SBA Acquisition to $9m Cash Exit in 5 Years

Today's guest is a search investor, a thoughtful observer of ETA and SMB acquisitions, and himself a successful exited self funded searcher. Andy Rougeot bought a blue collar business, gate service and maintenance for self storage facilities. Andy's initial plan was to grow his business horizontally by offering similar services in adjacent markets.

When he saw that wouldn't work, he looked to geographic expansion as the answer and he figured out a way to stand up remote territories of his business across four other states. His formula for doing so is one of the key takeaways of this interview and Andy believes it's applicable to other blue collar businesses.

It's a playbook that enabled him to grow from $2.5 million in revenue to $9 million in revenue, at which point he exited to a private equity backed strategic so that he could run for mayor of Denver. He came in 4th of 17. I mentioned that Andy's an investor and he also generously brought data from his 26 primarily self funded search investments and he shares his takeaways from that portfolio.

It's a fascinating cross section of search investing. We actually review his spreadsheet live. So if you're listening to this, consider watching the interview on YouTube where you'll be able to see the spreadsheet as.

We talk about it. It's a clean 26 rows showing performance of each individual company in the portfolio. We appreciate the transparency Andy brought to his story of buying, growing and exiting a blue collar business and to his. Track record as an investor.

For more Andy, watch his webinar from September entitled Liquidity Options for Search Investors. You'll find that at acquiringminds.co webinars. Okay, here he is, Andy Rougeot, former owner of RG Maintenance and current GP at Search Fund Secondaries Group.

Are you drawn to the opportunity of small business acquisition but don't seek to acquire a business yourself? Well, tomorrow, Tuesday, Nicholas James, my partner in Mind's Capital, is hosting a webinar about investing in not leading small business acquisitions. You'll hear the occasional guests on Acquiring Minds talk about investing in search deals.

Well, tomorrow's webinar is your primer on how to begin doing that yourself, how to build a strategy around SMB investing, how to generate deal flow, how to diligence and what it looks like post closing with board seats, reporting taxes, etc. The webinar is how to Invest in SMBs Without Buying One Yourself. It's tomorrow, Tuesday, December 9, noon Eastern.

Link to register for the webinar is right at the top of this episode's show. Notes or or on the Acquiring Minds homepage. Acquiringminds Co. Last month Tim Erickson of Shareholder Ventures and Acquisition Lab presented a primer on the financial anatomy of a self funded SBA search deal with investor equity.

Lots of definitions and theory was covered including pref rate, step up waterfall and much, much more. Well, this Thursday, December 11th, Tim returns for part two of this popular session to walk through a financial model row by row. You'll learn how pref rate, interest rate, step up debt and equity all work together.

You'll learn how to import your own deal into the model, how to create a base case, bear case and bull case sensitivity analysis. What happens to your acquisition if revenue. Declines 20%, for example?

The webinar is how to model an investor backed search acquisition and it's this Thursday, December 11th noon Eastern. Link to register for the webinar is right at the top of this episode's show Notes or on the Acquiring Minds homepage. Acquiringminds Co Foreign.