An increasingly popular route to success as a small business owner is
“acquisition entrepreneurship”—buying and running an existing operation.
If you’re considering such a path, the authors offer practical advice
for each stage of the process. Think it through. Do you have the right
qualities for the job (managerial skills, confidence, persuasiveness,
persistence, a thirst for learning, and tolerance for stress)? Are you
willing to trade the benefits of working at a large organization for the
chance to be in charge? Search diligently and efficiently. Plan to
spend six months to two years—full time—following leads and
systematically vetting business prospects. Focus on companies that are
consistently profitable and have annual revenues of $5 million to $15
million. During this phase, you can self-finance or establish a search
fund to recruit potential investors. Strike a deal. When you’ve settled
on a target, do preliminary due diligence to confirm the business’s
viability and arrive at a fair offer. If the seller accepts, you’ll have
about 90 days to work with your accountant and attorney on confirmatory
due diligence. Transition into leadership. After the sale closes, your
priorities should be building relationships (with employees, customers,
and suppliers) and setting up processes to ensure steady cash flow.
[ABSTRACT FROM AUTHOR]