Business named after seller

searcher profile

April 21, 2023

by a searcher from University of Pennsylvania - The Wharton School in Atlanta, GA, USA

Hi all,

Has anyone acquired a business that was named after the seller, when the seller planned to exit?

What did you end up doing with the business name post-close?

For context, I'm looking at a $1M EBITDA roofing business named after the founders.

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commentor profile
Reply by a professional
from University of Idaho in Boise, ID, USA
This is always tricky. It's hard to give perfect advice without knowing more about the business because they're all different. For the sake of example, I'm going to assume the roofing business has a website and Google Business profile with some reviews, and that those things have been online for 5-10 years. I'll also assume the URL has the business owners' names in it, so a rebrand would require changing URLs. If getting business relies on traffic from Google, you'll need to be very careful and considerate in changing URLs. It can easily take a year or more for Google to transfer authority from one domain to another. In the case of the brand itself, that can be done, and that's more in your control. Feel free to DM me if you want to jump on a call and take a closer look. Thanks for the mention ^redacted‌
commentor profile
Reply by an intermediary
from The University of Chicago in Chicago, IL, USA
1) Don't even buy the business if it is dependent on owner name (I doubt this is the case with $1 M EBITDA,)
2) If the business has negative image, despite profitability, do consider strategic name change,
3) If you are driven to build your name brand, consider name change but be ready to risk what the owner has built.
4) In my 35 years as M&A Broker, I have yet to have a buyer ask, or even consider, a name change. If anything, all have insisted name retention and asked the owner to not use similar name for other unrelated businesses,
5) One example comes to mind. Sold a service business with owner name. Similar size as yours. After 15 years, the EBITDA is 30x with no name change.
6) If you do need to change the name for any reason, there are ways to do so while being on both sides of the table.
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