Is buying a small business at this moment in time a bad idea? A recession appears to be right around the corner.
Is the smart move to hold water for 6-to-12 months, let the recession hit and then seek to buy a company once prices come down? I'm also concerned about putting 90% debt on a deal via a SBA loan and then having a recession hit... feels like servicing the debt could become a challenge.
Any thoughts?
Recession - Fall 2019
by a searcher from Dartmouth College
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1) don't lever up as heavily; businesses survive prolonged recessions because they are strong; typically they are strong because they are properly capitalized (limited debt, so cash can go into investing in the business while competition suffers and pulls back due to fear)
2) better reason to focus on a company that can grow through acquisition. Buy a business, manage it, and when things turn you'll know the players you want to buy, banks will trust you if you have industry experience and investors will believe the thesis (if its good) from someone actually involved in the space as an operator.
3) if you find a good opportunity, raise more money than you need so you can do #2.