And the businesses have just been scaling rapidly over the last few years. I think obviously DFW is a very competitive market, especially when it comes to H vac and the team had just figured it out and they'd found a nice niche for themselves in Dallas and we're on an upward trajectory.
Acquiring Minds
Buying $1.5m of Earnings Without an SBA Loan
Excerpts · 304 segments · ~1:22:52 long
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And so having been through the STOS process, that definitely helped me with my diligence and being able to at least have a side by side of detail of in depth operations that I could kind of compare to. Right. And so yeah, the business was a high growth business, solid margins, solid team. It didn't have the full team in place obviously and there was a ton of potential to get there.
I think what created the interest from all three parties, myself and First American and Copeland was that they had reached a point where they needed to scale even further, go broader within dfw. And that's where my experience and skill set came in, as well as access to capital. And that really kicked off the beginning of the great relationship.
And we spent about four months in diligence and doing one deal on its own is hard enough, but then structuring two together and then ensuring that everyone's on the same page and terms are, are met with everyone, that was, that was definitely something that in hindsight I probably, you know, definitely bit off too much that I could chew. But it took a good four and a half months to get over the…
From the day I started fundraising, I think the, you know, as with anything, someone, someone told me that don't worry about the capital, the capital will come. I didn't believe them. And then the first six weeks was putting together the initial deck, putting together the diligence materials and then going out to market.
And I had a few investors lined up from the stoves deal, but we had never gotten to the point where they had to fund any cash. And so you've been dragging people along and then the rubber meets the road and you wonder will they actually fund and will the capital be there or have they just been stringing you along? And some people fell to the wayside.
But I think, you know, the big thing that, that stood out to me was obviously it was, they were both good assets. And when you have that dialed in and you have the trust of, of your network and people to back you, the capital flows. And, and we were oversubscribed by, by the end of it.
Oh, fantastic. Great. Well, I want to hear about the structure as we, as we said. But just going back to the business, you said 8 million in one and a half of EBITDA. That was just Copeland's.
That was pro forma. So, so Copeland and, and First America together.
Yeah. God. Okay, thank you. And, and, but Copeland was the larger of the two businesses. Correct. Great. And it was only a three year old business. So they. Okay. And did you see risk in that, that, you know, quick, quick growth, but also quick, quick decline potentially.
I mean it is H Vac, so it's like an enduring, an enduring business, but still.
Yeah. And look, I think if I hadn't had the Stos experience, you know, a 40 year old business which from, you know, 10,000 Foot View is the ideal acquisition target. Right. The downside of that is you're also picking up 40 years of bad habits. And I think if I hadn't gone through that experience, I would have seen the three year old company because I know a lot of people don't even look at…
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