How to Get an Acquisition Deal Across The Finish Line?

Team Acquira
-  January 18, 2024
What You’ll Learn
  • How two Acquisition Entrepreneurs pushed their deal across the finish line.
  • How John and Bryant overcame the fact that one of them wasn’t eligible for life insurance.
  • How these AEs created a unique roll-up strategy for their first acquisition.
  • Time kills deals.

    If the bank is dragging its feet or the business seller isn’t providing the information you need fast enough, it can torpedo an acquisition.

    John and Bryant are two acquisition entrepreneurs who really had to fight to drag their deal across the finish line. They joined Acquira in October 2021 and by early November 2022, they had acquired two businesses and were preparing to acquire a third as part of an overall roll-up strategy. 

    They funded the deal through a combination of ROBS, start-up capital, and SBA loans and overcame the fact that one of them was uninsurable from a life insurance perspective.

    Here’s their conversation with Acquira’s Ty Trumbull.

    The Roll-Up Approach

    After filling out their investment thesis, the pair realized that they wanted to buy a business close to home. 

    “One of the things that Acquira really talks about is the investment thesis. And they have this idea where you can either have a business you want, and you have to be location agnostic, or you have a location and you need to be business agnostic,” John explained. “Our ultimate goal was to build systems. But we wanted to be able to touch, see, and smell the business if we wanted to. So we wanted to kind of be in our backyard.”

    John and Bryant then went to the bank and got pre-approved for a loan but weren’t able to find anything within their budget that also met their operational standards. That led them to think about some creative structures.

    “John is a very outside-the-box thinker,” Bryant says. “So he started thinking let's look at businesses that are small, that have X amount of capacity of cash flow, maybe around the $200K or so, or maybe a little less. But combine others to do a roll-up strategy. When we did that approach, you actually got better traction with finding things in the Richmond area, finding things in the Maryland area, really close to home for us. And then that allowed us to really put together a package for the bank where they were like, ‘Oh, this is like, really interesting and creative.’ They [said that they] never would have thought of that.”

    Creative Deal Structures

    acquisition finish line

    One of the more interesting facets of John and Bryant’s acquisition was the loan structure they set up. The team used a combination of ROBS, start-up capital, and an SBA loan to secure the deal.

    “When you're emerging out of the world of working for other people, most of us are sitting on some kind of capital. We usually have it locked into things that don't make it easily deployable. For me, it was my 401(k). For many people, it's a single-family home,” explained John. 

    As John says, there is a danger in buying a business that’s too small.

    “All you're doing is buying the ability to never have a weekend again. So I wanted something a little bit more robust than that. And you can't build systems when you can barely function,” he said. 

    But he wasn’t sure where he was going to get the money until he discovered the ROBS strategy.  A rollover for business startups (ROBS) allows acquisition entrepreneurs to make use of their funds from an existing 401(k) or individual retirement account (IRA). Importantly, a ROBS isn’t a business loan or a loan from your 401(k), so there are no interest payments to make or debt to repay, although there are annual service fees.

    Though, he’s quick to point out that the process is a lot.

    “The paperwork is like a small colonoscopy,” he says. “But it allows banks to take what they consider to be a risk on people that they don't consider to be more traditional entrepreneurs.”

    They combined that with personal capital to reach the down payment threshold on the purchase price of their busines and were able to get the banks to agree to the arrangement.

    Overcoming Uninsurability

    Another obstacle that the pair encountered was that one of them was unable to get approved for life insurance. As taxsaversonline.com explains, “your life insurance will act as collateral and reduce the risk for the SBA. If you pass away before your loan is repaid, your policy payout will provide the funds needed to pay your loan off in full.”

    Fortunately, John and Bryant are persistent. That, they say, was their key to success. “That and constantly badgering the bank to work with us to figure out a solution. And also reading very closely, what are the actual SOPs for the SBA loan process. Because that's important to understand. Is that a bank requirement? Or is it an SBA requirement?”

    finish line tax solution

    What the pair discovered is that the SBA doesn’t actually require both parties applying for the loan to have life insurance. It was a requirement of the bank. So they got to work proving their case. 

    “We threw lots of paperwork at it,” Bryant explained. They showed documentation to the bank from experts explaining it wasn’t a requirement. They also shared their “resilience plan,” which laid out the systems they planned to implement to ensure the business would run smoothly with or without them. 

    “So we made the case that we are not irreplaceable, so to speak, for the bank to understand that this is something that we can do,” Bryant says. “It's our vision, it's our company. So you can't get rid of us in that sense, but we definitely know we can be replaced to ensure that this business is standing on its own two feet.”


    For John and Bryant, persistence really was crucial to success. And they faced their share of obstacles before closing.

    “This particular bank that we were working with definitely blew up a deal that we were doing,” John said. “The particular people we worked with were so obnoxious that they basically wasted everybody's time for about six weeks.”

    When a deal valuation came back lower than expected, the bank wasn’t sure if it could get the deal done. “And we were like ‘nobody told you to stop working. Don't count us out. We're not done until we say we're done. And we drug – and I mean drug – that across the finish line,” John said.

    The search process can be demoralizing – as John puts it – for many acquisition entrepreneurs. But John and Bryant were resilient and steadfast in their aim and eventually closed on the deal they wanted. Hear their full story in the video above.

    Of course, their training started with Acquira and our Accelerator Program. You can sign up for the program through the form below, but our cohorts can fill up as space is limited each month. 

    Key Takeaways

    • Don’t be afraid to think outside of the box.
    • There are many different ways to structure deal financing.
    • Find a bank that will work with you to create a deal that works for you.
    • Don’t give up.
    Want to Buy a Business?
    Subscribe to our YouTube Channel
    Join Our Weekly Newsletter

    Dive into these Highlighted Acquisition Narratives

    running workshop

    How To Run Great Workshops

    What You’ll Learn The purpose and ideal cadence for regular workshops The most effective way to run a workshop Who

    Join Our Weekly Newsletter
    Join Our Weekly Newsletter