Ep. 258 — Kylan Gingerich: Why Acquisition Entrepreneurs Are the Missing Buyer for Mid-Market Owners

6 min read

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Episode Summary

You built the thing over thirty years. You love the craft. You don’t love the admin, the financing, the HR fires, the late-night invoicing. A PE firm sent you a 40-slide deck with a 20-year vision and an equity rollup you can’t decipher. A broker wants to list your 70 employees on a website. Your CPA does taxes, your banker manages the line, and nobody is sitting at the chart with you asking what you actually want from this sale. This is the gap I keep seeing between roughly $400K and $2M of EBITDA, and it’s where most baby boomer owners are stuck right now. I brought Kylan Gingerich from Acquira on to dig into the acquisition entrepreneur model: who these buyers are, how they’re funded, why an SBA buyer with a humble operator beats a spreadsheet roll-up most days, and what the seller actually needs to look at beyond the headline number. Kylan ran painting and brick-and-mortar businesses, sold three of them, and now helps owner-operators acquire small businesses through Acquira’s accelerator and investment fund. We got into why he spends the first three to six months in a business as a CSR and a ride-along instead of overhauling software, why high EQ buyers win deals over higher offers, and the real story of his Montana plumbing acquisition: 70% seller finance, 10% down, seller retains 20%, and they’re still figuring out the partnership one weekly meeting at a time.

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## Top 10 Takeaways
  1. There’s a real buyer gap between $400K and $2M of EBITDA, and acquisition entrepreneurs are the ones who fit it.
  2. If your cash flow requires an owner-operator salary plus distributions to work, your buyer pool shrinks to one type of person.
  3. The SBA “$200K down, sit on a beach” pitch ignores that your business is full of real people who don’t want to be overhauled.
  4. The first three to six months in an acquired business is for listening, not optimizing. Ride the trucks. Answer the phones.
  5. Your buyer’s EQ matters more than their spreadsheet. The deal closes on relationship, not just price.
  6. A 30% customer concentration is a price cut or an earn-out, not a reason to walk. Structure around the risk.
  7. Sellers under $2M EBITDA are mostly craftsmen who wanted a craft, not a private-equity-grade asset. Treat the handoff that way.
  8. You can’t expedite trust with employees, sellers, or techs. The deal where everyone walks away happy starts with that.
  9. Rolled equity only works if both partners can hold opposing views of the future without one of them quitting.
  10. Beginning with the end in mind beats reacting to the next inquiry: ten-year vision, three-year plan, this quarter’s move.

Sound Bites

“The number one thing I learned is I’d rather skip the whole startup process. It feels like cheating. It’s almost like you’re cutting in line and it’s okay.” (@TBD) — Kylan Gingerich

“100% of the companies on the planet, you can just acquire this seven figure HVAC or plumbing company, use an SBA loan, put a hundred, two hundred thousand cash down, and now you can just go chill on a beach. It’s not the case at all.” (@TBD) — Kylan Gingerich

“At the end of it, all the businesses, it’s just a bunch of people. The sellers are real people too. They have certain values. They have a certain culture in their business.” (@TBD) — Kylan Gingerich

“You can roll a bunch of those spreadsheets together, but you have to have a bunch of team meetings where people like each other to actually deliver the goods and services to the customer.” (@TBD) — Ryan Tansom

“The best deals I’ve seen, everybody in that transaction walks away happy. It’s a win-win, but there’s a relationship as well. Almost to the point where the relationship comes first.” (@TBD) — Kylan Gingerich

About This Episode

Kylan Gingerich is a Navy veteran, college dropout, and serial entrepreneur with three exits behind him: a multi-state painting company and two brick-and-mortar businesses sold between 2015 and 2019. He’s a principal at Acquira, an investment fund and accelerator for acquisition entrepreneurs that has closed over 22 acquisitions, currently focused on HVAC, plumbing, and roofing. He also hosts the Successful Dropout podcast and plays drums for the rock band Entice the Mice. This episode is part of Ryan’s run on search funds and the acquisition entrepreneur model, focused on the buyer-and-seller fit that determines whether a mid-market deal actually works.

Resources Mentioned

  • Acquira — Kylan’s investment fund and accelerator for acquisition entrepreneurs. — acquira.com/intentionalgrowth
  • Successful Dropout Podcast — Kylan’s show on nontraditional learning paths.
  • Entice the Mice — Kylan’s band, on Spotify.
  • Walker Deibel — Buy Then Build — Referenced for “never start a business again.”
  • Bo Burlingham — Finish Big — Referenced for what owners actually want from a sale.
  • Mark Manson — The Subtle Art of Not Giving a F*** — Referenced for “what pain do you want.”
  • John Mackey — Conscious Capitalism — Referenced for trust with employees, customers, and partners.
  • Gino Wickman — EOS / Traction — Referenced as the operating system Kylan is installing in the plumbing acquisition.
  • BizBuySell — Referenced as a source for small business comps and pricing data.
  • Service Titan — Referenced as the staple software in home services.
  • Roland Frazier — Referenced as an educator in the acquisition space.

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