How to buy and turn around a
distressed business or 'roll-up' competitors

On this site you’ll read real life stories of how 23 entrepreneurs find, fix and then sell small companies on the edge of failure. Sometimes we buy our weak competitors in a roll-up and get new clients cheaper by acquisition then organic growth. If you like these concepts, come to the next workshop. Learn how we...

✓  Find distressed companies that are worth saving for capital gains
✓  "Roll-up" your competitors for rapid growth with little cash or risk  
✓  Why buying a distressed business is the BEST way to do a start up

From KC Truby Lonesome Cowboy Publishing Inc. 301 Thelma Drive #426, Casper WY 82609 (760) 207-6385

Why most failing businesses CLOSE DOWN rather than sell out to you

By on May 30, 2014

Why most failing businesses CLOSE DOWN rather than sell out to you

By: KC Truby

Well first off – the owner (in their mind) have NOTHING worth buying.  Sometimes that’s the truth about half of the 2 million business that close each year should NEVER have been started.

The business model was flawed and it took the startups’ entire savings account before they figure it out.  That may be why you should always seek advice from successful people before you start any venture.   We often fall in love with our own BS or seek out others that agree with us for advice.  That is plum nuts.  Get your idea in front of people who have already made big money,  and ask for honest feed back.  You may not like it,  but it could save your fortune.

Business brokers tell me that 7 out of 10 calls they get to list a business go nowhere once the broker looks at the sellers books (if they even have books.)

The second big reason is owners ride failing businesses into the ground.  Many times it would have been far wiser to get out last year when you still had something worth selling.  But often times hope springs eternal.

It just seems that failing companies make a series of 5 mistakes over and over that make it hard to transfer any value to a new owner. This is especially true if the business is losing money, since we pay a multiple of earnings.

This is not all bad news.

In some cases if you are doing ‘roll ups’ in a specific industry like ‘home health care’ or ‘insurance’ it is worth following up, even with the weakest business, because they have some customers and maybe one employee that you can use.

From antidotal evidence we figure that out of the 2 million failures about 10% could be saved and maybe another 70% have those ‘off balance sheet’ assets that are good to someone in the exact same business.

The real and bigger problem.

What bothers me is that 10% of the closures or about 200,000 companies could be saved. They have customers, employees, vendor relationships and infrastructure. They just simply could not get a handle on managing a small company and went over a cliff. That is a shame.

Now we already know that most business failure is caused by the same 5 mistakes that the owner chose not to see or do anything about. Fix those mistakes and you could have a profitable turn around, quick.

So how do you find your 2 or 3 of those 200,000 companies?

The secret is to be IN the market actively looking and to let EVERYONE you meet know that you are buying companies. Nothing more complicated than that.

The failing business owner has lost heart, they believe they have wasted their life savings and years chasing a dream that never came about. Get in there before the employees and customers all leave and you can pick up where they left off.

To successfully find these deals – always be looking.   We may meet a competitor for lunch and then email them a polite note 10 times a year and not hear a word.  But someday,  something is going to happen to many of our competitors and I want to be around before the owner goes over the cliff and loses everything of value.  Attend one of our seminars you will see exactly how we do it.   We hope to talk to you soon.

About KC Truby

From their ranch in Wyoming, KC and his wife Linnea have bought or started 21 companies as a side line to their accounting business leading them into M&A as a full time business in 2012. These companies are located all over the Western Rocky Mountains, London and India. Since 1969 through their accounting and training companies, KC has taught 18,000 business owners how to improve cash flow and find more customers by installing standardized systems in their small business. Since 1989 KC has presented over 1,000 seminars and training classes to the small business owner.

One Comment

  1. Gerome

    June 22, 2014 at 10:50 pm

    7 out of 10 businesses get declined from Broker listings, wow, it seems like they would want to list it anyways?

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