with Made in New Mexico · Made in New Mexico
LenderHawk analysis. Not affiliated with or endorsed by Acquisitions Anonymous.
The hosts see the business as potentially stable and locally rooted, but overpriced relative to its earnings and likely constrained by weak e-commerce execution. Their preferred buyer would be someone with a Taos presence or a clear plan to improve catalog distribution and online channels.
A storefront can function as distribution infrastructure, not just a cost center, when it helps secure wholesale access to products that would otherwise be unavailable.
Businesses that rely on cheap shipping and low-price consumables need stronger gross margins than 20% to make online growth work.
If an acquisition target has taken 20 years to reach roughly $1.3M in revenue, the seller’s growth story deserves skepticism even if the brand looks polished.
A buyer who removes the physical store from a hybrid retail-and-ecommerce model may accidentally destroy the product assortment and sourcing advantage.
SBA financing availability does not make a 10x EBITDA purchase price sensible; leverage only works when the entry price is reasonable.
For acquisition borrowers, the right response to distress is early lender communication, not concealment or delay.
Most real lenders prefer a cooperative workout over foreclosure because they want repayment, not operational control.
Small SBA acquisition loans can be available, but Heather notes that smaller loans are not automatically safer on a statistical basis.
A hybrid business uses a visible storefront to support sourcing, credibility, and local sales while the online channel drives additional volume. The storefront can look unprofitable in isolation but still be strategically necessary.
When to use: Use this lens when evaluating local retail businesses that also claim e-commerce or marketplace revenue.
The listing asked $2,274,998 for a business with $227,831 of cash flow, a roughly 10x EBITDA multiple.
The hosts immediately frame the deal as expensive relative to earnings.
Trailing twelve-month revenue was listed at $1,304,000.
The broker teaser and hosts cite this as the business’s current sales level.
The business reported an average order value of $66.75 and a 35% return-customer rate in 2023.
These figures are presented as evidence of customer stickiness, though the hosts still doubt the pricing.
The company had 135,000 email contacts and a four-person full-time staff.
The listing emphasizes these operational assets as transition support.
Heather cites an SBA acquisition-loan default rate of about 1.35%, versus about 1.95% for the broader SBA pool.
She uses the numbers to argue that acquisition lending is statistically safer than many listeners assume.
Heather says SBA borrowers generally must be 90 days past due before liquidation can begin, with acquisition loans often getting another 90-day workout window.
The discussion contrasts borrower fears with actual lender process.
The business was founded in 2005 and the hosts use that date to identify the likely listing.
Michael reverse-engineers the company from the teaser’s clues.
When evaluating a hybrid retail-and-ecommerce business, map the top-selling SKUs from the store to Amazon, Etsy, and eBay search demand before assuming the online channel can scale.
Why: The online business may have room to grow only if the catalog contains products with real third-party marketplace demand.
Do not assume the storefront can be eliminated just because the online channel looks more attractive on paper.
Why: The storefront may be the reason vendors will supply the products and may preserve the brand’s uniqueness.
If a business is distressed, contact the lender before you miss too many payments and explain the problem plainly.
Why: Lenders are far more willing to work with borrowers who are proactive than borrowers who hide the issue.
If you are going to use SBA leverage, negotiate the entry price aggressively instead of rationalizing a rich ask because debt is available.
Why: The financing tool does not fix a bad acquisition price.
Choose the right size business based on quality and upside, not just the comfort of a smaller loan balance.
Why: The hosts argue that smaller businesses can actually be riskier and less scalable than larger, better-run ones.
Bill recounts a prior transaction where a broker allegedly told a seller a much higher valuation just to win the listing, then later admitted that the market would sort it out. The seller used that inflated expectation to resist a lower offer, illustrating how optimistic pricing can stall or distort deals.
Lesson: Broker incentives can push valuations above reality, so buyers should not anchor on the listing price.
Bill describes advice from a bankruptcy lawyer that most distressed borrowers make things worse by hiding the problem and hoping it goes away. The lawyer’s advice was that credible lenders usually respond better when borrowers disclose trouble early and ask for a workout.
Lesson: Transparency is usually more effective than denial when a loan begins to go bad.