How to Buy a $20m Business as a First-Timer

I was trying to also get familiar with, you know, people that might be on my deal team, lawyers, Q of providers and just trying to network with anyone who might be able to help me find a business in, in the, in the area.

I noticed you didn't mention owners in that list of people you were meeting with. So you weren't, you weren't trying to meet owners in your networking. I mean directly, you weren't reaching out to owners directly.

Yeah. Yep. Well, you did the lab acquisition lab, which is where we met at the, at the Labs conference in St. Louis last year. And one of the things that the lab recommends is brokered search. So that was reinforcing, I assume?

Yeah, absolutely. I mean, it was. But I also, like I said, it just felt like that was going to be the right thing for me. I just didn't. Without having, you know, the other thing is without having a clear sense of like what the industry was that I was focusing on. I think it's just really hard to do any kind of proprietary search unless you focus down in terms of industry.

I will say as my search progressed, I did get pretty interested in the managed service provider space. Um, I had heard an interview that you did with Elliot Edge. I don't know if you remember Elliot, but I got really inspired by his interview and by the path he was taking and,.

And remind people about Elliot's story.

So he, he had bought a small managed service provider and was in the process of doing a rollup of managed service providers. And there's a pretty clear path in that industry of if you buy these smaller MSPs, you can get them at a lower multiple and then if you build a bigger business when you exit, you can get a higher multiple. And that's like a pretty strong playbook in that industry that…

And I had a background in technology and really liked technology and I felt like that could be a good fit for me. And so as my search progressed, I did consider doing some proprietary outreach in that industry. But I, the, I was having a hard time finding the right business there and the more I got into it, the more I kind of got scared off of that as being my path.

Part of that was because, you know, of what was happening with AI and how it's affecting technology companies and how, you know, I was just learning that AI is really disrupting that industry in certain ways. And I felt like people that were. Had more experience there were going to be.

I just felt like it was going to be hard. And so over time I kind of moved off of that as being my path.

Well, the other thing that jumps out to me about that, you finding that desirable is it's Essentially a roll up, a consolidation, kind of programmatically acquiring. And so the nature of the project is very acquisition transaction heavy. Yeah, it's, it's.