This Week In SMB PE | October 1st, 2024

A Weekly Recap of SMB Deal + Opportunities

Author

Dennis Unrein
October 01, 2024

Welcome to This Week In SMB PE. Our weekly recap of deals in SMB M&A, Micro Private Equity and Self-Funded Search space.

In this newsletter we highlight interesting opportunities from this past week in SMB M&A, Micro Private Equity, and Search Funds.

We target cash-flowing companies under $10MM in acquisition value.

This Week’s Top 10 In SMB Social Media

Contact Us: Google Registration Forms

If interested in working with SMB PE?

Free Google Forms below. Please introduce yourself:

Prior Posts:

Weekly Deal Reviews SMB PE | Video Reviews

Interested In A Deal? Expanded information included below:

1. Porta Potty Rental Business - California | $6.4M Revenue | $1.7M Cashflow

Deal Summary:

  • $6.4M Revenue

  • $1.7M Cashflow

  • $10.5M Ask Price

  • 6.2x Cashflow Multiple

What Do They Do?

  1. Portable restroom rentals.

  2. Construction, Concerts, Sporting Events.

  3. Temporary fencing solutions.

Highlights:

  1. Operation for decades, Seller retiring.

  2. Experienced well trained team of 20.

  3. Consistent profitability.

Risks/ Concerns:

  1. Customer concentration risk.

  2. CA regulatory + environmental regulations.

  3. Replacement costs for $1.5M assets.

2. Commercial Painting Company - Ohio | $3.5M Revenue | $777K Cashflow

Deal Summary:

  • $3.5M Revenue

  • $777K Cashflow

  • $2.0M Ask Price

  • 2.6x Cashflow Multiple

What does the Company do?

  1. Commercial painting services.

  2. Solutions for Big Box retailers.

  3. Work throughout United States.

Highlights:

  1. Established business in 1985.

  2. Owner retiring.

  3. Consistent profitability.

Risks/ Concerns:

  1. Client concentration risk.

  2. Competition in market.

  3. Contracts one-time or recurring?

3. 35+ Year Caribbean Boat Tour - Florida | $250K Revenue | $225K Cashflow

Deal Summary:

  • $250K Revenue

  • $225K Cashflow

  • $395K Ask Price

  • 1.8x Cashflow Multiple

What does the Company do?

  1. Guided boat tours + private charters.

  2. Floating water playground.

  3. Swing, slide, water basketball.

Highlights:

  1. Established 1988. Seller 76 years old.

  2. Premier tourism destination.

  3. Seller willing to offer 50% financing.

Risks/ Concerns:

  1. Regulatory + license requirements.

  2. Injury liability + insurance.

  3. Competition in area.

4. 30+ Year Animal Veterinary Clinic - New Hampshire | $830K Revenue | $225K Cashflow

Deal Summary:

  • $830K Revenue

  • $225K Cashflow

  • $550K Ask Price

  • 2.4x Cashflow Multiple

What does the Company do?

  1. Veterinary services provider.

  2. Wellness checks and preventive care.

  3. Emergency and urgent care.

Highlights:

  1. Established in 1993.

  2. Seller is retiring.

  3. Consistent profitability.

Risks/ Concerns:

  1. "Home-based" / Relocatable?

  2. Regulatory compliance challenges.

  3. Competition from corporate chains.

5. ATM Route - 105 Units - Florida | $435K Revenue | $205K Cashflow

Deal Summary:

  • $435K Revenue

  • $205K Cashflow

  • $925K Ask Price

  • 4.5x Cashflow Multiple

What does the Company do?

  1. Operates ATM network.

  2. Provides cash access.

  3. Revenue from transaction fees.

Highlights:

  1. Diverse 105-Unit Footprint.

  2. High traffic locations.

  3. Consistent cashflow.

Risks/ Concerns:

  1. Malfunctions, cash shortages, maintenance.

  2. Security challenges.

  3. Seller transparency on activity.

6. 3x Laundromats - California | $1M Revenue | $598K Cashflow

Deal Summary:

  • $1.0M Revenue

  • $598K Cashflow

  • $2.1M Ask Price

  • 3.6x Cashflow Multiple

What does the Company do?

  1. Coin-operated laundry services.

  2. 3x combined locations.

  3. Self-service washing and drying.

Highlights:

  1. High traffic area with parking.

  2. Established history of profitability.

  3. Below market rent for all locations.

Risks/ Concerns:

  1. Established in 2020 why sell now?

  2. What are capex needs for the business?

  3. Only 2 on staff, any hiring needs?

7. 47 Year Old Sod Company - Florida | $2.6M Revenue | $701K Cashflow

Deal Summary:

  • $2.6M Revenue

  • $701K Cashflow

  • $1.4M Ask Price

  • 2.0x Cashflow Multiple

What does the Company do?

  1. Quality sod and sod services.

  2. Established in 1977.

  3. Installation, repairing, maintenance, removal.

Highlights:

  1. Owner retiring, 3x generations of sod.

  2. Year round market in southern Florida.

  3. Established customer base + brand.

Risks/ Concerns:

  1. Residential % vs commercial % customers.

  2. Owner dependency risk.

  3. Labor and team post-close.

SMB PE 101 M&A Resources

Interested in learning more about Business Buying and if it is right for you?

We have received inquiries about resources to find, locate and underwrite potential SMBs potential acquisition targets. Beyond please options to follow along below.

1) Free Weekly Newsletter: 1x Weekly Deal Recap of SMB Deals

  • What Is It? Accelerator/ Incubator for Small Business M&A and Micro Private Equity deals

  • “How-To Buy A Business” Content Including: 

    • Process Timeline: Timeline for M&A deals

    • Models: Valuation and financial model for Pre-LOI analysis

    • Searching: Websites, Brokers, Off-Market Strategies

    • 1×1 Coaching Calls: 15 slots weekly for M&A Advisory Calls

    • Databases ($250 Value): Includes all SMB Databases below (60+ marketplaces, 111 Due Diligence Questions, 1,000+ Business Brokers)

  • Investors + SMB Accelerator (Optional): We have 125+ accredited investors that can invest at their discretion for live deals. We present them with interesting deals and they can choose to participate in deals if they choose to.

The average course is $2,000 in the market, so we priced our monthly community at $99 so that we can have something that is constantly adding over time. The average Search can take 12 - 24+ Months making us competitive with those in market for educational products.

  • SMB Marketplaces Database ($49): List of 60+ marketplaces + brokerages search for SMBs. (Link)

  • Due Diligence Volume I Database ($49): List of 111 questions to consider during due diligence. (Link)

  • Business Brokers Database ($149): List of 1,000+ business brokers to contact to increase deal flow. (Link)

  • How to scale to 90K followers in 90 days on Instagram ($999): Formula for posting social media on Instagram that we used to grow to 90,000 followers over 90 days (Link)

Please reach out with any questions or recommendations for the newsletter. We will do our best to incorporate.

SMB PE Disclaimer

For informational and illustrative purposes only. This communication does not constitute an offer to sell, a solicitation of an offer to buy or a recommendation of any security or any other product or service by SMB PE LLC. Prior to making any further decisions, investors should seek individual advice from their personal financial, tax, legal or other profession advisors to take into account the risks associated with their own specific situation.

While SMB PE LLC uses reasonable efforts to provide accurate and timely information, SMB PE LLC makes no representations or warranties as to the accuracy, reliability or completeness of any information included in this document. It is educational in nature and not designed to be a recommendation for any specific investment product, strategy, plan feature or other purposes. By receiving this communication you agree with the intended purposes described above. Any examples used in this material are generic, hypothetical and for illustration purposes only. Certain information contained in these documents may be superseded as new guidance or interpretations are issued and any contents or financial projections included are subject to change without notice. All materials are meant to be reviewed, including any footnotes, disclaimers, restrictions or disclosure, and any copyright proprietary notices. Access to information about investments is limited to investors who either qualify as accredited investors within the meaning of the Securities Act of 1933, as amended, or those investors who generally are sophisticated in financial matters, such that they are capable of evaluating the merits and risks of prospective investments.

All investments are speculative in nature and involve substantial risk of loss including 100% loss of original principal amount invested. There is no guarantee that any forecast will come to fruition. Any investment decision should be based solely on the basis of offering documents including but not limited to the prospectus, private placement, or offering memorandum.

This communication is intended solely for the use of the individual or entity to which it is addressed. It contains confidential information. If you are not the intended recipient, you are hereby notified that any dissemination, distribution, copying or other use of this message or its attachments is strictly prohibited. If you have received this message in error, please notify the sender immediately and permanently delete this communication and any applicable attachments.