We hold longer than we are supposed to.

Our median hold is six and a half years against a market closer to four. These businesses compound slowly and reliably; a distributor that adds two branches a year is not improved by being hurried.

When we do sell, we tell you first and your leadership team second, before any bank is appointed. Thirteen of our twenty-two exits have gone to another family business, which is something we go looking for.

Median hold
6.5 years
Exits to another family business
13 of 22
“They did not make me prove anything I had spent twenty years already proving.”
Ruth Lakewood · sold Lakewood Industrial Supply, 2015 · adviser to the board until 2021
31 Businesses bought since 2006. Two redundancies across all of them.
03What we buy

Written plainly, because most people reading this have never sold a business.

Size
Between $5M and $30M of annual operating profit. If you are not sure what yours is, send three years of tax returns and we will tell you.
What we take
A controlling stake, usually 70–90%. You keep the rest and it grows with the business.
Where
Minnesota, Wisconsin, Iowa, the Dakotas, Nebraska, Illinois. Close enough that a partner drives to the board meeting.
What kind of business
Distribution, light manufacturing, business services, staffing, healthcare services. Companies with trucks, buildings and long-tenured people.
What happens to you
Two to three years as a paid adviser. After that it is your call, and several have stayed on the board for a decade.
How long it takes
About twelve weeks from first meeting to money in your account, assuming the books are in reasonable order.
04Companies

Nine we own now, and who we bought each one from.

Current portfolio, Fund IV and Fund V. Twenty-two of the thirty-one have been sold. Headcount as at 30 June 2026.
BusinessWhere BoughtPeopleFounded
Lakewood Industrial SupplyBought from Ruth Lakewood, who ran it for 31 yearsEau Claire, WI20151861971
Cedar Valley FabricationBought from the Osterhaus family, second generationWinona, MN20172141958
Prairie Home HealthBought from Denise Achterberg, RN, its first employee and ownerSioux Falls, SD20183401994
Redwing PackagingBought from Hal Brenner, who stayed on the board six yearsRed Wing, MN20191291983
Northfield StaffingBought from two brothers who still run itRochester, MN2020972001
Arrowhead Bearing & DriveBought from the Salminen family, third generationDuluth, MN20211581949
Kettle River CoatingsBought from Paul Vang, now our operating adviserCloquet, MN2022881977
Grafton Electrical ServicesBought from Marie Grafton on her retirementFargo, ND20241421988
Blue Earth Grain HandlingBought from a co-operative board, the first we have done that wayMankato, MN2025761966
05People

Five of us, and what each of us did before this.

We do not publish photographs of the team. You will meet them in your own building.
NameBefore Clearwater With us sinceBoards
Tom HalvorsenFounderNineteen years running a Rochester distribution business he later sold20064
Lisa OstrowskiManaging PartnerOperations, then CFO, of a family-owned packaging group20095
James ParkPartnerFifteen years in lower-middle-market lending in Chicago20134
Sarah DellingerPrincipal · operationsPlant manager, then COO, of a 300-person fabricator20183
Wei-Lin ChenPrincipal · financeAudit, then corporate development, in the upper Midwest20212
06Contact

Call the office. A partner answers it.

If it is your business

You do not need a banker, a teaser or a data room to start. A phone call and three years of tax returns is enough for us to tell you whether we are the right buyer, and you will know within a week either way. Nothing leaves the five of us until you say so in writing.

tom@clearwaterpartners.example
+1 612 555 0173
Start the conversation

If you are the adviser

We read everything and we answer all of it. If it is not for us you will know inside two days, with a reason attached.

deals@clearwaterpartners.example
+1 612 555 0180
A brick industrial works on a quiet street under flat daylight.
Redwing Packaging — Red Wing, Minnesota. The same building since 1983.
Owned since 2019 · 129 people
Sample site Demonstration build — this firm is invented. All names, people, figures and portfolio companies are fictional, and every photograph is licensed stock. No real people, logos, or identifying images from client sites appear anywhere.