Acquiring Minds: From 16 Years in Corporate to a $1M SDE Acquisition

Episode: From 16 Years in Corporate to a $1m SDE Acquisition
Release Date: August 7, 2025
Host: Will Smith
Guest: Jesus Wong, Owner of Gear Restore

Introduction

In this compelling episode of Acquiring Minds, host Will Smith, alongside co-host Connor Gross, delves into the transformative journey of Jesus Wong. After dedicating 16 years to the corporate world, Jesus transitioned into acquisition entrepreneurship by purchasing Gear Restore, a thriving business specializing in repairing high-end outdoor gear. This detailed conversation explores Jesus's motivations, search process, financing strategies, and the intricacies of managing a business that operates across two countries.

Guest Background

Jesus Wong's entrepreneurial spirit is deeply rooted in his family's history. Born in Mexico City to Chinese immigrant parents who ran small restaurants, Jesus was exposed early on to the challenges and rewards of entrepreneurship. At seven years old, his family relocated to Vancouver, Canada, seeking better safety and educational opportunities. This move instilled in him resilience and a strong work ethic, essential traits for his later ventures.

Jesus Wong [06:28]: "I worked and had part-time jobs and had to fund my own education. It was a great learning experience on how to navigate tough situations and the value of money."

Educated at the University of British Columbia with a degree in accounting and finance, Jesus excelled at KPMG before joining Orbis Investments, a hedge fund. Despite his successful corporate career, Jesus felt a persistent yearning to build something of his own, leading him to explore entrepreneurship through acquisition (ETA).

Decision to Pursue Acquisition Entrepreneurship

As Jesus approached his 40th birthday, he recognized the need for a significant career shift. The stability and achievements in his corporate roles at KPMG and Orbis Investments were impressive, yet they couldn't quell his growing desire for entrepreneurial fulfillment.

Jesus Wong [13:07]: "I needed to be an entrepreneur. I couldn't ignore this powerful feeling anymore."

Initially considering starting businesses from scratch, Jesus attempted several startup ideas. However, the inherent uncertainties and risks of the zero-to-one journey prompted him to seek a more stable and proven path. His eureka moment came upon discovering the concept of ETA through resources like Acquiring Minds podcast and influencers like Cody Sanchez.

Jesus Wong [16:54]: "I just found this wonderful world of ETA and was immediately sold on the idea."

Aligned with his FIRE (Financial Independence, Retire Early) principles, Jesus viewed ETA as a means to achieve a life of freedom, flexibility, and meaningful engagement without the unpredictability of traditional startups.

Search Process

Jesus approached his search with meticulous diligence, consuming extensive content from the ETA community, including every Acquiring Minds episode, Buy Then Build, and participating in forums like Search Funder. His methodical strategy involved:

• Defining Criteria: Targeting businesses with $750K to $1.5M in Seller's Discretionary Earnings (SDE), industry-agnostic, and primarily located in Canada with openness to remote operations.

• Evaluating Deals: Screening over 1,086 deals to find a suitable acquisition.

Jesus Wong [20:12]: "I looked at thousands of deals. If you like the CRM in front of me, to be exact, 1,086 deals."

This relentless approach underscored his commitment to finding a business that not only met his financial criteria but also aligned with his personal interests and values.

Finding the Ideal Business: Gear Restore

Jesus ultimately acquired Gear Restore, the largest provider in North America for repairing technical outerwear and gear for major brands like Patagonia, Canus, Arcteryx, and Helly Hansen. The company operates three locations across Denver, Philadelphia, and Calgary, with a workforce of about 85 employees during peak seasons.

Jesus Wong [22:10]: "They’re the largest in repairs of technical outerwear and gear. We service large brands like Patagonia, Canus, Arcteryx, Helly Hansen, to name a few."

Key Attributes of Gear Restore:

• Labor-Intensive but Scalable: With a workforce that can adjust based on demand, the business remains flexible without heavy capital constraints.

• Exclusive Contracts: Gear Restore holds exclusive agreements with several major brands, ensuring a steady stream of repairs as long as these relationships are maintained.

• Sustainability Focus: Beyond repairs, the company offers technical laundry services, aiding brands in maintaining the waterproofness of their garments, aligning with the growing sustainability trend in the industry.

Jesus Wong [27:00]: "We are the largest in North America... there is an expectation for the work to continue as long as we have that relationship with them."

Deal Structure and Financing

Financing the acquisition without the support of an SBA loan—a common route in the US—posed unique challenges. Jesus navigated the Canadian financial landscape by:

1. Engaging a Loan Advisor: Partnering with Joey Tai of Creek Capital was pivotal in understanding the Canadian lending environment and presenting his case effectively to senior bank officials.

2. Building a Strong Deal Team: Collaborating with professionals like Haifang Hu from Bennett Jones law firm and Kevin Yu from M&P ensured comprehensive legal and accounting diligence.

3. Structuring the Deal:

   • Equity Contribution: Jesus invested 10% of his own equity.
   • Loan: Secured 60% through a vendor take-back (seller note) arrangement.
   • Earnout: The remaining 30% was structured as an earnout, tying future payments to the company’s performance.

Jesus Wong [50:19]: "I put about 10% of my own equity. 60% of it is the loan. About 40% of it was an earnout plus some seller funds."

The vendor take-back included a component to protect downside risks by tying repayments to maintained EBITDA levels, while also offering the seller an upside profit share for exceeding performance targets.

Connor Gross [51:05]: "Forgivability is about protecting downside for you, the buyer. If the business dips, you will have to pay less back."

Financing Challenges and Solutions

Navigating the Canadian financing landscape required Jesus to:

• Identify the Right Contacts: Moving beyond local branch loan officers to senior banking officials who understood the nuances of business acquisitions.

• Leverage Professional Expertise: Utilizing the knowledge and networks of his loan advisor and legal team to present a compelling case to lenders.

Jesus Wong [44:28]: "I connected with Joey Tai... he helped me understand a lot about the landscape of lending."

Despite initial hurdles, Jesus secured favorable terms—7-year amortization at approximately 5% interest—demonstrating that with the right preparation and support, acquisition financing in Canada is attainable.

Jesus Wong [48:18]: "The one that I landed with was offering a seven-year. So not too far off from a ten, which is nice."

Challenges of Acquiring a Canadian Business with US Operations

Acquiring Gear Restore involved managing operations across two countries, presenting additional complexities:

• Dual Jurisdictions: Dealing with two sets of accounting books, different tax regulations, and fluctuating exchange rates between the Canadian and US dollars.

• Higher Transaction Costs: Navigating the less mature ETA space in Canada resulted in higher acquisition costs compared to the US, due to fewer players and less competition driving prices down.

Jesus Wong [61:00]: "Transaction costs in Canada are actually just astronomically higher than the U.S."

To mitigate these challenges, Jesus engaged deeply with his deal team, conducted parallel due diligence, and utilized AI tools like ChatGPT to understand complex tax regulations, ensuring a robust and informed acquisition process.

Reflections and Future Outlook

Despite acquiring Gear Restore only 23 days prior to the interview, Jesus expresses immense satisfaction and excitement about his decision.

Jesus Wong [68:53]: "I'm ecstatic. I'm amped. I'm so excited for this next journey ahead."

He acknowledges the struggles and complexities of the acquisition process but views them as affirmations of his chosen path.

Jesus Wong [69:05]: "The struggle and how tough some parts of the process really reinforce that this is the right path for me."

Looking forward, Jesus is enthusiastic about expanding Gear Restore's offerings and exploring adjacent opportunities within the sustainability and technical maintenance sectors of the outdoor gear industry. He also contemplates continuing his engagement with the ETA community, possibly through mentoring or future acquisitions.

Connor Gross [68:22]: "You don't have to like both [deal process and operations]. You should like one."

Conclusion and Takeaways

Jesus Wong's journey from a seasoned corporate professional to a successful acquisition entrepreneur underscores several key insights for aspiring ETA searchers:

1. Persistence and Diligence: Screening over 1,086 deals exemplifies the level of commitment required to find the right acquisition.

2. Leveraging Professional Networks: Building a strong deal team, including advisors and legal experts, is crucial in navigating complex acquisition landscapes, especially in environments lacking established ETA frameworks like Canada.

3. Flexible Deal Structuring: Utilizing earnouts and vendor take-backs can provide both security and incentives, balancing risk and reward between buyer and seller.

4. Understanding Market Dynamics: Recognizing the nuances of the target industry, such as customer concentration and sustainability trends, can inform strategic growth and risk management.

5. Personal Fulfillment: Aligning acquisition choices with personal values and long-term life goals can lead to both professional success and personal satisfaction.

Jesus Wong [73:08]: "As long as you kind of keep working hard and do what feels right and you're good to people, that's the most important thing."

Jesus's story serves as an inspiring blueprint for entrepreneurs considering the transition from corporate roles to ownership through acquisitions, highlighting the importance of strategic planning, professional guidance, and aligning business ventures with personal aspirations.

Notable Quotes:

• Jesus Wong [13:07]: "I needed to be an entrepreneur."
• Jesus Wong [16:54]: "I just found this wonderful world of ETA and was immediately sold on the idea."
• Connor Gross [51:05]: "Forgivability is about protecting downside for you, the buyer."
• Jesus Wong [48:18]: "The one that I landed with was offering a seven-year. So not too far off from a ten, which is nice."
• Jesus Wong [68:53]: "I'm ecstatic. I'm amped. I'm so excited for this next journey ahead."
• Jesus Wong [73:08]: "As long as you kind of keep working hard and do what feels right and you're good to people, that's the most important thing."

This episode not only chronicles Jesus Wong's successful acquisition but also provides invaluable lessons on navigating the ETA landscape without traditional support structures like the SBA, making it a must-listen for entrepreneurs aspiring to follow a similar path.