TUESDAY | DEAL BREAKDOWN
TL;DR
Three SBA-financed businesses scored this week: a Colorado arcade at $2M, a Florida kitchen and bath remodeler at $2.85M, and a Florida digital marketing agency at $9.9M. The first two clear every bar with room to spare. The third posts the highest earnings and the highest margin in the group and still fails its stress test. Each deal links to its full scored breakdown.
Green means it cleared. Red means it did not. Click any deal for the full model.
🟩 CLEARS AT 5.15x DSCR
Arcade | Colorado
Asking Price | $2,000,000 |
Earnings (SDE) | $1,573,748 |
Revenue | $3,918,724 |
Multiple | 1.27x |
The Setup. A family-friendly arcade with two Colorado locations, built on skill-based gaming and contest-style machines, on the market because the owner is retiring. The premises are leased, the staff is under fifteen, and the operation returns forty cents of owner earnings on every dollar that comes through the door. That is a lot of margin for a business whose product is quarters, and how much of it survives once you are not the one on the floor is the open question.
Coverage clears at 5.15x. What happens to your take-home the day you hire someone to run it is the part worth reading. See the manager-adjusted math
🟩 CLEARS AT 3.28x DSCR
Kitchen And Bath Remodeler | Florida
Asking Price | $2,850,000 |
Earnings (SDE) | $1,427,788 |
Revenue | $4,285,326 |
Multiple | 2.00x |
The Setup. A Florida remodeler selling vanities, tile, countertops, tubs, glass, and the crews to install all of it, out of a real showroom with a design team behind it. Four decades of family name in the market, a staff that comes with the business, and a retiring owner willing to stay through the transition. The books run on accrual with work in progress still outstanding, and that pipeline is both the reason to look and the thing you would have to open up first.
Two times earnings for a business with a showroom, a payroll, and bids already on the street. The work in progress is where the real number hides. See the full model
Most buyers never learn to tell these two apart until after they have wired the money.
The free 28-minute masterclass walks through the exact structure behind every deal in this issue.
🟥 FAILS STRESS TEST AT 1.23x DSCR
Digital Marketing And Lead Generation | Florida
Asking Price | $9,900,000 |
Earnings (SDE) | $2,323,887 |
Revenue | $3,289,235 |
Multiple | 4.26x |
The Setup. A twelve-year-old Florida agency that buys attention and sells it to insurance advertisers, running roughly 650,000 unique visitors a month across media it owns outright rather than an affiliate network. Advertisers commit six figures a year and keep coming back, and the whole thing runs on a proprietary CRM and an in-house email platform with two million consumer records behind it. Ninety percent of the revenue arrives through a single channel, and that is before you get to the asking price.
You put $1,287,000 on the table at closing to buy $811,791 a year, and the coverage breaks the moment revenue touches $2.6M. See what would have to change
The two that cleared are the ones nobody brings up at a conference. An arcade and a remodeling shop. The third has the best margin in the issue, the highest earnings of the three, and the only red badge on the page. If you open one of these all the way, open that one.
See you Thursday.
-Mike
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