$250k SDE Acquisition: Limited Downside, Big Upside

It was manufacturing heavy machinery to factories, sort of a niche product as well. And it had a lot of expert and I think it was ticking a lot of boxes where you could right off the bat see that there would be a lot of things that could be improved. But then we tried sort of proceed with that, but we were a bit late.

It was listed on one of these sites and unfortunately there was another buyer who ended up buying the company. And we never got to sort of move forward with that opportunity. Then I sort of continued the search and maybe I should say I was also on purpose, sort of.

So I was, I was kind of on a personal side. I was, I was kind of hoping that I would not find something that would be very interesting at that very moment because I felt it might be a better timing in a year's time or two years time. But then, yeah, then I started, then I, then I actually accidentally happened to come across the business that I ended up buying. Great.

Well, before we hear about it, let me ask you just about what you were discovering about the market itself for buying businesses. And just to give kind of a little bit more context to the question. So obviously Acquiring Minds, it's a US podcast, so the vast majority of my guests and stories are here in the States.

And so listeners will have an intuitive sense of, you know, how competitive it is out there and how to, how to, how to buy a business, the mechanics, the how you put the deal together, debt and so on. And I think that when we have stories like yours from outside the US it's always important to explore two attributes of ETA in non US markets or markets that I'm less familiar with.

And that is kind of the kind of the supply demand of businesses and the kind of culture of buying businesses and how sellers react to you, et cetera. So I want to ask you that. And then secondly, which we'll get to later, is of course how you structure a deal, what it looks like to finance, if you can finance it all, if there's bank debt available to do a project like this.

We'll get to that. So to the first question and maybe now imagining, you know, a Finnish listener here or listeners in other similar economies, maybe the other Nordics, what did you find about the lay of the land in terms of how many businesses were out there to buy? Is it competitive? Were you bumping up against other searchers, against private equity? What did all that feel like?

Well, first of all, in terms of numbers, there's a, similar to, I guess most Western countries. There's, there's a lot of, lot of good companies where the owners are retiring and they might not have a succession plan in place. So I think in terms of supply, it's.

Yeah, there's a lot of supply. Of course we're a small country, so the numbers compared to us for instance, are of course tiny. But I would say at least my feeling is that there is a sort of imbalance between supply and demand.

So there's a lot more supply than demand. Private equity, of course. Yeah, we have Private equity.

And I would say they're probably their target companies. They might be somewhat smaller than what private equity might be looking at in the US but of course they don't really have people to step into a sort of owner operator role. So there is still that, that kind of space where, where and a searcher can actually or is.