The M&A Playbook of a Multimillion Dollar Independent Sponsor | Brandon Halcott

For many independent sponsors, buying a business takes incredible skill, patience and persistence. Success does not happen overnight, and it takes real sacrifice. Brandon's story is one of systematic and tireless pursuit of improving his personal business skillset while diligently searching for his big opportunity.

Cashing Out Podcast | Episode 7 | Brandon Halcott | Multimillion Dollar Independent Sponsor Playbook

Todd: [00:00:00] Hello and welcome everyone. I'm Todd Sullivan and this is Cashing Out. This show is an open dialogue with fellow founders and former business owners sharing their stories and advice about selling their companies to some of the top acquirers in the world. Today I have a special guest, friend and independent sponsor, Brandon Halcott.

Brandon started in investment banking at Goldman Sachs and then jumped to Private Equity to learn the tricks of the trade. After graduating from Harvard Business School, Brandon not only started a company, but he also worked in strategy and in M&A roles in multiple industries. Ultimately, Brandon discovered his life changing opportunity as an independent sponsor by purchasing and rolling up dental practices in the Midwest.

Five years later, after building up a significant business, Brandon and his partner were approached by a much larger organization to be acquired. For many independent sponsors, buying a business takes incredible skill, patience and persistence. [00:01:00] Success does not happen overnight, and it takes real sacrifice.

Brandon's story is one of systematic and tireless pursuit of improving his personal business skillset while diligently searching for his big opportunity. I hope you enjoy my conversation with Brandon. So, Brandon, thank you for being here. I am really fired up that you have decided to share your story, your entrepreneurial journey.

You're really the first independent sponsor that we have had on, and I know you've had that entrepreneurial bug for a long period of time, but that independent sponsor or that entrepreneurship via acquisition journey, I think is. And the fact that you went through a bunch of stuff to find the area where you're in and be very successful in that, have an exit go from entrepreneurship to being employee, I think is, there are gonna be so many insights and tips for our fellow founders.
So I really appreciate you doing this. And I'll say one thing, like as soon as I knew that you were gonna take this time slot, [00:02:00] I didn't think twice about bumping Mark Cuban from the time slot. So thank you for being here.

Brandon: I appreciate it. Todd. Excited to spend some time together and, uh, and chat and yeah, we'll have to apologize to Mark later on.

Todd: Uh, so I like to start a little bit about how we know each other, right. So I think the first time we met was our kids we're at some like gym together, jumping around on mats, right? And we're like two or four of the parents kind of hanging out in. For whatever reason, I'm just like, you know, looking at these kids, making sure they're safe, and then seeing anyone else that's in the, Oh, maybe, maybe you're the only other dad.

I don't know what it was when I'm like, Hey, how are you? I'm just looking for some camaraderie in that room. And then kind of immediately found like we knew a lot of the same people we're living around the corner from each other. Our kids are the same ages. Right. So it just kind of spiraled from there.
Absolutely. Yeah.

Brandon: And I, it, uh, it was at The Little Gym. Orchard Lake [00:03:00] Road and uh, we were, I think it was Harvard/Yale weekend and so we were chatting on that.

Todd: That’s it. That's it. Yale.

Brandon: Cause the game was being played and Hey, when's the last time you went? And how much fun that going to that, those festivities and having some fun there.

Todd: That’s right. You had your sweatshirt on. So I had to go and like kind of pick a fight or whatever I was doing. Yeah. A hundred percent. That's great. That's great. So what's been really fun is not only do our, you know, wives get to know each other, the kids play together. You're living around the corner. We start to get to know each other, and I hear about this like entrepreneur in you and then what you're doing or have been doing, and the reason you moved to Michigan from Chicago, right?
The business was starting to really grow. Before we get into that, maybe you could take me back to, you know, how you really kind of started your career, how you thought about where you wanted to go, cuz knowing you, right? I think of you as, you know, methodical, very intentional about where you want to go.

And if it's [00:04:00] worth doing, it's worth doing, you know, a hundred percent. So maybe you could kind of take me back and set the groundwork.

Brandon: Yeah, absolutely. I always like to start with where, where I grew up, um, because I, little non-traditional, uh, growing up on a farm in central Illinois, half an hour from a stop light.
And I just think that upbringing is a, a part of me today and will always be a part of me. Um, so I always start with that because. Just, uh, the experiences that I got there, seeing entrepreneurism, um, with my family and the family farm and how they thought about making decisions, um, within livestock or grains and, and all of those things there, and asking those questions at a young age.
Um, it was kinda like my, my first forte into it, but it wasn't, I mean, I was just farming. I didn't think of it as entrepreneurism, but at the end of the day, it's a small business that my, my parents are in. The, the hard work and effort that you needed to be successful, I think is a part of my success today.
So fast forward to coming outta school and, and working in finance. Um, wanted to have that opportunity. To see the world from a financial perspective, see the larger plays that are happening both from an M&A perspective, raising capital for IPOs, things of that nature.

And it, it was a great education that I had. Uh, I'll be honest, I wasn't the best, um, at the end of the day, like. If my three statement model didn't balance it, it didn't cause me to stay up or try to solve that for the next five hours until the, you know, two, three AM in the morning at your analyst desk and investment banking.

Um, and that, that continued to be a factor, hey, that I did well because I worked really hard and had great relations and rapports with management teams. But as you look at, in my career in finance, hey, just I, I had more to give and it was somewhere else. So after business school, Um, started off on a first worked for a CEO [00:06:00] as a chief of staff, and then went to, um, had a car repair company, very similar to Safelite, um, doing, uh, paintless dent repairs, so PDR and then small scratches, uh, so cosmetic repairs, um, and, uh, great industry, fragmented industry.
So was opportunity to consolidate and bring a new product to, to the industry. Um, and did that for a bit and then moved into for-profit beauty school chain. So was working on a roll up with for profit beauty schools and Title Four funding. Um, unfortunately, like the government stopped having that. So our starts, uh, went away to a great degree.

And then, um, so I had a couple shots on goal, uh, great experiences, gotta learn a lot. Um, worked with boards, worked with management teams in that sense. And then finally, Third time around, went and started a, um, uh, a DSO, so dental support organization with someone I had met, uh, that, uh, came about when I was raising money for the car repair company.

And, [00:07:00] you know, I look back and the skillset of being an analyst in investment banking and then going to the private equity world and then business school, those were all great learnings that happened and helped. Build a set of tools that I could apply then, uh, with my partner in that dental industry. But, um, I mean, if you had, Hey, what made you successful?

Just really didn't quit and really wanted it to work out and, and, you know, needed it to work out, um, put that together. And that's a little bit of the journey to the dental business I was building in, um, the Detroit area. But more importantly, like, hey, the, the background and the components and the decisions that happened, uh, to get me to, to that point in.

Todd: So let me just step back. So you were in this auto repair area, and then you were in beauty. Were you founder or are you strategy and M&A? Like what was your role in those, In those businesses?
Brandon: Yeah. In, in the car repair. So the, uh, Dent Recon, uh, founder and jack of all [00:08:00] trades at that point with a small business.

Working on the capital, raising the it creation, marketing, everything at that stage. And then at the beauty school ran, um, operations and strategy. Um, so more focused on. How we can operate the individual schools on a, a more efficient basis. Um, greater outcomes in terms of success for licensure for students.

Um, because that was our, at the end of the day, we're in the business of education. So we were looking at our outcomes from a success perspective and seeing how we could deliver, deliver on that at a higher level.

Todd: So in that, you incorporated M&A in that you were looking at other companies to buy, to grow that business.

Brandon: Yes. And hey, how does dental and car repair and beauty school, how does that all fit together? Yeah. They were all fragmented industries. Yep. And so there was a huge opportunity of M&A in all of them. Uh, and then they all had low technology adoption, Right? So you had the opportunity to bring in new [00:09:00] softwares, new marketing.

Arenas to this, to, to all those industries and, and the traditional mom and pop that they weren't applying those. So, uh, M&A and all the, and the ITPs were big, big parts of these fragmented industries that really helped, uh, scale to build a larger enterprise.
Todd: That's great. Right? So you're kind of honing how you're, the hunt is going where you're gonna kind of ultimately find real success.

We get contacted almost daily from independent sponsors all looking for something very general, which is SaaS with at least a million of EBITDA, right? They're all reaching out for that. But for you to get more specific around low technology adoption, high fragmentation, I'm sure there's other criteria, but you end up saying, Okay, the dental space, so why the dental space?

Brandon: Dental has those characteristics we just talked about, first and foremost. So tons of, uh, fragmentation and low tech adoption. You look at, uh, I mean, I didn't realize this until I got [00:10:00] involved, but there's 130,000 dental practices, so every time you see a Taco Bell and a McDonald's, so there's 200, 300,000, 250,000 fast food.

There's, you know, just the amount like half of dental practices and you just don't think of that in terms. How many there are that are out there cuz they're in medical office buildings are tucked away and it's not, um, next to the Starbucks, but more Denovos and, and the newer model does have some of those very retail centric.

Um, and that was, uh, yeah, that was, it was applying some of those same lessons and seeing that. That gave that opportunity to the biggest benefit for us. Another one was at the private equity fund I worked at, I worked on a roll up of physical therapy offices. Ah, yeah. And so I knew about multi-unit outpatient physical therapy and ATI was the name of the company Sure.

Which is, is in Michigan and in West Bloomfield and all around. And I gotta see that on a very early stage because we, we bought it when it was [00:11:00] in Illinois and then added an asset out on the East coast and kept it grow and kept growing it from there. And I gotta see the, the way that. The, once the parts came together, how the enterprise could deliver that much more from a patient perspective and a team member perspective in terms of training, resources, technology, all of these things.
And that's essentially the, the same play on a, um, in dental, which is, hey, a single office can do X, Y, and Z. But a larger entity with multiple offices can have better access to technology. They've just got, you know, The, the volume of margin, the dollars are higher and they can redeploy that. And then there's scale benefits from purchasing and marketing.

Todd: And I think you also thought that was kind of minimal opportunity for the industry itself to be disrupted.

Brandon: Yeah, absolutely. And I work really well on a, I get scared of a white piece of paper, but if you, if you gimme a painting or something on there and say, Hey, make it better, I, I excel in that situation.
And it's just really understanding who you are. And I think if, if, if your listeners are gonna go and want to go buy something, What makes sense for them when they look in the mirror, this gets me outta bed. And maybe it's just the fact that it's business gets them excited or on the other, on the flip side, hey, this industry or this type of what I believe that I'm gonna deploy my skillset in like this really works with who I am as a human being.

And then that's just like, if you're, if you're waking up every day and energized and excited, it's not work like you, you're having fun and you get to do that, that's like the best thing in the world. So, um, for us, my partner and. [00:13:00] Dental industry, it's not going to get disrupted. I like, an example we would use is like Blockbuster was when Netflix came out, it was game over because all of a sudden the, the distribution channel changed overnight and that it, it will be tough for that to happen in dental.
Um, and we don't have, like, dental's not gonna be growing. From a, a top line perspective, like organic, same store sales aren't gonna be at 30%, 50% like you can see in some other industries, but it's very stable. Um, it can handle a downturn pretty well. And, and those, those pieces were important to us in terms of entrepreneurs and very risky.

And so let's try to limit some of those risks that are there beyond the whole overarching theme of entrepreneurs. I mean, let's try to get. Plus is in our column so that we can help make this as successful as possible. So making sure that industry's not gonna go away overnight. There's not a lot of, um, [00:14:00] the ability to handle a recession.

Todd: I think one of the things you just said that really, really resonates with me is knowing your own skillset, right? Knowing what gets you out of bed in the morning. All excited, fired up. To go to work. That is not necessarily work if you love it that much. And I know for me, I love that blank page, right?
That, that beginning stage of product, let's figure out product market fit. Let's figure out unit economics. Let's scale beyond the first customer and then you operationally can take something, somebody else's painting and and make it better. So I think for people listening and thinking about buying a business, right, you really have to know who you are.[00:15:00]

This is not easy, right? You're gonna run into a lot of stone walls, and I think you've told me before, right? It's really you're gonna be successful if you don't quit. I'm paraphrasing, but maybe you could say that better. What kind of makes you who you are and why you're successful.

Brandon: Yeah. The statement is businesses don't fail. People quit, and there's always an opportunity. Entrepreneurship is very hard. There's nine bad days in one good day, and what's gonna get you out of bed those nine days that it's hard or bad days. Um, and do you have the faith in yourself and what you're doing and what you're trying to bring to market?

Um, those are very important because you look at how risky the endeavor is and knowing who you are and. Knowing what you're gonna have to commit is, is really important. One thing that I don't know if we as a, [00:16:00] as a, in general, if we talk, talk a lot about it, is just the collateral damage that happens outside of the business.

And, and so there's 24 hours in a day and you should sleep according to science, like six to eight hours. People sleep more, sleep less, Um, and then. 16 after that. And what are you, And if you're working for eight and then the other eight to your family or working for 12 and, and I just mentioned that cuz the collateral damage, like it's a commitment not only as an individual, but is the institution around that individual.

And that could be, um, the family that's currently there, spouse, significant other children, and then friends because you are, you're doing something that's really hard, like building a business, um, is. The easiest thing. And that's why there, there, there's huge rewards for it both professionally and financially.
And those rewards are there because of the difficulty that exists. And you have to be honest, that going [00:17:00] down this path creates these, um, these casualties that, that are on the side and, and understanding that commitment and then being honest with not only yourself, but those around you, loved ones friends and, and making sure that you've got a path to not, um, not put those to the side.
And not have them totally fall off.

Businesses don't fail for, people quit. And so, Hey, why are you quitting? Well, I've got these exterior motives that I've got. It's my family, it's my friends and, and these things. And so there's a lot that goes into it, I'd say. And being very transparent and open and honest with yourself and others at that initial onset of what it's gonna take to be successful can then lead to success because it's not, um, it's [00:18:00] not all, uh, like shoot and ladders that are just going down.
That's really easy. It's, uh, it's a lot of uphill and pushing something uphill. We, we obviously celebrate entrepreneurs in this country in a, in a great way, and we celebrate their success and what they've been able to do. But I don't think we've done a great enough job shining the light on what it's taken to be successful.

Um, and the sacrifices that not only that individual, but their, the fear around them, friends and family, those sacrifices that they've made as well, because you, you might not be at work. Are you present? Well, if you're not, you're thinking about the business working on it. And that's what, that's what makes success.

And, um, we, we could do a better job of that, I believe, in terms of what it actually requires.

Todd: Yeah, I hear you. This is a very common theme in the people that I talk to and certainly what I've experienced in my life. It sounds like you have, I mean, you know, I know your family, right? You have fantastic support, as do [00:19:00] I.

And even when we go into this, we can warn what we think is gonna happen and it ends up being 10 times harder. So it's really important to have that support system to keep you going and also to pick up where you're gonna falter. You know, whether that's at, with missing trips with friends, or not being present at home, right?

You said it really well that we don't focus on those things and those are real, and you know, you call those casualties, right?

It's, it's those moments. The moments that you are losing are the casualties. Yeah. You're absolutely right. So thank you for sharing that. So you've made the commitment, you're going into the dental world, you know what kind of you're looking for. Are you using your own money at this point? Is it partners?
Is it outside capital? How are you gonna finance the first purchase?

Brandon: Yeah. Before [00:20:00] that had used, I personally had used some, um, like had passed the hat, uh, at the startup, the, the car startup. And then the, the beauty school chain was backed by a family office, but I mean, essentially a, a sponsor, so a private equity group.
And this time around wanted to, um, believe that we had the ability to, to fund the business ourselves. So, uh, our first couple transactions were done with a hundred percent debt. That was, they came from a local bank. Really small local bank in the community, in the Chicagoland area. And that was based on, um, balance sheet of myself, my partner, as well as personal, personal guarantees for that debt.
Wow. Okay. And so didn't need to have any outside capital. And the reason that wanted to do that is had experience on working for an institution and then having, passing the hat on an investor's perspective. Wanted to [00:21:00] keep more of the pie and found a way to do it from a financial engineering perspective.

And the reason to keep more of the pie is, um, you're working for yourself versus working for others. And dental is, and then in the industry, we're able to do that because there's low working capital and then there's also low capax and the entry multiples on single locations because of the risk. There's a provider, two providers, but if something happens there, there's a lot of key provider risk.
And so your entry multiple on a single location, uh, is not that high. The, the two other alternative businesses that I was looking at was, um, self storage and then fleet refueling. Fleet refueling as you 3000 gallon diesel truck going at night, refueling delivery vehicles, ups, Coca-Cola or construction sites.
Uh, and both of those are incredibly capital intensive. Would have to have raised money there, but would've raised money to fund [00:22:00] working capital, which is, I think is a, personally, I believe that's a poor use of like equity in terms of why would I go give away equity just to fund working capital. Um, and so that's how came into the, all the opportunities and dental specifically.
Another reason for that as well as how we thought about the, um, the capital structure of that business out of the…

Todd: Was there opportunity for seller financing at all on those first couple of opportunities or you just, you just didn't need it?

Brandon: Uh, I'm smiling because our, our first deal, Yeah. As nine months in, something around there was, it was from an estate, so we couldn't get a dentist who was alive to sell to us, but a, a state like a dentist who had unfortunately passed away.

That's how we were able to get it done. So, Um, seller financing. It could have still happened there from an estate perspective, but we were, um, these were smaller deals. We were [00:23:00] just getting started. Um, we never asked for it because we had the, the, the line from the bank and eventually we got to that where we were having seller financing, but we had track record credibility in two years, three years, four years of, um, Historicals that sellers could see.
And we were known in the community at that point, and they could talk to their colleagues who had prior, previously sold and had earnouts and those type of things, um, or some holdbacks that they were getting paid. And so it, it, it was easier to do it at that point, would've been much harder outta the gate.
Not to say you shouldn't try though. Right.

Todd: So the first couple, right? You got under your belt and then you're saying, Okay, we gotta grow this. How are you going out and acquiring, How are you financing that, that side of the business?
Brandon: The growth on the acquiring side, there's, in, in dental, there's, uh, one option is the proprietary deal.

So you're out knocking on doors, you're sending marketing material, those type of things, [00:24:00] building your brand of options for sellers. And the, the other is through the broker channel. So there's a very well established network of brokers who have relationships with clients and, um, that are at different stages.

And, and that's a, those are both great pipelines from a, um, affiliation perspective to look for new deals. And then on the financing side, so the first regional bank, or sorry, first local bank, uh, we did four deals with them and then, I think it was number five or number six, where they were getting a little concerned, We went to a regional, um, a regional, uh, bank that was in the, the Midwest. And they had done a little bit of work with DSOs, so they knew about it.[00:25:00]

We, we joined up with them and I think we got to somewhere in the, like 10 offices, maybe low teens, but we went from that five or six where we were before to that, to that 10 in a year and a half or a year. Wow. And they, they got to gun shy pretty quick and say, Hey, this is, I knew, I know you guys said you were gonna grow and you're delivering on that.

This happened pretty fast. And so it was at that point we went to then a, we went to look at professional lending institutions, so, um, ones that have LPs with committed capital that are looking to lend into high growth businesses. And most of those are already working with financial sponsors, private equity funds.
And that's the type of institution that we ultimately got to, to then have a, it was a delayed draw term loan that we had. Um, And they would give that to us in tranches. We would provide the proformas as well as the financials and all of our diligence on the [00:26:00] practices. And then we'd go to their, they'd go to their committee and fund.

Um, but it was a, like an interest only type, uh, loan that we had that ultimately really helped us accelerate our growth to get to, I mean, ultimately there were 27 deals done. In the five and a half years and that, you know, part that, that allowed us to scale at that rapid clip. So it was, it wasn't the first one and it wasn't the second one.
And personal guarantees eventually went away. so that, that's, that, that is our financing story through throughout the history of True Family

Todd: So you got to some top line. How big did you get the business?

Brandon: Wasn't 20 million. It wasn't a hundred million. Okay. Yep.

Todd: I'll share that. Got it, got it. All right. So yeah, sizable business.
Now, what triggered this idea that, hey, now's the time to sell?

Brandon: Well, it's interesting how Covid came for all of us
We had a great pipeline. Um, the existing core business was performing really well, and then you're told that you, you have to shut down your business. Um, which was very scary. Um, I mean, I, I looked at my wife, I looked at Jenny and said, Wow, I don't know what we're gonna, what we're gonna do here, because you, we literally couldn't serve customer.

We could do it episodically. So someone broke a tooth, they had a root canal, something like emergency pain, but we couldn't do preventative care. People couldn't come in for, uh, their cleanings. And our business was built around optimizing oral health. So we wanted, you know, you gotta come in twice a year because that's gonna lead to overall health.

And, uh, to go to, to go to like essentially zero. Um, Was scary. Incredibly. Yeah. I mean scary and just, I mean, it literally, you [00:30:00] had the, did we make bad decisions? Did we do something wrong? Um, we talked, your earlier questions taught around the industry, Hey, you thought handles recession and people have teeth need clean, but you, it didn't, didn't put a pandemic in my, um, in my thought of, of like what could happen here.

Um, so March, April, may. Were very challenging, um, you know, to sit there and not know what was gonna happen and not know how we were gonna keep going. I mean, the fear factor was high and the anxiety was incredibly high, and just for everyone, but we. [00:31:00] We did a lot of things during that time to create the culture and the community of true family to, to prepare us for June when we got the call that we're gonna be able to open again.

And we were in Illinois and Michigan, so two states that had very restrictive policies. Uh, we opened up though, and patients were, patients wanted to come back. They were comfortable with that. Um, and then, uh, we were able to, performance wise, we were able to do a great job to get back to what we had in regards to our budget.

We, we weren't actively looking to sell the business, but we had great relationships with a lot of, um, larger organizations in the industry. And these relationships go back to the days when we founded the business and had some questions on how to do things. And based on those relationships, uh, uh, had had the, um, an opportunity to do a transaction with Hartland Dental and we had a great foundation of.
Um, so I, I'd say like, uh, a common goal in between how we think about how we thought about true family and, and what Heartland thinks about in terms of their team members and, and serving, um, the dentist first and foremost, and then also serving patients. And so that rapport really allowed a, um, yeah, really allowed the transaction to take place.

And it was a, it was an incredible outcome for, for shareholders. It was something that we, we, we couldn't say no to, but we weren't actively thinking about transacting. It was the trials and tribulations through covid and just discussions with, uh, our network that we've, that we've had in place since day one that really helped facilitate that, that process coming to fruition.[00:33:00]

Todd: That's great. I think when I hear that story, I think more about you personally and that how seriously you take your personal network and building your professional network, right? So it's no mistake that Heartland, you guys have some relationship because you are, whether you're asking for advice or treating them as advisors and building that kind of collaborative environment around.
I really encourage a lot of entrepreneurs, you just can't sit in a closet building your business. You gotta reach out to the community, create strategic partnerships, help out where you can and get help where you can. Because in the end, people do business and transactions with people and people that they trust.

And I can see right from what I know of you, you would've built those relationships for somebody to. Hey, what Brandon has done is gonna fit our culture really well. We know him. This makes sense. And then the numbers can kind of fall in place, right? If, if people want to do it and they trust the people [00:34:00] around him, they'll make the transaction work.

So, um, yeah. Kudos to you for building that opportunity and even if you weren't looking for it, right?
Brandon: Absolutely. And I love that advice in terms of what you're given to listeners, and it's a lot of times it's not, uh, what you know, but who you. and when you're, when you're building a high growth business, you have to go from that individual that did everything to building a team.
And that's really hard for a lot of entrepreneurs. And you see, we've seen that in the, from time to time again, some, some individuals that can't scale to, to the importance of building that team and having that network that you, that you talk about. Just because you don't need, let's say a, um, IT director today.

You're gonna need one pretty soon if it's a high growth business. And just putting yourself out there, um, and participating in the industry and trade shows, those type of things. Like, it's, it's so much better to [00:35:00] bring someone in that, you know

If you've got a personal relationship prior to bringing someone into an organization, it's gonna be that much more successful and impactful because they know strengths, weaknesses of the business and of you as an individual and they're still making that decision to join. So it's really good advice to give to your, to give to listeners because you gotta always be doing that LinkedIn, other posts and things of that nature, like put yourself out there,

Todd: meeting guys at like Little Kids Gym.


Brandon: For example, going to the, going to The Little Gym on Saturday mornings for, Uh, tumbling. For tumbling,

Todd: Yes. Okay. So I want to get to the major advice around the actual M&A transaction that maybe you have, What kind of pieces, gold nuggets that you have for people when they're in the middle of it.
But before we do. So this is essentially inbound interest. You're not [00:36:00] looking for the sale, but you've created a community and you've created this opportunity. So they're approaching you. Did you hire investment bankers? Lawyers? Can you talk to me? How about how you constructed actually taking this transaction down?

Getting it done?

Brandon: We had a relationship with the law firm, uh, that we use for all of our individual affiliations, and we continued to maintain that relationship through this transaction. From a, um, investment banking perspective, we, we did not hire, uh, outside council there, like outside an outside firm to help with the transaction.

The multiples that you see in the space, those are pretty, well, I guess those are disseminated a lot. And you can see those at industry shows and things of that nature. And because we weren't, we weren't out shopping, it was. This is what we need. And then, um, let's go from [00:37:00] that versus, Hey, we're out to here to we're out trying to drum up interest and see what the business is worth.
It was, Hey, this is, we feel we're worth this and this is what it would take to transact because our alternative. Was just to continue to build. Yep, yep. Um, we had capital, we had the debt facility in place and we had a pipeline, we had a team. And you got through the storm Exactly, exactly like that. And the, uh, yeah, so we, we came out like, you always, it's always about, um, not losing an appendage or quote unquote bleeding out.

And so yes, came outta covid, um, battered and beaten, but, um, survived to your point. And, uh, so that was our alternative. So it was really, Here's, here's a valuation that makes sense for shareholders of True and shareholders of Heartland. And, and does that make sense for both entities? And, um, ultimately we came to agreement that yes, it did, but that, uh, um, did not have someone shepherding that, um, shepherding us through the process.

[00:38:00] Now, hey, to be fair though, yeah. Both my partner and I worked in investment banking Yes. And worked in private equity. And then we had our law firm, they were a seasoned firm that worked with m and a. Yep. And they, and they worked with a lot of financial sponsors, private equity funds. So the, the team that was, um, the team that helped build or helped seal the, uh, the transaction, very familiar with all the inner workings.

And so I wouldn't. Uh, it, it's always great to have advisors that are gonna, uh, if, if you don't know something, like, if, if you're at the poker table and you know, you can't find the, the dummy so to speak, then you better leave because it's you. Yeah. . Um, so, and, and, and then another part is like, look, as a, as an entrepreneur, you don't do a lot of these in terms of selling your business.
Right. And better be sure. You, you, you do everything you can, um, and, and do it well because [00:39:00] you, you don't get a lot of shots on goals. So, uh, if, if in doubt, there's, if in doubt, providers are, uh, a very, very, um, welcome resource to be able to, to do something that you don't do all the time and do it really well.

Todd: So I love hearing the stories of people that have been able to essentially do it on their own with a little bit of kind of outside counsel, because founders are always asking me, Hey, could I sell my business on my own? I'm really vehemently against that. If you're looking to maximize your outcome and run right, a real process.

So the entrepreneurs that we talk to that have done it on their own, there's always something there, which is you and your partner. Were both investment bankers. In your past, you've worked in private equity, and I think one of the critical things is you'd built a relationship with an m and a firm buying companies.

So they're really familiar with the space, they're really familiar with your industry, and they're very familiar with m and a in general, and are gonna be very efficient [00:40:00] in creating the outcome and protecting their clients. So as I will still tell entrepreneurs, you don't wanna do this on your own. Like you said, you get very few shots on goal.

You have to make this one count and advisors will help and they will pay for themselves many times over. In your case, I can understand why the team that you had was really already part of your team. So that's great. That's great to hear. So I really appreciate you sharing all of this story. We haven't had an independent sponsor on, I think it's a unique perspective.
Your background and how you built the skillset necessary to actually make this successful is really impressive. And I want people to really understand you don't just fall into this level of success. Is there any other pieces of advice that you would leave? I mean, we've got a lot along the way here.
Anything else that you wanna finish with? Yeah,

Brandon: I think being honest, what I'd leave with, like being honest with yourself, um, do the. [00:41:00] Are the rewards, but also the challenges of entrepreneurs and worth it to you. And then, um, make sure that the team and that team can be, um, the, the family, the spouse, every, everyone else.
Like make sure that you appreciate that team because they are an incredible piece of one's success and it shouldn't come lightly. Uh, that, that it's all you or an individually you like, It's, it's a team and everything is a team. Was, was an athlete. Um, and believed that, that everything is a, everything's a team sport.

Um, and it always helps to have the best and brightest around you, and that includes that family and friends. So, um, thanking them to help this, to, to help you be successful is, is really important in my mind. And making sure that, uh, you appreciate that.
Todd: I love that advice. We've heard it many times and sometimes you feel it internally, but don't know if it's real for everybody else, so that's like a, just a major lesson for [00:42:00] everybody to take from this conversation.

Brandon, thank you. This has been awesome. I think people are really gonna learn something from this, and that's the goal of Cashing Out podcast is really we think of m and a, and it's very much a black box for most entrepreneurs who have not got to go through this process. So revealing kind of the inner workings is really helpful. So, thank you.

Brandon: Oh, happy to be here. And, um, hopefully there's some good nuggets in there as uh, people go on. What is an incredible journey and something that, uh, is, uh, I mean, the highs are as high as they come and should enjoy every piece of it. That's great. Thank you.

Todd: Thanks, Todd. Thanks again for listening to the Caching Out podcast.

For more Founder Exit stories, please subscribe to the Caching Out podcast on Apple, iTunes, Spotify, or wherever you listen to your favorite podcasts. And please remember, exit and the cashing Out podcast are for entertainment purposes only. This should not be relied upon as the [00:43:00] basis for investment decisions.

The M&A Playbook of a Multimillion Dollar Independent Sponsor | Brandon Halcott
Broadcast by