Hey there,
I spend 10 hours every week looking at acquisition deals.
That's 25% of my work time.
Not running operations. Not putting out fires. Not managing day-to-day.
Looking at companies to buy and merge into Home Alliance.
Most operators think M&A is something you do later. "First I'll build to $10M, then I'll think about acquisitions."
I thought the same thing.
I was wrong.
The problem most operators don't see
When you build a standalone business, you optimize for your own operations.
Your systems work for you. Your processes fit your team. Your infrastructure serves your customers.
That's fine if you never want to acquire another company.
But if you do, you've built the wrong foundation.
Because here's what happens when standalone businesses try to merge:
Different accounting systems. Different HR policies. Different customer databases. Different marketing tools. Different operational processes.
Integration becomes a nightmare.
80% of acquisitions fail after year two. Not because the deal was bad. Because integration was impossible.
The realization that changed everything
A few years ago, I had a conversation with Allan Hartley. He's a serial entrepreneur and M&A executive who's built, scaled, acquired, and integrated companies worth over $1B in revenue.
He told me something I'll never forget:
"In a roll-up strategy, 1+1 should equal 4. Not 2. Not even 3."
Most operators acquire companies and try to keep them independent. Separate brands. Separate systems. Separate teams.
That doesn't work.
You're just collecting expensive assets.
Platform thinking vs. collection thinking
Here's the difference:
Collection thinking: Buy companies, keep them separate, hope for synergies.
Platform thinking: Build shared infrastructure first, then plug companies into it.
When you think like a platform, the math changes completely.
A $3M standalone HVAC company sells for 2x-3x revenue multiple.
But ten $3M companies merged into one platform? That's 10x-12x multiple.
Same $30M in revenue. 10x valuation difference.
Why?
Because standalone businesses are risky. One bad quarter, one key employee leaving, one market shift—and the business tanks.
Platforms are predictable. Diversified revenue. Shared infrastructure. Operating leverage that compounds with every acquisition.
How we built Home Alliance for acquisitions
We didn't start thinking about M&A when we hit $100M.
We started thinking about it at $10M.
Not to buy companies yet. But to build infrastructure that other companies could eventually plug into.
Here's what that looked like:
Shared services infrastructure
Instead of building accounting just for our HVAC division, we built it to handle multiple service verticals.
When we added plumbing, the accounting system didn't change. We just added plumbing accounts.
When we added electrical, same thing.
Now when we acquire a company, we don't integrate their accounting system. We migrate them to ours in 30 days.
Centralized call center
We built one call center that handles all service requests across all verticals.
HVAC, plumbing, electrical, appliance repair—all on the same phone system.
When we acquire a regional HVAC company, we don't keep their call center. We route their calls to ours on day one.
Customer experience improves immediately. Costs drop 40%.
Unified technology stack
One CRM. One scheduling system. One customer database. One marketing platform.
Acquired companies plug into our stack instead of us adapting to theirs.
Standardized training through Home Alliance Academy
We don't inherit training programs from acquired companies.
We train their technicians through our Academy. Same curriculum. Same certifications. Same quality standards.
Within 90 days, every acquired technician operates at Home Alliance standards.
This is platform economics.
Build the infrastructure once. Scale it infinitely.
The three stages of M&A readiness
Most operators aren't ready to acquire companies.
Not because they can't afford it. Because their business isn't built to integrate.
Here are the three stages:
Stage 1: Standalone operator ($1M-$5M)
You're still figuring out your own operations. Don't think about M&A yet.
But do this: Document everything. Build SOPs. Create systems that don't depend on you personally.
This makes your business acquirable later. And it prepares you to acquire others.
Stage 2: Platform builder ($5M-$20M)
Now you can start thinking like a platform.
Ask yourself: If I acquired a competitor tomorrow, could I integrate them in 90 days?
If no, start building shared infrastructure.
Centralize your back office. Standardize your processes. Build systems that can handle 2x your current volume without breaking.
Stage 3: Active acquirer ($20M+)
Now you're ready to buy.
But not just any company. You're looking for companies that fit your platform.
Same market. Similar operations. Culture that aligns. Leadership willing to integrate, not fight for independence.
What to look for in acquisition targets
I have an M&A team that brings me deals daily.
Here's what we evaluate:
Red flag 1: They want to stay independent
If the owner says "I'll sell but I want to keep running it my way"—that's a no.
Integration is non-negotiable. If they can't plug into our infrastructure, we don't buy.
Red flag 2: Their systems are a mess
No documentation. No SOPs. Everything in the owner's head.
That's not an acquisition. That's a turnaround project. Pass.
Red flag 3: Cultural misalignment
If they treat technicians like disposable labor and we treat them like partners, integration will fail.
Culture eats strategy for breakfast. And it kills M&A for dinner.
Green flag 1: Strong operations, weak marketing
They do great work. Their customers love them. But they don't know how to scale marketing.
Perfect. We plug them into our marketing infrastructure and 3x their revenue in year one.
Green flag 2: Regional dominance
They own their local market. Strong brand. Loyal customers. Just can't expand beyond their geography.
We give them our national platform. They give us local density.
Green flag 3: Talented team, limited resources
Great technicians. Smart managers. But they can't afford the technology and infrastructure we have.
We give them our tools. They give us their talent.
How deals actually work
Most operators think M&A is all about valuation.
It's not.
It's about structure.
I've broken down our entire deal anatomy in the visual above. This is the exact framework we use to evaluate and structure every acquisition.
Let me walk you through it:
Stock vs. asset deals
Asset deal: We buy their customer list, equipment, contracts. They keep the legal entity and liabilities.
Stock deal: We buy the entire company, including liabilities.
We prefer asset deals for small acquisitions. Less risk. Cleaner integration.
Earnout structures
We rarely pay 100% upfront.
Instead: 50% at close, 50% earned over 24 months based on performance.
But here's the key: We tie earnouts to gross profit, not EBITDA.
Why? Because we're going to change their cost structure. If we tie it to EBITDA, they fight every operational change.
Gross profit aligns incentives. They want to grow revenue and maintain quality. We want the same thing.
Integration timeline
Day 1-30: Migrate to our phone system and CRM Day 31-60: Train team on our processes and Academy curriculum
Day 61-90: Full integration into shared services (accounting, HR, marketing)
By day 90, they're operating as a Home Alliance division. Not a separate company.
The math that makes this work
Here's what happens when integration works:
Revenue stays flat or grows (because marketing improves).
Cost of goods stays flat (same quality technicians).
Operating expenses drop 30-40% (shared back office, centralized call center, better technology).
EBITDA margin improves 10-15 percentage points.
Valuation multiple increases from 2x-3x to 10x-12x (because now it's part of a platform, not a standalone risk).
This is how you go from $100M to $1B.
Not 10x organic growth.
Strategic acquisitions that plug into infrastructure you've already built.
What this means for you
You don't need to be at $100M to think about M&A.
You need to think about M&A to get to $100M.
Even if you're at $5M today, ask yourself:
Am I building a standalone business or a platform?
If I acquired my biggest competitor tomorrow, could I integrate them in 90 days?
Do I have shared infrastructure that can scale?
Are my systems documented and repeatable?
The answers reveal whether you're building for acquisition—or building something that will hit a ceiling at $10M-$20M.
Here's what to do next
If you're under $5M: Focus on documentation and systems. Build SOPs for every process. Make your business run without you.
If you're $5M-$20M: Start building platform infrastructure. Centralize your back office. Standardize processes. Prepare for integration even if you're not buying yet.
If you're over $20M: Start looking at deals. Build an M&A pipeline. Develop a thesis for what you acquire and why.
M&A isn't just for billion-dollar companies.
It's how $10M companies become $100M companies.
And how $100M companies become $1B companies.
That's it for today.
Talk soon,
P.S. - If you're thinking about M&A but don't know where to start, the first step isn't finding companies to buy. It's building infrastructure that can absorb them.
Most operators get this backwards. They find a great deal, acquire it, then realize they have no idea how to integrate. Start with infrastructure. Deals will follow.