Looking for people willing to share their Rollup experience

March 19, 2024
by a searcher from Harvard University - Harvard Business School in Austin, TX, USA
Hello! I am early in the process of rolling up beauty salons and looking for people who are willing to share their experience with rollup strategy. I'd love to hear from your journey and get any advice on pitfalls and areas to consider. Separately, if you can point me towards any resources on rollups, I'd greatly appreciate it. Thank you!
from Northeastern University in Seattle, WA, USA
Rollups are on the whole, I believe not successful, but the needle can be threaded if the downside is severely de-risked (no money down, or no more than 1x upfront). I do believe though at the end of the day, all industries consolidate. It may not be a monopoly, perhaps an oligopoly but ultimately all industries consolidate, and I think that THAT is when the roll-ups value comes to light. However that's assuming that the companies doing the roll ups can survive to that point (over levered).
For beauty salons, I guess you could roll a bunch up in an area and either brand them all the same or keep them all differently branded (then you aren't really getting synergies) but I'd wonder what would prevent someone from then just opening up another beauty salon, and thus what's the true moat one is developing by rolling the businesses up? Fragmentation exists for a reason.
There's also a significant, often underestimated, super power that individual small business owners have of persistance and drive that gets lost when businesses get bought by a larger company and then handed over to a GM. That's why there's a franchising middle ground.
from Texas A&M University in Tyler, TX, USA