🆕 Hydro-Excavation Business Making $950k/yr 👀

Welcome Back to The Corporate Pivot!

Tired of the corporate rat race? Our newsletter is your ticket to understanding the confusing world of business acquisition. Follow along with real stories from buyers making the leap and seasoned owners sharing their daily experiences. We're here to simplify the process and show you the path to true financial freedom.

Confusing Corporate Saying of the Day:

Let’s not boil the ocean = take on an impossible task... ok this one is kinda creative 😂

Here’s what we have for you today:

Sam’s Perspective (1st Time Buyer)

💪 Challenge of the week: Back to having issues with brokers (we are coming up with a more streamlined process I promise). I actually received financial information back that only included the income statements from 2021 & 2022. Weird right? The numbers listed on the website for cash flow and revenue actually matched what was shown on the 2022 numbers. I followed up with the broker and he is having to get the information from the seller. Something seems off about that, but we will find out once the 2023 & year to date 2024 numbers come through. QUICK TIP: If you sign an NDA and the broker has not responded with the financials in a couple days, send a follow up email. Typically they will get back to you quickly. The squeaky wheel gets the grease.

📚 Cool Business Lesson of the Week: Billboards. I know super boring and unoriginal, but that’s what we like. That means it’s a good business! I had no idea how lucrative they can be. I was listening to one of my favorite podcasts, The Side Hustle Show by Nick Loper, and he was interviewing a guy named Chris Brown, no not chris breezy, but instead a billboard guru. He started out by just tracking down the owner of a billboard in his town in Arkansas and giving him a call. The owner needed some money and ended up selling it to him for $75k. He rented it out for $2400 a month, basing it off near by competitor pricing. Insane right? That one billboard would net $28,800 and the initial investment would be back in 2.6 years. That’s a really solid ROI for something with almost no upkeep or operational expenses. Chris obviously ran with this as a business and expanded, but the key point I want to make is people are selling these things all the time. You want to avoid the larger company conglomerate owned billboards, like from Lamar, but if you can find ones that might be distressed or locally owned, you might just get lucky. You can look at each billboard as buying a business. Keep your eyes peeled next time you’re driving!

Tyler’s Perspective (Multiple Businesses Owned)

🚨 Tip of the Week: You would think that one of the major advantages of a route based service business, is consistency in terms of the financials (ignoring the inherent fluctuations of routes coming and going, which most buyers are aware of and usually fluctuate within an expected margin of error), however, one thing that I have had to learn is the seasonality of service based businesses. For my business, our expenses are significantly higher, due to additional expenses in materials. Maintaining a close eye on your financials to be able to weather your thinner margins (during whatever season that may be), is essential for the success of a service business. 

💰 Deals < $500k

Business Name: Owner Absentee Successful Dry Clean Store
Revenue: $450,000
Asking Price: $325,000
Profit: $125,000 (Profit Multiple = 2.6)
Location: Boca Raton, FL
Established: 2000

✅ Pros:

• Prime Location: The store is located in a busy plaza with ample parking and several major tenants, attracting a lot of foot traffic.

• Experienced Staff: Long-term employees can manage daily operations with minimal owner supervision, ensuring a smooth transition.

⚠️ Cons:

• Dependence on Key Location: The business's success is closely tied to its location in an affluent area, which could be a risk if demographics change.

📈 Growth Opportunities:

• Extended Hours: Increasing store hours can attract more customers and boost revenue.

• Enhanced Online Presence: Increasing the store's online presence can attract a wider customer base and increase sales through online orders.

💰💰 Deals $500k - $2m

Business Name: Established Property Management Business
Revenue: $1,347,000
Asking Price: $1,279,900
Profit: $345,300 (Profit Multiple = 3.7)
Location: Frisco, CO
Established: 2012

✅ Pros:

• Reputation: The business has a great reputation for offering high levels of personal service and technology integration.

• Steady Growth: The company has experienced significant growth over the last three years, indicating strong market demand.

⚠️ Cons:

• Employee Management: With 14 employees, managing the workforce could be complex and time-consuming.

📈 Growth Opportunities:

• Expand Services: The new owner can expand into short-term rental management, residential homes, or commercial property management.

• Increase Service Offerings: Adding new services can attract more clients and increase revenue streams.

💰💰💰 Deals $2m - $10m

Business Name: Hydro-Excavation and Construction Services
Revenue: $2,108,436
Asking Price: $2,250,000
Profit: $949,868 (Profit Multiple = 2.4)
Location: McIntosh County, OK
Established: 2009

✅ Pros:

• Diverse Services: The company offers a comprehensive range of services, catering to various customer needs and reducing dependency on a single revenue stream.

• Low Competition: The business faces relatively low competition, providing an opportunity to capture a larger market share.

⚠️ Cons:

• Geographic Limitations: The company's current operations are limited to a specific region, which could restrict growth potential.

📈 Growth Opportunities:

• Geographic Expansion: Expanding into neighboring states like Texas and Arkansas can increase market reach.

• Service Diversification: Introducing new services like power washing oil rig cleaning and disaster restoration can attract new clients and boost revenue.

The Lean Startup: Ch. 4 Part 4

The culmination of Eric’s first section of the book, named VISION, is a discussion on the government & the implementation of the Consumer Federal Protection Bureau (CFPB). Although Eric released this book in the Early 2010's I believe this approach can still be used to curtail government overspending.

President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protections Act into law on July 21, 2010. One of the provisions was to create a new government agency, the Consumer Federal Protection Bureau (CFPB), to help protect American citizens from predatory lending by financial services companies such as credit card companies, student lenders, and payday loan offices. If you watch any of Caleb Hammer’s Financial Audit it sounds like most Americans DID NOT get the memo that the CFPB exists.

Read more at corppivot.com!

Hope you enjoy this week's insights and happy deal hunting! Remember, if you find these updates helpful, share this newsletter with a friend!

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