Sam Rosati
@Sam_Rosati
Followers
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Sharing SMB insights as an investor, operator, lawyer & CPA. Day job: sponsoring a Commercial Fence Co. @SMBootcamp_ @SmbLawGroup @SMB_ash & @PursuantCapital
Tampa Bay
Joined August 2011
If you're serious about buying a business in 2025. Join us at SMBootcamp Live on February 5-7th in Downtown Tampa, Florida. Or get started sooner with SMBootcamp Digital today. 80% of our Searchers close within 6-12 months from starting. Learn more and apply below:.
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Want to buy a great SMB in the next 12 months?. I’ve spent 100+ hours creating an email course to help you:. - Raise debt and equity.- Close fast (with low risk).- Find quality businesses for sale. Want access?. Like and comment “SMB“ and I’ll send it for FREE!
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SMB acquisitions are the most powerful wealth-generating vehicles on earth. Yet only 1% of people know how to buy one. So here's a playbook anyone can copy (with little $ down to boot):.
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Working on buying SMB w/ $1.5M EBITDA. As I work through financing, it’s pretty clear that the $1.5-2M of EBITDA range (give or take) is a sweet spot for SMB buyers b/c it’s an “in between” size for usual buyers. Too big for “job buyers” and too small for other folks (PE, SBIC).
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My personal savings in Wells Fargo is currently earning 0.54% APY. This morning, I called my local branch, said I was moving it to a higher yielding competitor, and they increased rate to 2.26% APY for 6 months. Needle mover for anyone willing to make a 3 minute phone call.
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So you are “planning” to search to buy an SMB. Or worse yet, telling yourself you will search when the time is right. Do these QUICK 10 things to get started TODAY:. 1. Form an LLC, in your home state, to shield yourself from liability when you sign NDAs. Lawyer not necessary,.
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🚨🚨 Another interesting opportunity for an entrepreneurial searcher/operator who has more hustle than capital and would like to partner with an established SMB platform (that I own/manage)🚨🚨. 👇. (1/11).
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Are you “planning” to search to buy an SMB? Or stuck in the "I'll start tomorrow" phase?. Or worse yet, telling yourself you will search when the time is right?. Do these QUICK 10 things to get started TODAY:. 1. Create a search name. Do NOT include the word “capital” unless you.
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Wish I had a small group of like-minded ETA/SMB peers to talk/vent/strategize with. Like a mini EO for ETA. Topics very tactical. Business and personal (e.g., how to juggle spouse/kids, mental health, fitness, blind spots). Thinking about starting one… any interest out there?.
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Are you “planning” to search to buy an SMB? Or stuck in the "I'll start tomorrow" phase?. Or worse yet, telling yourself you will search when the time is right?. Do these QUICK 10 things to get started TODAY:.
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I get an absolute avalanche of brokered SMB deal flow in my inbox. It's mostly perfect for the ETA SMB buyer (nationwide, $500k-1.5M SDE, non-glam industries). How do I get that deal flow into the right hands within this SMB community without much work? . Help plz.
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Wish I had a small group of like-minded ETA/SMB peers to talk/vent/strategize with. Like a mini EO for ETA. Topics very tactical. Business and personal (e.g., how to juggle spouse/kids, mental health, fitness, blind spots). Thinking about starting one … any interest out.
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Wish I had a small group of like-minded ETA/SMB peers to talk/vent/strategize w/. Like a mini EO for ETA. Topics very tactical. Business and personal (e.g. how to juggle spouse/kids, mental health, fitness, blind spots). Thinking about starting one…. Any interest out there?. No.
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All posts about sleep, exercise or health MUST disclose whether or not you have kids under 5yo 😬.
The thing I’m most proud of is my sleep…. When I sleep well, I feel like I can overcome any challenge. When I don’t sleep well, I feel brittle. Here is how i ensure I get good sleep (some are dorky, but OK):. 1. Darkness. Heavy curtains, and some sort of eye cover. 2
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Since 2018, @PursuantCapital has acquired/invested in more than a dozen SMBs, all through some version of ETA. And ~50 searchers (current + prospective) have attended our Search Fund Bootcamps. 1/9.
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I've been quiet on @X for the last few months, and I can finally share why:. Perimeter Solutions Group, the commercial fence, gate and access controls company that I co-sponsor, recently partnered with Bertram Capital. We've been on an incredible journey the past 3 years where.
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🚨 SMB Accounting Bombs 🚨. When inventory is the same #, period after period, it’s a warning sign! ⚠️. It's NOT a sign that inventory stays constant!. Instead, inventory purchases are running through the P&L as an expense (COGS) in the period they're paid for (cash accounting).
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HBS & Stanford (+ others, e.g. Booth, Kellogg) known as leaders in Search Fund world. But A. J. Wasserstein @ Yale has written some really insightful stuff on all things Search. Link to cases here (warning, the rabbit hole is deep):
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A big reason search/ETA takes so long is not being crystal clear at the start about your "Big 3 & Little 2 Criteria" - leads to tire kicking, wasted time on deals that aren't right for you, and giving brokers/sellers the impression you are a rookie buyer. The Big 3 criteria are:.
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Finally, @SMB_Attorney reveals himself so he, @KHendersonCo and I can share the launch of @smblawgroup, an ETA/SMB/M&A focused law firm.
Should you hire a lawyer for your deal?.How do you find one?. Learn legal insights with Eric Pacifici aka @SMB_Attorney on our last episode. Tune in!
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🚨 It's been a perfect storm for SMB acquisitions 🚨 . SBA loan interest rates have risen like crazy (e.g., 5% to 11%). But valuations have NOT come down!. So if your SMB deal doesn’t initially pencil (i.e., bank and investor returns are too low), you can still make it work 👇🧵.
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Contrarian take: SMB buyers would be better off starting their careers as business brokers instead of MBA/IB/PE.
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A few thoughts on how today's tighter debt financing market is creating opportunities for ETA SMB buyers:. We are working on another SMB acquisition, this time with ~$1.4M EBITDA. Bidding 4.25x, so $6M purchase price. As I work through our financing plan, it’s pretty clear that.
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🚨 🚨 7 takeaways from spending 3 days with 100+ ETA searchers, owner/operators and investors at @SMB_ash:. 1. There are a thousand versions of ETA. And the only correct version is the one that's best for YOU. The key is to find a good business, get a deal done and get in the.
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[🚨Partnership Opportunity 🚨]. One fascinating takeaway from working with hundreds of SMB buyers and searchers: raising that FIRST equity check often creates more anxiety than an SBA personal guarantee!. Ironically, over the past five years, I’ve seen SO MANY high-net-worth.
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Too often, searchers use max SBA debt (90% LTV) & leave too little cash on the balance sheet at closing. Reminder: you can raise extra equity & sleep well knowing you have a war chest of cash while you learn the biz and transition from the owner. So what if you own 5-10% less….
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🚨SMB Buyers🚨. If you are under LOI/contract to buy a small business, tweet me some *nonconfidential* details and I will retweet in an effort to connect you with other owners/operators in that industry. Seeing too many folks go into diligence without “insider” knowledge on.
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Do you know how to manage your Deal Team and M&A workstreams after you go under LOI?. If not, watch this video on Navigating the Post-LOI Process 🚀
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Finally time to switch payroll providers. Currently use ADP which feels like a Ferrari in a go-cart race…What’s everyone’s favorite for SMB? Don’t need benefits—handled separately. Do need QuickBooks integration. Otherwise flexible.
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I’ve been quiet on SMBtwit for a while, but with good reason … another commercial fencing business joined Perimeter Solutions Group today via acquisition. A transformative deal bringing new capabilities to the platform in a core Sunbelt market. First conversation with broker.
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Consistently hear about shortages of the following:. HVAC service/install techs .SMB tax CPAs.Master Plumbers. There’s a lesson in there somewhere….
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Hot take: business valuations are terrible for M&A. They anchor a seller's price expectations to a number that's prepared by a party without any skin in the game.
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Why can't I use conventional debt on my SMB acquisition???. Here is an example:.
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Launched new personal / SMB website with lots of free resources on ETA, SMB M&A/ops, etc. www.SamRosatiSMB .com. Feedback welcome.
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From the minds that brought you @PursuantCapital, @smblawgroup, @SMB_ash and SMBootcamp comes SMB Work, a new co-working space and SMB/ETA clubhouse in sunny Tampa Bay, FL.
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SMB vs. W2:. Me (SMB owner): not tied to an office, tons of flexibility, tons of financial upside … but zero guarantee of income, tons of downside, and generally always on call 24/7/365. My wife (W2 healthcare): strict 7am-4pm in office with zero flexibility, rules for.
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Lot of advice on Twtr coming from people who haven't been in the arena, advisors included. If you are searching to buy an SMB, planning to sign a PG and go "all in" make sure you are getting advice from people who have done it/are doing it.
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Been getting the 'how do you buy a portfolio of micro SMBs?' question a lot recently, esp from 1st time searchers. My answer: simple math makes it hard, but if you can play the long game, it gets easier. (math below is rounded + TONS of assumptions = keeping it simple).
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Have your opening balance sheet ready before closing. During first 90 days, when your accrual P&L isn't reliable yet, track leading/trailing KPIs closely. and do manual cash P&L/reconciliation weekly. Hard stop. Even if you have to do it by hand. Otherwise you are driving blind.
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I've seen my ex-IB Searcher friends waste time on overly detailed spreadsheets. Complex deal models have their place. But rarely lead to a different decision than if you would've used a back-of-napkin model.
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Military veterans and athletes have a competitive advantage in ETA due to their experiences leading teams, discipline, work ethic, etc. Last week I had a ton of fun introducing ETA to more than a dozen athletes at the Pro Athlete Community's Next Chapter U Business Combine. I
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SMB buyers willing to stomach PG: couldn't be a better time: new fed stimulus bill waives guarantee fee (~$27K on $1M loan) and pays 6 months of P&I up to $9K/mo ($54K max). along with usual 10 year amort, covenant free (fixed rates available).
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Before you start searching, get your "Deal Team" ready to go:. 1. QofE "Light" .2. SBA Lender.3. Law Firm.4. Insurance Agency.5. Tax CPA. Understand their roles, when to call, pricing arrangement, etc. Don't wait until after the deal hits your inbox. @PursuantCapital.
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Quick intro for new followers (👍 @SMB_Attorney). -Former SMB owner/operator (sold in '20), recovering M&A lawyer/CPA.-'21: 7 SMB deals (4 active/control, 2 passive, 1 advisory).-'22: Build @PursuantCapital team to double deal volume v. '21. Here to share all things SMB, M&A, ETA.
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Working on buying an SMB w/ $1.5M EBITDA. As I work through financing, it’s pretty clear that the ~$1.5-2M of EBITDA range is a sweet spot for SMB buyers b/c it’s an “in between” size for usual buyers. Too big for “job buyers” and too small for other folks (PE, SBIC). Agree?.
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Today, an SMB owner/operator officially paid back all of his investors' capital plus accrued pref. Officially turning "investors" into "partners.”. And next up is the SBA loan. And then it gets really fun!. This is the SMB dream. Couldn't be more fun to watch. (it’s way.
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All posts about sleep, exercise or health MUST disclose whether or not you have kids under 5yo 😬.
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Traits of the best SMB owner/operators:. -grit.-humility .-creativity.-empathy.-curiosity .-persistence. Not necessary: IQ, fancy degree, technical skill, money, age, experience.
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3 kids, 2 jobs, and a lot of life flying at us. But it was fun to get out Saturday night to spread the ETA gospel with some professional athletes and local SMB owners. @ProAthleteCom, @traviskey, @chippaucek, @KT_PlayerEngage.
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🚨 It's been a perfect storm for SMB acquisitions 🚨 . SBA loan interest rates have risen like crazy (e.g., 5% to 11%). But valuations have NOT come down!. So if your SMB deal doesn’t initially pencil (i.e., bank and investor returns are too low), you can still make it work 👇🧵.
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Everybody wants to be an owner . but nobody wants to do the work to be a successful searcher.
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Why can't I use conventional debt on my SMB acquisition???. Here is an example:. (BTW, @KHendersonCo and I recorded a mini pod about The "Market" for Investor Terms which also covers the topic of searcher economics - link to ppt slides and pod recording are in my profile). When.
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Tomorrow is the first day of our 7th SMBootcamp … and we’ll have over 100 alumni by Friday afternoon!. @PursuantCapital @sbabmarks @smblawgroup @SMB_Attorney @JermanMichael @MrJoshFro and more!.
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Austin TX with the @smblawgroup crew. If you’re out there grinding and building your SMB dream, make sure you are doing it with friends you trust and jive with … then you can’t lose. @KHendersonCo @SMB_Attorney @TwoTeesSMB @ParsleyETA 🚀🚀🚀
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Literally the ONLY THING that will make you feel ok about a busted deal is looking at your pipeline and seeing it full of strong, actionable deals. So, when under LOI and short on time and energy, DO THE EXTRA WORK to keep deals coming in the door. You will thank yourself later.
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Most people start their ETA journey around the same time they are going through early child raising years. Those are 2 of the most overwhelming, daunting, stressful and complicated journeys we face as humans. I know first hand: we had our first child in the 2nd month of our.
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This is a must read. Most people start their ETA journey around the same time they are going through early child raising years. Those are 2 of the most overwhelming, daunting, stressful and complicated journeys we face as humans. I know first hand: we had our first child in.
I just spent 3 days with dear friends, all of whom have kids ages 8mo to 4y. Something I need to get off my chest about being a parent of young kids and the culture we live in:.
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Got a ton of DMs about this video. The SMB community needs waaay more technical content and not as much preachy generalities . .
Do you know how to manage your Deal Team and M&A workstreams after you go under LOI?. If not, watch this video on Navigating the Post-LOI Process 🚀
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For anyone struggling with cash flow issues, I have a streamlined 7-week cash flow forecast that I'm happy to share. Also for anyone struggling with cash flow issues, you aren't alone, SMB ops is hard!.
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Transparently, my goals for running SMBootcamp:. INTERNALLY:. 1. To invest in SMB acquisitions alongside entrepreneurs I know, for deals I get to see early, that are vetted (in most cases) by my Deal Team. 2. To source operators for SMBs in our HoldCo. 3. To make a profit on the.
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So you are “planning” to search to buy an SMB. Or worse yet, telling yourself you will search when the time is right. Do these QUICK 10 things to get started TODAY:. 1. Form an LLC, in your home state, to shield yourself from liability when you sign NDAs. Lawyer not necessary,.
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Everyone wants to start their career in i-banking then PE … maybe with an MBA in between. But IMO, if you want to buy an SMB, you’d be better off starting your career as a business broker learning how deals are done (and how businesses are run) on Main Street.
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Transparently, my INTERNAL goals for running Search Fund Bootcamps:. 1. To invest in SMB acquisitions alongside entrepreneurs I know, for deals I get to see early, that are vetted (in most cases) by my Deal Team. 2. To source operators for SMBs in our HoldCo. 3. To make a.
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Not able to make @SMB_ash this year? Here are 10 takeaways from spending 3 days with 100+ SMB searchers, owner/operators and investors:
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🚨⚠️ Want to ruin your SMB and default on your loan?. Pursue a HoldCo. Before: .(1) your acquisition debt is paid off, .(2) you (operator) are removed from day-to-day ops, .(3) documented SOPs are in place. WAY too many searchers and first-time SMB owners chasing the 2nd and.
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Timing is everything. One of the largest waterfront properties in Tampa sold recently for ~$17.9M. The former owners bought the property in 2012 for ~$1.2M. That’s a $16.7M gain in 11 years!. BUT, buying when there is blood in the streets is WAY harder than it looks. You need
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There is a HUGE segment of the SMB/ETA community that is buying businesses within an hour or so drive of where they live. Traditional search community HATES this. But it's reality - and IMO super healthy for first-time buyers.
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Interesting opportunity for an entrepreneurial searcher/operator who has more hustle than capital and willing to move quickly on a deal here in Tampa. .
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When I started searching, we got really good deal flow early on. I was convinced we'd close on an SMB in the first year. The 3 best deals were a DOT sign manufacturer, a food broker to the military, and a healthcare focused courier. And then all three deals died. And.
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Finally back online after nearly a month spent getting a deal over the finish line and through early transition. Excited to partner with a self-funded searcher to purchase a local (to Tampa) light manufacturing SMB. Every deal is hard -- always thankful to get one over the hump.
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Hardest thing about buying your first SMB? Deciding which biz in your pipeline is “good enough.” There are a million criteria checklists (e.g., HBS Guide) and rules of thumb. But nothing beats experience (and quality advisors/mentors) to help you make the really hard decisions….
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Would any SMB owners/operators be interested in forming a buying group/informal cooperative to leverage our buying power with common SMB vendors? This happens within industries, maybe we can make it happen here too. And please somebody tell me if this is a stupid idea….
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Over the weekend I asked my kids what I do for work. They said I talk on the phone all day, eat snacks, and look at the computer. 3yo son added that I “do putting.” . This is what ETA dreams are made of, folks.
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When I tell people we are in the fencing business, they assume it’s the residential fencing business, i.e., installing fences around backyards. However, we exclusively install fencing around public and private COMMERCIAL properties. Think jails, schools, hospitals, etc. It’s.
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There is a HUGE segment of the SMB/ETA community that is buying businesses within an hour or so drive of where they live. Traditional search community HATES this. But it's reality - and IMO super healthy for first-time buyers.
If you're buying a biz far away from you, be careful. Staying in touch with the info flow in a local SMB requires (your) boots on the ground — it requires walking client properties, moving trucks around, and more. It matters what city you’re in.
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We target SMBs in FL within driving distance. The idea is sometimes small co’s go sideways & we have to get our hands dirty, and when that happens, I want to be home for dinner each night. That’s happening now for 1 of our co’s, and it sucks, but I’m home each night for dinner ✌️.
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Today, an SMB owner/operator I backed officially paid back all of his investors' capital plus accrued pref. Officially turning "investors" into "partners.”. And next up is the SBA loan. And then it gets really fun!. This is the SMB dream. Couldn't be more fun to watch.
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SMB searching is like my battle w/ my garage gym. My tendency is to think I need a big, hour-long, knock-down/drag-out session to create value. That doesn’t work for me. Lately, I’ve done short but intense daily lifts. Just enough to pump. But not enough to cause me to skip.
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Monthly note to self: . The deal/SMB business is the people business. Don’t think for a second that ETA/SMB is all about spreadsheets and software and scaling.
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This is the Tweet that got @ChandlerReedSMB and I together to buy his SMB. Might have another opportunity like this on the horizon . a CEO role for a searcher/operator who has more hustle than capital. But this time no Tampa focus. It's an existing platform + nationwide.
Interesting opportunity for an entrepreneurial searcher/operator who has more hustle than capital and willing to move quickly on a deal here in Tampa. .
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Huge THANK YOU to everyone that came to Orlando for @SMB_ash. What started as an idea among 3 friends to meet, share ideas and have fun turned into 4 jam-packed days with 100+ SMB owners, operators, investors & friends. SMBash '23 planning is underway! @MatthewGHinson @laughridge
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Just made a "SMB Deal Expense Calculator" to help searchers tally their estimated transaction expenses. We typically cover this at Bootcamp, but @ChandlerReedSMB and I wanted something more user-friendly for the broader community. 👇.
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Want to ruin your SMB and default on your loan?. Pursue a HoldCo before:. (1) your acquisition debt is paid off.(2) you (operator) are removed from day-to-day ops.(3) documented SOPs are in place. WAY too many searchers/first-time owners chasing the 2nd/3rd deal before securing.
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So energizing to meet our new cohort of searchers at the @PursuantCapital Search Fund Bootcamp last week. 3 packed days of helping entrepreneurs through their ETA journey! More info to come on content, Deal Team, etc.
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Entrepreneurship:. Sending emails at 4:45am on a Saturday…. So I can do this on a Tuesday afternoon…. Know your “why”
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Approaching 1 year mark since @PursuantCapital May ‘22 cohort of Search Fund Bootcamp … 5 of 14 (35%!) have closed and others are getting closer!.
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RE cap rates of 4-5% = purchase price multiples as high as 20-25x NOI … but SMB multiples of 4-5x FCF implies SMB has FAR greater risk than RE … has the spread widened too far between asset classes?.
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The hard truth: most ETA searchers won’t do the hard work to buy an SMB. The good news: if you actually do the hard work, you’ll probably close and win. Be honest with yourself before you start.
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Rookie move: "let's inject as little cash as the SBA will allow so I can keep the biggest % possible. LOC can fund ops in the meantime.". Veteran move, after a post-closing cash pinch: "next time, let's fund cash on the balance sheet as if we won't make any revenue for 3 months".
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ETA isn’t mainstream, but the word is spreading. Got to teach ETA at the Professional Athlete Community (PAC) this week. @jeffdriskel, @brandongraham55 @T_Armstead72 @__allcost @chippaucek joined us at a local SMB to see what it’s really like to be a small business owner.
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⚠️ For self-funded SMB buyers/searchers, TIME is your greatest asset but also your enemy ⚠️. (read to the bottom for our 1-page checklist). IMO the #1 reason search takes so long is buyers are not CRYSTAL clear about their "Big 3 & Second 2 Criteria" . This leads to tire kicking,
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Struggle with financial modeling? . Want to see me model a real SMB acquisition? . Join @whentheresawill and me this Friday (1/12, Noon eastern) as we "live" model a self-funded, SBA-financed search deal. Registration link in my bio!.
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Another conundrum in ETA: unless you have an angle, today’s crazy valuations may justify the risk/pain of building from scratch (esp in hot industries). But that defeats point of ETA. What to do? Go down market, wait, pay up, more leverage—new searchers should have their plan.
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