Podcast Summary: Acquiring Minds – Episode: From Searcher to Sponsor: How to Buy a $22m Business

Title: From Searcher to Sponsor: How to Buy a $22m Business
Host: Will Smith
Guest: Jan Vanarski, CEO of Floorguard
Release Date: July 17, 2025
Podcast Series: Acquiring Minds
Sign Up for Summaries: acquiringminds.co

Introduction

In this compelling episode of Acquiring Minds, host Will Smith interviews Jan Vanarski, the CEO of Floorguard, a Chicago-based manufacturer of floor coating solutions. Jan shares his transformative journey from a self-funded searcher targeting businesses with $750k to $1.5 million in SDE (Seller's Discretionary Earnings) to acquiring a significantly larger $22 million EBITDA business through the independent sponsor model.

Guest Introduction: Jan Vanarski’s Background ([04:01])

Jan Vanarski begins by detailing his diverse career path, which laid the foundation for his venture into acquisition entrepreneurship.

Jan Vanarski ([04:38]): "My background's in management consulting. I started my career at Accenture, moved into tech with Sendgrid, and later joined a boutique consultancy in Chicago. Each step reinforced my passion for building and scaling businesses."

Jan's experience spans management consulting, product management at Sendgrid (later acquired by Twilio), and leadership at Tracing Company, a consulting firm that was itself acquired by a private equity-backed accounting firm. These roles honed his skills in growth and strategy consulting, ultimately leading him to consider acquiring his own business.

The Search Process and Initial Deal ([10:18])

Initially, Jan embarked on a typical searcher journey, targeting businesses within his preferred SDE range and geographical area near Chicago. He partnered with Calder Capital, a buy-side brokerage, to streamline his search.

Jan Vanarski ([10:25]): "I was looking for a business with $750k to $1.5 million in SDE, preferably SBA-backed, within an hour's drive of Chicago. Hiring Calder Capital allowed me to access proprietary leads and accelerate my search while maintaining my full-time job."

Pivot to Independent Sponsor Model ([28:00])

Halfway through his search, Jan discovered that the business he was interested in, Floor Guard, exceeded his initial financial targets, boasting approximately $4 million in EBITDA. Realizing that an SBA loan wouldn't suffice, Jan turned to Nicholas James from Minds Capital for guidance.

Jan Vanarski ([28:00]): "Nicholas introduced me to the independent sponsor model. That 30-minute call fundamentally changed my approach, enabling me to explore financing options beyond SBA loans and ultimately acquire Floor Guard."

Nicholas James, a veteran independent sponsor, explained the benefits of this model, emphasizing the ability to acquire larger businesses without the constraints of traditional financing.

Acquiring Floor Guard: The Deal and Closing ([22:10])

Floor Guard, a manufacturer of epoxy and polyaspartic floor coatings, was initially presented as a business with just over $1 million in EBITDA. However, during the on-site visit, Jan discovered its true profitability was closer to $4 million. This revelation led to a reevaluation of his acquisition strategy.

Jan Vanarski ([23:27]): "They understated their EBITDA to avoid attracting competitors. It wasn't until after the onsite visit that I realized Floorguard was a much larger and more lucrative opportunity."

Recognizing the potential, Jan collaborated with independent sponsor Nicholas James to structure the deal, securing $7.5 million in equity through a combination of personal investment and funding from SBIC (Small Business Investment Company) funds like Oxer Capital and Everside Capital.

Transition Challenges and Lessons Learned ([76:30])

Post-acquisition, Jan faced unexpected challenges during the transition phase. The sellers, a husband and wife team, initially committed to a long-term transition but abruptly exited after 45 days, leading to operational sabotage.

Jan Vanarski ([80:34]): "The sellers left abruptly, taking down company files and marketing materials. It was a major curveball that forced us into damage control mode."

This experience underscored the complexities of transitioning ownership in a family-run business and highlighted the importance of cultural alignment and clear transition plans.

Floor Guard's Business Model and Growth Strategy ([95:14])

To capitalize on the substantial growth potential, Jan revamped Floor Guard's distribution strategy. Previously reliant on direct e-commerce sales, the company now established local distribution channels to cater to smaller contractors who purchase in smaller quantities.

Jan Vanarski ([96:45]): "By building out our distribution network, we've increased volume by 20-30% and improved profitability. This shift allows us to tap into an 80% larger market of smaller contractors."

Jan emphasizes the strategic advantage of empowering local distributors, enabling greater market penetration without the overhead of setting up company-owned stores.

Future Plans and Insights on Independent Sponsorship ([109:01])

Looking ahead, Jan envisions an exit strategy involving either a strategic buyer or private equity firm within four to five years. He values the independent sponsor model for its flexibility and the ability to balance operational control with investor expectations.

Jan Vanarski ([112:30]): "The independent sponsor model provides optionality. Whether I choose to reinvest, transition, or engage in new ventures, the structure supports diverse future paths."

Jan also discusses the importance of cultural transformation within acquired businesses, focusing on employee empowerment and accountability to foster a high-performance culture.

Conclusion

Jan Vanarski's journey from a self-funded searcher to an independent sponsor illustrates the transformative potential of alternative acquisition models. Despite facing significant challenges, his strategic pivots and commitment to growth have positioned Floorguard for substantial expansion. Jan's insights offer valuable lessons for entrepreneurs considering similar paths in acquisition entrepreneurship.

Notable Quotes:

• Jan Vanarski ([04:38]): "My skill set is better served at scaling out a concept that's proven and building processes. Buying a business felt less risky and accelerated our path compared to starting from scratch."

• Jan Vanarski ([28:00]): "That 30-minute call with Nicholas was the most impactful life-changing moment in my entire search process."

• Jan Vanarski ([95:14]): "Switching to a distribution model not only increased our market penetration but also enhanced our profitability by allowing us to serve a broader base of smaller contractors."

• Jan Vanarski ([112:30]): "The independent sponsor model provides optionality. Whether I choose to reinvest, transition, or engage in new ventures, the structure supports diverse future paths."

Resources Mentioned:

• Mind's Capital Podcast: A sister podcast to Acquiring Minds, featuring stories of independent sponsors buying large businesses. New episodes drop every Wednesday.

• Webinar: Common Legal Diligence Issues hosted by legal experts James David Williams and Bill Barlow. Scheduled for Thursday, July 17, at noon Eastern. Register here.

• Acquisition Lab: An accelerator and community for aspiring buyers, founded by Walker Deibel, author of Buy Then Build. Learn more at acquisitionlab.com.

• Inzo Technologies: Offers IT audits for target companies. Visit inzotechnologies.com or email nick@inzotechnologies.com.

• System 6: An outsourced finance team for SMBs, particularly suited for searchers and their acquisitions. Visit system6.com or email hello@system6.com.

This detailed summary captures the essence of Jan Vanarski's insightful discussion on transitioning from a self-funded searcher to an independent sponsor, the strategic acquisition of Floorguard, the challenges faced during the transition, and the innovative growth strategies implemented post-acquisition. The inclusion of notable quotes with timestamps provides authenticity and allows listeners to reference key moments of the conversation.