The non-emergent medical transport company, established in 2013, presents an intriguing opportunity for growth in a sector poised for future expansion. Specializing in transporting patients to and from doctor’s appointments, hospitals, and methadone clinics, the company is well-established with a fleet of around 30 vehicles, including minivans and wheelchair-accessible vehicles. It operates in upstate New York and currently serves a variety of customers, including insurance companies, with services covered under Medicare and other health insurance plans.

The company is looking for a buyer as the owner, a retired CPA, is seeking to exit the business and focus on personal interests, including managing racehorses. The business has strong operational support, with a capable office manager who could step into the role of General Manager. The current owner has shown little interest in expanding the business, which presents an opportunity for a buyer to tap into the underdeveloped wheelchair van segment and expand into neighboring counties that lack these services. Additionally, there is potential to leverage the company’s repair shop by offering services to other vehicles or starting a repair business as an ancillary service.

Although the company’s revenue and profitability have remained steady, it has done very little marketing in recent years, with the exception of hiring a full-time marketing person recently. This gap presents an opportunity to implement more aggressive marketing strategies to drive further growth. The company also recently purchased two new wheelchair vans and is preparing to reopen this segment of the business, which was temporarily closed during the COVID-19 pandemic.

A key growth opportunity lies in expanding the wheelchair van service, as there is demand in surrounding counties with no service providers. Additionally, there are opportunities to grow by developing relationships with local insurance companies and physician-owned organizations to bring in more clients. With the aging population and increasing demand for medical transport services, the market for this business is projected to grow at around 9% annually.

The company’s fixed assets include vehicles, which make up the majority of the business’s value. While the business lacks sufficient working capital, with just $22,000 in cash, the vehicles may help secure financing for the business. The adjusted EBITDA is a strong $453,000, but the lack of working capital and the high valuation of $1.5 million (which includes shares in the Catalyst insurance company) may require negotiations to lower the price. The seller has agreed to finance $140,000 of the purchase price, which could provide some breathing room for working capital needs. However, the lack of available cash and the low amount of working capital are concerns that should be addressed through financial diligence.

The company offers a strong platform for expansion, especially with the ability to capitalize on the growing need for medical transport services. With some strategic marketing and operational enhancements, it could provide a solid foundation for future growth in a thriving market.

Full Transcript:

Happy Thursday, guys. Hope all is well. Looking forward to the call today.

Glad to see Kyle Asman as as my cohost today. We’ll go around the room and, just check-in with everybody. Wow. What a week.

It’s been absolutely crazy busy. As you know, it was at the Dealmaker Getaway Weekend in Orlando, Friday, Saturday, Sunday. Really, really cool event. First time we’ve ever done that where it’s kind of very similar to the upper echelon, mastermind, but we we opened it up to some, to some new people.

And, we had a whole a whole lot of firmness, some great speakers, and some great people, some great deals, and, lots of hot tub time and drinking and all the crazy stuff, you know, I get up to when I get to hang with you guys. So, glad to be on the red light, green light call this week. I know I’ve missed it last few weeks with traveling and all those different things.

Let’s go to, deal number two. Let’s go to, Lars Boesphrom. The floor is yours, my friend. Off you go.

So, Lars, just FYI, after my four mile walk to Starbucks and back this morning in the wind, I needed one of those bad boys. So if you buy this company, remember your uncle Carl if he if he deteriorates in the future.

Yeah. So my name is Lars. I, see if I can get this to go under presentation mode here.

There you go.

Click the big purple button on the bottom that says present.

There we go.

Yep. So I’m looking at a non emergent medical transport company, both myself and Roberto. Roberto is with a patient right now, so he may or may not be able to chime in here.

Combined, we got, you know, about thirty five years of experience in the health care sector. I I work as a paramedic for Kansas City, Kansas fire department, and worked with experienced, physical therapist in the home health care setting.

The company here, it’s a, it’s established in two thousand thirteen.

The owner retired as a CPA back in two thousand thirteen, started this vehicle this company with one vehicle, so I built it up to what it is now.

Sort of the Upstate New York, transporting patients, to and from doctor’s appointments, emergency rooms. They got a big contract. They make a lot of revenue actually transporting people to, methadone clinics as well. So it’s, the drug rehab stuff there.

They also do some long distance stuff, transporting to, to to every city in New York there. They, have about thirty vehicles in their fleet, consisting of cabs, minivans, larger vans. They just recently bought two new wheelchair vehicles.

Company’s made up. They’ve got twenty four drivers, have some office staff, have a dispatch center. They’ve got their own shop with a mechanic.

The owner’s sixty five years old. He’s ready to retire. He’s kind of lost interest in the business.

Says he’s got a bunch of expensive racehorses up there in New York. He just kinda wants to retire, go play with his horses, doesn’t wanna have much to do with this anymore. He’s pretty hands off as it is now, so he comes in for he kinda does the hiring and firing.

There’s a girl in the office that does all the other day to day, and he said she’s capable of doing doing hiring and firing as well. So, she’s who we’ve got pegged to be our GM.

They’ve got in the deal, they have this catalyst insurance. They said, it’s difficult to get insurance for for the vehicles in this type of business, and they’re they’ve got shares in this company.

So that that’s part of the valuation of the business there.

He they just messaged us yesterday, said the the new, valuation just came in. It’s increased by fifty five thousand dollars for the the shares they have in that.

Owner’s asking one point five for the business. He said he’d take the value of the shares off and sell it to us for that, or we could pay for the shares. So that was a consideration.

Looking at growth, they said they’ve done very little marketing. They’ve done no marketing since COVID started. They just recently hired a a full time marketing person.

The the wheelchair van portion of the company, they closed down during COVID. They just bought two new vans, and are opening that back up.

Expanding to new territories. He said there’s a couple there’s at least a couple counties near them that have no wheelchair van service, and he said he’s kind of lost interest in the business, has no desire to do that. But that the the office girl there, she’s real eager to to build upon that.

The, the mechanic at the repair shop, he said he’s not at capacity, so we have the ability to maybe open up a repair shop service as well, maybe as a an ancillary business to that.

So potential with some insurance companies that work with Medicare and some physician owned organizations in the area to to build more more clients that way.

The market analysis, got a a projected growth rate of around nine percent due to aging population and more more interest in preventative care.

Any questions before I move on to the one sheet?

No. Let’s see the see the numbers. Great presentation, by the way.

Thanks. Yes. I think the first time I’ve done a slideshow in more than fifteen years now.

So You’re crushing it, dude.

Keep going.

But let me ask you a quick question while you’re just figuring this year out. The, so is it a million five including the three hundred k from Catalyst or in addition to the three hundred k from Catalyst?

That’s including that.

Yep. Okay. Perfect.

So if you if you let him keep those shares, right, which is what I would do, how does that affect the transfer of the insurance deal?

Can you still have that insurance as part of the business, or do you have to own the shares to be able to qualify to have that insurance in place?

So you have to I think we’d have to purchase shares in the company to to be insured through them.

Right. Okay.

Yeah. Okay.

The the thing about that, though, it it connects to security potentially.

I’m just thinking if you did an SBA deal, whether you can use that three hundred k as your down payment or part of it.

Yeah. Okay. Alright. No no worries. Yeah. Let let’s go through the numbers, and then I’ll, I’ll I’ll I’ll give you, my thoughts.

Alright.

So, yeah, we’ve got the the the adjusted EBITDA for the the average is at four fifty three.

Three times multiple, so one point three six. We kinda I think including the shares with the the offer we have made, we dropped it down to, like, about a two point seven multiple plus the shares. We’re we did an offer of one point four four.

Yep. And Yep. It it’s it’s lacking a bit of working capital, isn’t it?

You know?

Yeah. So we It’s quite a bit in cash is is is a bit low for for this type of deal. But, yeah, there’s there’s there needs to be probably another couple of hundred thousand dollars of cash in this business. That that’s my only concern with this.

What’s the other fixed assets? The two eighty eight one eight. Is that what is that?

I think it’s probably the the vehicles. That’s the their big assets is all the vehicles they have.

Right. Okay. Cool. Alright. Hey. I was pretty good.

Yeah. So the, said the AR is running at about two weeks.

I think with the it is a broker deal. I think they’re looking at cash free, debt free, but leaving in about a hundred and twenty five thousand of AR minus AP for the for the working capital is what they were wanting to do.

Yeah. Which is way too low.

Ordinarily, in a deal to be super, super safe and give you lots of headroom, you you typically want a couple of months of revenue in your working capital number. So, like, for me, I’d wanna see, probably around four hundred thousand dollars of working capital in this business, half of that being cash.

So so yeah. I I think the the beauty of an SBA deal, though, is if you can leverage the insurance, asset as, as the equity in this deal, you you you might not be able to do that. You’d have to talk to to to to David. Right?

But through an SBA seven a loan, it it’s highly likely I I think they would do this, right, because it’s, you know, the revenues are are going up. The margins are going up. The margins are, you know, pretty reasonable, especially the adjusted EBITDA. Twenty percent margins for a business like this, you know, is pretty good.

We’ve got an aging population.

Presumably, a lot of the clients of this business, they’re leveraging their insurance carrier. Correct?

Correct.

Yeah. Great. So it’s not like it’s an affordability, you know, type of thing.

Insurance company is paying really fast, though. Most of the medical deals I’ve looked at, they’re not paying on average every every fourteen days. But, on on the whole, I I I like it.

I think there’s there’s definitely a significant lack of working capital. And for that reason, I think the valuation is is a little bit high.

And then I think one of the challenges you’ve got is you’ve got a savvy seller. Right? What do I mean by that? The owner’s a CPA. Right? He’s not in the business day to day. He’s not distressed.

You know, that’s coming out massively in in your mid score.

He’s gone and listed with a broker. He’s not in the business that much. I think this guy will sit with this business on the market, until until he sells it. Having said that, this isn’t an industry to my knowledge where there’s a lot of trade buyers kind of sniffing around. I’ve not seen any, like, major roll ups going on in this industry. I think this is one of those deals where it’s more lifestyle related. Clearly, I think you could grow this.

It looks like this is just a better place for him to put some money.

You know, the business has been around ten, eleven years. So on the whole, I I like it. I I just think it’s a little bit overvalued based on the lack of working capital that that the business has.

But, Jeremy, what do you think?

Yeah. I like these these mobile, health care related businesses.

You know, other than the points that that you made, you know, my my question would be, I’d I’d wanna dig into the add backs and take backs just because those are significant as compared to the overall adjusted EBITDA. So, just making sure that those are actually legit, because they are adding, some significant value to the to the business there. So I’d really wanna dig into to those. The the other thing that I wanna question is I assume that fixed asset value is probably a a net asset value. So I think you said there’s, what, almost twenty vehicles, in the business. Is that correct?

Yeah. There’s, I think there’s thirty.

There’s thirty. So k. That, again, that’s probably the net amount. So you’re probably gonna be able to leverage some of those assets to to back any loan that you have because you’re gonna get to step up in value for for those assets. Probably not a ton just because they’re vehicle related, but they are vans, so they probably have a longer life, obviously, than a regular vehicle. But, the SBA will look at that to to help back the the loan and, you know, have those as as collateral. So that’ll help you as well.

Cool. Let’s go to, let’s go to Jamie Busby.

I can hear me.

Yeah. What do you think, Jamie?

Yeah. It’s record one else’s comments.

What do I say? Yeah. I look just a bit concerned about the EBITDA dropping down to eight percent. We really wanna get to know what what that’s all about.

Like the industry, I think, you know, it’s definitely only gonna grow, isn’t it?

Yeah. I think it’s a good deal.

Cool. Alright. Toby Bergstrom, what do you think?

The thing I would, I wanna wanna ask the seller is how they budget for CapEx for replacing the, the vans, things like that. And and just to understand or at least at least project for yourself how you’re gonna do that, because although they do have a long life, they do, I’m sure, wear out.

Yeah. We’re I’m working on getting a list of all the vehicles and the the loan payments and the I think he’s got some are leased and some are owned.

Yeah. Last, just speak can you speak to the hundred percent gross margins?

Comment from Kelly in the, in in in the chat. I missed that when I was skimming the numbers.

Yeah. Revenues and gross profits are the same. So I I I’m guessing it’s because, you know, they’re not they don’t really have a cost of sales, Although you could argue maintenance fuel cost of the drivers in in real gap accounting would be cost of sales. So business like this, you typically see about seventy percent gross margins, and then you’d have the normal overheads of the business. I think what these guys have done is just put all of the costs in the, in the operating expenses.

Jeremy, would you concur with that?

Yeah. I think that’s yeah. That’s probably what they’re doing.

So Shannon They had zero zero for the cost of goods sold is what they had on the balance sheet.

Yeah. So it doesn’t affect your EBITDA margins at all. It’s it’s just, you know, the way they’re running their accounts.

Normally, if the accounts would conform to US GAAP, that there is typically a true cost of goods sold even for a services business.

It it still costs you money to provide the the product or or the service that’s being delivered to the customer. But, it’s it’s yeah. I I just wanna give Kelly the, the credit for for for kinda pulling that out. But, but okay. Let’s go to let’s go to Lydia. Lydia’s new to Protege, got a great horizontal skill set. She’s a corporate turnarounds, professional, Does a lot of work with private equity.

Lydia, do you like this deal?

Personally, I would pass.

I I do I I think when you’re coming from the industry, it it makes sense to go into something like this because you will understand your client base quite a bit.

And, you’ll you’ll be able to see all the need in in the in the industry.

I as far as I I heard some comments about, vehicles that events lasting longer than they should be per IRS. It it is a depreciable asset up to seven years, so there is really this is kinda this is kinda it.

So and depending how they depreciate those assets given that this person is a CPA, they might have depreciated it with the this bonus depreciation method.

And, also also to point out Carl’s point that, excuse me, that there are no, cost of goods sold listed. It’s it’s kinda it’s kinda interesting to me because you can really see what it takes to run the business and, how to improve the operations and basically see where where where your opportunities are to grow this business. Instead of just going and looking at the top line, you can also see how efficiently it’s been run and improve on that as well.

Right. Thank you very much, Lydia.

Thanks for answering the question. We’ll go to some questions in a minute from the from the group, but let’s wrap up. Let’s go to, Kyle. Kyle, any anything to add on this?

No. I mean, like I said, I like the growth. The asset situation’s a little bit concerning.

Yeah, I feel like it’s got a good growth part for profile that’s set up, though.

I think the price is a little bit high, to be honest, at one point five million. I I would probably push a little bit lower in the price, a lot of that being related to the assets. But I I like the I like the growth. I would probably be a low green light if you can get the price down a little bit.

Yep. Perfect. So you’re pretty much where I am. Thanks for that. And then, last bit of analysis, let’s go to Darren Yee. Darren, what do you think?

Yeah.

I’m much rather you guys are with the price point kind of might be on a higher side, but it’s gonna be hard to wiggle off of that price point for him because his MUD score is not really there to say, hey. I’m gonna bring it down. Right? Because, you know, he could just sit on this, and he’s making pretty good cash, you know, on-site situation.

So there’s good there there’s gonna be some challenges in working through that working price. Right? Like, we think it slightly lower valuation, but doesn’t have a necessarily a ton of motivation outside. He just wants to retire.

Right?

So Yeah.

You might find it a little bit of pain point. He could sit on this deal for another year and still make, you know, plenty of money doing it. So, but, figure out kind of that cash on hand, but, like many of the other people on this, I’m a kind of a low green light on it.

So Yeah.

Thanks, Darren. I I I think you nailed it there. I I I think summing all the comments up, I think this is slightly overvalued.

You know, there is a big lack of working capital in the business. I think this type of business does have a pretty rapid cash conversion cycle. I’d love to know how he’s getting paid much faster than what normally insurance companies would would would pay.

But, but, yeah, I think, you know, I don’t see a trade buyer coming in and buying this. Right? I I I see this as, an individual. And as we know, no individual is gonna rock up with a million five in cold, hard cash.

They’re gonna go and get financing. Right? So it’s like real estate. You should appeal. It’s subject to what the financing markets can bear, and and I I think the SBA are probably gonna be at a at a lower valuation than than what he’s asking.

So, I think those are really good comments.

Just wanna answer a couple of questions in the chat, and then we’ll go to Kaye, Rodney, and Roberto.

So Benjamin’s got a good point.

Could you keep the owner on with a small equity share, leave the shares with him, and and keep the insurance?

I think that’s a decent shout.

You know, with all the new changes now with SBA, I I think you can get so flexible now with the the terms and the deal structures where you’re potentially leaving sellers, a little piece of retained equity. So I think that’s a a really good point. And then, Ryan, Ganese, he’s also from Austin, so he’ll be another one of my neighbors.

I I missed him in the shout out at the beginning because he didn’t have his camera on. So welcome to Ryan. He’s a new protege. He He was asking the question, how to determine how much working capital is required?

So what we normally do, Ryan, at this stage when we’re kind of vetting and we’re putting numbers together like this, we typically take about two months worth of revenue as as the amount of working capital with half of that being physical cash. Right? So if you’ve got a business doing two point four million dollars in revenues, we’re we’re taking one month as cash, which should be two hundred k and then another two hundred k in in other working capital. And working capital is AR plus cash plus inventory less any AP and any, other liabilities that are payable within the next, you know, twelve months.

So bank loans, tax payments, loan payments, all those different things. When you when you get into the cinema with a nice car too much?

When you get into the process where there’s, Ryan, you when you go through the training and you learn how to use the model and, you know, we we’ve got coaching for you on all that stuff as well with our financing coaches, You’ll you’ll see that the model calculates all that for you, and it adjusts the valuation and the deal structure accordingly based on, you know, what working capital is in the business. And, typically, you’re in three camps. Right? You find a business where the working capital is is really where it should be, and think of working capital as fuel, in a car.

You can buy a really expensive car with no fuel in it, or there’s no charge in it if it’s an electric car. Car with no fuel in it, or there’s no charge in it. If it’s an electric car, the car’s not gonna go. Right?

It’s the same with the business. The business needs that working capital fuel to continue to to trade and continue to do its operations.

We saw on the first deal that business had a surplus of working capital. There was more working capital in that business than than what the business actually needed. And in the in the structure on on deal one, we talked about how we could potentially use some of that as part of the funding mix. And then in this deal, it’s the opposite way.

There’s not enough working capital in this business. This is like you’re driving the car down the freeway and the red light’s on. Right? You need to refuel, because in in ten, fifteen, twenty miles, this car’s gonna run out of gas.

Right? So so all that stuff’s gotta be figured out as part of the deal structure. And the beauty of financing strategies like the SBA, the seven a loan program, is if they like the business, and I I think they would they would like this at the right value, the lower value, they will give you additional financing to top that working capital up. So it’s like you’re going and buying a car.

You’re financing the purchase of the car and the financing company is saying, yeah. Ryan, we really like this car, but you know what? You need a full tank of fuel to really enjoy it. Right?

So they’ll give you the extra money to, you know, to top that up so that it’s working. So just wanted to to answer that. And then let’s go to the questions in the group. So let’s start with, with Kay Stoner.

Great. Thank you. I’ll make this quick. First off, first question, where in New York state is it? Upstate New York is awfully big.

Second, if there are no similar services like this in surrounding counties, that raises a red flag for me because I was a consumer of these kinds of services for a while. And the fact that there are no other businesses in the neighboring counties, it kinda is you know, raises a flag because there should be. I mean, there is a real need for this. So what happened to them?

Did they go out of business? Were they not able to sustain? Like, what what’s the deal with that? And is the faith that befell them similar to what’s maybe befall your company?

Also, my business partner, Janine Little, her husband’s family was in this business for many years, and she knows a ton about it. She’s also texting me things to ask about. So I just wanted to put them out there.

And so they’re they’re in the the capital region of New York.

They do say they have two competitors that are larger than them, but there’s a lot of the competitors or mom and pop shops that kinda come and go.

They said the two counties near them I think they operate in thirteen counties predominantly, but they’ve got two counties near them that have zero wheelchair van coverage. And I think there’s been there’s been some interest.

They’ve they’ve reached out wanting it, but he’s like, I’ve got no interest in it. But the the office girl wants to do it. That’s gonna be our GM.

Yep.

Cool.

Just real real quick question, from the chat from Dave Evans, my friend. I wanna just, answer it. So Dave was asking, you know, what sort of health care businesses can you work with? If this was in the UK, then you’d look at the NHS. So one of the pieces of the UK is if you’re old and poor, the country will take care of you. Right? You don’t have to pay for health care in England.

In America, doesn’t work like that. Right? So, nobody gets free health care as far as I understand unless you’re retired military and you have that kind of coverage. So everybody has to have health care insurance.

You’ve got Medicare. You’ve got Medicaid. You’ve got Obamacare. And then you’ve got, obviously, your own health care that you have to buy and and and pay for.

So it’s insurance companies, David, that, will be paying for these services, and and that’s a great thing. Right?

If you if you looked at this for the NHS in England, the NHS is the only customer of this business, right, for all the different NHS trusts all over the country. But then, because it’s free and the NHS being under some, you know, pretty horrendous financial pressures, I don’t think this would be such a great deal, but in the US with the, with with the monster health insurance market and with all the customers being able to use that insurance to pay for a lot of these services, This is why I I think the margins are pretty decent. But, let’s, let’s wrap up with the questions, then we’ll move on to deal three. Let’s go to Rodney Johnson.

Oh, hey, guys. So I actually looked at this deal, last summer until last fall. The problem for me was the add backs.

So when I looked through them, I I pretty much didn’t agree with any of them. It was, stuff like car washes, car leases.

He had his entire salary in there, his wife’s salary.

And, no one said he didn’t work day to day in the business, but he still did some stuff. He kinda went in the office and worked on some stuff every once in a while. Not sure if I ever got an answer on what the wife actually did.

But, yeah, it was it was pretty much the add backs. I didn’t really see, any of them as, like, legit add backs. And for me, like, without the add backs working, or being legit to me, it just didn’t really make so much of a sense. Every time I got an answer to a question, I ended up with, like, ten more questions I needed to ask, and it just didn’t make sense to me.

Okay. Great. Well, I think definitely, Rodney, it’d be great for you to connect with Lars at some point offline and just share some of that insight with him. But, yeah, I think Jeremy mentioned in his analysis, you know, the ad backs were pretty large. You always need to vet the ad backs. For broker deals, brokers typically put ad backs in that aren’t real.

If his wife isn’t working in the business, but but is drawing the salary, which you do see a lot, that is a legitimate add back. If if if the guy’s working in the business ten hours a week doing a little bit of work, but he’s paying himself a hundred thousand dollars a year, then some of that would would be an add back. You’ve always got to look at, what’s the cost of replacing, that stuff. Like, if there’s a GM in this business that can step up and do what the original owner was doing, then, possibly could be a full ad bank. But you need to vet that and then, Lars, take you can take that to the the the biweekly financing call, if you got questions on that, or by all means, chat with Sarkis or Danielle, in in a in a coaching call to go through some of that. But, thank you, Rodney, for that, for that insight.

Last wrap let’s wrap up with, Ashley Pete, and then we’ll, we’ll move on to deal through. Ashley, what’s your question, buddy?

So I’m just wondering, is there any common good reasons why with businesses like this when we see good EBITDA but very, very low cash?

Is there any good reasons for that situation happening? Because, like, I understand if, you know, they’d spent money on assets, but then we’d see it in on the balance sheet. Or if they’re taking dividends, but then why would anyone take so much dividends to leave only three days of cash in the bank? I’m just it just seems to scream mismatched in some way to me.

Some business owners are greedy, especially if they’re preparing for a sale. Well, you know, Rodney mentioned he looked at this deal nine, ten months ago. This business has been sat on the market for a while, which I think, you know, tells you a lot about the valuation. Right?

So there’s probably a deal to be had. But but but yeah. Like, a lot of times, business owners treat their businesses like their own personal piggy bank.

You know, clearly, this guy, he’s an owner investor for the most part.

He’s I don’t wanna say rape and pillaging the business for cash, but, he’s obviously taking out as as much as he as he possibly can. You know, when I look at a business doing two and a half million in revenues with with only twenty two thousand dollars of cash in the business, that’s a big red flag for me. But as a CPA, he might have the most optimized financial management inside of this business. Right?

Like, being a CPA is a great horizontal skill set, as as an owner investor. Maybe he’s dialed in, his financials to where, you know, he doesn’t need this this type of cash flow pumping through the business. Like, we mentioned about the AR Normally so this business is b two b because the customers are insurance companies. They’re not individual patients as we understand.

So, normally, health insurance companies, they pay on average around ninety days. So I would expect AR in a business like this, you know, to to be, you know, six, seven hundred thousand dollars. The fact that it’s only one sixty, just needs, just needs some financial vetting.

But I I I think on on the, you know, on the balance of everything, I still think this is a good deal, for the right price. Roberto, I see you back with your hand up as co as co dealmaker on this. I’ll let you I’ll let you wrap up on deal two, and then we’ll go to deal three with David Horry.

Yes. Sorry, guys. I I was seeing patient in and out in the car. So, yes.

We’re actually a little bit ahead with this, Carl.

We spoke with Victoria, and so the the owners really agreed to for, like, the one point four range. Now And Once you get out in the sun and get walking.

Sorry. I just muted Don Larson. He’s getting out in the sun and walking. He’s obviously he’s not in Florida because it’s windy today. But yeah. Sorry, Roberto. Go ahead.

Yeah. So, Victoria said, you know, he I mean, she allowed us to for, like, a two seventy five k, working capital. And she said, with this type of business, she she already, the the financial, and she said there’s there’s more room to go up a little bit if we need to. And, also, with the cash injection from the seller, the the seller agreed to to carry a note for one forty k.

So we can, you know, he agrees to to do, interest only for two years, and then we can pay you know, we can start, principal and interest on the third year.

Right.

So he agreed for, like, seven year term and no prepayment, payment penalty if we need to wrap him up for, like, after four or five years.

Perfect.

So that kinda cover us a little bit too.

Yeah. Good. Well, it’s good it’s good that you’ve already started having the conversations. Whenever you get a deal guys that is reasonably close, like this, absolutely, you gotta be talking to financiers. Right?

Whether you’ve got direct as the SBA, you go to the Evervesty guys, or you go and talk to David, Marcantonio, or or his daughter, Victoria. But you didn’t know that Victoria’s his daughter, did you?

But anyway, so, yeah, like chatting to those guys, you know, these guys are doing this every day.

They’re they’re looking at deals. They’re underwriting deals. And and what they do is they have a panel of hundreds and hundreds and hundreds of different lenders under SBA. Some of them are banks. Some of them are non banks. And they’re they’re like a they’re like a triage service.

They obviously they they kick away bad deals, but then depending on the type of deal and the type of structure, they’ll go and they’ll find the right home for that deal because they just have that pulse of the market for who’s lending on what, what business types, what multiples, what coverage ratios and all those different things. So, so, yeah, I definitely I’m I’m pleased that you’re already in the financing, conversations with us. And, I think you can get it for the right price, and they’ll they’ll give you the extra working capital. I I definitely think this is a deal that that you should pursue. So, so so great job, Lars. Great job on the presentation.

Thank you. You and that, you know, as you said, the first presentation you’ve done in fifteen years. So, this is why we do it on this call. This is a safe space to not only get great feedback on the deal, but to give you that that that training. Right? To give you that opportunity to test this so that when you’re pitching other people, that that won’t be as friendly.

Sometimes you’ve got the you know, you you’ve got those training wheels off, and you can go forward. So, another great presentation, and and, yeah, kind of an average green light for me, but definitely worth pursuing.

Until then, bye bye for now.