Experience with Micro (<50K SDE) deals?

July 31, 2025

by a searcher from Georgia Institute of Technology in Atlanta, GA, USA

Hello, I wanted to see if anyone has experience with very small deals that would be willing to connect. I have run across a lifestyle business that I think would fit nicely into my current life. As the title implies it's incredibly small deal (owner + 2 employee operated) where I would be heavily involved. I'm struggling to think through what makes sense for diligence given the total size of the deal and was hoping to connect with others who have experience with these very small opportunities. Thanks!

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Reply by a searcher
from University of Wisconsin in Washington, D.C., USA

I agree with Jacob's comments. Only thing I'd add to the conversation... For businesses like that, you could propose profit sharing arrangements in exchange for your help optimizing / operating the business. It can help create win-wins for both the owner who is looking to step back while at the same time reduce your risk in case it doesn't grow.

Reply by a searcher
from University of Texas at Austin in San Antonio, TX, USA

Hey Brad - I'd be happy to share my experience. I bought an FBA business a few years ago with about $80k in SDE, but was declining. The price was about 2x SDE. My theory was at such a low multiple I could get positive ROI, even if it took a few years. (Spoiler alert: that's not what happened) I ultimately ended up losing money on the deal. The business was declining after the COVID bump much faster than I realized. The biggest issue I had was that I had another business that was bigger and more profitable, and I could never justify taking away time and attention from the bigger business to try to turn around the smaller business. I suppose I wasn't that great at multi-tasking. Your situation may be different, and I have heard stories of people being successful growing small businesses. However, in my experience, the small businesses need just as much time and attention as the larger ones so you have to be intentional on what you spend your time on. Why spend 40 hours on a $50k SDE business when you could spend 40 hours on a $500k SDE business?

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