Hi Searchfunders —
Self-funded searcher here very interested in manufacturing. I did an outreach to owners of architectural millwork + custom cabinetry businesses last week resulting in (so far) 6 calls with owners. What I’m finding thus far is that owners are more interested in a partnership than sale, and this might be an interesting arrangement for me too, a way to derisk this process. Some more detail:
The companies have $1m - $2m in revenue, minimal marketing and systems but (so far) solid technical/woodworking teams. Only mildly profitable but room for growth. I would bring tech, financial, and people skills, decent familiarity with the domain (woodworking + residential construction), and would hope to add significantly to the top and bottom lines.
I’m open to a partnership where I’d work alongside the owner for sweat equity and eventual buyout. (Lest anyone wonder, I am temperamentally ok with this and have been around the block/likely have the maturity to navigate this). Any thoughts on how to structure such a situation? Has anyone seen or explored such a thing before?
Thanks in advance for any insights.
It was for a retailer who launched an eCommerce platform.
In summary what I did was structure a "pilot" period - say 6 months with a defined goal or milestone.
Clear roles and responsibilities as well as commitment to funding marketing/growth/ systems is a must.
Clear profit share/participation during the pilot, post pilot for both upside and downside scenarios should be agreed from the beginning.
Once the goal is achieved, this triggers a more formal arrangement or structure based on mutual objectives.
By doing it this way, you can get started fairly quickly, and test whether you can actually improve revenue/ cost efficiencies before committing too much time/capital.
Hope this helps, happy to chat further.