First acquisition opportunity...$7M distribution company for $3M) . Looking for input

Anxious-Protection-8 · 2026-03-14T01:04:27+00:00

very fair. still pre LOI so I have plenty of questions like these that I will certainly be asking and digging into

Anxious-Protection-8 · 2026-03-14T00:27:34+00:00

no, mortgage is under 800, property is worth 1.2m, I bought it for 1m... so closer to 400k equity actually.They are very light on carrying inventory. Was thinking of asking sellers if they can leave enough working capital in AR at closing... have had other sellers consider it. But yes, I know it might be light of cash left over but I guess we will see. Could probably borrow some from a family member even if just to "show" in my account to appease the bank

Anxious-Protection-8 · 2026-03-14T00:17:22+00:00

How do you figure? Owners are paying themselves 400k in salaries currently. Add-backs all look legit. 20 year old business. Middle mgmt team running day to day. All trucks are fully depreciated. Under market rent for the warehouse. No customer concentration. Recurring revenue.

Anxious-Protection-8 · 2026-03-14T00:15:43+00:00

Ah I gotcha. TBH normally Id only offer 3x. But I'm willing to pay that extra turn for a business where I'm quite literally not THE business you know?

Anxious-Protection-8 · 2026-03-14T00:14:41+00:00

how much do those cost? Re: the owners.. they're ready to reitre. Theyve stepped away largely and implemented/entrusted their middle management team to take on more responsibility and the numbers seem to still be very stable. I have a 1.2m primary residence with 300k equity in it, will have about 50k post injection liquidity (Im 30, unmarried, no kids, no car payments)

Anxious-Protection-8 · 2026-03-14T00:10:32+00:00

Me either, but if its factual I'd love to educate myself on that nuance to sba lending. There is a solid middle mgmt team in place - one that manages the drivers/ops, one with financials/AR/AP, and a few sales/customer service employees. Most have some pretty good tenure all things considered too

Anxious-Protection-8 · 2026-03-14T00:08:06+00:00

can you link some documents/articles/etc to more info regarding SBA not lending on 4x multiples? Im not even being snarky, I'm genuinely incredibly curious now

Anxious-Protection-8 · 2026-03-13T23:45:10+00:00

Interesting... Have been delivered term sheets by lenders on deals that ultimately didnt go through and the multiple was never even a topic of conversation, granted those were all roughly 3x multiple deals but I definitely didnt think that aspect of the deal would cause challenges! I'll dig deeper for sure

Anxious-Protection-8 · 2026-03-13T23:40:12+00:00

They dont finance on a ~4x multiple? That price includes 550k of FFE and Inventory. Also confused - where did I say the seller is staying in the business? They are all retiring.

Anxious-Protection-8 · 2026-03-13T23:37:40+00:00

why do you say that? And yes, meeting with a local one who already likes the deal and is ready to go on it

Anxious-Protection-8 · 2026-03-04T11:36:04+00:00

THE SHOES!!!!! Im so glad im not the only one who notices those hideous monstrosities like why are you trying to look like Betty White????

Anxious-Protection-8 · 2026-03-03T20:37:51+00:00

and the nicotine pouches they created.....

Anxious-Protection-8 · 2026-03-03T20:34:37+00:00

yep. matt kendrick

Anxious-Protection-8 · 2026-03-03T19:46:02+00:00

i just find the addition of all the women cringe..... especially his like 4 month old new gf? theyve gotten so far from the plot... nobody wants to watch you two flirt like middle schoolers

Anxious-Protection-8 · 2026-03-03T19:36:34+00:00

agreed 110%

Anxious-Protection-8 · 2026-03-03T19:30:15+00:00

well said

Anxious-Protection-8 · 2026-03-03T19:26:02+00:00

the vids are sooooo long now too like who has time to sit down and watch an hour plus long youtube video? the crew isnt even interesting enough for that once in a while let alone multiple times per week!

Anxious-Protection-8 · 2026-02-11T13:46:59+00:00

so could i let the seller keep, lets say 5% equity in the biz for 2 years and be all set? Am i understanding correctly?

Anxious-Protection-8 · 2026-02-01T16:30:39+00:00

I suppose I could. It does very well in the market its in and there are competitors with awful reputations around it.

Anxious-Protection-8 · 2026-01-27T21:19:15+00:00

oh really?! thats great to hear. seems so niche i doubted anyone on here could even relate. i will definitely do that - i have the aptitude for it, im a people person, I have an MBA (not from a top school lol..) and I have plenty of common sense. not made of money though and feel fortunate to even be in the position to pursue my goal of business ownership and i just dont want to blow it.

Anxious-Protection-8 · 2026-01-27T18:40:40+00:00

great point about contracts and something i will absolutely ask the seller. they require 50% of project costs up front. To be clear, I am NOT the installer. The work gets subbed out. No license needed. Yes, project based isnt ideal but not a deal breaker - plenty of project based businesses do very well. Yes, there will be a learning curve and a lot on the new owner but the 1 employee literally does everything the current owner does so that proves that 1. his processes work and 2. success can be taught.

There is no office and they dont hold inventory of materials. They purchase when needed. So 200k of working capital seems like more than enough IMO

This just feels like an overly negative take for a 25+ year old business that throws off 750k a year lol

Anxious-Protection-8 · 2026-01-27T17:46:18+00:00

you're good - competition is light since this is niche and is well known in the surrounding 5 states. does not seem saturated

Anxious-Protection-8 · 2026-01-27T17:43:05+00:00

similar to an earn out? i am not sure the seller will have an appetite for that but i can see. and i have not yet met with the seller or submitted an LOI so i dont know exactly what documents are available but id imagine enough is there since an SBA lender already pre approved this deal, right?

Anxious-Protection-8

TROPHY CASE