This isn't what I thought it would be like...

searcher profile

November 09, 2024

by a searcher in Florida, USA

Good day everyone,

I'm writing to ask for some advice from the community.

About 5 years ago, I discovered search and ETA, and eventually bought my first small business as a self-funded searcher. It is a small parts manufacturing business in the US generating about $500k EBITDA.

At the time, I was working in various corporate roles, such as strategy, business development, and M&A. I had previously been a startup founder, and was excited about the idea of owning my own company again. I thought buying a small businesses would give me the freedom to create my own future and eventually generate wealth to enjoy my life (i.e. pay off my MBA debt, buy a home, perhaps purchase more companies, etc).

I was also disenchanted with the corporate world. In the years leading up to my ETA experience, I was in various roles at different (very large Fortune 500) companies that each individually put a bad taste in my mouth for one reason or another. Everything from people competing for political fiefdoms (which can be somewhat 'normal' in corporate life) to straight up toxic culture, and I did not want to be a part of it. I wanted to own my future - design a strategy, lead a team, generate results, and celebrate success. In my experience as a startup founder, this was our raison d'etre and we crushed it.

Going back to ETA, I feel different about the small business I acquired. Sure, I am leading a team and we are moving forward with small wins, but there are so many stark differences to my daily life these days. The culture I inherited at the small business I acquired is very bad, the people are miserable and often times nasty to one another, the quality of the product is good not great, and - I hate to say it, but I will - the intellectual quality of the people I work with is very sub-par. I came from a world where my colleagues were designing rockets to fly into space and orbit Earth; here, the staff cannot connect to the printer or the internet without asking for help. The people are simply not smart enough to solve basic or even moderately complex problems. I am not intellectually stimulated, and find that I am really only "in this" to have a shot at generating wealth. That's about it. Am I in it for the wrong reasons?

Rewind back to about a year before I acquired my company, I was already in the ETA process to buy a business but had landed a new role within a relatively well known Fortune 500 company. Up until that point almost all my corporate jobs were pretty bad, mostly due to poor culture or a bad manager, or both. But this new role was exciting - the job description was very interesting, the title was director-level, which in corporate as everyone may know, is relatively senior (ish), the people were highly intellectual, the team culture seemed very good, and leadership including my direct manager were great. So now I am sitting here, at 5am on a Saturday morning in the US, typing this note on my couch, probably awake because of some level of stress due to my small business, and asking myself - did I make the right call?

And the other part of my question to others in this space is this - has anyone else felt like they may have made a mistake leaving corporate to go into ETA, only to then determine that ETA - at least in the lower end of the lower middle market - is not for them?

I sort of believe that the company I acquired has some inherent flaws and yes, size does matter - I am aware that typically companies with less than $1m EBITDA have many fires to put out all the time, but I could not afford anything more at the time. And for the record I am working to fix the issues that handicap my small business, but the bigger question is...did I make the right move or should I have stayed in corporate?

I've been struggling with this question for a long time now. Thanks for your comments and advice.

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commentor profile
Reply by a searcher
from University of Georgia in St. Louis, MO, USA
Having purchased a business and then changing it dramatically, I can tell you that you can change everything you don't like about your company. Maybe not quickly, but you can.

It all started for me when I got our hiring processes in place. When that happened, I wasn't beholden to people in my company. Before then, I was afraid to push too hard on any one person because if they quit, I'd be in trouble. Over time, we've gotten rid of the toxic people and brought in people that I identified with.

You can change your customers one sale at a time into the kinds of customers you want to have. Don't throw your current customers away, but steer the ship to where you want to go.

You can also change the people you interact with, as you do different things in the business (back to hiring).

Now, all that said, are you going to enjoy what you are doing? That's something only you can decide. Maybe you do. Maybe you don't. Either way, know that you shouldn't do something you don't really enjoy, even if you've told people that's what you were going to do. If you decide you want to go back to Corporate, good on you to figure out what you actually enjoy and to go do it.

Finally, I would say that if you are in the first year of your acquisition, give it a little time. I think it sucks for everyone, so give it at least until your year mark before you make a decision to stay or go.

Best of luck!
commentor profile
Reply by an investor
from Illinois Institute of Technology in Pasadena, CA, USA
Perhaps ETA is not for you? Of course, the ETA route is not always peaches and cream. There are hiccups along the way and if it were “easy” everyone would be doing this.

OK, you’ve recognized you don’t have critical mass. Figure out a way of getting it. A bolt-on acquisition? A pivot to a different product, market, geography or?

Get over the somewhat negative comments re your staff. Recognize that the people who help operate this company for YOU should beone of your greatest assets. Your job as owner, I believe, should include helping those who are trying to help you. They should be helping you grow the business revenues and profits. They can’t do this if they are trying to follow a leader who has doesn’t have fire in his belly. If you don’t, perhaps you need to exit.

I was a corporate minion prior to ETA. Great company whose CEO took a 3 employee company in BK. to Fortune 15 by###-###-#### Did I miss the intellectual camaraderie and being involved in billion $ deals? Yes, but ETA provided an opportunity to be my own boss. I never looked back. Join YPO, sounds like you could benefit from the experiences you and your forum mates have all gone through.
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