The Business Buying Process

Every successful acquisition follows a structure — whether you're an individual buying your first business or a PE firm completing your tenth. The buyers who close deals efficiently are the ones who have done the internal work before they start looking: defined criteria, confirmed financing capacity, and a clear thesis for what they want and why.

Step 1: Define Your Acquisition Criteria

Before you look at a single deal, you need to be clear on what you're looking for. This includes industry preference, revenue and EBITDA range, geographic requirements, deal structure preferences (how much cash you're putting in, whether you'll use SBA financing), and operational background you bring to the table.

Buyers without clear criteria waste time — theirs and ours. More importantly, sellers and their brokers can spot unfocused buyers immediately. Walking into a deal without a clear thesis undermines your credibility from the first interaction.

Step 2: Get Your Financing in Order

Most acquisitions in the $1M–$20M deal range use a combination of buyer equity, seller financing (a seller note), and institutional debt — most commonly an SBA 7(a) loan. Before you review any confidential information, you need to understand your financing capacity.

For SBA loans: lenders typically require 10–30% buyer equity injection, and they will evaluate your personal financial strength, credit history, and relevant business experience. Pre-qualification from an SBA lender before you're under LOI puts you in a much stronger negotiating position.

For PE or institutional buyers: having a clear capital commitment and deal structure in place demonstrates seriousness to sellers who are evaluating multiple offers.

Step 3: Register and Start Reviewing Opportunities

Once you've established your criteria and financing capability, we can begin matching you with opportunities. All deals are subject to mutual NDA before any confidential information is shared. We will never share your information with sellers without your consent, and seller information is always handled with the same discretion.

We present opportunities that genuinely match your criteria — not every deal that comes through our desk. Our job is to save you time by filtering for fit before you invest hours in reviewing something that doesn't work.

Step 4: Evaluate the Opportunity

Once you've reviewed the CIM and expressed interest, we facilitate a management meeting — a conversation with the seller — and provide supporting documentation for your financial analysis.

Key questions to answer in your evaluation:

• Is the financial performance real and reproducible? (Review 3+ years of actuals)
• What is the customer concentration? What happens if the top 2–3 accounts leave?
• How dependent is the business on the current owner? What transitions with the sale?
• What capex is required to maintain or grow the business?
• What are the key operational risks a new owner inherits?
• Does the deal structure make sense given your financing and return requirements?

Step 5: Submit a Letter of Intent

If you're ready to proceed, you'll submit an LOI — a non-binding letter outlining your proposed purchase price, deal structure, exclusivity period, and key conditions. The LOI stage is where negotiation happens before the deal gets expensive (legal fees, accounting fees, lender appraisals).

A strong LOI is specific: it spells out the price, how it's being paid, what the transition looks like, and any conditions that must be met. Vague LOIs signal unprepared buyers. We'll help you structure an LOI that conveys your seriousness and positions you favorably against competing offers.

Step 6: Conduct Due Diligence

Once an LOI is accepted and you're in exclusivity, due diligence begins. This is your opportunity to verify everything represented in the CIM. You're looking for material discrepancies, hidden liabilities, customer risk, and anything that would change your view of the business or the price.

Due diligence typically covers: financial statements and tax returns, customer contracts and concentration, employee matters and key person risk, lease agreements, licenses and permits, equipment condition and maintenance history, and any legal or regulatory history.

You'll need advisors: an accountant for financial QofE, an attorney for legal and contract review, and often a third-party appraiser for equipment. Budget 4–6 weeks and the associated professional fees for a thorough diligence process.

Step 7: Finalize the Deal & Close

If due diligence confirms the business matches what was represented, you move to the Purchase and Sale Agreement — the definitive legal document. Your attorney will negotiate final terms, representations, and warranties. Closing conditions are satisfied, funds are transferred, and ownership changes hands.

For SBA-financed deals, the lender will have their own diligence and appraisal process running in parallel, which can add time. Coordinating lender timelines with deal timelines is one of the most important things we manage to keep transactions on track.

Step 8: Transition

Most deals include a seller transition period — typically 30–90 days of active involvement, followed by a period of availability. Use this time to meet key customers and employees, learn the operational systems, and establish yourself as the new owner with stakeholders who matter.

The transition is also when any earnout structure you negotiated becomes relevant. Clear metrics, defined measurement periods, and well-drafted earnout terms prevent disputes after close.