Acquiring Minds Podcast Episode Summary

Title: Networking His Way to $800k SDE
Host: Will Smith
Guest: Alex Holley, Owner of Bdry Systems of Louisville and Ramjack Louisville
Release Date: February 13, 2025
Available On: YouTube | Website

1. Introduction

In this episode of Acquiring Minds, host Will Smith sits down with Alex Holley, the owner of Bdry Systems of Louisville and Ramjack Louisville. Alex shares his inspiring journey of transitioning from a corporate career to acquisition entrepreneurship, ultimately achieving an impressive $800k in Seller’s Discretionary Earnings (SDE) within a few months.

2. Guest Background

[05:22] Alex Holley: "I graduated from the University of Kentucky in 2008... worked in technology consulting through the end of 2016."

Alex Holley provides a comprehensive background, detailing his education at the University of Kentucky and his extensive experience in technology consulting. Despite initial interests in commercial lending, the financial crisis redirected his career path, leading him to small business management by 2016.

3. Transition from Corporate to Entrepreneurship

[09:14] Alex Holley: "The more I kind of dove in, the more attractive it kind of looked. It was just a matter of when a good time to do it was."

Alex discusses his fascination with small businesses, influenced by friends’ family-run enterprises in Kentucky. This interest led him to eventually leave his corporate role to manage a small local business, gaining firsthand operational experience.

4. Networking Strategy

[05:00 - 17:00]
Alex emphasizes the crucial role of networking in finding quality deal flow, especially in local markets where opportunities are scarce. He recounts scheduling 100 meetings over three months, averaging one meeting per day, to connect with potential sellers and industry experts.

Notable Quote:
[16:07] Alex Holley: "I really kind of made it my full-time job as much as I could."

Alex’s relentless networking approach mirrors stories from other successful entrepreneurs featured on the podcast, highlighting the importance of proactive relationship-building in acquisition entrepreneurship.

5. Acquisition Details

[25:32]
Alex details his acquisition of Bdry Systems of Louisville and Ramjack Louisville. He discovered the opportunity through a local broker, impressed by Bdry’s strong brand presence in the waterproofing and foundation repair industry.

[39:26] Alex Holley: "The five-year rolling average is probably four and a half in revenue... with margins around 20%."

The businesses generate approximately $4.5 million in annual revenue with healthy margins, translating to over $800k in SDE. The acquisition also included commercial real estate, structured into separate entities to optimize financial operations and leverage SBA loan benefits.

6. Business Operations

[57:09] Will Smith: "Turning our attention now just as we start to wrap up to what it's been like as owner operator..."
[58:33] Alex Holley: "I'm having a blast. Good. I'm loving it."

Alex shares insights into managing a construction-based company, emphasizing hands-on leadership and adapting to the operational demands of running multiple crews. He highlights the importance of maintaining strong relationships with employees and integrating two distinct service brands under one roof.

Notable Quote:
[65:32] Alex Holley: "We start running crews, multiple crews was something I was probably most nervous about, but I've had plenty of help."

7. Challenges and Lessons Learned

[42:40] Alex Holley: "My whole goal was to make sure I could pay myself what my wife and I would need... and pay down the debt at an accelerated fashion if possible."

Alex discusses financial strategies post-acquisition, focusing on manageable salaries and aggressive debt repayment. He also recounts the initial challenges of transitioning ownership, such as handling payroll hiccups and ensuring employee trust.

[61:06] Alex Holley: "I offered everyone a paper check before they left if they wanted it... and then direct deposit started to hit their bank accounts."

Alex’s transparency and willingness to navigate payroll issues firsthand helped build trust with his team, reinforcing the importance of leadership integrity during transitions.

8. Conclusion

Alex Holley concludes by expressing gratitude toward the Acquiring Minds community for providing support and inspiration throughout his acquisition journey. He encourages fellow entrepreneurs to leverage networking and remain resilient through challenges.

[77:30] Alex Holley: "Thank you for saying yes. And thank you big time, Will. It's been very, very beneficial..."

Alex’s journey underscores the power of strategic networking, diligent financial planning, and authentic leadership in successful business acquisitions.

Key Takeaways

• Networking is Essential: Building a robust network can uncover hidden business opportunities and provide invaluable support during the acquisition process.
• Focus on SDE Over EBITDA: Understanding Seller’s Discretionary Earnings offers a clearer picture of a business’s profitability and sustainability.
• Transparent Leadership: Open communication and hands-on problem-solving foster trust and loyalty among employees, especially during ownership transitions.
• Strategic Financial Planning: Prioritizing debt repayment and maintaining sustainable salary structures are critical for long-term business stability.
• Hands-On Management: Actively engaging in daily operations and understanding the nuances of the industry enhances managerial effectiveness and business growth.

Notable Quotes

• Alex Holley at [05:22]: "I graduated from the University of Kentucky in 2008... worked in technology consulting through the end of 2016."
• Alex Holley at [16:07]: "I really kind of made it my full-time job as much as I could."
• Alex Holley at [39:26]: "The five-year rolling average is probably four and a half in revenue... with margins around 20%."
• Alex Holley at [42:40]: "My whole goal was to make sure I could pay myself what my wife and I would need... and pay down the debt at an accelerated fashion if possible."
• Alex Holley at [61:06]: "I offered everyone a paper check before they left if they wanted it... and then direct deposit started to hit their bank accounts."
• Alex Holley at [77:30]: "Thank you for saying yes. And thank you big time, Will. It's been very, very beneficial..."

Additional Resources

• Connect with Alex Holley: LinkedIn (Insert actual LinkedIn URL)
• Learn More About Acquiring Minds: Acquiring Minds YouTube | Episode Summaries
• Upcoming Webinars and Events:
  • Thursday Legal Office Hours: February 13th at noon Eastern
  • Sale Leaseback Webinar: February 20th at noon Eastern
  • SM Bash Conference: April 2nd-4th in Dallas (smbash.com)

Thank you for tuning into Acquiring Minds. Stay connected for more insights and success stories from acquisition entrepreneurs like Alex Holley!