ROLL UP STRATEGIES

Acquiring multiple businesses within the same industry is a dream for many searchers, but it’s far from reality in actual practice. While the acquisition process is very similar to Entrepreneurship through Acquisition (EtA), the additional skill of successfully integrating multiple businesses makes this strategy very complicated and with risk, as reported by searchers who have traveled this path. The primary basis of value creation is derived from multiple arbitrage as higher revenue businesses command larger valuations than what they were purchased for. However, it excludes small “tuck-in” deals where you may be essentially buying a customer list or a few employees in an “acqui-hiring” situation.

As with much of EtA, no one path is the best; each acquired search business is like a snowflake, unique in many ways. A survey of a dozen-plus searcher/CEOs yielded a variety of opinions, principles, and practices that worked well for them. Their comments can help you make a decision about whether this particular focused path makes sense for you at a unique stage in your career. This is their way of giving back to the EtA community and in many ways more valuable than my own opinions on the topic.

You can read more in my blog post here: https://jimsteinsharpe.com/searching/roll-up-strategies/

Please let the community know your thoughts and comments below!

Search On!!!

Jim Sharpe



share: