How I Think About Pricing Power When Buying a Business
Pricing power tells me more about a business than almost any other metric. If a company can raise prices without losing customers, it has real resilience. In this article, I share how I evaluate pricing power during acquisitions, why it signals competitive advantage, and how it influences my decision-making before I close a deal.
Why I Study Competitor Dynamics Before Acquiring a Business
Before I buy a business, I study its competitors closely. Understanding market dynamics—pricing, positioning, and strengths—helps me avoid surprises and identify opportunities for growth. In this article, I explain how competitor analysis shapes my acquisition decisions, why it influences valuation, and how it helps me plan a long-term competitive edge.
The Risks I Watch for in Owner Financing Deals
Owner financing can be a great tool for closing deals, but it comes with risks that buyers often underestimate. Over the years, I’ve learned to watch for hidden terms, repayment traps, and misaligned incentives. In this article, I share the red flags I look for in owner financing, how I structure deals to protect myself, and why discipline is key to using this strategy wisely.
Why I Treat Cash Flow as King in Every Acquisition
If there’s one lesson I’ve learned in acquisitions, it’s this: cash flow is king. Revenue and profit projections mean little without strong, reliable cash flow. I focus heavily on understanding how money actually moves through a business, testing different scenarios, and ensuring liquidity can withstand downturns. In this article, I share why cash flow dominates my acquisition decisions and how it shapes the price I’m willing to pay.
Why I Avoid Businesses That Depend Too Heavily on the Owner’s Personality
Some businesses look profitable but are really just extensions of the owner’s personality. When customers, employees, and vendors rely too heavily on one individual, the business often loses value the moment that person steps away. In this article, I explain why I avoid these types of businesses, how I spot signs of owner dependence, and what I look for instead to ensure transferable value and long-term scalability.
Why I Avoid Businesses With No Clear Succession Plan
A business without a succession plan is a ticking time bomb. I’ve seen deals collapse because there was no clear path for leadership or continuity after the owner left. That’s why I avoid businesses without strong succession planning in place. In this article, I share how I evaluate succession risks, why they matter so much, and how they directly impact valuation and long-term success.
How I Value Small Businesses Without Overcomplicating the Math
Valuing a small business doesn’t need to be complicated. Over the years, I’ve developed a simple framework that cuts through noise and focuses on what truly drives value—cash flow, customer stability, and growth potential. In this article, I share how I value businesses without drowning in complex models, and why a clear, disciplined approach leads to smarter acquisition decisions.
Why I Always Study Customer Concentration Before Buying a Business
I’ve seen too many businesses that look strong but rely on just a few customers for most of their revenue. That kind of concentration can wipe out value overnight if a single client leaves. That’s why I always study customer concentration before buying. In this article, I share how I analyze customer mix, why it matters for valuation, and the risks it can reveal during due diligence.
How I Structure Earnouts to Align Seller and Buyer Interests
Earnouts can either create trust or chaos depending on how they’re structured. I’ve learned that when done right, they align seller and buyer interests by tying payouts to performance milestones. In this article, I share how I structure earnouts to reduce risk, build fairness into deals, and ensure both sides are incentivized for long-term success after acquisition.
How I Judge Whether a Business Has Real Competitive Advantages
Not every business that looks strong has real competitive advantages. I’ve learned to distinguish between temporary wins and lasting moats that protect value. When evaluating acquisitions, I focus on customer loyalty, differentiation, and resilience against competitors. In this article, I share how I judge whether a business has true competitive advantages and why it’s a key driver of long-term success.
The Difference Between Buying Assets and Buying Equity in a Business
When buying a business, one of the most important decisions is whether to purchase assets or equity. Each path has different implications for risk, liability, and long-term value. I’ve learned that understanding these differences is critical for making the right deal structure choice. In this article, I break down how I evaluate asset vs. equity purchases and why the structure often determines the success of an acquisition.
How I Balance Growth Opportunities With Risk Management in Acquisitions
Every acquisition is a balancing act between chasing growth and managing risk. I’ve seen deals fall apart because buyers focused only on upside potential without preparing for the downside. In this article, I share how I balance growth opportunities with risk management, the frameworks I use to evaluate trade-offs, and why this discipline helps me protect capital while still creating long-term upside.