In the spirit of transparency & efficiency, we feel it is best to be radically focused in our search efforts to save all parties time. Below are commonly asked questions and a look into our search thesis, which is the lense we evaluate each opportunity through.
Our search is focused regionally on the Southeast of Florida from Melbourne to Florida Keys; Southwest Florida from Tampa to Marco Island; Mid-Central Florida from Orlando to Jacksonville; and Central to Southeast Texas in major metros. These are markets that we are familiar with, are within reasonable proximity to our advisors and investors, and are areas we are comfortable setting down long-term roots, which will allow us to be good stewards of our capital allocation, employees and community.
We will use a mix of our savings, a few investors, and an SBA 7(a) loan. In an effort to ensure both the seller's commitment to a transaction and to ensure we succeed as buyers, we are in search of a seller that is willing to provide a seller note for a percentage of the transactional value.
The ideal company will have between $1M-$6M in annual revenues and between $500k-$1M EBITDA or SDE with potential for substantial growth. Due to the partnership structure of our entity, the target company business model must make sense to support both owners/operators on a fair market salary, allow us to meet the requirements of our DSCR, and avoid capital constraints after debt obligations are met.
We are flexible on industry categories, outside of B2C retail, health care providers, true construction, SaaS, and very complex operations like heavy manufacturing. Commercial service providers are a target (i.e., provides commercial services, and services required by law), but we are not bound to them. We are more focused on the characteristics of the business, and confirming it has a high-quality business model, and stable cash flows to get us through the transition process.
We will move to the location and run the business full-time as a strategic operator. We are not looking for a business where the owner provides the actual product or service themselves. The business needs to have enough infrastructure in place where the owners can be more focused on operations, financial management and growth opportunities.
It depends on the quality and type of business. Our search is centered around finding a business we want to own and grow. That said, we are interested in a valuation based on an EBITDA multiplier, and are focused on getting a deal done. Minor valuation differences should not derail a transaction.
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