Acquisitions Anonymous - #1 for business buying, selling and operating - This Smart Home Business Checks a Lot of ETA Boxes

Episode Date: February 17, 2026

In this episode, the hosts break down a $1M EBITDA smart home and AV integration business in booming Charlotte, NC—debating whether the real opportunity lies in the electrical add-on and attached $3.5M showroom real estate.Business Listing – https://www.bizbuysell.com/business-opportunity/1-00mm-sde-smart-home-and-av-integration-company-in-charlotte/2365518/Welcome to Acquisitions Anonymous – the #1 podcast for small business M&A. Every week, we break down businesses for sale and talk about buying, operating, and growing them.Looking to build a professional website in minutes? Try Wix: https://wix.pxf.io/c/6898629/3115214/25616?trafcat=templateHubSpot is the backbone for how businesses scale without chaos. Try them out here: https://go.try-hubspot.com/OeG9Vr💰 Sponsored by:FRANZY - Thinking about buying a franchise instead of an independent business? FRANZY is a free platform built for acquisition-minded entrepreneurs who want to explore franchise ownership without broker bias. FRANZY matches you with franchise opportunities based on your capital, goals, and lifestyle—and includes free coaching from experienced franchise operators. If you're exploring ETA but want a structured, system-driven alternative, check out https://franzy.com/Acquisition Lab – Your fast-track to business ownership. Get hands-on support, world-class resources, and join a top-tier community of acquisition entrepreneurs. Schedule your free consultation at https://www.acquisitionlab.com and mention Acquisitions Anonymous!This week, the hosts evaluate a 15-year-old smart home and AV integration company in Charlotte, North Carolina generating $3.6M in revenue and exactly $1M in Seller’s Discretionary Earnings. The asking price? $3.5M (3.5x SDE), plus an additional optional $3.5M for a showroom property not included in the business price.Key Highlights:- $3.6M revenue | $1M SDE | Asking 3.5x multiple- 70% residential / 30% commercial mix- 18 employees including technicians, project managers & leadership- $3.5M optional showroom real estate with structuring upside- Major growth lever: Add licensed electrical services for full-stack installsSubscribe 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]

Hello everyone and welcome back to another episode of Acquisitions Anonymous. This is the internet's number one podcast. Yes, that's right. Number one podcast on buying, selling, and operating small businesses. I'm one of your hosts, Bill Dallisandro, and I love today's episode. I hope you will too. It is a smart home and AV home theater installation business in my hometown, Charlotte, North Carolina. I think there is a chance I might have been a customer of this business recently.

The business has a million bucks to SDE. There's a lot to like about it. And I've also got Chelsea Wood from Acquisition Lab here today on this episode to help me break it down. So without further ado, I hope you enjoy this episode of Acquisitions Anonymous. We'll say, Acquisition Anonymous. Hello, another episode of Acquisitions Anonymous. We don't have 100% beers anymore. And thumbs downing on just the plus inventory line.

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explore franchise ownership without broker bias. You answer a few questions, and Franzy shows you franchise opportunities that align with your capital, lifestyle, and long-term goals. You also get free coaching from people who have actually built and scaled franchise businesses. If you are exploring ETA and want to understand whether franchising fits your acquisition strategy, visit franzi.com. That's F-R-A-N-Z-Y.com. And thanks to them for sponsoring today's episode. Hello, Chelsea. Welcome to Acquisitions Anonymous.

Hey there. This is going to be fun. It's just you and me today. I know. I know. I'll get your undivided attention. That's great. And the timing is awesome. I was just telling you before you hit record. I just saw Walker Dibble, who wrote by then build and was your business partner at Acquisition Lab here in Charlotte. He was here for an ETA event. And I thought they said, hey, this is happening. Will you come? And I was like, yeah, of course. I thought there's going to be 20 people there. There were 100 people, 120 people almost, I think, at a Charlotte ETA event. So I was stoked. I mean, it's in the water, Chelsea. It's out there.

We just launched local meetups, actually. So we have 15 chapter presidents now, and they're doing quarterly meetups because the local community is really important. And we've not done that before. So I'm kind of excited about that. So you have Acquisition Lab meetups in 15 cities? Every quarter now we'll have them. They launched this quarter. So the first 15 are scheduled between starting in February. Yeah, 15 of our largest markets. We just went with chapter presidents. So lab members will be the chapter presidents. And they'll be the chapter presidents. And they'll be. we have a team that's organizing them. But yeah, and but we're not doing like those meetups are different in the sense of I didn't want it to be speakers. Like it's not like a like a like, I love Walker, but yeah,

it's more about like we're calling it searcher circle and it's more for lack of better words. Like I don't want to like, like I'm modeling it after AA, right? So like I want it to be more about like shared learning and vulnerability and kind of what we do in the library. And so there won't be a sponsors talking and stuff, but it'll be more about like what are you going through? Like what's worked for you? What hasn't worked for, you know, you and just building that community locally.

Like we do in the lab virtually. So anyway, I'm really excited about that. That's awesome. If people want to find it, is there a website they can go to find all 15 cities and the dates? No. Not yet. Will there be by the time the episode comes out, hopefully? It is for lab members.

It's open to the public. They can come to a couple if they want to. but it is an acquisition lab member event. And so you can go to vore.com probably in search for it because that's our company that's managing it. And just search searchers circle. And I'll send you a list of the cities. We can kind of make a link for it.

Awesome. That's cool. So we have a cool deal today. Chelsea and I picked this one not five minutes ago. But this should be good, Because Chelsea said that acquisition lab members have bought businesses like this. I have been a customer of a business like this, and this listing is actually right in my backyard. So you're ready here, Chelsea? I can't wait.

Okay. So this is a $1.00 exactly million dollars. I'm a little suspect, but okay, exactly a million dollars of SDE, a smart home and AV integration company in Charlotte, North Carolina. It has $3.6 million of revenue. It has a million bucks of SDE slash EBITDA, and they're asking $3.5 million for it. So they're asking for three and a half times EBITDA. It also says it has $3.5 million of real estate

that is not included in the asking price. So we can come back to that and structuring. It is here in Meckleburg County, North Carolina, which functionally means Charlotte. It says, this well-established home automation and AV integration company has been serving high-end residential and commercial clients for over 15 years in one of the fastest growing luxury markets in the southeast. Specializing in smart home systems, home theaters, networking, surveillance, and commercial AV,

the company has built a reputation for premium service, high-quality work, and consistent referrals. With over $3.5 million and consistent revenue in a million bucks of cash flow, this company is poised for a strategic acquisition. With a strong team, loyal customer base, and increasing demand from new residents and businesses moving into Charlotte. This is an attractive acquisition opportunity. Leadership can remain post-sale for continuity, with some recurring revenue through maintenance contracts. Over 3.5 million consistent revenue in a million bucks

of cash flow, the company is poised for an acquisition, blah, blah, strong team, very attractive, et cetera, et cetera. 18 employees, including season technicians, project managers, and support staff, leadership can remain. Diverse revenue stream is 70% residential, 30% commercial. Jobs range from $20,000 standard projects to $100,000 specialty projects. They have reputation-driven growth, deep referral base and strong online reviews, minimal paid advertising. It's expansion-ready, opportunities to grow by adding electrical licensing,

targeting underserved areas in the south of Charlotte, so the Burbs, expanding new product categories like smart lighting or automated shades. They have scalable infrastructure, meaning they have high quoting volume, it says. Recent hires include techs and a salesperson to improve conversion rate and handle growing demand. The real estate is optional. The facility includes a showroom that is available for purchase or rent. Okay, we'll come back to that. Growth opportunities expanded to high growth areas like Ballantine, Waxaw, and other affluent suburbs, add license electrical to enhance commercial big capacity, increase marketing efforts, build recurring revenue via service plans or maintenance packages. It says,

Ownership is flexible and open to retaining a minority stake or supporting a transition period to ensure smooth handoff. It has $200,000 of F, F&E. The lease, it says, is weird, it says lease showroom and office space. So I'm hoping they've adjusted the P&L for a kind of a pro forma lease if they also own that real estate. It says most rivals are small firms lacking the staff infrastructure and reputation to compete on complex and high-end projects. So that gives them a strong competitive moat because they've been around for a long time. They have experienced team. They get good referrals.

They really want you to grow by adding electrical licensing. They keep mentioning that and expanding into other areas like smart lighting and automated shades and then also going out into the burbs. The reason for selling is older owner facing retirement. Okay, that was a lot. Chelsea, you said you've got some experience. Your members have some experience. Tell me about this industry, about this business. Like, what does it really do?

Is this a good business? I mean, I like it. because I feel like it's one of those evergreen, like it's a core part of functioning that's not going to change, right? Well, the technology will change, but like people will always need this type of a service. The challenge that I have is that it's tied to, typically it's tied to new construction, right? So like this is done in new construction and so it's going to wait or follow those kind of trends, which I don't ever love anything tied to new construction. But there is some potential for upgrades.

So like when somebody buys like an outdated house and they have kind of these higher expectations. So I love that. I just spent five figures on this exact retrofit in my house. Exactly. And so like I like that it's diverse. And when you look down at it's commercial and residential, so I like that. the license your reference keeps me a little concerned, to be honest. Talent is a challenge.

They tend to be a high-cost talent because it tends to be a specialized on a talent base. And so, like, that posed a challenge in one of our members who acquired in this space is just the cost, right? They were underpaying their workforce, and so then they had come and adjust them to a market rate, which was not necessarily. something that was planned for. Because on, and this is, it's one of these things, and I'm sure you experienced this in the past, like on paper, somebody can be paid within the range when you do diligence. It's like, oh, everybody's good. But then when you get in and you learn how specialized the knowledge bases, then you're like,

oh, like, yes, you're paid appropriately for the title, but not for the specialization. And so I would just say that when you're going into something so specialized as in smart home, installation and maintenance, you have to recognize and make sure that people are being paid based on the skill level that they carry and just make sure that you're not going to have an increase in overhead there. Well, you also don't want to lose them, too. If you're underpaying your people, you'll have people churn, and your people are delivering your service here. So you don't want people churn. No, exactly. Well, and this is, again, a really highly skilled workforce, so it's not even easy to replace, right, and train. There's a long training period. And so this, I like,

like the industry because I think it's always going to be there. It might look different, right? Like what they were doing in the 80s looks different from what they're doing now, but they were still doing this kind of high-tech AV service. And so I like the place it plays in. I like the cash flow level. I like that it seems like they are, they have an infrastructure. I like the average about like order value. It doesn't really say anything about customer concentration. or where they're getting their work from. And so typically it's a referral base from construction companies or, you know, developers. And so I would want to know kind of what that looks like to see if there's transferability, because they keep referencing that the person's willing to stay. I read it as it's not the owner that runs it because it says several times strong manager. And so I think they're implying that management will stay, but the owner will do a transition period. Got it.

Leadership can remain, okay. Which is much better. Yeah, that's a thousand times better because the whole, like, referencing licensure and saying, like, leadership can remain post-sale for continuity. I'm like, so are, like, where's the, why do we keep talking about licensure? Like, do we need to have licensure? Are we saying that this person is so it's not a concern? What I like about this, Chelsea, is I don't think this does require licensure. So this is all low voltage, right?

Correct. And what they're saying is, so you don't need licensed electricians, which is awesome. Now, they keep saying, they said three times in this teaser that you should add licensed electrical, which makes a ton of sense. I mean, I just did all this and I needed to bring in someone different to do all the electrical. I wonder if this is the business that I used. So, I mean, it's a slam dunk no-brainer. There's a reason they mentioned it three times is to bring electrical in-house so you can sell that work too.

Well, and the challenge is if they don't have it. So I will be honest, the member, the one of our members bought almost identical company and it did have the electrical, right, which is why it was so expensive. So then I would argue you should have that. The fact that you had to bring in somebody to go and do the other half of this work is kind of not the best experience from a customer perspective. But that's great, right? Like this is a big growth opportunity. Like bring on some licenses of electricians. Your job size is going to go up. It's going to be a better customer experience. It's a win-win all the way around. But it's a high cost, it's a high cost workforce. Well, but in theory there's a margin in it, right? Like electricians bill out at more than their rate. In theory, right? You've got a million dollars of EBITDA here, right? But if you go and hire, like, how much can you actually increase the cost of,

and again, I don't know what they're charging. It feels like they're charging like they already have that workforce. I would be surprised if, go ahead. No, the way it's typically built, I mean, having just been a customer of this. So the way it's typically build, like you will get a quote. I really wonder if it was this company. You will get a quote for like all the low voltage work. So that will be like pulling all the Ethernet cable, that will be like mounting the TVs,

that will be putting the speakers in the ceiling, that will, you know, pulling all the speaker wire, you know, all that stuff, surveillance cameras, alarm, like all that stuff. But then they're going to spec out and they're going to go, we need electric here, here, and here. and then they will typically have a partner electrician. And he will come in, you get a separate quote for the electrical. So you'll have two quotes. So by bringing license electrical into this business,

you would just only get one quote for a larger amount from them. So you'd hire an electrician, like I don't know how much an electrician costs, 150K. So that would, you know, you can't sell him immediately. So yeah, there would be a bit of a J curve. You bring your licensed electrician in. But I mean, I will tell you 100% of these jobs need electrical. And there will be a 100% attach rate, which is great.

So you would sell, you would book this guy up pretty quick. Or they mentioned it so many times. Well, because it needs to happen. But it begs the question for me, if you're making a million dollars of EBITO, why in the hell haven't you done that already? That's my question. I really wonder why they haven't done it. I mean, obviously it's occurred to them.

They've mentioned it extensively, right? I really wonder why they haven't done it. The thing, you mentioned it's leveraged to new construction. There is some retrofit, but if you're going to be leveraged to new construction, I can't think of a much better place than Charlotte, North Carolina. I mean, like, this is just, there's a fundamental and structural population migration, you know, out of the bigger tier one cities to places like Charlotte, Atlanta, Nashville, whole southeast, etc.

So you have this population tail when the construction is like crazy. Your point, Chelsea was very good. really want to know where their leads come from. Like, is this all builders that have them come in and put it in a new home? Is it like spec builders where I would bet not? Because I don't think like putting extensive smart home in a spec build drives your sale price of the home. I would think this is probably custom built if it's new built or retrofit.

So I really want to understand kind of where my leads came from if it was just a couple builders because if so, that's customer concentration. Right? You lose those guys. it's really lead concentration, even though the homeowner may be paying you, but if the builder is the one bringing you all the leads, that's risky. Well, and I think that's the challenge when, for everybody buying in the space, or in any space, I should say, like the ETA space specifically is like,

there's an underestimation of the skill required to find and convince key decision makers to use your product. And so I think that understanding where they're getting their leads and how, the bright buyer needs to know how to continue furthering those relationships. Because I have a lot of conversations with folks that are like, oh, well, I did sales. And it's like, okay, well, not the type of, like, then you have to buy something appropriate for the skills you have. Because that's where I see lab members and just buyers in general, even not lab members on podcasts, right? They go wrong, not being able to identify and convert customers, you know. Yeah. So this business, if you you think about it, like how this works, it's system design. So Homer comes in. They go, I want a home

theater. I want the lights to be automatic. You know, all the stuff. You've got to understand you or your tax. I've got to understand kind of what you're selling. You might be a licensed dealer from, for some of these brands, which is great because then they'll be training. You'll have, you'll be a licensed dealer. There's a little bit, there's a little bit of brand value there. I mean, I don't think you're going to be exclusive for a territory, likely. But you will be, you know, you have support from the brand, the manufacturer. So you have to design the system. So there's a little bit of a sort of engineering and design capability up front.

Then when it's designed, you've got to actually install, which basically means pulling cable through walls, cutting drywall, you know, mounting TVs, you know, putting speakers in walls, like that type of stuff. It's like light construction. It's not. That feels pretty easy to, and I don't mean this judgmentally of the workforce,

but that feels like a pretty easy workforce. build. A hundred percent. Yeah, like this, this labor is easy to find. The, the kind of design labor, a little harder, but again, you're supported by the manufacturer. And, like, I don't think that's that hard either. You know, you're probably, you're probably selling mostly the same home theater every time, right? It's not like totally designed. Yeah, different configurations, but it's not that different. Then you've got to do the work. And then sort of the tail end is you have to configure the system. So, like, you've got to, it's like a little bit of software configuration to make it all work. And again, the manufacturers will support you there. And that's maybe a little bit more

technical. So you've probably got like your system designer and your system config are probably like the same work. And then you've got your more, you know, hammers and saws, people pulling cable and cut and drywall. So that's how this business delivers its service, if you can picture it. I love this, actually. I love it. I have a member, is it a member? Is it a member? or somebody trying to get in. I don't remember. I just talked to somebody yesterday. And there's a talent with being able to manage both of those types of workforces, right?

The more skilled workforce and then the more hands-on workforce. That I just, it's like, as soon as you're talking, I'm like, oh, he would be a really good fit for this, right? Because it's like, I like the business. I like the, there's a lot about the business that I really like, but I also, in light of how the market feels right now sometimes, I really like their valuation. Yes. Yes.

This would be like a $7 million listing because I feel like so many listings I'm looking at these days are 7 to 10x, which is just absurd. And especially because I use the term strategic. So that was part of what put me on my heels a little bit was there like this would be a good strategic acquisition. And strategic acquisition to me feels like someone saying this would be good for someone that can already operate this business needs somebody to come in and just kind of swoop it up. It can't stand on its own. but I think they were just using that word differently than what strategic means in my head. And so in our world, that means I want a huge multiple. Right. Right. Like you're going to basically get all these efficiencies by like wiping out the business and just buying the book of business.

But like I like the valuation. I'd like to talk about the real estate because I think that's interesting. I like what appears to be the structure to your point. It seems like the owner has. not necessarily core. So the transferability doesn't seem as concerning originally as it was. I still want to understand if the owner is owning those referral relationships, because that would be, you know, important to recognize. But I really like the business. It's got a long history. It's got good earnings. It's got a team. It sounds like it's got a manager. Like it's got a, from everything we can see so far, I would be very excited about it. I like it.

Are you ready to take a leap into business ownership but you don't know where to start? Well, look no further than Acquisition Lab, the premier resource for entrepreneurs seeking to buy their dream business. Founded by Harvard MBA and acquisition expert Walker Dybul, the lab is your fast-track to success in the search diligence and acquisition process. With hands-on support, world-class resources, and a community of like-minded entrepreneurs, Acquisition Lab gives you the tools and confidence to navigate every step of the journey.

And we're proud to call Walker and Chelsea, the lab's director, longtime friends of the podcast. They're passionate about helping entrepreneurs like you take the next big step. So don't wait to make your business ownership dream of reality. Visit AcquisitionLab.com today to learn more and schedule your free consultation. And when you do, be sure to tell them the Acquisitions Anonymous podcast sent you. So let's talk about the real estate. So the business has a million bucks of SDE and they're selling the business for three and a half million bucks. They've got a separate three and a half million bucks of real estate.

and they describe it as a showroom. They didn't like describe it as a warehouse or, you know, logistics facility, although I'm sure it does, you know, they'd probably warehouse some equipment there, some cable, things like that. But you probably don't need a huge warehouse, and that part can be moved. I mean, you probably need 1,000, 2,000 square feet, nothing major. So I would think what this really is is a showroom.

Chelsea, how would you think about, you know, valuing this real estate? What are the gotchas when real estate comes with a business? And do you think it would be severable? That's a good question. So a couple of things. The biggest thing, and you called it out earlier, is like, I really hope that they've adjusted the earnings to reflect the leasing component

in the value, like in their SDE value, because I feel like a lot of times when real estate is listed, they don't do that. And so you think that it's a million dollars. but then when you go and actually include the cost of leasing the property, now it drops dramatically, depending on the market it's in. And this is a high-valued property according to them, right? And so I would be a little bit concerned about what the cost of leasing the property would be in relation to the million dollars of earnings that they're listing.

Well, to me, though, I wonder, do you really need it? I mean, that's my first question is, like, do you sell business in the showroom? like do you really need this? Like are builders and people coming in and sitting in your recliner with speakers in the back of it and watching Top Gun and being blown away by the audio and going, I have to have this in my house? Or is it a lot of times in all businesses, especially, I mean, this is owned by a nerd. And I say that affectionately because I am one. This is owned by like a home automation nerd.

And he is like, you mean I can trick out this awesome showroom with all the coolest stuff and expense all of it? like, let's do it, right? And he's convinced himself as a business expense. I'm owners in all the industries do this, right? But the question is, do you really need it? And I would be tempted just to not lease it. Go do whatever you want. We'll move out. See you later. I have mixed feelings. So I have a love-hate relationship with real estate involved in deals. So on one hand, I have my grandpa in my ear telling me that, like, real estate is the most valuable asset you can ever have, go buy real estate. Real estate is always good, blah, blah, blah, right? And then on the other hand, I know the economics of deals. And so a lot of times the real estate doesn't make sense.

But I know nothing about this market. I'm in St. Louis, Missouri. I've never, I think I've actually been there. But like, we're going to say I'd never even been here, right? And so, but everything you've said to me about the market makes me think it's a good market to own real estate in. Broadly, it is. And so anytime there's like real estate that could potentially be valuable, aside from the deal, it makes me go, well, maybe that changes how I feel about real estate involved in the deal because it's, in and of itself, it's also a good investment. The other part of me is also thinking, this is a Chelsea problem. So like anyone listening, this is my perspective only.

I think that as humans, we are longing for tactile experiences related to our purchases. because we've gone so far in the other direction of buying everything online and having a hard time actually getting to see something in person before buying it, that having a showcase for this type of product is probably actually kind of important because it is a luxury item and it is very much selling someone on the experience and, like, they won't get to experience it until it's completely done. So I think not having a place to actually bring them and have them experience what they're about to do to their house might be a bad thing. and so I would go more towards yes, I would want the real estate. I would not want to lease it if I could help it because it feels like a valuable asset. And I think I would structure the offer slightly differently so that I could get the terms to work in my favor.

I think I would offer a little bit more than a 3.5 multiple for the business because I think it carries enough value that I could. And so I think, again, guys, this is not, I'm not telling anyone to make this offer on this business. But like, if I were doing this from an economics perspective, I would rather pay $4 million for the business and pay $3 million for the real estate so that I could take advantage of the business being more valuable than the real estate and get better terms. Right? Or I would flip it actually. So the real estate has to be more valuable than the business. Yeah, I'd probably flip it, right? Because your debt on your real estate is going to be cheaper debt than your business. Exactly. And so it's like, I think in this regard, because they valued it appropriately, that's the dyslexia. I could get in bill. I always. Yeah. But yeah, it's like, I think the real estate actually,

because it feels like a valuable market to own it in, the valuation of the business is a reasonable valuation. It would just depend on if the real estate valuation is also appropriate. But it could be that including the real estate here, actually positively impacts the economics of the deal because the terms can be better, because the real estate can be more valuable than the business. Sorry, I flipped it. So my gut says the real estate would be included here. I wouldn't know until I modeled it out, but like that's my- Well, that would be the first question for the owner, right, is honestly, do I need this showroom? Right? Tell me honestly. Like how much business you saw out of the showroom, et cetera. Correct. Let's assume you need the showroom. So just for purposes,

of the analysis going forward. To your point, Chelsea, I was first going to say, you kind of need to look at this buying the real estate as a separate transaction that's got to make sense. It's got to be valued appropriately. I'm going to assume for a second

that they have fairly burdened the million bucks of SDE with a market rent. Because if they haven't, they need to, and then you've got to if there's $200,000 a market rent, then you've got to take it down to $800,000. $1,000 SD and the purchase price of the business has got to change.

Right, everything changes. But let's assume that they know what they're doing here and they've burdened a pro forma lease rate, assuming you don't buy the real estate into that million bucks. So you're going to buy the business, got a million bucks of SDE burden for rent. Then you got to go, oh, I'm paying $200,000 a year for rent. Is it separately a good investment to invest my capital and make $200,000 a year of yield? And that's how you'll figure out if the real estate is valued appropriately. What's interesting, though, is savvy listeners have already picked up that these variables are interdependent.

So if you own the business and the real estate, which you, in theory, would upon the instant of closing, you can mess with the lease rate, right? You can pay yourself, your real estate entity, a higher lease rate, which to a point, I mean, lenders aren't stupid, but you could pay toward the high end of market, which, will in theory juice the value of the property, which might let you get more leverage on the property than you would otherwise get on the business. And if you're buying both from the seller and you could convince them, hey, to not really care, you know, you're taking home $7 million either way. Do you really care how the purchase price is allocated? You could juice the rent here and put your leverage on the building rather than on the business. And your terms might be better, and by better, I mean cheaper and longer. Correct. And, I mean, depending on the amount of

capital you bring to this, you might be able to get away with no PG. Because the business debt is going to be an SBA loan and it's going to be PG'd. The building loan is going to be guaranteed by the property, is going to be secured by the property and likely no PG. So you're going to get, the real estate debt's going to be better either way. So, but you've got to ask yourself, we already know the business valuation is reasonable, is the real estate valuation reasonable based on the market rents at three and a half million? If it is, you're basically making two good investments at the same time in the business and the real estate. And then once you decide you want to make both investments, then you get into the structuring and do I want to play games by pushing rent to either side of the ledger and

pushing leverage. But you've got to before you start deciding if I'm going to push value and debt and rent to either side of the leisure. Separately, you got to decide, do I want to them the business? Okay, yes or no. Separately based on a true market rent that I could rent into a third party for, do I want to own the real estate? If the answer to both of those is yes, then you can start playing structuring games. And that's very important. Don't start playing structuring games in order to justify making both investments. You've got to want to do them both on their own. Yeah. And I think my experience most of the time is the real estate can't work. like most deals that we look at where real estate is included,

the valuation on the business and the valuation on the real estate, like the math never mats. Not never, but you know what I mean. It's like in the event that this works, I think it would just make sense. Now, if this was completely in a different market and everything you would just said about

the market wasn't true, I would say no to the real estate, right? Because it wouldn't seem like a good investment. But there are situations and there are markets. And off to the markets where it makes sense to invest in real estate is where the valuations don't make. since. And so the economics die. And so I like the business. I think there's tremendous potential.

And that's what's interesting here is the Charlotte market drives both the real estate attractiveness and the business's attractiveness because it is leveraged to population growth. And the same things that make the real estate value go up make this business do well. So you've got to recognize too. You're on you're on both, you're on the same side of the seesaw twice. So you're really betting on the continued growth of the Charlotte market. So as the customer, of this lovely. Were you satisfied with your service? I was. I was, assuming it's, I don't know it's this business. I know. But I was, I was satisfied. It was expensive. I was kind of surprised, because like I'm, I'm enough of nerd that I, in theory, could have, like, crawled around the

attic and DIY this and pulled the cables. And like, I knew exactly what I wanted. I came to them. I was like, this system I want, et cetera. I just need you to do it. So I made it pretty easy on them. I was a little surprised at how expensive it was, to be honest. Like, I, the margins are good in this business. Do you think it's a convenience factor? It's literally you just don't want to do it. So like, yeah. That's why I did it. Yeah, I didn't want to be crawling around. Like, it would have been a lot of hours of my time. I'd rather hang out with you and record the podcast, you know, work on my businesses, do my investing, like all the stuff that I do, uh, rather than crawl around the attic. So yeah, I'm paying for convenience. And, but that's me. Like, most people don't have the skill set to do it. Like, I happen to be enough a dork that I could do it. You know, it is complicated. Like, I do not think you're selling convenience here. I do think you're selling

the skill as well i would imagine in my so i have a friend that kind of to your point he's a nerd he kind of dabbles in the stuff and it's kind of like a bowl of spaghetti of like there's just so much to keep organized and because it is electrical stuff um and so i could see that i i just like the distinction between the the workforce too i like that it's it's a it's a diverse workforce sometimes I don't love when it's a single, it's like you experience the same challenge as when it's a unified workforce. This could do a little bit of diversity. Anyway, I like the deal. Yeah, like if you're having trouble staffing the electrical side, you can still sell work. Correct. We can still sell low voltage work, yeah, and vice versa. Correct. No, I like, I like the deal. We'll go buy it. I'm ready.

Let's go. I'm like, should I buy their business? I mean, this is like perfect for me, right? It's in my backyard. All right, I love this face. We're done. That's a good one. So are you like valuation, fair? Like three and a half? I feel like three and a half for a million. If it's true, right? And if everything that they presented us is true,

then the valuation feels fair to me 100%. Yeah, I agree. And assuming it's burdened for the lease, the fair market rent on the real estate, I think they valued it fairly. This guy, I don't know what his deal is. David Robbins, it doesn't say his business broker. I googled him.

I can't find anything on him. I'm curious if this is the owner. it might be. Maybe I'll call. Yeah, you really should keep me posted because I really like the business. Yeah, this is a great space, but I think the huge asterisk here is this is a good business because it's in a good market. Correct. This business in a less good market, I would feel very differently about. I would not probably buy this business if it was in St. Louis, Missouri.

Yeah, you really need a good tailwinds on the new home construction. market, good net population growth, et cetera. And luxury growth. Yes. You know, it's not just growth because we have growth here, but we don't necessarily have luxury growth at the level to support a business like this or even the customer that would retrofit it. And so I think that, yeah, it's all about the right market.

And I think you're in the right market for it. So let me know when you close. All right. I'll be some champagne. Yeah. This is fun. Thank you. All right. Thanks for being here, Chelsea. And tell people just before we go, obviously, how you know so much about this? What the heck is Acquisition Lab? I guess because I'm the co-founder and CEO of Acquisition Lab. So we are an accelerator that helps Google Buy businesses. We started in 2019, launched in 2020. We've got over 1,000 members. We've had over 400 deals, over a billion in enterprise value of deals done. I'm a certified administrator. I've been in it for 11.

years in transactions for 15. Yeah. That's me. Awesome. So if people are interested, should they look up Acquisition Lab? Probably. That would be great. Go to IcbititionLub.com. Shoot me an email. Don't shoot me an email, actually. I'm drowning in emails. But you could email me at Chelsea at AcquisitionLab.com and someone will answer you. It may not be me anymore. And in case Chelsea's not like really, selling it, the curriculum that they have at Acquisition Lab is phenomenally good. It is, I believe, Chelsea, you guys have data that show that you guys are the most effective as far as like getting people to buy businesses by a ton, right? Yeah, but I think part of that is also like we're

very picky about who we work with. And so like, we're working with really great people that should be buying businesses. And so I think it was 44% is our close rate. But it's because we're picking the right people, if that makes any sense, right? Like, Like, our members are amazing, amazing humans. I'm very blessed. I did super biased. I chose the first 7,58 myself. But, yeah, we have, it's more than just, I think there's some misnomeras about the lab being a course.

It's not a course. It's more of an ecosystem than anything. We do a lot of education, but that's not, like, we're really there to hold your hand and be your thought partner throughout your entire ownership journey. That's why we have lifetime access. I still do by weekly calls with our closers to talk about

post-close challenges and successes and wins and all that stuff too so anyway that's the lab if you're interested reach out

it's a full bear hug if you want to buy a business love it thank you all right thanks Chelsea for being here and if you all like this episode we have 450 more

just like it well I mean not just like it Chelsea's not on all of them nor am I but we have a rotating cast of characters 450 episodes I don't think we ever

done a smart home contractor but we have done almost everything else. We have done FedEx routes. We have done quick service restaurants. We've done country clubs. We've done construction. We've done e-commerce. Whatever you're into, we've talked about it.

And on ACQU-Anon.com, we have a search tool so you don't have to listen to all 450. You can search and find just the deals that you're interested in. So please go check us out. ACQU andon.com. You can also get on our email list where we will email you the new episodes. If you're not an audio person or can't keep up with podcasts, but you're better at email, we can hang out with you at your inbox as well. So go get on our email list,

ACQUanon.com. Thanks for listening, and we will see you on the next episode of Acquisitions Anonymous.