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Ben Tiggelaar 🟠 Profile picture
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Jan 3 β€’ 30 tweets β€’ 86 min read
The 27 best 🧡 threads of 2022 for small business & entrepreneurship

The amount of free value in one spot is mind blowing 🀯 πŸ‘‡
First, threads are not in any particular order

Second...the competition.

-> the tweet with the highest [like to view] ratio will be crowned best thread of #SMBtwit for 2022

So smash the like button on the ones you think should win (multiple votes allowed!)
(1/27) @SMB_Attorney: 101 introduction to buying a small business
@SMB_Attorney (2/27) @rodrepairs: See the human side of a service business and how SMB can give you the outlet to make a difference in others lives
@SMB_Attorney @rodrepairs (3/27) @ClintFiore: 8 min video analysis showing a 76% cash-on-cash return return even at 10% interest rates.
@SMB_Attorney @rodrepairs @ClintFiore (4/27) @BrentBeshore: Ideas that you should consider on a personal level if you're a current or aspiring entrepreneur
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore (5/27) @bentigg: Buy a small business with 100% seller financing and no bank personal guarantee
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore (6/27) @ConnorAbene: Cash flow management for SMB operators
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene (7/27) @JordanPCarter: Great financial graphic to illustrate the known risks of buying small (<$500K of EBITDA). Feel free to do it, just know the implications
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter (8/27) @SievaKozinsky: Cold email equity + debt fundraising guide
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky (9/27) @BuySellSMB: There's much more to a business than the financials...Do you get it, do you want it, can you do it?
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB (10/27) @ChandlerReedSMB: SMB outsourcing with virtual assistants
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB (11/27) @brianbeers: Buying and rolling up franchises
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers (12/27) @sweatystartup: "Entrepreneurship isn’t that complicated. Do something with good odds, low risk and moderate rewards." YES.
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup (13/27) @patrickdichter: Build a small business budget in 60 minutes
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter (14/27) @BoilerPlateCPA: Financial due diligence tips for service businesses
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA (15/27) @thomasince: Tactical tips to know fight back when a re-trade is sprung on you in deal negotiations
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince (16/27) @ElliottEHolland: Understand the motivation for sale or it'll cost you lots of time & money
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland (17/27) @austinrileygray: Starting a service business from scratch. Afraid of debt financing? This might be a better route for you.
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray (18/27) @realrookieceo: A business buying saga of resilience & grit that was almost a 'how to go bankrupt' thread. Being an entrepreneur is not easy but it is rewarding.
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo (19/27) @KHendersonCo: Differences among entity/tax selections (LLC, C corp, S corp) & QSBS (First $10M of gain on your business tax-free)
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo (20/27) @SBA_Matthias: If you're a rookie business buyer, a commercial loan broker may be the perfect person to support you in financing your deal
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias (21/27) @kelceylehrich: Be honest with your situation (goals, finances, opportunity)
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich (22/27) @sbabmarks: Buy real estate after you close your business acquisition - Brilliant strategy & sure fire way to wealth building.
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks (23/27) @Girdley: Explains the 4 different HoldCo structures: Holdco, Accumulator, Platform, Roll-up
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks @girdley (24/27) @RomanSB1: Due diligence check lists & LOI templates
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks @girdley @RomanSB1 (25/27) @RegZeller: Roll-up strategy of related businesses is an effective strategy and here's how they work in reality
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks @girdley @RomanSB1 @RegZeller (26/27) @SahilBloom: everyone on the earth has seen this, but I think all the ideas are applicable to SMB acquisitions & operations
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks @girdley @RomanSB1 @RegZeller @SahilBloom (27/27) @lawyer4SMBs: Seller notes / financing for small businesses - literally everything you need to know about them, and how to have the seller finance your deal
@SMB_Attorney @rodrepairs @ClintFiore @BrentBeshore @ConnorAbene @JordanPCarter @SievaKozinsky @BuySellSMB @ChandlerReedSMB @brianbeers @sweatystartup @patrickdichter @BoilerPlateCPA @thomasince @ElliottEHolland @austinrileygray @realrookieceo @KHendersonCo @SBA_Matthias @kelceylehrich @sbabmarks @girdley @RomanSB1 @RegZeller @SahilBloom @lawyer4SMBs If you liked this thread, I'd request you RT the first tweet this thread (link right below here). I'll love you forever.

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More from @bentigg

Ben Tiggelaar 🟠 Profile picture
Dec 30, 2022
How much does a sole founder of a $300M private equity fund make assuming you 3x the investor's money?

$65,000,000 ... 🀯 πŸ‘‡
1. Management Fees: $15M

$6M of mgmt fees per year for 10 years (2% of fund annually)

Single founder, so you'd probably be able to pay yourself $1M-$2M

$1.5M / yr for 10 yrs = $15M

Rest of mgmt fees go to pay for your team compensation, office, some deal expenses, etc
2. Carried interest (carry): $50M

3x your fund: $900M
(-) less $300M return of capital
(-) less $240 pref hurdle of 8% over 10 yrs

=$360M profit
x 20% carry
= $72M carry

x 70% of the carry as sole founder (awarded 30% to your team)
= ~$50M to the founder 🀯 🀯
Read 6 tweets
Ben Tiggelaar 🟠 Profile picture
Dec 28, 2022
How much do M&A advisors (business brokers, investment bankers) get paid to sell a business?

πŸ”Έ5-10% for $2M to $5M
πŸ”Έ4-6% for $5M to $10M
πŸ”Έ2-4% for $20M to $50M
πŸ”Έ1-2% for $100M to $150M

(imo they're underpaid!)

This hot tea πŸ«– came from a report that was just released πŸ‘‡
2 ways M&A advisors make πŸ’Έ:

1. Engagement/work fee: one-time or monthly, usually netted against success fee (81% of advisors charge one)

2. Success fee: % of the sale price paid when the business is sold

Success fees are where most of the money is made
Most common success fee structures:
πŸ”Έ40% Lehman
πŸ”Έ35% flat fee
πŸ”Έ18% accelerator formula

This 2022 survey shows the success fee an M&A advisor would charge based on a certain deal size: Image
Read 10 tweets
Ben Tiggelaar 🟠 Profile picture
Dec 26, 2022
The People Analyzer is an incredible tool for small business management and micro PE peeps

The quick and dirty guide on how to use it
πŸ‘‡
People Analyzer is a list of all your employees rating them against your values

You should use it for:
-assessing new hires
-benchmarking existing employees
-annual assessments
-monthly or quarterly management meetings
First: your company’s core values

These are the 5 values you hope for all employees to have regardless of role

Landscaping company’s core values I found:
Read 9 tweets
Ben Tiggelaar 🟠 Profile picture
Dec 20, 2022
You're missing out on the latest small business buying opportunity in 2023

100% Seller Financing: no money down and no bank loan

And as interest rates rise, I think it will be even more effective

🧡 ⬇️ Here's how to do it and why I think it's a legit strategy
1. Interest rates for small business loans have risen from 5.25% to ~10%

Purchase prices are coming down

Sellers expectations are not being met

But you've got something other buyers are fearful of doing

This is your opportunity
2. The seller situation

Seller wants $5M to retire (only offer on the table is for $4M cash)

The seller doesn't need $5M today

REALLY the seller may really want a steady income stream over the next 10-15 years without the hassle of running an operating business
Read 12 tweets
Ben Tiggelaar 🟠 Profile picture
Dec 18, 2022
Want to buy a business within 25 miles of your house? (called a geographically constrained search)...17 things:

1. be open to a lots of diff business types

2. setup auto deal notifications on biz listing sites for geo

3. meet live every single local biz broker and banker
⬇️
4. call & email surrounding area bankers and brokers (between 25 and 250 miles of your city) every few months

5. contact all local accountants, lawyers (transaction & estate is gold), consultants, commercial bankers, wealth mgr

6. entrepreneur/SMB events (meetup, facebook)
7. post regularly in local real estate & biz group

8. get a list of every company in your geo that took a PPP loan, filter to 1000 best (email, cold call). Drop in live to top 100.

9. start posting content on LinkedIn about your geo search, connect with tons of peeps
Read 7 tweets
Ben Tiggelaar 🟠 Profile picture
Dec 15, 2022
Searcher problem: Personal guarantee

Investor Problem: Many desire cash pay structures, avoid equity, willing to go lower in return for higher certainty cash

Solution: 'cash pay preferred equity'

I want your thoughts / critiques! I may try to do this on an upcoming deal ⏬ Image
Issues with self-funded SBA deals:

-rarely pay out cash on schedule (first 3 yrs it's either tight or reinvesting in growth)
-risky for equity...sit behind SBA debt, a variable rate
-Many investors avoid equity. Increase pool of investors with certainty + cash pay (ex: my dad)
$5M purchase price

-$4.5M of pref equity, $500K seller note
-Pref equity has a CASH PAY of 10% annually
-Pref paid monthly just like debt
-possibly amortized over 10 years

At exit investor gets unpaid pref back + ~20% equity kicker
Returns: 14-19%
MoM: 2.4-3.7x
10 yr hold Image
Read 9 tweets

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