The 7-Year Collapse of an SBA Acquisition

Had to, had to serve. Yeah, they were commitments. And if you, you know, put yourself in the seat of somebody who's an engineer at one of our customers, it's hard for them to go back to their management and say, oh, we need a 40% price increase on this.

Right. And they just weren't. We did manage to get some extra dollars on those jobs, but not nearly enough. And it just, it damaged a lot of those relationships, not irreparably, but it took a huge.

And Scott, say more about the fact that this Connecticut barn that you started not just servicing injection molds, but actually making plastic parts yourself. So being injection molders, if I'm using.

The vocabulary correctly, yeah, yep, that works. And this is what I thought the future of the business was too. I had seen this work out with other companies in the area where they started doing the molding.

And together it was like a razor and blade type thing where the, the molding of the part was an annuity because there were switching costs. If you helped a customer design a part and then you built the tooling for them, and then you started doing the injection molding for them too. It was very difficult for them to find another vendor who could do all of that, that entire chain.

And we saw some really early success with it. So I thought, this is my way out of the J curve. This is my way out of dependence on tooling.

Because another thing that was going on in that market was that coming out of COVID everybody had a ton of capex dollars sloshing around in their budget. So the job mix for us shifted away from the service and repair that I loved and over to building new molds, which turned us into this crazy project based business. The exact opposite of what you want in a search business.

So in a way, injection molding buttress the business because now we're making money pennies at a time. We're just doing it a million times over instead of booking projects that are half a million dollars in revenue and could be all of that year's projected ebitda.

So sorry, you. You like the new business model even though it's less. Even though on paper it's less search friendly. It's. I heard you use the word an annuity.

Yeah, well, the. I liked the. I like the injection molding side of things. I did not like the project based side of building new tooling only. So just to clarify, I liked the combo of the two because the annuity on the molding side could be so good that you could basically give the tooling away and still be pretty profitable.

But I needed to do something to get away from doing only the new mold builds and in a decreasing amount of repair. So in my mind that was the molding great.