What I Learned Last Week 6.28.2024
Curating the best M&A, SMB, and EtA-related content since 2020.
Hello Friends!
This newsletter took a brief pause over the last two weeks while I was traveling overseas. We’re now back to our regularly scheduled program.
In this week’s issue of What I Learned Last Week:
📰 Articles
🧵 Best of X (Twitter)
🤔 Other
🗓️ Events
⚒️ Tools & Resources
💡 How I Can Help
This issue of The Business Inquirer is sponsored by:
Close Your Deal Quickly and Efficiently: M&A Legal Solutions Integrating Automation and Project Management
At Sterrett Law, we’ve developed a streamlined process using cutting-edge automation and project management techniques to maximize speed and efficiency. Using templates and a client-centered collaborative process we’ll keep your deal on track and on time.
Ready to make your next move? Schedule your free consultation today!
📰 Articles
I summarize, so you capitalize.
Evaluating The Most Common Forms of Debt Used to Finance Small Business Acquisitions
The article from Mineola Search Partners provides an analysis of the most common debt instruments used in financing small business acquisitions. It examines bank debt, mezzanine debt, seller financing, and SBA loans, highlighting their advantages, limitations, and suitable contexts for use.
Key insights include:
Bank Debt: Least expensive but rigid terms.
Mezzanine Debt: High interest, flexible terms.
Seller Financing: Sellers lend part of the purchase price, ensuring smooth transition and continued interest.
SBA Loans: Up to 90% financing with longer terms, minimal covenants, but requires personal guarantees.
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My morning routine is looking at acquire.com for 30 min
The article from Dev Shah details his morning routine centered around exploring listings on acquire.com for business acquisitions. It offers insights into effectively navigating and filtering through numerous listings to identify viable micro startups.
Key insights include:
Regularly check marketplaces to catch new deals quickly.
Practice analyzing listings to refine judgment.
Utilize filters to manage the vast number of listings.
Engage in negotiations to learn the process.
Revisit old deals as sellers might offer better terms later.
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What EtA Looks Like When It’s Done Well
The article from Alan Pentz explores the successful execution of Entrepreneurship through Acquisition (EtA) with a focus on Chris Williams's journey with System Six. Acquired in 2021, the company grew from $2.5 million to $4.5 million in revenue by early 2024 through strategic marketing, leadership investment, and a pod-based client service model.
Key insights include:
Importance of acquiring a business with steady, recurring revenue.
Effective use of a defensible marketing channel within the EtA community.
Early investment in leadership positions.
Implementation of a pod-based delivery system.
Exploring global talent for scaling.
🧵 Best of X (Twitter)
I scroll, so you don’t have to.
10 crucial tips to prevent inventory and COGS mismanagement during due diligence…
Protect yourself in potential equity sales by submitting LOIs for asset purchases with clauses for necessary equity deals…
While loan brokers can expedite SBA loan processes, their incentives to prioritize high-probability closures may not align with borrowers' goals of securing the best terms, so proceed with caution…
Choosing an SBA lender can be simplified by considering top lenders like Huntington and Live Oak for their experience and specialization, while being cautious of smaller and less experienced banks…
SV shares M&A insights on two popular industries - IT MSP and MedSpa…
The devil is in the details. With the rising cost of capital, we’ll start seeing an uptick in the default rate…
🗓️ Events
Southeast EtA Conference (Sept 6-7) - Washington D.C.
Independent Sponsor Forum (Sept 12) - Chicago, IL
Self-Funded Search Conference (Sept 14-15) - Dallas, TX
Main Street Summit (Oct 9-10) - Columbia, MO
Annual M&A Institute (Oct 10-11) - Dallas, TX
Rice EtA Conference (Oct 13-14) - Houston, TX
McGuireWoods Independent Sponsor (Oct 15-16) - Dallas, TX
Texas & The South M&A and Business Symposium (Oct 16-18) - Dallas, TX
National Summit for Middle Market Funds (Oct 27-29) - Palm Beach, FL
Booth-Kellogg EtA Conference (Nov 4) - Chicago, IL
HoldCo Conference (Mar 31-Apr 3 2025) - Sundance, UT
🎵 Listening: “Papaoutai (Afro House)“ by ARTMO’S 🎵
How did you like this issue of the newsletter?
⚒️Tools & Resources
I want to share some tools & resources that I have found helpful. Please note that some of these are paid sponsors or affiliates of the newsletter.
PrivSource - PrivSource helps you source deals and connect with transaction partners without ever paying a success fee.
X5 Deals - Proprietary deal sourcing for a great price. They do the outreach and send you relevant, actionable deals directly into your inbox.
Rejigg - Platform that connects searchers/investors directly with owners of off-market small businesses ($1M - $10M of revenue) considering exits. All deals are sourced by the Rejigg team. Their team adds 7 to 10 new deals each week.
Kumo - 100,000+ deals sourced from thousands of brokers and marketplaces. Plus, AI-powered listings, robust data & analytics, and more.
DealFlowXchange - The premier private capital funding community for raising and deploying capital. Use discount code DUEDILIO for 20% off your lifetime membership.
Sterrett Law - At Sterrett Law, we offer Manhattan and Boston experience at Vermont prices. Specializing in deals under $10 million, we're your go-to partner for navigating the complexities of mergers and acquisitions without the hefty price tag
BizNexus - Marketplace + off-market origination in one platform. The marketplace averages about 10k active listings & pre-CIM opportunities, and the off-market origination focuses on data & multi-channel.
Secret - Say goodbye to overspending on SaaS. With Secret, you get access to up to $1,000,000+ in savings on the best software to run your search, operate, and scale your business.
Search Fund Coalition - community for the Entrepreneurship Through Acquisition ecosystem. Monthly events and meetups for acquisition entrepreneurs.
Deal Sourcing Guide - a comprehensive list of business marketplaces, brokers, deal origination firms, and more.
💡 How I Can Help
Whenever you’re ready, here are a few ways for us to work together…
Schedule 1:1 consulting on deal sourcing, due diligence, M&A ecosystem, newsletters, entrepreneurship, or anything else you’d like to discuss
Promote your brand to business buyers, investors, SMB owners, and other M&A participants by sponsoring this newsletter
Assemble your M&A deal team with DueDilio
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