Thanks for your post ^[redacted]‌! Tagging a few Searchfunders that have commented on running a company remotely in the past and might be able to share some hard won wisdom here:

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To our friends with knowledge and/or opinions on running a company remotely, THANK YOU for helping to make Searchfunder a collaborative community! Be sure to take full advantage of your UNLIMITED access to IBISWorld (Searchers only) & BVR Deal Stats, now available under the INDUSTRIES & VALUATIONS tabs at the top of this screen. Here are the direct links:

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With Best Wishes, ^[redacted]‌

We can talk about this Charles. My view is that for that small of a company, I would recommend you being there 5 days a week at least for the first 6 months. You have to get into the details of a small business (especially this small) before you can let go of the reins and be comfortable with it running on its own.


My 2 cents
Vijay

I'm happy to talk about it. I believe you would uncover what you need to know during due diligence. 1. Ask the current owner how often in the last 2 years they have visited. Ask them to what they attirubute their ability to be remote. 2. Find out who will be managing things locally in your absence (if necessary). 3. Figure out if any local presence is necessary at all. For example, if the company is just a website kicking out leads, then it's not clear what a local person would even do. But it is prudent to have a local person to call on for emergencies I would think.

The remote companies I have worked in, had to local component. Flights and financial services don't really have anything local about them. Just airports.

I have a friend in central Florida who owns a gym (there's not much more hands-on than a gym!) and is on site about 2 days per week. He lives 90 minutes away, so it's a bit easier for him to get there than it will be for you, but it's definitely doable depending on the people on the ground and the deal thesis.

Depends on who the license holder is and how good he/she is at managing the day to day.

I'd love to connect regarding the HVAC industry!

I bought my company and it was 1.5 hours away. That commute was brutal in the beginning when I was trying to learn the business. Do yourself a favor and just get a cheap apartment in the place the business is. Then go back there when needed once you're in a somewhat steady state. Also you should be aware that your folks need to see you as the new owner. So you will need to be there every day at least in the beginning.

My wife worked for a business that was in this same position. Owner built the business with systems and processes, moved out of state and ran it remotely for a few years and sold it. The purchasing company tried to acquire it remotely but couldn’t manage to learn the existing systems and processes remotely. The purchasing company ended up moving half their executive management to the purchased company to get a wrap on what they purchased.

I would try and double the EBITDA and hire an Ops manager. Or get an apartment

I definitely agree with the need to being on site for the first 6 months. I acquired a company with its headquarters a two hour drive away from my home. I spent 4 days a week there for the first 6 months with the intention of deciding whether or not to move after 6 months (or potentially keep my home and buy a small condo there). Then COVID hit and we were shut down for 3 months, working remotely the best we could. We’ve opened the office back up and I now spend just one day a week there and it is working out quite well. Had I not been there in person like I was for the first 6 months to learn the business and build the relationships with my team, I don’t think this would have worked.

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Yes, my first one was 2 hours. There are 4 in negotiation 4.5 hrs, 2.5 hrs, 5 hrs and 6 hrs from me. Granted these are insurance practices that can be run from any computer and I only expect a minimal run off. In my case, it will start with weekly visits and gradually but rapidly drop to totally online.

I like it, Charles. Jump in there!

Hi Charles, I'm in a similar position of looking to remain in my current residence while acquiring a business further away. My perspective echos a lot of previous comments about planning to be on-site 5 days a week at first. Another thing to consider beyond just the immediate post-close is how seasonal the business is or what long-term growth initiatives might demand. I'm currently pursuing an acquisition with crazy seasonality that will demand attention something like 7 days a week for 2 months. Fortunately with my military background, I can compartmentalize this as a mini-deployment. As long as spouse/significant other is okay with that, I say go forth. But just consider long-term contingencies. Certainly hiring a stellar daily ops manager will help, but it's ultimately still your baby.
Another thing to consider in the negotiation is how transparent you want to be with the Seller on this point. Sometimes a Seller will view your long distance commute as a risk to the business that they built. It might be a stumbling block getting to close, especially if they will be rolling any equity.

The first company I bought was 2.5 hours away from where I currently lived. The company had middle management in place that was planning to stay on and sign employee entrance agreements. When I was first introduced to the company, I had a really cute idea: I would commute a few times a week then manage things remotely on other days(very similar to you). The company was in an industry I had no experience in. By the time we closed, I had signed a lease for an apartment near the company.

The seller has experience with this company that you don’t have. He has earned the loyalty of his team. He can work remotely and it may not be a big deal. As a buyer, you don’t have that luxury. For your first one, you need to be in there... everyday, grinding it out. Every company is different (especially small ones as they tend to be a direct reflection of the previous owner) and it’s hard to get a grasp on them when you’re not physically there.

Hi Charles, I'm still searching and don't have firsthand experience with the distance issue you're considering, so I won't speak to that. I would however like to connect as a fellow South Florida searcher, and would love to hear where this one shakes out. Please message me at [redacted] Thanks!

Charles - Tim Clark (who is a member of this community) was of great help to me as I did my search, closed on my purchase and learned to operate it. He has been buying and selling businesses for 20 years and told me he’s never lived close to any of them. And it’s never been a problem. That said, for a service business I think you wouldn’t want to be much more than 3 hours away- especially if it’s your first one.

FWIW I have been looking at tack on acquisitions to fold in with my business and would buy something up to 4 hrs drive from my house. Like you I would plan to be in the office a couple of times a week for the first year. But for the first 3-4 months you should assume you would need to be there every day in order to learn the business, learn which of the staff are good and which ones you need to coach up or replace; what is working and what can be improved

Now that I’m two years into it, I go to the office only once per week for 2-3 hrs and the rest from home. And my office is 15 minutes away. But it took a lot of fixing problems (HR, IT etc) to get to this point

I've managed several businesses that were remote, some as far away as 7,500 miles. You need to be in the trenches with your new staff for at least 6 months especially in a service business. In addition, the hvac business is getting harder and harder to staff with good technicians.

You will need a good system and structure in place and find one person to manage the operation who reports to you. Having too many directv reports in a small organization will just cause lots of problems.

Happy to talk off line as I was interested in a national service business once but couldn't get all the pieces aligned.

You can spend 3 days on site and 2 days remote. As you implement your 100 day plan and set it up for success the less you will have to be on site. Also, consider the idea of having a General Manager on the business.

Encouraging the business has been run remotely by the current owners. I think the key is in having strong management in place to ensure the business is operating as it should. You'll probably need to be prepared to be local in the office as needed for transition of management, along with up front time with the team when you first acquire the business of course.