Weekly Recap

E233: Guide to Sourcing Deals and Increasing Deal Flow for Business Acquisitions with Expert Tips

About the Guest(s):

Conner Young is the co-founder of Kairo Data, a company that focuses on helping investors and searchers source and find business deals. Conner has a diverse background in traditional investments, having worked with various investment firms managing portfolios, trading, and offering wealth management services since 2016. His expertise lies in creating innovative solutions to bring off-market deals to clients, particularly in the small and medium business (SMB) space.

Episode Summary:

In this engaging episode of the How2Exit podcast, host Ronald Skelton interviews Conner Young, co-founder of Kairo Data. Their discussion dives deep into the art and science of sourcing business deals, particularly those off the beaten path and not publicly listed for sale. Conner shares his extensive experience in the investment sector and how his journey led to the creation of Kairo Data, a platform that leverages proprietary databases and cold calling to unearth high-quality business opportunities for clients.

Conner discusses the various tools and strategies employed by Kairo Data to find these elusive deals, from their proprietary data solutions to an organized approach to cold outreach. He highlights the challenges and intricacies of sourcing businesses in different industries, from marketing agencies to cabinet manufacturers. The conversation also explores emerging trends in the mergers and acquisitions space, such as the increasing interest of private equity firms in smaller deals and alternative financing options that avoid personal guarantees.

Key Takeaways:

• The Importance of Quality Data: Clean, accurate data is the cornerstone of successful deal sourcing, significantly impacting the efficiency and outcome of cold outreach.

• Cold Calling Effectiveness: Direct phone outreach remains one of the most effective methods for sourcing off-market deals, supplemented by strategic email and text follow-ups.

• Shifts in Private Equity: There is a noticeable trend of private equity firms moving towards smaller deals, especially in service-based industries like pest control and HVAC.

• Kairo Data's Unique Model: Conner Young explains how Kairo Data operates without charging commissions or fees on deals, instead offering a subscription-based platform for accessing off-market business listings.

• Challenges and Opportunities: While industry nuances and the need for personalized communication in deal sourcing present challenges, they also offer unique opportunities for those willing to put in the effort.

Notable Quotes:

1. "Deal flow affects everyone. It doesn't matter if you've got 600 million ready to go after deals or if this is your first time with $10,000 in the bank and you want to go after your first SMB."

2. "The data is gold. If you can get that, and it is perfect, then that leads to the entire amount of volume that you should go after."

3. "You either have more deals than money or more money than deals, and you're playing that ebb and flow game."

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E232: Building and Scaling a Hold Co: Nate Ginsburg’s Journey from E-Commerce to Global Holdco

About the Guest(s):

Nate Ginsburg is a seasoned entrepreneur with an impressive track record of building and acquiring businesses. He is the owner of Centurica, which provides due diligence and quality of earnings services, and SellerPlex, a full-service Amazon agency. Recently, he co-founded NTMK Logistics, a freight forwarding business. Nate has a diverse global team managing operations and has a strong background in e-commerce, logistics, and financial analysis.

Episode Summary:

In this episode of the How2Exit podcast, Ronald Skelton reconnects with Nate Ginsburg, who previously appeared on episode 70. Nate shares updates on his entrepreneurial journey, including his experiences with his three businesses: Centurica, SellerPlex, and NTMK Logistics. He delves into the intricacies of managing multiple companies across different sectors, emphasizing the importance of leveraging synergies and the challenges involved in scaling diverse business operations.

Nate also provides insights into the dynamic world of logistics and e-commerce, reflecting on his strategies for business growth through acquisitions and new ventures. He discusses the complexities of quality of earnings and due diligence, particularly in brick-and-mortar versus online businesses. Throughout the conversation, Nate offers valuable lessons learned from his multifaceted career, highlighting the nuanced decision-making processes involved in determining whether to start a new business or acquire an existing one.

Key Takeaways:

• Entrepreneurial Experience: Nate Ginsburg discusses his journey of starting and acquiring multiple businesses, providing a unique perspective on both approaches.

• Quality of Earnings and Due Diligence: He emphasizes the importance of thorough financial verification and balance sheet analysis, especially in brick-and-mortar acquisitions.

• Logistics Industry Insights: Nate explains the vast and interconnected logistics industry, shedding light on freight forwarding and the collaboration between different companies.

• Strategic Growth vs. Synergies: The conversation explores the complexities of pursuing synergies between businesses and finding the best growth strategies for each individual company.

• Decision-Making Processes: Nate highlights the critical thought processes involved in deciding whether to invest in acquisitions, new ventures, or existing business growth.

Notable Quotes:

1. "The logistics industry is incredibly interconnected and that's something that's been, I've been learning just kind of getting more experience and exposure with this company."

2. "When it comes to acquisitions, it's like, you know, it's a very complex puzzle."

3. "The reality is it rarely is as easy or smooth as the people promoting the opportunity kind of make it out to be."

4. "Business is hard, things change, and the best that we can do for each company is follow the best path we can imagine for that business."

Article:

Exploring the Dual Path of Starting vs. Acquiring Businesses

FROM THE Editor:

Disclaimer: This newsletter is provided for informational & educational purposes only, and should not be relied upon as legal, business, investment, or tax advice. We are not attorneys, tax, or financial advisors and not qualified to give any such advice.  

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