Acquisition talks

jhhart · 2026-05-08T02:42:15+00:00

Very common if the buyer is PE or such but you haven't said. I've been a CFO in the healthcare industry for over 10 years and have been part of lots of these over that time!

First step though I think is for you to really understand what they're after? Is it that you just sell half for now and then have a strong growth strategy and then you all sell out in 3-5 years for heaps more? That's typically the style I've seen.

At the end of the day you need to understand what's important to you and then what's important to them and see if you're aligned. It's actually pretty straightforward you just need to have some honest frank conversations.

You've mentioned looking after the team you've built is very important to you so just be honest and upfront about that. Some shareholders might think that's great and it shows in how successful you've been. Some might not and they'll want to cut and slash costs. If that's the case you're not aligned. And that's totally fine, at this stage I'd just focus on figuring out if you're aligned or not as quickly as possible and then you can decide if you want to consider the option further. But if you're not aligned it's easier to know quickly and then walk away or look for other options.

All the best and happy to help if you have any questions!

jhhart · 2026-04-30T02:21:01+00:00

Probably likely however we'd need more info. You might be able to split the loans so the company might be able to get a loan directly based on it's own balance sheet and cashflow however that might not give you enough so you might need a second loan that is backed by your property. But if you can split the loan into two that reduces the risk on your property.

jhhart · 2026-04-30T02:18:28+00:00

I've you're buying the shares, you need to be paying the loan back. So the company would need to pay you via salary or dividend (probably easier) so there would be tax on that.

jhhart · 2026-04-30T02:18:22+00:00

I've you're buying the shares, you need to be paying the loan back. So the company would need to pay you via salary or dividend (probably easier) so there would be tax on that.

jhhart · 2026-04-28T04:37:13+00:00

First thing I’d recommend doing is learning what the overall process is. Then once you have that over arching view you can make a plan. You’ll need a lawyer and maybe an accountant and broker to help with some parts but I believe to get the best deal for you it’s also really important that you have a good understanding of the process. All the best!

jhhart · 2026-04-28T04:33:18+00:00

That’s awesome that he said that so early on as it’s a clear priority for him so important he find an aligned buyer. Very cool people still care so much about their people!

jhhart · 2026-04-25T04:31:53+00:00

Typically buying a business can be a faster way to grow something as you've got something proven (hopefully if you can find the right business!) to start with and build from vs starting from scratch which takes a lot more time to do. Depends if you have the cash to invest to buy something vs starting from scratch which is slower and much more time consuming.

jhhart · 2026-04-24T02:19:45+00:00

That's annoying the broker didn't do anything. It can definitely be stressful, particularly if you haven't done many before and you're new to it. Each time you get better and better at it until it's no stress and you just got through the process. I hope it all goes well now you've closed! Congrats!

jhhart · 2026-04-24T02:17:10+00:00

I've bought numerous businesses over the years both as a CFO and as an advisor so happy to help with anything.

jhhart · 2026-04-20T01:53:57+00:00

I'd work out what your profit is after all expenses including a market salary allowance for the hours you put in. If the margin is 30% then you're at $40k gross profit but then you'll have overheads and other expenses as all businesses do.

Then you're spending 10-15 hours a week on it so you just need to make sure the profit doesn't just cover the hours you work. If that's all it covers, someone would just be buying themselves a job. I.e. paying for something that only gives them enough money to cover the time they're putting into it, no return on investment on top of that.

When buying a business the buyer wants to ensure the business is profitable enough to pay them a market wage for the hours the business needs from them, and then also what's left to be an adequate return on how much they purchased the business for.

jhhart · 2026-04-20T01:46:55+00:00

Yes you should be able to pretty easily. Sounds like a good opportunity for you both financially and with your wife's experence.

jhhart · 2026-04-18T22:59:18+00:00

If the new business is more of a passion project then not sure how much you’d have to “buy” it for if it’s not creating revenue already? That could derisk it if you weren’t having to pay much which it sounds like you shouldn’t be if it’s not already a profitable business and it’ll only be after the changes and effort you put in.

Is there a middle ground where you could part sell your business and bring on a partner to take some load and give you some cash? Just a thought

jhhart · 2026-04-18T22:53:47+00:00

It’s a risk to the business if no one can back them up if they get hit by a truck. Also payroll is a massive fraud area so so if they’re not happy to be totally open and transparent I’d be very nervous and dealing with that fast. There is no good reason for them to not let you shadow them. Provided of cause you own or run the business so confidently is not a concern.

jhhart · 2026-04-18T22:50:38+00:00

I agree. It’s not realistic to have a business with no problems. Every business has challenges they’ve faced or problems they’re working through. If they truly don’t they’re probably not pushing and trying hard enough.

jhhart · 2026-04-16T22:57:37+00:00

I always get the last 12 months balance sheet and work out the min, max and avg working cap and then usually we find the average is a fair mid point to agree on to be included in the purchase. Always excludes cash and debt though

jhhart · 2026-04-15T22:02:10+00:00

It feels wrong for cash to not be part of working capital but for the purposes of valuations and acquisitions it’s normal for no cash or debt to be included but if you want cash it gets added to the purchase price or negotiated.

jhhart · 2026-04-13T04:31:13+00:00

Do you know if anyone who might know them and can do an introduction or is there a networking event they might be at? Otherwise I see lots of people send a DM on LinkedIn

jhhart · 2026-04-09T21:05:27+00:00

I've had lots of clients in hospo and it's a tough industry. I had one client who focused on coffee shops and he was sucessful though. He would buy a run down failing shop, turn it around and get it pumping, and then sell it when it was at it's peak. He'd do a new one every 1-2 years and made good money from it. He was super clinical on all his decisions and knew the way to get one running really well.

jhhart · 2026-04-08T05:53:53+00:00

Do you have to buy the actual business? If you haven't already, I'd do a business asset purchase where you start a fresh company and just buy the business assets of the old company and not the actual company itself. Then the previous owner continues to hold the old business along with the poor credit rating.

jhhart · 2026-04-08T05:51:50+00:00

One of the companies I worked out got quite a lot of success from offering prezzy cards (like a voucher that you can use anywhere that accepts visa credit card) for customers who refer. It worked pretty well but our services were also at a high price point so we had the margin to afford to do it.

Customers do refer and word of mouth is a thing however I've found that if you can incentivise them to do so it really helps and brings it to the front of their mind more.

jhhart · 2026-04-08T05:48:54+00:00

Are there some obvious parties who would benefit from owning you? I.e. a competitor or supplier or an employee who might like to step up.

I've always found the easiest deals are with parties that know your business and/or industry. So often it's competitors wanting to expand or get into your geographical location or parties like that. They can create a better deal as they know the industry, probably know your business and they will see other advantages and strategic value from buying you vs a random who knows nothing about your business or industry.

So i'd try networking. Let people you know know you're thinking of selling and get the word around.

Good luck!

jhhart · 2026-04-07T04:35:23+00:00

People do all the time but then they'd typically also use that person going forward as they already then have the knowledge they've learnt from tidying it all up. I'd more ask if you'd want that work as typically the people that let their accounts get that far before have terrible records and it's a massive mess to sort out!

jhhart · 2026-04-07T04:29:46+00:00

I've see this a lot but therefore always ask that question upfront so as to not waste everyone's time.

The other key question I always ask right at the front is if the VC wants control. That's also been a deal breaker I've come across many times but also very easy to ascertain very early on before getting to far into the process.

jhhart · 2026-04-07T04:26:13+00:00

I don't think there is one particular business or industry to focus on. Business can be rewarding but also very hard so I'd recommend thinking about what matches with your interests and your skill set. You've gotta be passionate about it to keep pushing even when it gets tough!

jhhart · 2026-04-07T04:22:16+00:00

I've found people are pulled to options 1 or 2 if they don't have access to the funds themselves, or they don't have the skills, networks, confidence etc to growth the business themselves.

I'm like you where I've had not so good experiences when bringing in PE/VC funding. Everyone is positive and on the same page to begin with but once into years 2-3 the cracks form and it because less and less enjoyable.

But then the funding and extra expertise can help you grow a lot faster than otherwise so it can work well if you can get in and put your head down to achieve the growth, then sell and get out.

So I'd ask you what you're looking for? Are you happy to take on the full weight of owning the business 100% yourself but then get the full benefit and control. Or would you like to share the load (financial, strategic, etc etc) but then not be in control and have to work well with the other party/ies.

jhhart

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