🧐 What I Learned Last Week
🧐 What I Learned Last Week
Week ending Friday, July 1st, 2022
What I Learned Last Week curates the most interesting content relating to business acquisitions, operations, entrepreneurship, finance, and more. WILLW is a publication of The Business Inquirer.
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Hello Friends!
For those of you celebrating - I hope you have a great 4th of July holiday!
This issue of The Business Inquirer is brought to you by DueDilio.
DueDilio is a leading online marketplace focused on M&A due diligence.
We connect business buyers, sellers, intermediaries, and private investors with pre-vetted due diligence service providers.
Our large and growing network of verified independent professionals, boutique and mid-size firms, and subject-matter experts specialize in finance, technology, legal, commercial, and other key areas of business diligence.
Submit your project. Review qualified proposals. Hire service provider.
📰 Articles
Business Sale Report published a quick read on the differences and similarities in the M&A landscape between the US and UK.
When examining the respective M&A markets of the USA and the UK, perhaps the most striking thing to note is the many similarities the two currently share. Both are, of course, still adjusting to the impact of the COVID-19 pandemic, as well as the political upheavals they have seen over recent years, such as the UK’s Brexit vote and the Trump Presidency.
A comparison of the private company M&A landscapes in the US and UK
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Walker Deibel of Buy Then Build fame has published a YouTube video on evaluating potential acquisitions when there is high customer concentration risk.
How to Navigate Customer Concentration in an Acquisition
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Maverick newsletter talks about the financial implications of straying away from the traditional career path and pursuing a search fund.
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ValuAnalytics has published a great article about valuation trends of 3PLs.
Following strong demand and performance in 2021, valuations corrected towards the end of June 2022. Undoubtedly, the decline in valuations was tied in part to a broad deterioration in investor sentiment. However, as discussed in this article, investors appeared to shift their attention away from growth and toward risk mitigation.
THIRD-PARTY LOGISTICS (3PL) COMPANY VALUATIONS – JUNE 2022 UPDATE
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Flippa’s CEO sent out an update on what they are seeing in the market and where opportunities lie.
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Axial writes about the emergence of e-commerce as a new asset class for investors in the lower middle market and how business sellers can maximize their valuation.
The Ecommerce Explosion: The Emergence of Online Marketplaces in the LMM
Also from Axial - Building an eCommerce Holding Company from Scratch, with Kelcey Lehrich
🧵 Twitter
Great breakdown of the business model…
Have an edge when acquiring a business…
Tons of valuable info here…
Buy a business, not a job…
A good case for buying into a franchise…
Now more than ever, pricing power is key…
🤔 Thoughts, Events, Other
Boston Meetup
Ping me if you’re in Boston or the surrounding areas. A few people are organizing an SMB/EtA/Entrepreneur Meetup in Boston either on July 13th or July 20th. The date hasn’t been confirmed yet.
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Macro Opportunities
Crescat Capital recently published a research note on their view of the US consumer and economy. It’s not looking pretty.
After experiencing the largest government-financed consumption boost in history, household demand for goods and services is poised to fall off a cliff. The US economy simply cannot handle the Fed’s continued monetary tightening. This is the onset of a vicious stagflationary environment. The unprecedented combination of excessive debt, the bursting of speculative asset bubbles, and the persistence of inflation due to structural supply imbalances makes the current economic and market environment truly precarious. A major contraction in consumer demand is imminent. These factors will soon pressure the Fed into a policy dilemma.
THE RISE AND FALL OF THE CONSUMER
I think there’s a solid argument to be made that the next 12-24 months are going to be some of the most volatile and difficult periods to navigate from a macro perspective. It’s reasonable to assume that a lot of business owners will simply not have the stomach or interest in pushing forward. This will create opportunities.
🛠 Tools & Resources
I want to share some tools & resources that I have found helpful. Please note that some of these may contain affiliate links. This means that I may receive compensation if you sign-up and use them.
Cerebro Capital - Cerebro has a network of 1,500+ lenders who can provide debt financing for your acquisition, refi, etc. $500k minimum.
X5 Deals - Proprietary deal sourcing. They do the outreach and send you relevant, actionable deals directly into your inbox.
Curators - Proprietary deal sourcing. You need targets that fit your investment criteria, and Curators delivers week after week - we even update your personalized database on a daily basis with new information on best-fit targets.
BizNexus - Proprietary deal flow, deal aggregator, and exit prep. Local Boston company and I consider the founder (Adam Ray) a friend.
PrivSource - Deal aggregator for lower and middle-market listings.
ProjectionHub - Access to 50+ CPA-developed financial projection templates. 25% discount using code “duedilio” at checkout.
Logology - Best automated logo & brand identity tool I’ve come across.
DeepBench - Access a cutting-edge expert network. $200 discount.
OpenPhone - The best VoIP phone solution that I have found. I use this for DueDilio. You get a $20 credit if you sign-up.
Eloquens - Knowledge marketplace. I’ve purchased a few templates from them.
Deal Flow Scout - Peer-to-peer deal flow exchange. Free, open, transparent.
Deal Sourcing Guide - A directory I put together of online marketplaces, brokers, DFY deal flow, and more.
That’s all for this issue of What I Learned Last Week!
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Important Disclaimer: This newsletter is provided for informational & educational purposes only, and should not be relied upon as legal, business, investment, or tax advice. This newsletter may link to other websites and certain information contained herein has been obtained from third-party sources. While taken from sources believed to be reliable, it has not been independently verified. The Business Inquirer makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. References to any companies, securities, listings, investments, or digital assets are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any business, tax, or investment decisions. Content in this newsletter speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.