Consistent themes of service-type businesses owned by Baby Boomers:

February 21, 2024

by a professional from James Madison University in Washington, DC, USA

Consistent themes after conducting financial due diligence on 50 + acquisitions & sales of service-type businesses owned by Baby Boomers:

1. Some of the nicest people I've met—seriously amazing.

2. They value legacy and the "right fit" over money.

3. They are the brand & sales pipeline.

4. Customers trust them for their reliability and long-standing community presence.

5. Closing deals is challenging (not impossible) due to doubts at the purchase agreement stage.

6. The absence of modern marketing and accounting systems opens up improvement opportunities for new buyers.

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Reply by a searcher
from Columbia Southern University in Idaho, USA

Thank you for sharing such insightful observations from your experiences with service-type businesses led by Baby Boomers. It's heartening to hear about the values and the personal touch they bring to their work, creating brands that truly resonate with their customers. The points you raise about the importance Baby Boomers place on legacy and finding a "right fit" highlights a meaningful approach to business transitions that goes beyond the transactional. Additionally, their established trust in the community is irreplaceable, but as you pointed out, it also presents unique challenges and opportunities. Particularly interesting is the potential for growth and modernization through the integration of updated marketing and accounting systems. For new and aspiring entrepreneurs, it's a great reminder that these acquisitions are not just financial investments but chances to build upon a foundation of trust and quality service. With the right blend of respect for tradition and an eye for innovation, new owners can carry forward the legacy while making their own mark. It's an exciting time for intergenerational exchange in the business world!

Reply by a searcher
from Northwestern University in Hamburg, Germany

I tend to disagree with the first two at least with regards to my own experience in Germany. Theres also a lot of talk about "the right fit", but in the end, the sellers want to take the money and retire somewhere in Spain. So 9 out of 10 times, the highest offer wins. Also I regularly came across DD findings related to accounting practices. When you have to explain the sellers that their business might not be worth as much as they though, they tend to be not so nice anymore ;)

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