r/buyingabusiness

I’m thinking about creating a thread on here teaching how to buy businesses and sell it to the employees through ESOP financing. The employees owns the company 100% in 7 - 10 years and you make a nice profit from the transaction.

We are a real company doing this and have successfully closed 3 of these this year and I think these could be a market for showing others how to do this.

I’m not selling anything and there is no course. Im just looking for feedback if this is something that would be interesting.

I am looking at a listing where the broker put the financing structure right in the ad. Roughly 60% bank loan, 20% seller note, 20% down. I had not even asked about seller financing yet.

Part of me reads that as a good sign. The seller is willing to stay financially tied to the business after close, which is the classic put-your-money-where-your-mouth-is signal. This one also claims all numbers come from signed tax returns, which fits the same pattern of a seller trying to look verifiable up front.

The other part of me reads it as a pricing tell. If the deal cleared a bank's debt-service math cleanly at the ask, would the seller need to advertise a note at all? Baking the note into the listing feels like it could be the broker admitting the ask only works with the seller subsidizing the financing.

And then there is the fine print I know I do not fully understand yet:

* Whether the note is on full standby or amortizing from day one, which completely changes the debt math

* Whether the rate and term are set, or just bait to get calls

* What happens to the note if the business misses a covenant or the seller's numbers turn out soft

* Whether banks actually treat the note as equity-like cushion or just more debt

For people who have closed with seller paper: did the note being offered up front (vs negotiated late) tell you anything real about the deal? And has anyone seen a standby note save a deal the bank math otherwise killed?

Been searching for an established business to acquire for about seven months now and I'm hitting a wall. Hoping some of you who've actually done this can point me in a better direction.

Quick background: I've got real operating and program-management experience, so I'm not new to running things — the bottleneck is deal flow, not know-how. My problem is finding something that matches reality. Almost everything on BizBuySell either doesn't match its own listing description once you dig in, or the numbers fall apart the second you ask a real question.

What I've tried so far:

- Signed up for a couple of coaching/acquisition programs. Both were flops — a lot of framework, very little actual sourcing.

- Started doing my own direct outreach, including running "wanted to buy" ads through a few waste-management / service company channels to reach owners who aren't listed anywhere.

So my questions for people who've closed a deal:

1. Where did your actual acquisition come from — broker, cold outreach, word of mouth, something else?

2. If you did off-market outreach, what actually got owners to respond?

3. Anything you wish you'd done differently seven months in?

Appreciate any real-world input. Happy to share more about my buy box if it helps.

I’m trying to understand how people buying businesses decide where to focus before looking seriously at individual deals.

Before reviewing targets, how do you choose which industries, business types, or acquisition criteria are worth pursuing?

I’m especially curious about:

• what sources, tools, reports, brokers, databases, or conversations you rely on
• what makes you reject an industry or business type early
• what part of the search criteria process is slow or uncertain
• whether you’ve ever wasted time looking in the wrong category

Not selling anything — just trying to understand how buyers actually make this decision before committing time to a search.

For buyers who skipped independent financial verification before closing: what happened? No judgment — genuinely trying to understand the real-world outcomes.

I got this pushback on my recent screening posts: stop treating SDE like cash flow until you know who actually runs the business.

That hit.

A listing can look cheap at 2-3x SDE and still be a bad deal if the owner is doing sales, managing employees, holding referral relationships, and quietly covering working-capital gaps.

So before I care too much about the CIM, I'm trying to separate two things:

- transferable business

- expensive owner-operator job

For people who have bought or diligenced these: what's the fastest tell from a listing or broker call that the "business" is really just the owner?

Hi everyone, I’m looking for advice on buying a small business in Ohio.

I don’t have a big investment budget, so I’m looking for affordable options, seller-financed deals, or helpful links to business/property listings.

Any advice, websites, brokers, or local resources would be appreciated.

Thank you!

My mom's parents passed away and left their beach houses to her and her sisters in a trust. They sold them last year and my mom now has a cool 1 million sitting in a HYSA at the moment that she is willing to invest as she's financially stable otherwise. She's retiring in October and I presented her with a desire to buy a business and she is in. Looking for advice from those who have done this on where to start, what to look for, what options to weigh, what you wish you would have done on your first acquisition, etc.

What is a realistic timetable to acquire our first business? The long term goal is to build wealth for my growing family (wife and 2 boys so far 2yo and new born). I understand it will be, and potentially would prefer it be, hands-on at first, something my mom and wife would enjoy being a part of? Or even allow me to transition into if I enjoyed it. I have a background in high-level sales/leadership in the health and real estate spaces. My wife is a Family Nurse Practitioner. Just trying to provide context that may be helpful. Thank you!

There has been a ton of noise this week about the SBA doubling its limit to $10M on July 4, and most of what I am seeing treats it like every Main Street deal just got twice the financing headroom. I do not think that is right, and I want to check my read.

From what I can tell, the individual 7(a) loan is still capped at $5M. What actually changed is that you can now stack a 7(a) and a 504 up to $10M combined. The catch is what a 504 is allowed to pay for. That money is for fixed assets, real estate and long-term equipment. It cannot fund goodwill, working capital, or inventory.

But most of the deals I look at on here are goodwill heavy. A service business, no building, not much equipment. So if I am buying a $6M HVAC or landscaping business that does not come with real estate, my acquisition financing still looks capped around the $5M 7(a) line, not $10M.

Where it does seem to matter is deals that come with a building or a yard of equipment. Manufacturing, self-storage, anything that owns its facility. There you could put the real estate on the 504 and the business on the 7(a) and actually use the higher combined number.

So for people who have actually closed SBA deals: am I underrating this? Are there structures where the $10M combined cap helps a goodwill-heavy acquisition with no real estate? Or is the honest answer that for most of what gets posted here, the binding constraint is still the $5M 7(a) limit, and this mostly helps owner-operators who are buying their building?

Retirement is the single most overused reason in business brokerage. It shows up in listings for forty-five year old owners whose revenue has been quietly sliding backward for three consecutive years.

Burnout is real and some owners genuinely are just done. But if the stated reason is health or retirement and the business has been losing operational ground for several seasons, you need to read between the lines.

The real or honest answer is usually that the owner is selling because the trajectory shifted. They want to cash out before things get worse.

If an owner is truly retiring from a thriving enterprise, the financials will show it. You will see regular capital reinvestment, updated equipment, active marketing spend, and stable employee retention. When an owner checks out because the business is getting harder to run, the first things they cut are the long-term investments. They squeeze the margins to make the trailing twelve months look as fat as possible for the sale.

Here's what that looks like using some real numbers:

Say a business did $600,000 in SDE three years ago, $520,000 two years ago, and $440,000 last year. The broker lists it at a 3x multiple on the trailing twelve months, which puts the asking price at $1.32 million. That feels reasonable on the surface. But if the underlying trend is an $80,000 per year decline and nothing structural has changed, you're not buying a $440,000 SDE business. You're buying a business that might do $360,000 in year one under your ownership, which at the same 3x multiple is worth about $1.08 million.

That means you just overpaid by $240,000 on day one, before you've touched a dollar of debt service. SBA lenders don't price deals on where the business used to be. You shouldn't either.

Do not argue with the broker about the seller's life choices. That gets you nowhere.

Instead, drop these two questions on your next introductory call.

The first one is: "I see the historical earnings have slid about fifteen percent since two years ago. What specific operational or market change occurred back then that triggered this shift?" Then stop talking and listen.

The second one is: "What has the owner invested back into the business in the last two years in terms of equipment, staffing, or marketing?" That question tells you whether the owner was building toward something or quietly cashing out while waiting for a buyer to show up.

A good broker will give you real answers. Something like: the labor market tightening in the local area, a major commercial client who moved their contract, a supply chain cost increase that compressed margins. Specific, verifiable, or macroeconomic. A broker who stumbles, over-explains, or tells you the owner just got tired, is in the process of winding down, or just stopped marketing as much (unless verifiable in P&L) is telling you more than they realize.

Before you spend twenty thousand dollars on a formal Quality of Earnings review, make sure the seller's story matches the actual data tape. If the business is shrinking, price it based on where the numbers are going, not where they came from.

What's the worst "retirement" story you've actually encountered in a deal? Wondering whether the broker came clean or whether you found it yourself in the financials.

The publication has very little editorial content and is mostly half-page and full-page ads sold to local businesses. It’s printed and distributed quarterly.

They are asking for $750,000 which is 3x SDE.

Does anyone here know anything about print advertising businesses in general, or specifically an advertising magazine? Any red flags I should look out for?

Looking for some opinions from the masses here.

I am currently in the process of acquiring a small business in my neighborhood (USA). Its a small IT/MSP and PC Repair shop. I have done due diligence, reviewed 4 years of P&Ls, tax returns (with accountant), bank statements etc. Its profitable, has shown steady growth YoY, its been in business for 20 years in this neighborhood and has fantastic reviews on google and yelp. If anything, it makes more money than it shows. I cant verify all of the SDE, but my accountant and I suspect a decent amount of personal expenses in the "COGS" line given the type of work they focus on and that they only ever report COGS as one big spend and no details.

My issue is the negotiation. I tend to be a very principled person, to the point where its a detriment to myself. I mention this because I need some grounding on if I am being too principled or if this is a true red flag I should walk way from.

The negotiation: We started out with an offer of 1.5x SDE, they countered back with about 1.75.

While emailing back and forth on the price, we were also trying to work on an in person meeting. I spent a few hours with the sellers, we walked through sales intake, fixed some laptops, did a data transfer for a customer, etc. Customers were coming in and out for an hour and it was slow for an hour seemed like a typical small business. I had some great discussion with the seller, but what caught me off guard is he reopened the negotiation randomly. At the time he tried to get me to come up in my price. This wasn't supposed to be a negotiation, more of an operational tour. I was caught off guard, but he said he had another offer on the table, he would rather sell to me as this other place was a small local "corporate" outfit, but he needed me to come up to asking. I said hey I wish I could give you all the money in the world, but I have what I have and I joked that i could check the couches for more money. We ended the meeting and other than that it felt really good.

The sellers then went on vacation for a couple of weeks and we agreed to touch base when they returned. I sent out an email the day before their return to check in and let the broker know that I liked the place and that I would come up to 1.75x SDE (we left the negotiation at 1.5 v 1.75, not including the talk I had with seller).

This is what frustrates me, she comes back and says the owner is firm at asking price. He said he told you he was firm. The broker and I were on the phone, so the other offer also got brought up and she goes "we dont have any other offers". This made my eye twitch lol. The last price we left on officially was the counter at 1.75.

I dont want to let my principals or ego get in the way, but this feels like a red flag. If I look purely at the financials and reputation, what they are asking DOES seem fair. This is also my dream, to own my own small business, especially in my community. But him lying about the other offer and fudging our conversation feels like a red flag to me. Or is it just my ego getting in the way?

Is this a red flag enough to kill the deal? Or is the seller just a little unprofessional and I shouldn't be as bothered as I am? Or am I the one missing something and being unprofessional for that matter?

Thoughts?

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Hello guys, I don't use Reddit really often but I see there is quite a community for M&A here so I thought I could ask my questions here.

I have been doing buy-side M&A for a couple of years, with good success, a couple of regular clients signed etc.

I also have a partner who is a very experienced sell-side broker, works for one of the top private advisory firms in the US and together we have starting basically doing hourly consulting work. Basically anything from sourcing to closing.

It started going okay at first, but soon we found that finding clients is not as easy as we thought. We know how to do the job given our experience, but do not know how to acquire new clients.

Are there any tips any of you can give me, maybe some guidelines I should follow when trying to get new clients. Any help is appreciated.

Has anyone had experience acquiring a content site/digital businesses using an sba loan?

From what I understand not all banks/lenders work with loans for acquiring a mainly digital business.

I have access to the p&l from 2024 - Present. According to the broker the llc has other digital businesses so the tax documents are bunched up with income from other businesses. Does anyone know of any banks or lenders that loan for the acquisition of such business?

Pretty straightforward! Just want to hear some opinions from folks who have read the book, and especially from those who have field experience with business acquisition on things they felt were done great/poorly in the book. Thanks in advance as I begin my entrepreneurial path!

How you can take advantage of it to buy a boring cash-flowing business in 2026:

An SBA loan lets you borrow money to buy a business. Because the government backs it, banks offer terms you can't get anywhere else: Low down payment and long repayment window.

Up until now, the maximum you could borrow was $5 million. Starting July 4th, borrowers can combine:

• SBA 7(a): up to $5M (acquisitions, working capital, debt refinancing)
• SBA 504: up to $5M (real estate & equipment)

Stack both and you get $10M in gov-backed financing for a single deal, which means you're targeting businesses doing $800k-$1.5M/year.

How to position yourself to close one:

Step #1: Get your financials in order

Pull your last 2-3 years of personal tax returns an get your credit above 680. Lenders need to see your financial history before they underwrite. The earlier you pull it together, the faster you move when you find the right deal.

Step #2: Find a business

Look for businesses doing $150k-$500k in SDE. That's where SBA financing is most powerful & competition from PE is lowest.

Step #3: Get an independent valuation

Lenders need proof the business is worth what you're borrowing for it. An independent valuation answers that and tells you whether you're overpaying. Hire a CPA and an M&A attorney.

Step #4: Submit the LOI

This lays out the price and basic deal terms on paper. It's not the final contract, but it shows the seller you're serious and gives lenders the deal structure they need to start underwriting. Without it, you don't get the loan.

Step #5: Get seller financing

The SBA requires 10% down for full ownership. A seller note can cover half of that. So on a $1M deal, the seller can fund $50k, you bring $50k, and the loan covers $900k. You own a $1M cash-flowing business for $50k out of pocket.

My wife and I run our family business in VA USA and have spent the last 12+ years in metal manufacturing industry, primarily supplying custom machined, cast, and fabricated components to OEM customers.

I’m now looking to acquire a machine shop as part of growing my business for the long term.

Location: United States (preferably the Chicago area, Virginia, or North Carolina)

Target: A small to medium-sized CNC machining business

I’m not looking for a customer list we already have an established customers and can bring work into the shop.

My focus is on acquiring a quality operation with good/ok equipment, a skilled team, and room to grow. I’m also open to retirement situations where the owner is willing to help with a smooth transition.

How do I find candidate shops?

Thanks in advance for any guidance.

Hoping to get some dialogue here. I’m recently off a call with my SBDC business advisor under search parameters to get a business under contract within the next six (6) months valued between $2MM and $4MM that is evergreen and running smoothly with no clear direction for what type of business I’d want to buy and run. His points were (1) business brokers don’t pursue buyers with no clear business types in mind and (2) that I need to find what business I’m looking for.

I know a few things that I don’t want to do or buy, but what’s the most effective way to narrow down what business is a good fit to buy?

I'm curious to hear from business brokers and experienced buyers.

What are the biggest mistakes you see first-time buyers make before they even reach out about a business for sale?

For example:

* Focusing on the wrong metrics?

* Not understanding valuation?

* Asking the wrong questions?

* Chasing the wrong types of businesses?

* Not doing enough research beforehand?

If you had to give a first-time buyer three pieces of advice or action steps before they contact a broker, what would they be?