Acquisitions Anonymous - #1 for business buying, selling and operating - Why This $12M SaaS Might Be a Massive Broker Trick

Episode Date: August 4, 2025

In this episode, the hosts dissect a $12M listing for a self-storage SaaS and marketing company—only to suspect it’s a digital agency in disguise.Business Listing – https://synergybb.com/listings/self-storage-saas-and-marketing-with-3-7m-mrr/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.💰 Sponsored by:Capital Pad – Buying a small business and need funding? Or looking to invest in others' deals? Capital Pad is the go-to marketplace for acquisition entrepreneurs and investors. It handles all the legal and governance headaches so you can focus on deals. Backed by entrepreneur Travis Jamison. Check out https://capitalpad.com and tell them Acquisitions Anonymous sent you!Franchise Help with Connor Groce – Curious about franchising? Connor Groce, franchise expert and operator, helps people navigate the franchise world. He owns multiple franchises and now helps others find the right fit. https://www.connorgroce.comThis episode dives into a $12M listing for a SaaS and marketing company serving the self-storage industry. The business boasts $3M in ARR, $4.3M in 2024 revenue, and $970K in cash flow—with 750 clients across 1700 locations and a tech stack promising AI-powered pricing, 3D unit visualization, and more.Key Highlights:- $12M asking price, $970K cash flow, 44 employees- 70% of revenue claimed as SaaS, but unclear definition- Self-storage tech includes ID verification, 3D visualizations, AI pricing- Strong ARR growth, but murky line between SaaS and marketing services- Hosts suspect broker repositioning to justify a high multipleSubscribe 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]

Hey, Michael here. Welcome to Acquisitions Anonymous. Internet's number one podcast about buying and selling small businesses. Today's deal was a fascinating one, myself, Heather Anderson of Viso Capital, and Travis Jameson of CapitalPad. We went through and talked about a deal that may have been a software business, but maybe something else. And it's in the self-storage space. So super interesting, and we dug into it.

And here's the episode. Hello, another episode of Acquisitions Anonymous. We don't have 100% beers anymore. And thumbs downing on just the plus inventory line. Hey, everyone, it's Bill. And I want to tell you about maybe the most exciting sponsor we've had in a long time on the pod. It's called CapitalPad. And it is the thing that I wish existed when I started my journey of operating and investing in small businesses.

So CapitalPad is a marketplace for acquisition entrepreneurs. That is people who want to buy a business and need capital. to list their deals and solicit capital from other people who want to invest in acquisition deals. So if you want to back somebody buying a small business, CapitalPad is a place to do it. And if you want to buy a business and need capital, you can go on CapitalPad to be introduced to investors. So the really great thing, too, from the investor side is that CapitalPad takes care of all of the details that can get hairy with small business acquisitions. They handle standardized terms, standardized governance, standardized distributions all up front in black and white. Basically, CapitalPad professionalizes investing in small businesses, and the returns can be really, really good.

I'm so stoked they exist. It's founded by my friend Travis, who is a phenomenal entrepreneur in his own right. So if this sounds like something that's appealing to you, if you want to buy a small business and need capital, or if you want to invest in small businesses, go check out Capitalpad. and tell them that Acquisitions Anonymous sent you. Travis, how are you, my friend? Fantastic, Mr. Gurley. How are you, my friend?

I'm doing well. Doing well. What's new in Jamison World? Nothing. Just looking at deals all day, every day, hunting for a good one. Yeah. When you guys look at CapitalPad, what is kind of your North Star number? Are you looking at total dollars transacted, total deals on platform?

Like, what are your kind of, do you have an individual number, are numbers that you're focused on? Well, we have those things. We have total allocations, investors, like, you know, search your sponsors on the platform. But really, we're just kind of focused on, like, how many good deals do we get out there. Yeah, so not as much focused on, like, platform growth,

although we are growing, more focus on just, like, quality coming out. Like, what can we get out of there? Nothing else matters. Yeah. Is it quality just, at this point, kind of your estimation of whether you think it's a quality deal or not or how are you thinking about it? Yeah, yeah, absolutely. I'd love to be able to give you a blueprint. I'd love to be able to say this is the checklist. We have a pretty strong checklist of things that steer us away, but it's just kind of opinion, really, of what's a

quality deal. And again, it's why we say no to the vast majority of deals that are coming on the platform. But I really wish we could have more. We just haven't seen enough that like cross the the threshold of being awesome for us to put it on there. Yeah. What is the main way people are sending stuff to CapitalPad? It's probably a almost 50-50 mix. A lot of people just come direct submitting their entire deal on the platform. Other people are coming through connections and like, you know,

but basically people we've gotten to know over time or they've like heard about us to different places. Maybe we've had a conversation at a conference. They're like, hey, here's the deal. We're finally ready to take a look. They give us the teaser and prospectus and stuff like that. Nice. Well, it seems like something there'll be a big flywheel over time.

The bigger the platform gets, the more. That's kind of the idea. Again, we have more capital than deals right now. So, again, if you're a searcher or a sponsor and you've got a deal, please, you've got to come pitch us. We would love to find some things that are a good fit right now. I have a deal. I'll maybe send it to you. We'll see what you think.

All right. It's kind of crazy. So that's what you'd expect. Fitting. Well, I got nothing else. I'm creative. Okay, speaking of creativity, I have a deal that I think is right up your alley that I ran across. I think it's super interesting. So it is from Synergy Business Brokers and is a self-storage SaaS and marketing services company with $3 million in ARR. Unfortunately, it is, has an accepted offer currently. But it's still worth talking about. So it's listed for $12 million. Annual revenue is, $4.3 million, and net cash flow is $970,000. So they're asking 12 times cash flow, but don't worry about that part. It's fine. Just go with it. Just go with it. This business has an accepted offer. Please be our other tech companies for sale. We're going to talk about it anyway.

Founded over a decade ago, this company is a leading SaaS and digital marketing solutions provider for the self-storage industry. With a team of 44 employees as of 2025, it delivers website design, SEO, PPC, AI-powered rental tools, and proprietary software that enhanced storage facility operations. The company serves approximately 750 unique customers across 1,700 locations, with the largest single customer operating over 100 locations. 2024 revenue was $4.3 million, up 21% year-over-year, driven entirely by ARR growth. 2024 ARR is expected to be $3.01 million and 70% of total revenue. 2024 SDE, seller's discretionary earnings is $970,000 expected to reach $1.3 million in 2025.

This year, for 2025, they expect to do $5.1 million in total revenue, 3.6 million of which is annual recurring revenue for a 27% STE margin. Gross retention is at 90% and net retention is a $1,000. 110%. Recurring SaaS revenues account for 70% of total revenue providing essential tools such as multilingual support, AI-driven pricing, 3D unit visualization, ID verification, and lead conversion capabilities tailored for self-storage facilities. The remaining 30% comes from SEO and digital marketing services, including PPC management, SEO optimization, Google Business Profile handling, and reputation tracking. These services work in synergy with the company's SaaS offerings and enhance clients' digital presence and revenue generation. They stand out in the service industry with AI-powered software,

offering a seamless rental experience and automated movement solutions that drive higher conversions. It has developed proprietary APIs and data tools that provide deep insights into pricing trends and customer behavior, enabling storage operators to make data-driven decisions. Has digital marketing services, high retention rate, blah, blah, they think that you could grow the business more with outbound sales and exploring hiring regional sales managers to target middle market ownership groups and key markets. It's also investing more in AI-driven automation and stuff like that. The owners are committed to support a smooth transition post-sale

and are open or providing guidance as needed. In addition, you could elevate one of their internal candidates to be your CEO to lead the company going forward. So I'll pause there. Travis, do you have a good idea what these guys are doing? I mean, it seems like a SaaS for self-storage units and then a little marketing company tacked on. I mean, I would almost bet it was a marketing company

that decided to build a little SaaS to fix it, and that probably outgrew it. I did like to see that, because so many of deals like this, they're like, oh, we're software and services, and the services are really like the meat of it all. This looks like it's the opposite, which is kind of nice to see. Yeah, I'm really confused. And maybe, Heather, I don't know if you read it in this,

like how much of this is, like, actual software revenue versus how much of it is marketing. Like, yeah, marketing agency stuff. It felt like they described a lot more marketing services in this teaser than they did, you know, what the software, I mean, I would assume it's maybe like a CRM with all these marketing capabilities sort of tagged on, but it felt it felt more marketing heavy in the description to me. Hey, everybody. If you've listened to the show, you've probably heard us talk about franchises.

While franchises can be a great path to business ownership for the right person, like there's a lot of pitfalls. And it's important to be really careful as there are certainly good franchises to be in and bad franchises that you don't want to be in. Connor Gross is a friend of the pod and a resident expert on franchises. And Connor not only owns and operates his portfolio of multiple franchises, but he's also a franchise consultant and helps others work through while picking the right franchise for them. So as he's sponsoring today's episode, everyone should totally click in the show notes below to join Connor's newsletter and attend one of his gateway to franchise ownership workshops. If you're ready to move and move quickly, schedule a call with Connor and his team today. I see 70% total revenues from SaaS.

Mm, okay. Tools such as multilingual support, AI-driven pricing. That's interesting. 3D unit visualization, ID verification, lead conversion. I wonder how much of this is really

software SaaS revenue. Because the kind of thing that's a little sketchy here, and Travis, I think you have a feel for this, but they're doing $4.3 million in revenue with 44 employees.

Yeah, what are they doing? But what was the, the company was it like builder AI or something that recently some like AI platform that came out which is like 700 Indians behind it all. That was actually a company called gurdly.ai. It was actually all Iranians are, I mean Indians just doing the work.

Just kidding. But yeah, that makes me wonder if this is really, how SaaS this really is, right? It feels marketing to me. Yeah, three times revenue for a fast-growing SaaS business is not insane. Because the idea is always you could just turn off growth and get $3 million a year out of the thing, right? And it pays for itself pretty quickly. The problem is this smells like it's not actually a software business.

Or is it like IT MSP, like IT managed services? like they're managing the CRM and the marketing services for this industry. They do some implementations, and then they, you know, get the servicing of it afterwards. Could be that. Yeah, I wish we knew what the SaaS actually did. And what platform it's on, because that would matter a lot to me. If this is truly SaaS, is it home-developed SaaS, it truly their own with their own code, or is this like on a platform like Salesforce or something like that where it's customized?

When I worked at Live Oak Bank, there's a company, a publicly traded company called Encino that was developed at Live Oak, and it's basically just a CRM for small loans at a bank built on Salesforce. That's what Encino is. So it could be a company like that. Ooh, this is proprietary all of a sudden. I don't know. Yeah, we just got to this part, so I don't know. It says proprietary coding enables clients to monitor real-time competitor pricing while

their effective SEO strategies drive increased web traffic enhancing revenue potential. So that second part, the SEO sounds like the digital agency stuff, whereas the proprietary coding sounds like they might have a pricing engine a little bit involved in this. Upside, this sounds like it might be a little sticky, which is nice, especially if they are using like proprietary pricing and whatnot. And then the SEO for like local companies like this

tends to be pretty effective so that they could probably get pretty good results assuming they're not terrible which a coin flip really. Yeah. This is one of those businesses where the listing is just really confusing because it's not I think we saw this in one of the listings Heather

we looked at the past couple weeks where it's just like oh this is a med spot and a Urgent care. It's an urgent care med spa. And children's services as well. It was great. So the more I read of this, it reads kind of like the software is,

or someone interested can just take a tour. Basically, like, you can book the whole thing remote. You don't have to go there to book it. It's what it seems like. You know, you're uploading your ID so that you can, you know, get the paperwork started. You can take a 3D tour of it, see what it would look like moved in. Yeah.

They say eliminating the needs. need for human interaction during Reynolds. Yeah. I mean, if you look at kind of Nick Huber and a lot of these other folks, they historically went and bought these old, you know, I would say stuck in the 90s kind of self-storage places and then went and put modern technology on them. And, you know, what I understand is Nick and his team have had to go assemble all those pieces of modern technology themselves and then put them into their places after they buy them. This appears to be somebody who just brings that all as a package, which is like, hey, we'll

bring you into the 21st century for your old school self-storage that's out in the middle of nowhere, and you just pay us to do it for you. Could this be a big operator of self-storage is that built it like a Nick Huber and then is spinning off the software company? Maybe it's Huber. Right. Maybe it's him. He's everywhere. That's what I'm thinking. Okay. Well, what do you guys think about this one? So let's start with Heather, 12 times CAFRO? Since I don't know whether this is really SaaS or not, that feels rich. But if I knew more, you know, maybe it's, maybe it's eight or ten, but not 12, I don't think. Yeah.

Travis, where's your head out on this one? I'm never really comfortable with evaluating software products anyway. I like it just based on cash flow multiples. It makes me sleep better at night. Because then you have to like, I don't know, make the evaluation work out. you have to actually turn off growth. Because I'm not, I don't like to assume that I can grow my way out of this

with a software like this. This isn't some like high growth potential thing. You're not going to triple this next year. They're storage units, right? The SaaS multiples work if it's just like this scalable model where you can add multiples of your revenue pretty quickly. And I'm not convinced it's possible here. Yeah.

Especially with 44 employees. Are you going to have 100 employees? to react to this? This to me smells totally like an agency masquerading as a SaaS business. And I bet you get in here and the ARR is mostly them like doing labor arbitrage with people in

Argentina, India, Philippines, that sort of thing. So I'm I would be curious enough about it to get the SIM, but this at its core, I think, is a digital agency that the broker is just packaging in order to try to get a make me move style asking price.

So, yeah. Maybe that's a good hack for agency owners, just like, you know, the last year, throw some middling software up there and try to get an extra turn on your purchase multiple. Yeah. I'm software. Yeah. Yeah. That's, I think we've seen that over and over again.

It's the number one broker trick. Like, take something that is, you know, not a hot category and try to cram it into a hot category. So people like it. Oh, this is, this isn't, this isn't, you know, a dev shop. This is MSP. like, oh, we're going to recast the whole thing. So more power to them. But you end up with deals that don't transact, I think, when you fall into that trap.

All right. On that note, sounds like Heather, thumbs up. Going to make an offer. Travis, thumbs down. Just kidding. Heather hates it. I hate everything, though. That's okay.

Well, you did. Heather, it's all right. Heather did like the worm farm, Travis. That was big. Ooh. Yeah, you want to why? I'll tell you why. Horses.

Horses. There were horses involved. It's all it takes, right? So if this self-souraged sass had a horse barn in the back, it would have worked. Yep. What if this was sass for horses? Then I would love it, like I said, easy. On that note, if you, a listener, happen to have a business that involves horses, please send it to us.

We'll do it. So Heather will buy it. No price too high, no deal too crappy. If there's horses involved, this is the way to go. That's right. All right, we'll get you next time. Thanks.