April 25, 2022

Take Five #005: The Maslov Hierarchy of Acquisition Needs and why recurring revenue is overrated, & more

Take Five #005: The Maslov Hierarchy of Acquisition Needs and why recurring revenue is overrated, & more

Subscribe to Take Five to get our top 5 quick weekly reads on the world of SMB, M&A, and EtA from the team at Kumo. Kumo aggregates thousands of deals into one easy-to-use platform so that you can spend less time sourcing, and more time closing deals.

Take Five #005: The Maslov Hierarchy of Acquisition Needs and why recurring revenue is overrated, & more

This week, we’re at the 8th Annual Booth-Kellogg Entrepreneurship through Acquisition (ETA) Conference to meet other search enthusiasts: if you’re in town, we’d love to chat about Kumo! Reach out to us here.

1. Here’s why recurring revenue is overrated:

Buy Small, Sell High, on why recurring revenue is actually a nice-to-have rather than a must-have:

What really matters is revenue predictability. Recurring revenue is just one version of predictable revenue.

I have written about why you should start with the widest tolerable criteria regarding geography and industry to increase your odds of finding a company. Assuming you are already using your widest possible range for those two criteria, below is my hierarchy of acquisition needs:

From “Recurring Revenue Is Overrated” by Buy Small, Sell High

2. A brand new Entrepreneurs in Residence program launched last week: The Brydon Group

Deadline to apply is June 15th, and founder Steve Ressler outlines who they’re looking for below:

3. The top mistakes new SMB owners make, from a 6x business owner:

4. Ten things one searcher learned from their first acquisitions:

“Number 4: The best opportunities came from connecting with someone who turned out to be a dud, but had someone else that they connected me with that turned out to be a great connection. So make meetings, and always ask if they can connect you with someone who may be interested.”

From “10 things I learned from our first acquisitions” on Searchfunder

5. The entrepreneurial spirit starts young:

You can imagine the listing: “Extremely profitable snow-shoveling business for sale, team of two, 100% profit, ARR $20, no SBA financing allowed, must have proof of funds, serious buyers only.”

Loved what you read? Subscribe to Take Five to get our top quick reads every week from the team at Kumo. Kumo aggregates thousands of sources into one easy-to-use platform so that you can spend less time sourcing, and more time closing deals.