Acquisitions Anonymous - #1 for business buying, selling and operating - $1.25mm HVAC Business - $4.1mm Blast Structure Manufacturer - e31

Episode Date: June 17, 2021

With special guest Sam Leslie, we review two companies for sale this week:- $1.25mm HVAC Business - $4.1mm Blast Structure ManufacturerEnjoy!-----* Do you love Acquanon and want to see our smiling faces? Subscribe to our Youtube channel.* Do you enjoy our content? Rate our show!* Follow us on twitter @acquanon Learnings about small business acquisitions and operations.-----Past guests on Acquanon include Nick Huber, Brent Beshore, Aaron Rubin, Mike Botkin, Ari Ozick, Mitchell Baldridge, Xavier Helgelsen, Mike Loftus, Steve Divitkos, Dzmitry Miranovich, Morgan Tate and more.-----Additional episodes you might enjoy:#62 Two Landscaping Businesses for Sale - Mike Loftus CEO of Connor's Landscaping#66 Analyzing Software Businesses for Sale with Steve Divitkos, experienced industry CEO#42 $900k Moving and Storage Company / $500k Rural Mini-Storage#61 Two Manufacturing Businesses for Sale - Brent Beshore - Founder and CEO at Permanent Equity#24 $5mm pool services and lifeguard staffing co / $2mm septic services business -  featuring baller @WilsonCompanies as a special guest!#45 $800k/yr cleaning business in Midland, TX / a $565k/yr window cleaning business in San Antonio, TX #48 Two Landscaping Businesses for Sale - Mike Botkin of Benchmark Group--- Support this podcast: https://anchor.fm/dealtalk/supportSubscribe to weekly our Newsletter and get curated deals in your inboxAdvertise with us by clicking here Do you love Acquanon and want to see our smiling faces? Subscribe to our Youtube channel. Do you enjoy our content? Rate our show! Follow us on Twitter @acquanon Learnings about small business acquisitions and operations. For inquiries or suggestions, email us at [e-mail]

All right, welcome to Acquisitions Anonymous. It is a beautiful Friday, and we are recording again. I have good news and I have bad news, Bill. Which would you like first? I want the good news first. The good news is we have some killer deals today and we have a kick-ass guest. The bad news is Mills is out putting a roof on something, so he's not here today. So only two of the three musketeers are here.

But we have an amazing guest. For those of you that don't know and haven't listened to any of our first 40 episodes, This is a podcast about small businesses for sale. We record it every week. And there's usually three of us, me, Mills and Bill. And I'm Michael Girdley, one of your hosts. And we look at two deals for sale that are small businesses. And then we talk about them and see what we think.

So it's a podcast for people that are search funders, people interested in small business M&A. And often we have great guests. And today we have a super-duper guest who is my Twitter buddy and future real-life buddy, Sam Leslie. So Sam, welcome. Thank you so much, man. I appreciate it. Thanks for having me on, guys. You definitely win the award for best mic setup of any guests we've had so far. We've had a couple people like basically be underwater in like submersibles and stuff.

So yours is great. Thanks for doing it. I told you my mic was on point, bro. You asked me how my mic game was. That's great. Well, before we get started, so we got two great deals today. We got an HVAC one, which is in your wheelhouse. And then we got a really cool one around, I guess, like bomb-proof structures. So we're going to do the H-FAC one first to warm us up for the bomb-proof one, but we're stoked about talking about these two businesses for sale. But before we do that, Sam, it would be great.

If you could just give a one-minute introduction of your career and how you got to today and, you know, everybody will want to understand your story. And then we're interested in see what you think about these companies for sale as well. Cool. Let's go. So I'm Sam Leslie. I've been married for 17 years to my wife. we have seven children, two boys and five girls. It's a wild, wild house. Girlie, I think you

understand how that goes, Bill. I don't know about your family, but before, you know, when we were first married, I had a lawn, lawn landscape company, had no idea how to market, had no idea how to grow a business, but I knew I wanted to own multiple businesses. Ended up selling that business after about 15 years of operating it in two different cities, actually, I moved with my family. sold it in 2007, bounced around, traded options full time, made a ton of money,

lost even more. That was in 2008. So the volatility was like, I was making 100% on my money every day and then losing 120%. So anyway, that didn't work out, super stressful,

was my bag. So I was running out of money. Took a job at a pest control company and got sick every day because of all the chemicals I was spraying and was nauseated, shaking every day, driving the truck. And so I decided to start my own pest control company.

And I went to my parents and I said, hey, can I have $2,000? You remember that $2,000 that you saved up to put teeth in my mouth? You remember that mom and dad? Can I have that $2,000 to start a business? And they said, yes. So I blew $1,000 on radio advertising. And then I spent about $1,000 getting equipment and cards. And so basically just ground that out, hustle that.

And in the meantime, I actually applied to go into the Army. So that kind of begins my Army thing. So 2010 moved into the Army, became a bomb tech. And was a bomb tech for eight years as a bomb tech officer, took command, did all that kind of stuff, deployed. And then after 10 and a half years and seven moves with my family, I was looking at another five. And so I said it's time to get out. So I'm moving into the reserves and acquiring. service companies.

So that's what I'm doing. Great. And you're, you're doing a deal right now and you're relocating the entire like brood. Exactly. Yep. We're moving out to the front range, Colorado and had decided to move out there anyway. After talking to Gurdley about what San Antonio was like, I decided to move to Colorado. It was just a, you know, definitely a easy position.

Well, Colorado, Colorado does have. more Chili's per capita, Bill. So just so, you know, I can see what he's doing it. The funny thing about that meme is, I don't think it's that funny, but everybody else loves it. I've got like 10 more memes I think are funnier,

but like, seriously, people are like out on Twitter and they like see something about Applebee's and they're like, oh, I'm going to tag Curdly in this because. You should just embrace it and get sponsored. Yeah, I mean, I'm cool with it. I've talked to Chili's headquarters a few times.

So whoever is the 23-year-old running their social media account. We're total buds. That's great. So, Sam, you are perfect for these deals because we've got an H-FAC, which is the industry you're getting into, and then we've got a bomb-proof enclosure, and you used to be a bomb technician. So you are the perfect, these are the perfect deals for you.

I'm excited. Let's do this. And for the last two years, for the last two years, I've been doing government acquisitions. So I'm a bomb tech and I do government contracts for weapons. So this is Emma Williams. I'm holding a lot today. This is going to be fun. Let's do it. Holy cow. And a good microphone. Man, this is like perfect. All right. So,

first deal is the HVAC one. So I've got this one and it is another buy-biz sell special. So we do like their teasers. They seem to be well written, unlike some other brokers do pretty terrible teasers. So this one is called very profitable HVAC business. So HVAC is heating, ventilating and air conditioning and it is in Jefferson County, Colorado. So that's what, that's the area north of Denver, right, Fort Collins-y type stuff? I think so, yeah. Okay. So you will be competing with this business, right, Sam? Probably. Yeah. I'm just going to, we're just going to crush them. It's cool. All right. So do I, do I, do I, do it. I, I'll do it. I got to do some work on this podcast. That's part of the deal. So this business, they're asking a one

and a quarter million dollars for it. So the asking price is 1.25 million. The suggested or the listed cash flow is $477,000 U.S. dollars per year. So $1.25 million is the list price. Cash flow is just under a half a million. So two and a half times. Two six. Yep, two sex. Two six. Two point six times cash flow. It grosses $1.4-ish million in sales a year. They have $6,000 in inventory. so I assume that's just parts and stuff in a shack. EBADAS, or earnings before interest, taxes, depreciation, and amortization is the same as cash flow. So 477,000. And then they have just a little bit of furniture, fixtures and equipment, $20,000 there.

And it's been around since 2003. It does not have any real estate. So assume they lease wherever they're based out of. The broker says this is a great opportunity to operate since the seller does not go into the field. So field means you would go out and do HVAC yourself. So this is above mom and pop. So at least mom and pop appear to sit in the office while other people go out and do the work. So this is an excellent opportunity to acquire a very profitable HBAC business serving the Denver metropolitan area.

This business is a small family owned and operated business established in 2003. The business is well organized, easy to transfer, and take over operations, and the margins are very high. The business is growing and there are clean books, records, and accounting. the business has been pre-approved for an SBA loan. So SBA, of course, the government entity allows you as a person to buy a small business like this without a lot of collateral or banking history. And the value proposition and advantage of purchasing this business is that the cumbersome obstacles to building a business have already been overcome, and there is a well-oiled machine in place.

The business has an excellent web and Internet presence and also excellent reviews. The business utilizes a software platform that includes scheduling, real-time tracking, job notes, CRM, and synchronization with QuickBooks. The business provides installation repair services for a variety of heating and cooling products. The business provides 100% residential, so no commercial. And the seller states that about 60% of revenue comes from installations, and summertime is traditionally a busier time than other times of the year, but they are busy the entire year. and you can complete an NDA to learn more about this business, NDA being non-disclosure agreement. The broker thinks an excellent buyer would be an HVAC professional

who would like to be in the business for themselves and not encumber all the headaches one might face if they struck it on on their own. This type of buyer should most likely have a master mechanical license and be competent in management and marketing functions. It's like asking somebody to be like, that's a unicorn right there. The seller has a city and county of Denver, licensing and has passed all ICC exams. I assume ICC is some sort of certification body for this

stuff. Is that right? Sam's shaking and said yes. All the other techs have an EPA universal certification, which EPA being the federal folks. All that sounds terrible. And another excellent buyer would include a business in the front range that would like to expand their HVAC business or a strategically aligned business such as plumbing that would like to add an HVAC division. Financing because of the excellent books records and accounting. This has been pre-approved by an SBA lender to a qualified buyer with only a 10% down payment. In order to qualify for the loan, the buyers should have industry experience and not be an investor or absentee owner. And then they cover a bunch of the other stuff here. What other stuff? Sam, you're pretty familiar with this deal.

What other stuff should we talk? Oh, this business is home-based. So the business is operated out of the home of these folks. What are we missing here? It sounds amazing. as far as like the cash flow and the amount of work that the owner has to do. So I really wanted to point out one thing that is at the bottom of the listing. And it says the seller's main duties include overall operations, the business, maintaining necessary business relationships, managing the subcontractor technicians. So everybody on Twitter was going crazy on this because they were saying, well, they probably employ subcontractor entities. So like other HVAC companies, but that's not what the teaser says.

It says technicians. Because if they are subcontractor technicians and they are being directed by the owner to do certain types of work, the IRS says they're not subcontractors. So basically, if they are hiring subcontractor technicians as like 1099 employees or 1099 subcontractors, then they are avoiding employment tax and they're avoiding liability. They're avoiding a lot of things by not. That's why they're probably why their cash flow is so high if they're employing 1099 HVAC technicians. So they're skirting IRS regulations if they're employing technicians in a 1099 relationship. That would be assuming that these technicians work only for them, right? If these technicians have four other companies they work with, then it might be fine.

I think if you look at the IRS regulations and their stipulation between what is an employee and what is not, it's like direction. So you tell them what to do, where to go. and so I don't know if dispatching somebody really, you know, I think you're skirting the line there. And a lot of business owners will do that because they avoid employment taxes, benefits, all that kind of stuff that's required. So that's what kind of turned me off to this business. I love the cash flow. And also it has two employees.

So the interesting thing is if you look at their gross revenue, 1.368 per employee, if they've got two employees, they're doing fantastic. However, we don't know how many subcontractors are actually working for this business. And my buddy Rich and John Wilson talk about how truck-based companies should be pulling in between $400,000 and $500,000 per technician. And so we have no idea how efficient this company is, how good this company is. It's just kind of a black hole. Yeah, it looks great. but it just turned me off.

So what do you guys think? I mean, it's got like software tracking, CRM. It's probably on service Titan. You know, what do you guys think about this? So this is not my industry. So Sam, I will defer to you here. That being said, I wouldn't strike this straight from the teaser. So this is a type of thing where, you know, for me, when I'm reading a teaser,

I'm really, I'm not trying to decide if I want to buy this business. I'm trying to decide if I want to learn more about this business. So in this case, I think it's got enough pluses where they're saying all the things. It seems like they've got, you know, the owner isn't out in the field. You know, he's actually got a management structure in place. They're using good software. Like the margins look good. You know, it seems to be kind of geographically concentrated.

Like there's a lot to like about this. So for me, you know, yes, I would say red flag on the 1099ers. But I would get the teaser and I would just put that 1099. topic at the top of my diligence list. Because it's the type of thing where, you know, if you like everything about this business, it might be worth the brain damage as part of the transaction to convert these guys to W2, right? Recast the financials and leave the past liability because it would be an asset deal,

leave the past liability with the buyer owner, get an indemnity. And, you know, maybe as part of the transaction, you can square that away. And now, now you've bought a good business that. had hair on it for a good price. Honestly, like for me, like those are the best F&B deals, right? They're never perfect. There's always something wrong with them. So I actually kind of like it when you can go, okay, it's very clear what's wrong with this, right? I'm going to get a purchase price discount because this thing is wrong with it, but I have a plan to fix that thing, right, through my diligence. And if I can't fix

the thing, I'm not going to buy it. Right. But, you know, during diligence, it's going to be as much making a plan with the seller in order to make his business saleable and transactable for me. I actually think that's where the opportunity is. So I would, I would pursue this one if I was looking for that deal. Okay. What, I mean, I almost see this as closer to a leg gen business than it is actually really an HVAC business, right? Because they're, that's where I would really dig in first, to your, to your point, Bill, like how dependent are, are these 1099s working for other contractors, but that's, or for other, other folks? By the way, that's, one of the tests the IRS uses.

Is it? Yeah. So it's like a combination of, and I'm no lawyer, so I just play one on podcast. But it is, it's like, do you bring your own equipment? Do you set your own hours? Do you set your own prices? Like those are some of the tests they use. And then there's like the stuff that's obviously 1099 and then there's stuff.

Oh, and then can you lose money? That's like one of the other tests. So like you're definitely an independent contractor if you have the ability to take a loss on a deal. Okay. Then I may have been wrong then. That sounds like I was wrong. Yeah.

No, I mean, they could be. But I think you highlight the thing that is the Achilles heel of this business, which is the moat around, I think a lot of these HVAC or especially regulatory capture businesses is you have a limited number of supply of master electricians, master plumbers, lawyers, like they have regulatory capture too. You know, all that stuff. together, like, how much are you going to be dependent upon labor that you don't actually really control, right? You look at like Strong Point Rich and guys like that on Twitter that are doing well

in H-FAC. It's because they realize the finite resources, master plumbers and journeymen and all that kind of stuff. And how do they keep those guys on the payroll and not go work for somebody else? Well, when you're dealing with contractors, in theory, they get to choose who they're going to work with. And if your deals aren't the best deals or they're busy, they're just going to tell you to kiss your butt, kiss their butt. Yeah. That's my fear. That's the red flag for me. Like the regulatory stuff, I think you would sort out or you just wouldn't buy the business if you couldn't.

But what you can't fix is the fact that you might not control these people. And you can't do any HBAC jobs. And pretty soon you'll be doing the HBAC jobs. And the reason you bought the business is not intact anymore. Exactly. I think the whole thing is who's got priority? Priority is the number one thing on this. But I do like the cash flow.

And this might be something that I would look at after I close on my other business. so as a bolt on. It'll be a great bolt on. In fact, they even say that, don't they? We're the ideal buyer as an H-back professional. Actually, it says right here, Sam Leslie, you should take a look at this business. Yeah. Yeah, so I think I need to throw a little bit of context in here.

I'm moving. I'm leaving the Army. I have to leave. This is a government house that I'm living in. So I have to leave where I am in New Jersey. I don't want to live in New Jersey. So I'm looking for a business. in an area that I'd like to move.

So that's, I mean, it was like San Antonio. It was front range of Colorado. And I just happened to find this. And so when I look at a deal like this, I say, am I willing to risk moving my whole family out and trying to close on this deal? And if I don't control the contractors, then I'm not willing to move my family. So that was, that was my criteria. And that's, you know, specific to me. Well, I think that highlights, though, like, that's,

really good point, Sam. Like every buyer, like when you're doing enterprise deals, every private equity firms is the buyer. Like all the buyers are the same. Like, it's pretty objective what makes a good business. In SMB deals, all the buyers have totally individual circumstances, right? So like, what's a great deal for Sam? It might be a terrible deal for Bill or, you know, vice versa. So when you are, when you are buying, just because other people tell you like, oh, that's a crap deal or oh, that's a great deal. Why aren't you interested in it? A totally valid reason. is like I have external circumstances, right? Like, that's not right for me. It might be right for you. And similarly, if you're selling, you want to try to find the buyer for whom it's really right.

And that's your hire. So essentially is like for this one, I don't know Jack about HBack. But what I do know is about kind of like digital marketing and lead gen. So where Sam as an HBack guy is like, I don't know if there's actually any HVAC going on here. This is mostly sales of lead lead. maybe. And I go, ooh, maybe there's no HVAC going on here. Maybe it's just sales and liegean. I love sales and league. People, you know, see it different. The moat you may be buying here is SEO, web presence, and Google reviews, right? That's what they say here. There's, it's, it's just hidden as a quiet little line, but it has a strong web presence with good reviews. Like, okay, that's what, that's

what you're getting is you're getting, you're getting a brand that they've crafted in theory in the Denver area. Unfortunately, if you're dealing with just 1099 contractors, you may not have your name on your truck like some of the other guys do, which I think is super smart. So this is a digital marketing moat that you're buying. I love it. I love digital marketing. Absolutely love it.

If it was a straight lead gin company where, like, I was just selling leads to plumbers in the area and it was pulling in this much cash, I'd buy it 100%. Like straight up. If it was just a lead gen and I was doing social media and I was doing that 100%. buy it. So that was interesting. Maybe, so maybe one thesis to buy this business is to fix the 1099 and move them to W-2s. Maybe the other thesis is, let's keep them 1099, let's make sure they're compliant 1099 that they got other customers and let me sign up for other HVAC companies in the area and actually turn this into a lead gen business. There's been numerous times I've hired a plumber

and somebody shows up in a truck with a different name on it. Oh, really? Yeah, I was like, I thought this was Ed's plumbing. They're like, no, no, I'm Billy. It's like, oh, thanks. Where's that? The danger, the danger with that is, too, if you send another plumber out and they like that plumber and that plumber owns his own business, you have lost that lead. You no longer have that customer. So they're with Ed or they're with Jimmy or whoever. But anyway, I thought this was interesting. The one that I'm working on right now is they're asking 1.35. Sellers discretionary in 2020 was 550. So it is, it's underpriced in my. opinion, W-2 employees, it's H-FAC slash plumbing. So it's both. And the company should be doing probably between $3 and $4 million. It's sitting at about $2.2. So that's kind of where, that's where I'm at. Yeah, that's awesome. Well, keep us posted on how that one goes. Sounds like a great path to entrepreneurship. So you're going to SBA loan that one? Yeah. Yep. Live Oak. Live Oak is coming in with a 10-year fixed under 5%. So just killing it. God bless the SBA.

All right. Let's move on to the new one. Let's do it. Let's do it. Bill, you're going to do that one. I'll do it, but I want Sam to talk about this one because I'm sure he's got opinions. And I would love it if we were not on radio and I could show the listeners, pictures that accompany this listing. It is on BizBicel. So if you use Google for impact black, resistant structures manufacturer with no competition on biz buy sell. You will find it and see the pictures of these cages that they make out of Plexi. So basically what this company makes is bomb-proof rooms. They are, they have the asking price is $4.1 million and they've got cash flow of

$817,000. So that's like roughly a four, five, maybe sniffing six max multiple. The deal highlights, they say they've got 46% net margins. So they've got 1.75 million in LTM sales and 817,000 of cash flow on that. They've been around since 2002. They state they have no competition, a diversified customer base in industries with strong financial footing, repeat customers. They say their operations are streamlined and they have outsourced all the manufacturing. So I guess they are not welding these things together. They have intellectual property protection due to historical. product testing data, which I assume means they set off bombs next to these things and actually tested it, which is pretty fun. Easy to relocate the business and the current owners have limited involvement, ready for retirement. The technology behind, and this is not anonymized, this is public

info. The technology behind Total Shield, registered trademark, could not have come from more auspicious beginnings. And they described where he took a job with Sandia National Laboratories. this guy was tested doing material science and came up with this special design that is bomb-proof and has turned it into a business. They've been around since 2002, which is when he started it after the terrorist attacks of 9-11. They labored for six years to build the company's line of products. It was until 2008 the business really took off.

Today, they sell products in four main categories. Bomb-proof rooms, mobile enclosures and barriers, bomb-proof blankets that are made from Kevlar. The heat shield, heat exchanger test shield is for large oil company uses. So it seems like they've got some real IP here. They say the cool thing is that these are not categorized as permanent structures. These are basically like, think of them as like overgrown telephone boost. Like they basically look like the thing that you would put the villain in in a superhero

movie. Like if you've captured the villain and you've put him in prison, like he's sitting inside of these rib, right? It's like, you know, it's like busting glass. It's like reinforced riveted steel on all the edges, you know, and they're like torturing him. He's got cuffs on and he's sweating. That's what it looks like they make. Most recently, Total Shield made a very large room 14 feet by 24 foot that is being installed by a contractor at the NASA in Cape Canaveral, Florida. So seems like a pretty freaking cool business. What do you guys think about this one? Number one thing that jumps off the page is patent protection and no competition.

That's the thing that really makes it really interesting for me. But like no competition also means that there may not be a there. There's not a very big tam, right? There's not a very big market for this. It's a very, very niche product. And if you take a look at their gross revenue, you can definitely tell this is a very niche product with not a big market or they just suck at advertising or marketing. but so coming from a kind of an explosive ordinance disposal background not kind of but actually coming from an EOD background you know explosive testing all kinds of safety testing needs to be done in these types of containers if there's any kind of you know kinetic or explosive factors that could happen with the products so they you know fortune 500 companies i could see that you could see government as well of course and the cool thing about this is

is that they get into how the business was started, who was developed by, and why. But it's listed, when you start seeing the name of the company, you know it's listed by owner, right? So the thing that I'm concerned about with this business is, one, I love, I love the profit. I don't love the gross revenue. I love the profit margin. It does have patent protection. but the thing that I'm concerned about is that these things were developed by one person who has all of the experience and all of the professional credentials. So if I'm going to buy this business, I need him to be a consultant for me for the rest of his life in order to help design more products and more things.

The cool thing about they make the blanket, right? I've been thinking a lot about Kevlar blankets and how they could be used in grilling. for cold environments. I know that's like off the beaten path. But like if you're in a cold environment, you can't keep your grill hot. So you need a flame resistant or burning resistant blanket.

Anyway, all that to say, I think it's a really interesting business that'll never go away. But I just don't think there's a whole lot of opportunity to scale and some risk around the development of new products. Sam, how small do you think this market really is? Because they're doing $1.7 million in sale. That's a bug on the ass of a small market. Like, I would think you could even 10x this business. And it would still be an itty, bitty little business. Like people are governments and companies are setting off bombs. Like there's pictures here of these enclosures around industrial machinery. In fact, like, I would think you could sell more than $1.7 million of these things, right? probably but one of the things that makes me concerned, of course I say that again, but is the last

paragraph. It says, in addition, individual sections can be repaired or replaced if damaged, reducing overall maintenance costs and extending the life of the equipment. I don't want to extend the life of equipment. I want it to be, you know, if it's damaged, you need to get a new one. I know that's that's just kind of pragmatic and but but that like you buy one of these things it's made to last. So they may buy one and own one for 20 years and just buy Plexi, you know. But yeah, I would say worldwide like internationally, this thing is a, the TAM is much bigger. But if there is no competition, if there's no competition for this and they're at 1.7, then either they're lying that there's no competition or the TAM is tiny.

Let me put it this way. I've never seen a seller telling the truth when they said there was no competition. If you'd like to run an experiment, Google the words blast resistance structures, and tell me how many competitors come up. So either this teaser is doing a bad job of explaining how they're totally unique or they are lying. And I'm guessing they're lying. This, I mean, when you sniff out the size of this and how variegated the products are and how they're all. custom done. This is actually a consulting organization masquerading as a product company, right? When you look at it. Look how. Yeah. That's exactly, that is exactly what's going on here.

And you're buying yourself a mess with this. Like, this is not, the way they talk about it's not necessarily repeatable. They're not cranking these things out. It's like custom design with repairs. Like, and I agree. Like, it's an attractive business because everybody wants to pay up so their bomb structure doesn't fail on them. It's kind of a big deal. You don't want to get blown up when your thing fails. But like, you got to know what you're getting. This is not a manufacturer. Like, that's the teaser title to this is actually have two lies in it at the same time. Right. It's not a manufacturer and there's definitely competition. So they, there's definitely good analysis. That was good. Yeah.

So they do say they outsource their manufacturing, which is kind of what you're saying. Do you think there's room like, again, buyer business fit here? Like if you're someone that understands government contracts or nuclear power plants or bomb manufacturing supply chain or like if you're in this niche like is this business transactable and saleable like is there someone that can buy this or do we think this is just not saleable at all because it's so tied up in the in the pattern i think that it could be a good fit for a government contractor in the ppe space or protective some kind of protective equipment space it's already got a gsa schedule meaning that they've already got a listing with the government to sell the government

these products at a certain price. So they'd probably have to add on to their schedule these products and they'd have to standardize, kind of standardize them a little bit, but they could customize them for the government customers just kind of at a solid or fixed price. So if they could get listed on the GSA, on a GSA schedule, then I believe that this could be something a good add-on for a. a PPE company, but it's not something that it's not definitely not going to fit most buyers. So one data point, I do know, I do know some folks that are specifically in this because

the sanatorium is a big government contracting workhead and do bombs and explosives and stuff. And they told me recently that Trump administration spending tons of money and all this stuff, and then the day the Biden administration walked in, it was like, nope, social programs and bridges. That's what we're building. So, you know, you are facing a headwind with this type of stuff, which is this type of military, go-to-market, fight Russia type stuff, espionage. Like, it's all been, the budgets have gone way down for that kind of stuff. So let me also say something else about this business, which is a little bit more generic that I see in lots of listing, than I see it here. And it's actually something I really like, typically, which is this company, the founder of this company, is obsessed with the problem.

This guy is a scientist by background. He developed like a custom polycarbonate. This is a product CEO. This is not, I mean, this is, I don't mean to say he's not an entrepreneur, but this is a guy who has obsessed with the product and built a company around the product. A lot of times these guys and gals have a great product and they suck at everything else. Product and marketing, you know, finance, sales, like all that stuff. So sometimes when I do see a company with a deep product background founder like this that is smaller than I think it could be,

sometimes it tips me off to an opportunity where if you came in and ran this thing like a real business and made this guy, you know, as you said earlier, a consultant, the chief product officer, not the CEO, and actually put the pedal of the metal with best practices on a sales organization. I have seen, and I don't know about this business specifically, but I have seen other businesses where the founder just leaves so much meat on the bone because all they want to do is gaze up their own navel at the product. And they don't want to do the other 90% of business. And I kind of smell out here.

Technicians. That was the thing we'd always joke. I'd run into these CrossFit people. And it's the same thing. You get technicians there too that want to just talk CrossFit all day long, but have no interest in making sure their gyms clean or like making sure their customers are happy. but man, if you want to talk about how to do pull-ups, like they'll give you an hour's worth of it.

It only took me 12 minutes to get cross-fitting, guys. I knew I could do it. So what I like about it is the patent. Now, that patent and that custom product could be spun into other products. So I'm thinking like armored vehicles and other things that need protection, not just testing.

Because that's where he's coming from. Sandia National Labs, right? That's all they do is test, test, test, test. So he's been focused on testing. This product could be used for a lot of other applications. So this might be a Kevin Harrington. I'm going to license, you know, I'm going to license this product, and I'm going to get royalties. And so it's just something that would be interesting to dig a little bit more into.

Plus, it's seller listed. This is a cool one. Thanks for bringing it, Sam. reason for selling retirement and headed to the beach. And you can tell how excited they are about the beach that they capitalized beach. It's capital B. Man, these guys, cool name. TotalShield.com is a cool name.

I don't even think that shows up anywhere on the internet in a quick search. That might be, that's where Bill was talking about. They just suck it. Yeah. Everything else but product. I think this business is going to sell. I really do. I don't know if it'll go for six times.

but I think I think someone could do well with this, the right person. I'm kind of seeing it from your, like, you're kind of turning my focus here. I was at a no, and I think I'm moving toward a yes. If somebody had the time and the ability to turn this thing, I think there's a lot of opportunity. Yep. Pending diligence. Pending diligence. As always.

Dang it, Bill. Yep. That's a great part about this podcast is we get to buy businesses on the spot. and then never think about them again. Yeah. You know what? Like I would love to be able to see, I would love to be able to see our choices. So like I keep a journal on like, hey, if I'm not ready to take a risk, I'll take a journal and I'll take a journal entry and I'll say, I would have done this.

And then I look back at it three to six months later and see if my prediction was right, which helps me trust my gut more. So I'd love to see these businesses later down the road, but impossible. Holy cow. guys are in North Bonneville, Washington, which you're like, oh, they're in Washington. No, it's basically an hour and a half east of Portland, just on the Washington side of stuff. Yeah. It's way out there. It's on the Hood River. Like, you just keep going towards Mount Hood and then you get there. This is way out of the middle of over. This is great. Well, great job today, Sam. Brought the energy, awesome microphone and knowledge. I think it turned out amazingly.

10 out of 10, Bill, again, maybe an 11 out of 10 this week. Thank. Yeah, I think we were great. Yeah, Sam, you did great, Sam. Thanks for, and especially thanks for bringing stuff that was in your wheelhouse. It's super cool. You know, there's a lot of listeners for this podcast. Yes, we're as surprised as you are to hear that.

But what can our listeners do to support you, follow along with your journey? What would be helpful for you? Oh, man. Just follow me at Sam T. Leslie. and on Twitter and sign up for the mailing list. Sometimes I shoot out cool stuff, sometimes not. I'm pretty lazy when it comes to that, especially when I'm concentrated on seven kids moving across the country,

putting them in school, finding a house, and closing on a business. So just find me on Twitter. I put out some fire memes and Gertley and I go back and forth. So I love you guys. You're awesome. Yeah, well, we're super, super glad you're hearing. Good luck. Keep us posted on your journey.

I certainly will. Thanks, Bill. Thanks, early. Thanks, guys.