From Searcher to Sponsor: How to Buy a $22m Business

in different levels of seriousness there was another ioi that we put together a couple of other on-site visits one with a machining a cnc shop one for a kind of a home services automation uh type of business but uh it was fast and it was you know to me that's why you know i do a lot of reference calls when folks think about working with a buy side broker and calder in particular

I, you know, I can't say that my experience is normal, but it was certainly, it, it certainly paid off. I mean, between it, we didn't even go through the full six month commitment. Um, and I think what's related to Florida, which is ultimately the company that, that I bought it, it was a much bigger company that I don't think I would have been introduced to had I done a proprietary, uh, you know,…

I mean, they accelerated my search process. You probably would have taken me at least a year, you know, 18 months to go find it on my own.

Yeah, and I do. But just before we pivot to that, Jan, the deals were proprietary. So none of these opportunities that they brought you were on the market. Yeah.

No, no, not that I could tell. So the five that I looked into fairly seriously, they were all in that area where they were thinking of selling. Some of them had engaged either a lawyer or some advisor, but they weren't a public auction.

They weren't looking for multiple bids. So they... It looked like whatever their process is behind the scenes to that, you know, are you serious? Are you buying? Are you considering buying?

Worked because I was never in a competitive process. And FloorGuard 2, they had gotten interest from private equity, but they weren't looking for multiple bids. So it was... Pretty much kind of what they were saying, you know, that you were kind of going up.

And I think that probably decreases the price that you need to pay because you're not competing against private equity.

Great, Jan. Let's pivot to the size of FloorGuard and how it was bigger than you expected and the process was faster, you were going to say.

Yeah, so this always makes me laugh when I remember how this got introduced. So, you know, when I was working with Calder, I gave them the same criteria, 750K to 1.5 million in SDE, Chicago, and that's what they use to find companies. Well, when they talk to companies, not every owner is super open to them about how, you know, what their revenue is, what their margins are.

But they usually try to give a range. So what they told, what floor guard told Calder when they were doing the qualifications were, hey, you know, we're north of $1 million in EBITDA. Well, that's one way of saying it.