🆕 Security Services Firm Making $4.2m/yr 🚨

Welcome Back to The Corporate Pivot!

If your biggest daily challenge is surviving the awkward silence in the elevator, maybe it’s time for a change. The Corporate Pivot is all about helping you escape corporate purgatory and buy businesses that actually excites you. The best part? No more fake small talk—just real growth and real ownership.

Confusing Corporate Saying of the Day:

“That project is on my radar”

Professional Translation: “That project is a priority of mine and I am just about to work on it”
Corporate Pivot Translation: “I 100% haven’t started and I didn’t even know it was assigned”

Here’s what we have for you today:

Sam’s Perspective (1st Time Buyer)

🆕 Status Update: I had some difficulty coordinating with the broker for the tree business this week, but we've rescheduled for next Monday. In preparation for that meeting, I thought I'd share the key questions I plan to ask. Hopefully, this helps you when it's your turn to speak with a broker or business owner for the first time. It can feel intimidating, but remember—they need to sell, so the pressure is on them!

Business Operations:

1. What kind of contracts are in place? Roughly what percentage of revenue comes from existing contracts versus new business?

2. What's the split between residential and commercial clients?

3. Can you explain the permitting process? Would you consider staying on as a consultant to help maintain certification?

4. How long have the employees been with the company?

5. Are there any major clients that account for a large portion of revenue? (Client concentration risk)

6. What’s your client retention rate, and how often do you get repeat business?

7. Are all the listed assets fully paid off, or is there any outstanding debt on the equipment?

8. Revenue and expenses have both increased year over year, which makes sense. But what's driving that—expansion, operational costs like gas and insurance, or something else?

Owner Day to Day:

1. What does your typical day look like as the owner?

2. With a manager in place, are you still needed on-site?

3. Why hasn't the manager taken over ownership? Would he and the other employees stay on after the sale?

4. Are all the employees comfortable with new ownership?

5. Are there any key client or vendor relationships that are dependent on you personally?

Financing:

1. Is the business eligible for an SBA loan?

2. Is seller financing a possibility? If so, to what extent?

Growth Potential:

1. Have you identified any growth opportunities that you haven’t pursued yet?

Final thoughts: 

1. Anything I didn’t ask that would be important to cover?

Tyler’s Perspective (Multiple Businesses Owned)

🚨 Tip of the Week: As you may have already picked up on, being a business owner/entrepreneur isn’t always fun. In fact, there’s one aspect that I believe most (if not all) business owners/entrepreneurs despise. . .taxes! I have been working on my taxes for the last week or so, and let me tell you, it’s miserable (and expensive). As you’ve probably heard, there are many tax advantages and strategies for business owner’s, but this only adds to the misery (partially joking). Not only is it important that you hire a sophisticated professional to assist you (which, in my opinion, is one thing that is always worth spending the money on), but because of the strategies/advantages involved, you need to pay extra attention to detail and be actively involved in your tax planning. This may sound daunting, but if you have the right professionals assisting you, you’ll make it through. Wish me luck on mine!

💰 Deals < $500k

Business Name: Commercial Weed Control Services
Revenue: $180,000
Asking Price: $350,000
Profit: $140,000 (Profit Multiple = 2.5x)
Location: Idaho
Established: 2018

✅ Pros:

• Government contracts: Established relationships with government and commercial clients ensure consistent revenue.

• Seasonal flexibility: Business only operates from mid-March to mid-August, providing a flexible lifestyle.

⚠️ Cons:

• Seasonal limitations: Business only operates for part of the year, reducing potential annual earnings.

📈 Growth Opportunities:

• Expand into fall: Offering fall services could significantly increase revenue and profitability.

• Broaden service area: Expanding operations to additional regions could capture a larger customer base.

💰💰 Deals $500k - $2m

Business Name: Virtual CPA Practice
Revenue: $700,000
Asking Price: $995,000
Profit: $505,750 (Profit Multiple = 1.97x)
Location: Maricopa County, AZ
Established: 2004

✅ Pros:

• Virtual model: Entire business operates online, reducing overhead costs.

• High-margin services: Specialty in cost segregation and R&D projects ensures a high profit margin.

⚠️ Cons:

• Highly specialized services: May require niche expertise or knowledge of specific industries to maintain.

📈 Growth Opportunities:

• Expand client base: Focus on digital marketing to attract new clients nationally.

• Add additional services: Consider expanding into broader financial advisory services to capture more market share.

💰💰💰Deals $2m-$10m

Business Name: Security Services Firm
Revenue: $4,163,289
Asking Price: $3,500,000
Profit: $4,208,069 (Profit Multiple = 0.83x)
Location: New Jersey
Established: 2012

✅ Pros:

• Diverse client base: Over 30 locations served, providing a diversified revenue stream.

• Experienced staff: A team of 100+ armed/unarmed guards ensures smooth operations and scalability.

⚠️ Cons:

• High staff turnover risk: Managing a large number of employees in a competitive labor market could present challenges.

📈 Growth Opportunities:

• Expand services: Offer more specialized security services or expand geographically to grow the business.

• Develop new contracts: Seek additional long-term government or corporate contracts to ensure steady income.

The Lean Startup: Ch. 6 Part 4

Today we will be discussing speed bumps in building an MVP as well as a path to innovation accounting (SHHH! We will talk more in depth in Chapter 7… stay tuned). It may have not occurred to you yet, but MVPs aren’t without risks! Both real and imaginary risks could derail an MVP. 

Some of the most common speed bumps can be legal issues, fears about competitors, branding risks, and the impact of morale. I’m not sure if this relates to you, but some startups (and companies) can utilize patients as protection. Depending on the jurisdiction you are in, this could be beneficial or not! They can be a defensive purpose, a deterrent to hold competitors at bay. If you are using it defensively, the patent risks of an MVP are minor compared with the learning benefits. But, if you are in a new science breakthrough, your risks need to be balanced more carefully. 

Either way, all entrepreneurs should seek legal counsel to ensure that they (or you) understand the risk. This may be concerning, most of which is a fear of competitors stealing their (or your) idea! Well guess what? Odds are, if you’re a startup, it is EXTREMELY CHALLENGING to have your idea, company or product noticed by anyone… let alone a competitor.

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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