Acquiring MindsApril 18, 2024✓ Verified in SBA records

The Gritty, High-Capex Road to Millions

with Reid Tileston · Giddings Hawkins

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The Deal

Business

Giddings Hawkins

Industry

liquid waste company

State

Purchase Price

$4.1M

Multiple (SDE)

5.0x

Year

2019

Revenue at Purchase

$2.0M

SDE at Purchase

$825K

LTV at Close

85%

Deal Source

other

Financing Structure

SBA 7(a)

Buyer Equity

Strategic Rationale

Buyer targetted high barriers to entry due to CapEx, high gross margins, and sticky revenue.

Post-Acquisition Performance

Grew revenue 20-30% year-over-year; expanded margins; sold to PE-backed strategic after 3 years.

Key Takeaways

1Conduct thorough diligence on supposedly unattractive assets like high-capex items; detailed analysis of truck costs, maintenance, and replacement options revealed them as reliable money-making equipment rather than liabilities.
2Hire slowly through structured temp-to-permanent pipelines with extended evaluation periods to ensure cultural fit and long-term retention, even during tight labor markets.
3Build high-margin businesses by enforcing strict cost percentage disciplines on every job and focusing growth on highest-margin service offerings rather than pursuing volume.
4Technology transformation requires hands-on owner involvement; personally evaluate field service platforms, set a clear shared vision, and anticipate that implementation will be four times harder than expected.
5Differentiate yourself to sellers, brokers, and lenders through credibility, all-in mentality, and relationship investment; cultivate long-term connections with key advisors including intermediaries and bankers.

Matched SBA Loan Records

SBA loan filings we matched to this deal

JPMorgan Chase Bank, National Association95%

$3.5MP + 0.50%FY2019

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The Deal

Business

Giddings Hawkins

Industry

liquid waste company

State

Purchase Price

$4.1M

Multiple (SDE)

5.0x

Year

2019

Revenue at Purchase

$2.0M

SDE at Purchase

$825K

LTV at Close

85%

Deal Source

other

Financing Structure

SBA 7(a)

Buyer Equity

Strategic Rationale

Buyer targetted high barriers to entry due to CapEx, high gross margins, and sticky revenue.

Post-Acquisition Performance

Grew revenue 20-30% year-over-year; expanded margins; sold to PE-backed strategic after 3 years.

Key Takeaways

1Conduct thorough diligence on supposedly unattractive assets like high-capex items; detailed analysis of truck costs, maintenance, and replacement options revealed them as reliable money-making equipment rather than liabilities.

2Hire slowly through structured temp-to-permanent pipelines with extended evaluation periods to ensure cultural fit and long-term retention, even during tight labor markets.

3Build high-margin businesses by enforcing strict cost percentage disciplines on every job and focusing growth on highest-margin service offerings rather than pursuing volume.

4Technology transformation requires hands-on owner involvement; personally evaluate field service platforms, set a clear shared vision, and anticipate that implementation will be four times harder than expected.

5Differentiate yourself to sellers, brokers, and lenders through credibility, all-in mentality, and relationship investment; cultivate long-term connections with key advisors including intermediaries and bankers.