Worauf bei Firmenübernahmen geachtet wird

0:00Is this company in our deal box? Do we really like the founders? Cuz a lot of times if you're buying a company you kick the founders out and then you put it in operator that you trust etc. So like we have a lot of which actually makes it harder for us to do deals cuz there's so many reasons that we won't do a deal. Like we don't like the founders, they don't have a big enough vision, um we don't think the product's good enough long term which means like we won't redo pre-product product market fit. That's one of our big like that's why $3 million if anyone's curious like why $3 million in top line is kind of the minimum um and for us it's $3 million-ish but at least a million in EBITDA because unless you're there like usually it's you're still figuring stuff out. Like we want to have at least a basic product market fit.

0:36>> something. Yeah, there's something that's here, right? Um And so uh we won't redo that and then we want it to be in a couple areas. For us it's usually uh consumer services or business services which is either brick and mortar chains or national services like mortgage sales or something, right? Uh and those are places where if we can see like an easy like 5x or something like that, that's usually what we will want to pick up. So if there's like a bunch of like it's kind of funny like the double-edged sword of you want a good business but you uh my my head of biz dev said he's like we want you to be very specifically incompetent.

1:13As in like incompetent in all the ways that we are excellent, okay? >> [laughter] >> And so it's like if someone's like, "Oh yeah, our sales process is horrible." Or like, "Man, we can't get enough demand gen but we have like a huge LTV and we're really sticky on the back end." Like those are companies that we can come in and just murder. Yeah, I mean we just we just bought a 32-location uh teeth whitening chain um and I was so excited about this and then we went to the facility and the experience was fine in terms of the product but the sales process that I went through was like I was like giddy. I was like, "Oh my god, there's so many things that we can do to improve this." And so we just rolled out our first level and we 5x'd LTV. Wow. In one roll out. And so this is 32 locations and it was like, "Great.

1:57Like, we just created $50 million enterprise value. Like, let's just roll the this out over the next 12 months to all 32." And I was like, "And that will be a W for the year." You know what I mean? Like, one of the hardest parts about what we have is that you have this desire to have activity, right? It's like, we have all cuz right now we get 3,000 companies a month that apply. So it's it's continued to grow. Um but we don't we don't necessarily make more money by doing more deals. And so it's way more about find And like that the hard part is sticking with the plan and not getting like eyes bigger than your stomach. And so anyways, that's that's been the the biggest challenge for us is like just being very selective about the deals that we know are the best deals for us, not necessarily just good deals. And you talk about the deal box, which is Warren Buffett's like you you you wait to swing, right? So what do you think it is for your deal box? You kind of mentioned a couple things there. So right now, and I think that over time we'll probably expand it as we bring in other like like ex-operators. So somebody, you know, if someone's scaled and exited a business for like a hundred million plus in like software or something, then I'd be like, "Well, dude, just come into my deal flow and we'll make a deal that makes sense for both of us. You don't have to spend three years building out this massive deal machine. I'll just partner with you on it and then we'll, you know, kick off at a different pod."

3:04But for right now, our stuff has been focused on services. Just cuz like that's the world we just know really well. Got it. And that's this kind of starts to go into content a little bit because you're you've been very prolific in the last two years with with leveling up your content. Did that teeth whitening company did that come through your content or where did it come from? >> Content. Yep. So walk me through how that worked cuz actually I was having lunch and my friend has a pet holding company. He's like, "I want to ask like how cuz he just produced content, right?

3:30He's like, how how much does that content actually help with deal flow?" So what happened with that story? >> All of our deal flow comes from content. So, yes, it does help. Um yeah, I mean, it's pretty like someone will watch a number of pieces, they'll listen to a bunch of podcasts, they'll buy the book, they'll read the book, they'll go through the course, and you know, they'll have spent a hundred hours with me virtually before they decide to take the first action, which I like because then it a lot of times will fix a lot of the low-hanging fruit, which is kind of nice cuz then you don't have to like have a thing that has all these issues. And so they'll apply our you know head of business that well well there's multiple screenings. We have an automated screening that weeds out like probably like 90% just cuz they're not big enough or they're in a space or they're international, etc.

4:09Um and then once that we have somebody who immediately reaches out uh to just qualify that this data is accurate, which again that's like another wave. Uh and then from the qualifying stage we have somebody who then does a way more in-depth business case and basically writes up a full like one-page write-up per business. And then the ones that that person thinks are big enough and in our deal box then get passed on to managing director of business development. And so then he uh takes the the deal from that point until close, which is usually like several more conversations, which he usually weeds out most of them. We usually do about two LOIs a month.

4:45Is what that results in for us. I think just for those people listening it's it's hard once you're in it like you understand how hard it is, right? But when you look at your team it actually is a team of badasses. It's like a SWAT team, right? And so you have people that have actually been there done that. You've talked about your CFO before. You said it's 30 people. Who else are kind of the the key players on that holdco team cuz I don't want people to think this is easy. Oh, yeah. >> [laughter]

5:09>> Everything's easy if you don't do a good job. Um Uh So for us we look at it by function. So it's like we have somebody who who's an I So we call them SMEs, so subject matter experts. So subject matter expert for IT, for finance, for um HR and recruiting, uh for we have two different marketing SMEs, one that's more on like the tech side like MarTech, um and like media buying and like funnel optimization stuff, CRO. And then the other one is more like truly like the art side of like the words, the copy, VS like video sales letters, ads, that kind of side. Um and then we have uh director of sales, and we have a director of customer success. And so, each of those people has years of experience building and scaling multiple teams to bigger than most of the companies that are coming to us.

5:56Um, and now have, you know, experience doing their function and scaling it within each of our portfolio companies. And we've just It's just a very long process of step-by-step codifying every plan in the playbook. And I think that it's kind of like the the Bruce Lee of like in the In the beginning, everything's simple, and then you have like a zillion, you know, punches and kicks, and then it comes back to just like, don't get hit. >> [laughter] >> Um, and I think that right now we're we're getting better and better at like, okay, we crushed this playbook really well. We crushed this playbook really well. So, right now we've got like a three playbook that it's like we can 10x like services companies. And so, I'm just trying to see like, okay, there's 20 other things that we do really well, but like, where are those like easy just massive levers that we can crank on? And then I think that's where I want to just like, I might even say, let's get even more efficient at just do pulling these four levers, immediately 10x in the business, and then saying like, okay, so do we want to exit, or do we want to like double down again, or do a dividend recap, or something like that, and then reinvest for another 10. Real quick, if you're a business owner, and you're not growing as fast as you'd like, I'd like to give you a free gift. So, my team and I put together the $100 scaling roadmap, which is basically 200 hours of us looking over all the portfolio companies we've had, and what stages of growth they went through, and more importantly, where they got stuck, and how they got past it. And so, we broke it into these 10 stages, and we made this little kind of quiz thing where if you put in your business information, it'll tell you where you're at, and the most important part for you, what to do for each of functions of the business across product, marketing, sales, customer success, recruiting, IT, human resources, and finance. And so, no matter what you're struggling with, someone else has already struggled with it and solved it. And so, I'd like to give you this thing absolutely free. You can go to acquisition.com/roadmap, plug in your business information, and if you want us to actually help you deconstraint the business, and you're trying to scale, we'd love to help you out. On the thank you page, you can book a call with my team, and we will look at the business, see if we can help, and if we can, we'll invite you out to Vegas, and we'll do this in person, live.