New Deals: A security guard company, IT services business, and 3 other finds

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NEW DEALS

1/ Security Guard Company

📍 Location: Houston, Texas
💰 Asking Price: $2,000,000
💼 EBITDA: $600,000
📊 Revenue: $3,200,000
📅 Established: 2012

💭 My 2 Cents: Regular readers know that I really like security guard companies as their services are always in demand across multiple industries spanning real estate, retail stores, government buildings, hospitals, schools, and more. They also often come with very sticky client relationships, contracts, and recurring revenue. Security guard companies tend to be few and far between though, so I’m excited when I see a new one listed. I like this company’s longevity, robust scale with 85 employees, and very attractive 2.66x EBITDA multiple. That said, I’d want to dig into their client relationships, what industries the clients represent, what contracts they have in place, and ensure there isn’t any massive client concentration. I’d also need to understand their operations better, including if they provide armed or unarmed security, what training they provide, what systems and software they have in place to manage the large security force, the nature and condition of any equipment included in the sale (i.e. patrol cars), and who is currently managing client relationships. Ultimately, this is a very scalable business with some interesting paths to acquiring new customers (i.e. developing relationships with property managers who are in charge of multiple buildings).

2/ IT Services Business

📍 Location: Mississippi
💰 Asking Price: $4,100,000
💼 EBITDA: $707,500
📊 Revenue: $1,926,000
📅 Established: 1986

💭 My 2 Cents: This family-owned company offers a full suite of technology services from sales and installation to repair and hosting. In business since 1986, they clearly have stood the test of time and should have built a very loyal clientele in their area. I like how their business model, with its emphasis on repeat clients and ongoing contracts, provides them with a very nice steady revenue base. Another real positive is their authorized reseller status with major tech providers, as this both adds to their credibility and positions them for further growth. I’d want to dig into the revenue breakdown between their different services, how they attract and retain clients, who their local competition is, how they compete with the national players and online options also found in their space, how reliant the business is on the current owners, and what possibilities might exist for expanding their offerings or market reach. Given their solid client base and consistent earnings, this should be an excellent opportunity for either a tech-oriented new owner or an existing IT services company looking to scale.

3/ Plumbing Business

📍 Location: Miami, Florida
💰 Asking Price: $2,600,900
💼 EBITDA: $450,000
📊 Revenue: $3,000,000
📅 Established: 2016

💭 My 2 Cents: You probably saw the recent WSJ article titled, “America’s New Millionaire Class: Plumbers and HVAC Entrepreneurs.” It’s hardly a secret that plumbing companies are one of the stars of the boring business world—they serve an essential function across both residential and commercial sectors. This highly profitable company, with 12 employees handling all types of plumbing work, boasts both high cash flow and very impressive margins. I especially like the $2.25M in equipment and inventory included in their sale as this provides hard assets worth almost the entire purchase price. I’d want to understand the nature and condition of the FF&E and inventory and why these have such a high valuation. I’d also want to get a handle on the split between their residential and commercial work, who their typical clients are, how they routinely win new business (do they have an established lead generation funnel in place or is it mostly through word of mouth/referrals), the qualifications and experience of their staff, as well as who holds key licenses in the business and whether there’s a redundancy. The asking price is high, but the business is listed directly by the retiring owner so I believe there should be some negotiation room.

4/ Mobile Homes Sales and Installation

📍 Location: Orange County, California (Home-Based)
💰 Asking Price: $899,999
💼 EBITDA: $571,891
📊 Revenue: $2,136,188
📅 Established: 2014

💭 My 2 Cents: As everyone knows, the need for affordable housing has never been higher. This company sells and installs manufactured mobile homes, working with homeowners, developers, nonprofits, and local governments. I like how the timeline for their projects is very condensed compared to many construction businesses, aiding revenue and cash flow, and that the permitting for accessory dwelling units (ADUs) in California has become easier in recent years, lowering a key barrier to bringing in new work. I also like their use of 15 active websites or social media accounts to generate new business, as this tells me they have a proven marketing funnel. I’d want to better understand their different sources of new business, what their repeat customer rate looks like, what their competition looks like, what geographies they serve, and the roles and responsibilities of their ten employees. I’d also want to look into how much work the current staff could handle without needing to expand and how they might use their digital capabilities to extend their market reach into other parts of their state (and beyond). The owner is willing to use their licenses to qualify the business until a new owner can acquire them on their own, both showing confidence in the future of the company and helping surmount a significant hurdle for someone trying to enter the space without specific industry experience.

5/ HVAC and Refrigeration Business

📍 Location: Pennsylvania
💰 Asking Price: $2,500,000
💼 EBITDA: $582,000
📊 Revenue: $2,029,000
📅 Established: N/A

💭 My 2 Cents: Another absolutely essential business for you all today — this time, refrigeration. In business for almost 70 years, this refrigeration company supplies and services food service equipment for commercial clients. I love their longevity, as it’s very likely they’ve developed a stellar reputation, enjoy deep relationships with clients, and have an experienced staff with expertise in their specific niche. They have ten employees (five technicians and five office staff) who intend to stay post-transition and operate from a 6,400 sq ft facility that includes a showroom. I like how the purchase price includes the property (valued at $640K) and $350K of FF&E and inventory, which may help you attain more favorable terms from lenders. I’d want to ask about the revenue breakdown between sales, installs, and service, the level of ongoing service contracts and recurring revenue, the degree of competition in their niche, and how they market to and acquire new clients. At a minimum, this deal offers a proven niche HVAC company that likely comes with stable cash flows.