What I Learned Last Week 7.12.2024
Curating the best M&A, SMB, and EtA-related content since 2020.
Hello Friends!
In this week’s issue of What I Learned Last Week:
📰 Articles
🧵 Best of X (Twitter)
🤔 Other - Is Deal Flow Slowing?
🗓️ 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.
2024 Stanford Search Fund Study
This is an important read for anyone who is pursuing an acquisition. There have been many recaps of this study already, so I won’t add my own. Broadly, the data shows that there is a slowdown in acquisitions, lower returns, and a big uptick in competition within the search fund world. On a positive note, diversity is up. It’s important to remember that this data is for search funds, not for self-funded searchers (individual acquirers). Tons of great insights in this report so go check it out.
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How to Present Your Deal to Investors (And Get 4x Oversubscribed)
The article provides guidance on effectively presenting a business deal to investors. It emphasizes the importance of clarity, compelling storytelling, and solid financials. Key elements include defining the problem and solution, showcasing market potential, highlighting the team’s expertise, and detailing the financial projections and deal structure. It also stresses the need to anticipate investor questions and objections, and to be concise and confident in delivery.
Key insights include:
Importance of a clear, compelling narrative.
Highlighting market potential and team expertise.
Detailed financial projections and deal structure.
Anticipating and addressing investor concerns.
🧵 Best of X (Twitter)
I scroll, so you don’t have to.
Tibo is selling an info-product but the thread does have some good tips for acquiring a SaaS…
This guide explains how to select an appropriate multiple and validate valuations…
Under LOI for a business with fluctuating EBITDA? Learn how to model the deal and assess the impact of seller notes and interest rates on your debt service coverage ratio…
Networking should be a key part of your deal-sourcing strategy…
🤔 Other
Is Deal Flow Slowing? Insights from the Searchfunder Community
A recent discussion on Searchfunder raised the question of whether deal flow is slowing, particularly in specific geographic areas. Here's a summary of the key insights shared by community members:
Mixed Observations:
Dan Doran (Quantive): Reports an increase in deal flow since early Q4 2023, despite economic challenges.
Avery Coleman (Landsie Investment Properties): Noted fewer new listings in Atlanta but plenty of opportunities in Las Vegas, Florida Panhandle, and Texas Gulf Coast.
Justin Harris (Solo Searcher): Continues to see deal flow, emphasizing the importance of broker relationships and active search strategies.
Geographic Variability:
Paul Rhynard (FOG Capital) and Blake Hutchison (Flippa.com): Report strong direct sourcing and an increase in online business listings, respectively.
Joaquín Razetto (Nudo Capital): Emphasized regional differences, with some areas seeing strong deal flow while others experience slowdowns.
Seasonality and Market Dynamics:
Nicholas Daily (Self-Funded Searcher): Mentioned seasonal slowdowns during summer and holidays, impacting deal postings.
Tim Michaels (Kickstart My Franchise) and Zach Blatt (Bedford Falls Group): Echoed the seasonal nature of deal flow, with summer being slower but expected to pick up post-summer holidays.
Strategic Advice:
Shawn Fateh: Recommends developing relationships with brokers and being open to geographic flexibility.
Luis Jaramillo (Self-Funded Searcher): Suggests being proactive in networking and exploring multiple regions to mitigate localized slowdowns.
Other Perspectives:
Kishen Raghunath (Halcyon Capital) and Denise Shade (Cormitto Partners): Noted that deal flow can depend on the type of deals (brokered vs. proprietary) and the quality of deals available.
Tomos Mughan (SourceCo) and Jon Gordon (Palladian Capital Partners): Highlighted active deal flow in founder and family-owned businesses, though quality may vary.
The discussion reveals a complex picture of deal flow in the M&A market. While some regions and types of deals may experience slowdowns, others report robust activity.
🗓️ Events
Southeast EtA Conference (Sept 6-7) - Washington D.C.
Independent Sponsor Forum (Sept 12) - Chicago, IL
Self-Funded Search Conference (Sept 13-15) - 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: “My Lovin’“ by Gamper & Dadoni
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 ($200k - $3M EBITDA) considering exits. All deals are sourced by the Rejigg team. Their team adds 15 to 20 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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