Acquiring Isn't Always a One-Way Door

Because essentially once you put yourself in that company, the company runs a certain way and if you don't adjust your baseline of your decision making style to the company, then the company is going to be affected at some point. You're a flying risk. Right. So talking about a company that generates, you know, $3 million, obviously you have to churn projects.

You know, we'll remodel four or five projects every two weeks. So those projects need decision making constantly. So I didn't have any issues adjusting to that, to, to that part of the road.

So Katie Tile and Marvel is a company that was founded in 1991 here in what's called Katy, Texas is one of the suburbs of surrounding areas of Houston. Katie is probably the fastest growing or the most probably at this point is the biggest sort of in the Houston area. Katie has been tripling in terms of housing, in terms of trades businesses since early 2000.

So the company was, funny thing, founded in 1991 and then the, the owners I bought it from, they actually bought that company in 2001 themselves. Then I acquired in 2024. It's a company that throughout the years they, they started with just flooring, basic carpet, you know, early 2000s.

You know, all of these homes in at least in Texas had mainly carpet or than hardwood floors or anything else on the homes. Right. And Then at some point, you know, in mid-2015 or so, then the, the for different types of floorings like hardwood, laminate, vinyl. So the company was known for that, just a flooring company.

And then at some point they started doing full remodels like kitchens, bathrooms, custom cabinets, paint, you know, electrical work, plumbing, anything inside the home, even patios. Right. So 2023, that's when I approached them. The company historically Trend in between 2.6 to 3.7 in, in, in annual revenue.

These type of companies have a high variance in revenue because historically, at least in Texas, there's usually natural disasters, usually like big floods every five years. So when that happens and they have that, that, that magic year where there is probably like a, a double increase in revenue for that particular year. Right. So as a business owner, you don't want that to happen.

But I mean, it's nice to know that hey, maybe every five to seven years is going to be a year where you're going to really like increase revenue by double digits. No, so that's overall, that's the profile of the company. They had six full time employees in W2W2S and then they had around 15 to 20 subcontractors that they'll hire.

I mean they will contract probably like 80, 90 of their own capacity just based on the seasonality. You know, in interior remodeling, mainly in residential, people want to do bathrooms or kitchens from March all the way to, you know, October, as you probably know because of the holidays and school. November, December, January and February are more slow months.

And then you know, from March on, this just more of a, of a high run. So it's a seasonal business. You have to be careful on how you, how you invest on projects, how you invest on inventory of front.

A lot of inventory is just construction materials for most of the projects. But since it's a customer modeling company, a lot of the selections and materials in terms of like hardwood or tile, that's just picked by, by the customer. Right. So it's project based. Okay, so yeah, that's in a nutshell.