Welcome to the “Show Me The Way” podcast with David Seitter
In this episode of “Show Me The Way,” Dave sits down with Steve Burbridge, Owner of Anthony Plumbing, Heating, Cooling & Electric, to discuss the many lessons learned owning and selling multiple businesses, the role that company culture plays in the deal, and many personal details to be wary of throughout the process.
Ep. 18 — A Two Timer Plumbing M&A with Steve Burbridge
Introducing Steve Burbridge
Dave asks Steve to discuss his background and early career.
- Steve runs through his background of growing up around Kansas City, and graduating from the University of Kansas with an accounting degree.
- He then explains how he ended up owning and running a plumbing business, even though he had an accounting degree.
- After prompting from Dave, he runs through how he started at his father’s businesses, and took over after many years of growing it.
- He adds that he and a number of other companies started the first publicly traded HVAC company.
- He notes that the quickest way to grow the business was through acquisition.
- After a manufacturer acquired his business, he stayed on and later had the opportunity purchase his old company back.
Dave continues these words of wisdom by saying that it is better to buy a business than to start one from scratch.
- Steve agrees, and explains how when you can add skills that the company doesn’t have, such as marketing, you’re able to help that company grow.
Lessons from Owning Multiple Businesses
Dave asks what he knows now that he wishes he had known with his first businesses.
- Steve says he realized he was working too much in the business and not working on the business.
- He runs through how his mindset changed, and experiences that helped him prioritize it.
- Dave agrees and says that a lot of people experience that same process.
Dave runs through Steve’s expansive educational background, and asks what led Steve to pulling out of his business.
- Steve says the best time to sell a business is when you are not compelled to.
- He also noted that if the market is doing well, then the multiples will be higher as well.
- He explains his mindset behind why he sold his company when he did, including advice from his best practices group, and why he turned down multiple LOIs.
Culture Can Determine the Deal
Dave mentions the differences in the culture and how they can determine a fate of a deal, and asks Steve what of those thoughts were running through his mind.
- Steve says yes, and talks about his exposure and handling with certain firms.
- He notes that working with a professional to help broker the deal changed everything for him.
- He adds that selling the business becomes a fulltime job, and even with the advisor the deal still took nine months.
- Steve continues by noting the importance of putting together a team to help you through the process.
Dave says that clearly the first buyers were not the right fit, and asks Steve to reflect on what the right buyer looked like to him.
- Steve says that they do respect you more if you have a good broker who can help put the information together.
- He notes that if the acquirer is talking about coworkers and customers a lot, that is usually a good sign.
- He also adds that he didn’t want to have to teach somebody his industry, and explains how that influenced his decision.
- Steve mentions a number of steps he went through to evaluate the potential buyers, ensuring that their culture aligned with his own values.
Deal Fatigue and Other Issues
Dave then goes into issues that may arise through the process, such as deal fatigue, and asks Steve how he dealt with deal fatigue.
- Steve begins by talking about how Covid played a role in his deal fatigue.
- He notes that with the right professionals, you will still get deal fatigue, but it will not be as bad.
- He talks about how Dave was a quarterback calling on other teammates all around the country to help when specific expertise was necessary.
- Steve adds how having professionals help negotiate helps because after the deal is signed, you will likely be partners with the other side.
- Steve explains how the fees you pay for the professionals to help you broker the deal are well worth every penny.
Steve then runs through additional points where he either got hung up or learned a lesson.
- He discusses how, even though LOIs can be non-binding, there are still ramifications that go along with signing one.
- He adds that the sale of any business includes trying to minimize the taxes each party has to pay.
Advice for Selling A Business
Dave asks Steve what final points he would want to leave people with.
- He says first to get a team of professionals together, brokers, law firms, accounting firm, etc.
- He adds to take your time and not be in a hurry, because it is a lengthy process.
To reach Steve, email him at email@example.com
To reach out to Dave for advice or consultation, please visit www.davidseitter.com or email him at firstname.lastname@example.org
This podcast is provided for educational purposes. It does not constitute legal advice and is not intended to establish an attorney-client relationship. The recommendations contained in this podcast are not necessarily appropriate for every individual or business. In determining the best course of action, business owners should consult with an attorney on their distinct circumstances.