Under LOI!!
I’m excited to share an important update as we move through March. As of February 28th, we’ve secured an LOI on a highly promising opportunity. The process was intense—with over 40 buyers and 7 offers coming in, including interest from both strategic players and private equity firms. This competitive landscape underscores the strength of the opportunity we’re pursuing.
Seller Profile: A Legacy in Trusted Hands
The sellers are the type you want to work with. In their mid-70s and ready to retire, their primary motivation was to ensure the business remains in good hands for its long-term employees. They were committed to finding a partner who not only values the legacy they’ve built but can also work closely with them on structuring the deal to improve tax implications. This clear focus and commitment played a pivotal role in securing the LOI, even amidst stiff competition from PE and strategic buyers.
The Business – A Proven Platform with Untapped Potential
This company is a model of steady, consistent performance. With over 30 years in business, it has delivered super consistent revenue for more than 5 years—largely because the sellers chose to stay consistent rather than pursue aggressive growth. Most of its business comes organically through word of mouth and a strong local presence, boasting a 4.9-star rating and over 800 Google reviews. Yet, almost no money has been spent on marketing, leaving significant untapped opportunities. With a robust growth plan and the capital to support it, the business is well positioned to capitalize on the enormous potential in its market.
Lesson Learned
One key takeaway from this process was the importance of how you present yourself. The sellers accepted my offer largely because I took the time to consult with them on the implications of a seller note—even though their initial stance was for no seller note at all. Beyond simply finding the right sellers, focusing on your buyer profile and understanding the "why" behind your desire to buy a business is crucial. Sellers don’t care if your goal is multiple arbitrage or a big rollup backed by an MBA. What really matters is your ability to close the deal and support their personal motivations on their journey. If you don’t ask about their motivations and truly listen, how can you structure the deal in a way that aligns with their needs?
What’s Next?
The process is moving forward on multiple fronts. Quality of Earnings (QOE) analysis has started, lender term sheets have been received, and final investor terms are being developed. The legal workstream is set to kick off in about two weeks, with a goal to close the deal in early May. In the coming weeks, I’ll be finalizing the financial details and strategic roadmap that will leverage the sellers’ legacy as a solid foundation for growth, unlocking new opportunities for the business.
