Buying a coin-operated laundry is a popular option for first-time investors. Many laundromat acquisitions require lender financing to cover a large part of the cost. In this article, we discuss how to finance a laundromat acquisition. We cover: How are laundromats financed? What do lenders look for in a transaction? How are acquisitions structured? How […]
Buying a Business? How to Pay for it
Buying an established business is a common way for first-time entrepreneurs to get into business ownership. It’s a strategy that has lower risk because buyers can review past performance and, consequently, be better able to forecast performance. When executed correctly, this strategy can help the buyer acquire a company with solid potential. However, buying a […]
What is an Equity Injection?
The equity injection is the funds that a buyer contributes to a business acquisition. Equity injections are commonly required in transactions that use lender financing. In this article, we cover: What is an equity injection? How are equity injections calculated? Why are they required? Can the equity injection be financed? Common equity injection sources Exceptions […]
Can a FedEx Route Carve-Out Acquisition be Financed?
FedEx Pick and Delivery (FedEx P&D) route carve-out sales are often listed through business brokers. While popular, these acquisitions are notoriously difficult to execute. Furthermore, they are difficult to finance and often require buyers willing to pay “all cash” for the business. In this article, we explore: What is a FedEx P & D route […]
How Much Money do You Need to Buy a Business?
This question is common for entrepreneurs looking to buy their first business. The answer depends on how you plan to pay for the acquisition. In most cases, buyers use financing – since few people can afford to pay for a business in cash only. We think that buyers actually have a different question in mind. […]
Advantages & Disadvantages of a Leveraged Buyout (Small Business)
Leveraged buyouts (LBOs) are a popular way to finance business acquisitions by using debt financing. This article focuses on the pros and cons of using an LBO to buy a small business. We discuss the following: Advantages of using an LBO Disadvantages of this strategy Common misconceptions For a detailed explanation of LBOs, read “What […]
Can I Get a Business Acquisition Loan with No Collateral?
There are many misconceptions regarding business acquisition loans and their need for collateral. This article explains the collateral requirements in clear terms and puts you in a better position to negotiate this requirement with lenders. The article covers: What is collateral? Why do lenders ask for collateral? Why is personal collateral required? Can you finance […]
Can You Do a Leveraged Buyout with No Money Down?
Leveraged buyouts are a popular way to finance business acquisitions. Though well-known for their use in large transactions, they are commonly used in smaller acquisitions as well. Thanks to some popular media stories, leveraged buyouts (LBOs) have gained a reputation for financing an acquisition without using your own money. But is this portrayal accurate? In […]
Pros and Cons of Buying a FedEx Route
FedEx routes provide small business owners with the potential of a great business opportunity. However, no business opportunity is perfect, and you must carefully weigh the benefits against potential downsides. This article discusses the advantages and disadvantages of acquiring a route and becoming a contractor for FedEx. Is a FedEx route a good investment? Buying […]
FedEx Case Study – Route Acquisition Using a Small Business LBO (P & D)
This article presents the case study of how a client used a leveraged buyout (LBO) to acquire a FedEx Pickup and Delivery (P&D) route. In recent years we have helped clients finance these acquisitions using a LBO strategy. Although not widely known, FedEx operates many P&D routes through third parties. These routes are a niche […]