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Selling a Service Business Without an Earn-Out

Brandon Lazar

In 2008, Brandon Lazar started A+ Gutter & Window Cleaning, servicing homeowners in British Columbia, Canada. Lazar successfully bootstrapped the business, generating nearly $1.5 million in revenue before being approached by an acquirer.

Lazar sold A+ Gutter & Window Cleaning to a private buyer in 2023 for approximately 3.5 times EBITDA, without an earn-out.


In this episode, you’ll learn how to:

  • Modernize an older industry and gain a competitive advantage.

  • Effectively navigate negotiations with both sophisticated buyers and inexperienced ones.

  • Establish firm timelines during negotiations for a smoother acquisition

  • Secure financing when conventional lenders are not an option.

  • Leverage a unique technique to sell your service business without an earn-out.

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More About Brandon Lazar

Brandon has operated a window-cleaning business for the last 15 years. Despite being located in a town with less than 90,000 people, the business generated $1.5m a year in revenue and employs more than 30 people.


After 2 separate acquisition attempts, which spanned over 12 months, the business was sold this Spring. A motorcycle trip from East to South Africa, climbing to the Mt Everest Basecamp, and funding a growing commercial real estate portfolio have all come from cleaning glass.


Currently, Brandon’s time is split between his software business, NinjaVA (NinjaVA.co), a virtual assistant recruiting service, HourlyIQ, which does performance pay bonus systems for the home service industry, and coaching small business clients thru Conquer.


Definitions

Letter of Intent (LOI): A letter of intent (LOI) is a document declaring the preliminary commitment of one party to do business with another. The letter outlines the chief terms of a prospective deal. Commonly used in major business transactions, LOIs are similar in content to term sheets. One major difference between the two, though, is that LOIs are presented in letter formats, while term sheets are listicle in nature. Source.


Earn-out: Earnout or earn-out refers to a pricing structure in mergers and acquisitions where the sellers must “earn” part of the purchase price based on the performance of the business following the acquisition. Source.


Due-Diligence: Due diligence is an investigation, audit, or review performed to confirm facts or details of a matter under consideration. In the financial world, due diligence requires an examination of financial records before entering into a proposed transaction with another party. Source.

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