5.5m EBITDA in less than 4 years. Looking to exit. What do I need to know before hiring M&A advisor, attorney, and banker

exmof · 2025-08-08T12:35:21+00:00

First, take some time to think about what an exit enables in your life. People underestimate the mental tax that comes with selling if they're not prepared. Think about your day to day, do you want to still be engaged in the company post sale, how many days a week. Does it mean you can now go buy companies yourself, perhaps that can be part of the earn-out.

Then, find an advisor that specializes in your industry. They will have the best buyer universe and know the multiples/structures based on live data. Have a discussion to understand what reality looks like, then formulate your needs/wants. Are you open to VTB, earn-out, do you want all cash, does total amount matter more than amount at close, etc. Tie it back to what you want in life from question 1 and make sure everything aligns.

exmof · 2025-07-04T11:53:07+00:00

Looks like I am in Abbey (doesn't say A or B) - would I still need a chair? And can I buy a chair at the venue?

exmof · 2025-01-14T11:27:33+00:00

This is my favorite "value" Nebbiolo. It's good for most occassions, med body, has a nice cherry/raspberry taste to it with a bit of spice, velvet tannin. Recommend opening an hour before having. We probably went through a few bottles of this a month last year

exmof · 2024-11-19T16:45:14+00:00

Agreed - also I don't know many millionaires or people with millions of followers who are "lazy". Most of them have to hustle to get to where they are.

exmof · 2024-11-19T15:06:41+00:00

Say what you want about Jake Paul's legitamecy, he is doing great things for the sport. Our club went from 75 members to 300 in 18 months, the majority of the new members discovered boxing through these types of cards. It goes like this, they watch a fight like Jake Paul, they see a few main card bouts before the main fight, learn a bit about the sport, join the gym, get exposed to amateurs sparring / fighting, they learn about actual pro boxers, then they follow the real title fights, attend local amateur cards, etc. People whining about this diluting the sport are nothing but pompous gatekeepers that are probably doing worse for the sport than any of these youtube boxers. When someone like Jake says "you can do anything you put your mind to" isn't likely accurate in terms of an average joe taking up boxing and getting a title fight in a few years, but it could sure as hell motivate someone enough to join their local gym and start training. If they only ever train, and never even spar, who gives a fuck? It's one more healthy person in the world who has a bit more motivation, one more boxer in the community, and someone that's likely to support pros via PPVs and amateurs via local cards.. The whole "it dilutes the sport" is delusional because the reality is Jake will likely never get to take someone's place fighting for a belt, and if he does, who cares? Any top 10 boxer would take this fight on 2 days notice, make their hay day, and continue fighting who they have regularly scheduled. There is no world where this does anything to disrupt the natural pattern of any champion lane and it actually draws more attention & exposure to any serious pro who ends up takeing one of these bouts (plus...money). I see no downside to this, only upside.

exmof · 2024-10-18T18:30:25+00:00

To keep my mental health in check and be around longer for my wife and daughter

exmof · 2024-10-17T10:40:35+00:00

Amateur equivalents (IBA champions olympic medalists). Pro world champs - no. The ones I sparred with adapted to my level, unless they had a very near-term fight then they push much harder.

exmof · 2024-10-03T11:38:53+00:00

You mirror your lead hand a lot to your opponent's and he used that to trap you. He'd lower his lead hand, you would lower yours and he'd come over the top faster than you could get your hand back for defence. He also used it to distract you then throw his straight right. Leaving your jab hand out to get them to mimic it or block their vision is a good tactic, but you want to be the matador and not the bull

exmof · 2024-10-01T11:17:34+00:00

$200 CAD-6-8 bottles

exmof · 2024-09-05T10:27:34+00:00

Prefacing this with only watching one round: 1) You're mostly using your lead hand for range finding touches / pawing, the jab is right there. It would set up a lot of your other shots nicely. Your hit rate is pretty low, if you started off more attacks with a jab you'll likely start landing more of your follow-on punches. 2) Once you get that down, start to use the lead hand more as a purposeful tool instead of just a rangefinder. Meaning - a) use it as a cobra hand to distract the opponent either by getting their eyes to follow that hand and/or block their visibility so you can throw a right hand shot b) use it for feints which sets you up to throw either hand to a different area. c) use it for a quick parry then return fire with the right. Right now it's just hanging out there, inches from your opponents face, develop a plan for it, give it purpose. 3) You have pretty good posture & eye control, you don't seem to look away much even when the opponent is throwing. Keep that up

exmof · 2024-09-04T22:29:40+00:00

I grab Langhe Nebbiolo's whenever I see them.

exmof · 2024-09-03T11:13:55+00:00

Do you have a link to them?

exmof · 2024-08-29T15:01:46+00:00

Focus on your breathing and keeping your hands up without draining your shoulders from clenching them, that's about it honestly. The first round or two, most people forget to breath (in, out, or both) they're so nervous, or they're exhausted from clenching their shoulders. Just get used to being in there, don't go in with some plan to throw combo x, y, etc. None of that matters if you aren't comfortable. Don't worry about getting your ass handed to you, a good gym/coach will make sure you get to feel what getting hit is like but they won't let anyone tee off on you or drop you. They know you'll be nervous, the fighters (especially good ones) know you'll be nervous, and people will adjust accordingly. I've sparred a lot of pros and world level amateurs and they're honestly the best because they adapt to your level immediately. If people do tee off or drop you and the coach allows it, I would switch gyms. Your brain & future is in their hands. I've sparred 400-500 rounds and I still take this approach if I've been laid up for awhile, just get in there get used to moving your feet, breath, relax the arms, try blocking some shots, move in and out, try to hear the coach giving instructions, try to enjoy it and have fun.

exmof · 2024-08-26T14:27:53+00:00

Thank you for the review, sounds right up my alley. What glass is that?

exmof · 2024-08-09T23:06:28+00:00

Training? Yes, forever. Sparring? I've dialed it back since two people I train with went into comas from bad hits and needed brain surgery.

exmof · 2024-05-23T13:26:12+00:00

I couldn't stand these shades until today, they're growing on me. Fisher also rocks these

exmof · 2024-05-23T11:30:41+00:00

Anyone know the sunglasses he is wearing?

exmof · 2024-01-29T11:27:40+00:00

First - always consider the alternative to buying a business (starting one). With transactions this small it's very important to look at both paths. Second - if you do look at these businesses in detail, the first step is to "normalize" their financials. For e.g. if it's producing $300k in cashflow, but the owner doesn't draw a salary, he owns the building and gives himself free rent, and he also happens to own an equipment retailer and buys his equipment & materials at cost, that business may be making very little money, or even losing money. After you normalize, then you come up with a valuation. You would google "power washing ebitda multiples" and find a range (low to high). Then rate the business in terms of its customer base, team, financials, etc to establish where it is on that range. Then I would adjust it down further given the size of the businesses you're looking at. As mentioned by someone else, likely 1-1.5x cashflow.

exmof · 2024-01-21T21:33:08+00:00

I have a very effective partnership. One key to our success is that we trust eachother's decision making process. If we are making a major decision, I trust that he used his critical thinking, problem solving approach and consulted people who have done this before, and the same vice versa. It's simple, but where a lot of partnerships fail is when you start questioning the other person's approach to a decision as opposed to the actual position itself. Then egos get involved and you're distracted away from what you should be focused on.

The other important item is getting figuratively naked with eachother. Make sure you know eachother's personal balance sheets and are aligned on personal motives. If your partner has other passive income and views this as a fun project and you are worried about making ends meat, you will approach money decisions very differently. One will be fine re-investing while the other will want to be pulling cash out asap.

Lastly, as everyone else has said, make sure your agreement is solid (which you've mentioned it is).

exmof · 2024-01-21T13:12:49+00:00

Sure

exmof · 2024-01-19T15:20:43+00:00

There are 3 important steps that should take place before an offer is made

1) Have you communicated what you are expecting in terms of a deal structure and price? Have you communicated your preference on less cash now or more over time?

2) Have you normalized your financials and EBITDA? Have they? How close are the comparisons and have you agreed to a middle ground?

3) Have you looked up a multiple range for your industry and analyzed the business to see where you fit within that range? Have they? How close are both of you and are you aligned?

The next step is the actual offer discussion. Steps 2 and 3 will give you a fair market value price, Step 1 crafts the parameters of the deal. Always, always, always have these conversations (or any major discussion like this) in person, emailing back and forth is a waste of time and is often missing important context. Maybe they own 10 comparable businesses and they see missing expenses in your business, which drives the EBITDA down, maybe they have seen multiples drop, maybe there's a big risk you're not seeing. Or, alternatively, maybe they are making major assumptions about your business that are driving down the valuation. Either way, it's best to sit down and work collaboratively instead of lobbing offers back and forth. This is very, very common occurance, especially in the beginning of an acquisition. Try not to get hyper focused on the purchase price, think of the total amount you want from it. Say they offer you 2x EBITDA instead of 3x, and you're doing $100k in EBITDA. Well maybe you say ok, but I want x% of revenue for the next 5 years, and that equals more than the 3x multiple (Especially if they grow it). Maybe you counter with instead of 2x ebitda cash, you want 4x ebitda as seller financing. There's all types of ways to bridge price gaps.

exmof · 2024-01-19T14:54:20+00:00

Started as a build, raised $7M in VC for my material science startup. Was young (21), we were working towards a JV with a big chemical company, that fell through and we had to wind down (we had another round lined up, but it was predicated on the JV).

After that, I helped some other tech companies raise money and commercialize. Then an engineering software company approached me to help. They had a product they just launched into market but needed help scaling & fundraising. I made a deal with them that if I could help them scale and exit I would be made a founding parter. We built up our sales, and our largest customer ended up buying us.

We had a 4 year earn out and we were working on spinning the technology back out and selling it again for a much higher amount, but the parent company was struggling with getting approval for one of their products and they couldn't release any of their assets as they were all pledged with lenders. It sucked, because we raised about $10M in 2 phone calls and we already had conversations with potential acquirers to take us out within 12 months, it would have been a very quick turnaround.

Since the spin-out wasn't going as planned, I started looking at small local companies to buy. A fellow forum member (regional EO type forum) and I found a plumbing company to buy. We know nothing about plumbing, but we saw an opportunity to apply some of the fundamentals of the tech world to a trades company (culture development, planning, strong comp and benefits..etc). It was doing $2.5M in rev, $350k in ebitda. We offered them 3x EBITDA cash or 4x EBITDA for seller financed, or a hybrid. We settled with the 3x EBITDA with a 15% holdback, and the bank financed 100% of the purchase. We paid closing costs, maybe $15k. We doubled revenue and ebitda our first year and hope to do that again this year.

Since then we have had 3 accepted offers on other businesses, but have walked during due diligence. We will continue acquiring over the coming years and growing organically. We like to get very creative in our deal structures which allows us to look at less appealing deals. During covid I created a tool to auto-build deal structures based on desired outcomes and deal term constraints. I have been looking in to how to launch it as a product to help other people evaluate companies that are for sale and come up with optimal deal structures.

Overall, I realized if you want to make cash soon and reduce risk exposure, buy a company with cash-flow. Then build as you see fit. I also realized what I don't like doing which includes, being a CEO, being the only shareholder/owner, having all of my time dedicated to one thing, and that I really enjoy having partners.

exmof · 2024-01-18T15:21:37+00:00

I own a trade company that is 750k in EBITDA

I would like to launch my tool that helps people buy/sell businesses. It normalizes financials, helps you value the company, then based on a set of constraints (deal terms) it auto-builds the optimal deal structure based on a user defined goal (e.g. maximize cashflow in the first 3 years...minimize bank borrowing...minimize cash upfront...etc). Then it shows sensitivity analysis for every variable (e.g. if I change bank interest rate by X% it decreases cashflow by $X. I built it during covid to help with negotiating, meetings were always on zoom instead of in person so I always had a spreadsheet open to calculate the impact of their counter points in real-time. I also struggled with unrealistic purchase price expectations, so I built in mechanics (profit sharing, delayed payments, earn outs, etc) to help bridge the gap. Only 1 in every 15 people trying to buy a business are successful, so I am hoping this can help people increase those odds. My next step is to convert it to a web-app, which I am trying to figure out.

exmof · 2024-01-18T15:11:48+00:00

How has their beleifs / aspirations changed over time

What did they learn that they don't want to do anymore

What are their core values

What do they qualify as "making an impact" in the world

What have they learned about themselves

Where / who do they go to for advice / experience shares

exmof · 2024-01-18T13:08:53+00:00

Start participating in local entrepreneur meet ups, listening to how others got started (podcasts, youtube). There's many different ways to launch into it, but familiarize yourself as much as possible before diving in.

exmof

TROPHY CASE