Financing an MBO typically involves a mix of debt and equity. Here are some common sources: - Bank Loans: Traditional bank loans are often used to fund a portion of the purchase price. - Private Equity: Private equity firms may invest in the buyout, providing much-needed capital in exchange for a stake in the company. - Seller Financing: Sometimes, the current owner may finance part of the sale with a loan to the management team. - Personal Savings: Managers may also invest their own money to show their commitment to the business.