5 Businesses Acquired with a Long Term Hold Model | Ryan Sullivan Interview

Ryan Sullivan launched a new career in his late 40s. The self-described risk averse entrepreneur is acquiring small legacy manufacturing businesses across the US — and it's going well. His first acquisition was a 100-year-old electrical component manufacturer in Wichita, Kansas, doing about $700k in adjusted EBITDA. He bought it alongside a partner, who took a little apartment in Wichita and flew back and forth during the transition. 2 years later, they've bought 3 more businesses, have another under LOI, and have expanded to 5 partners. We spend a lot of time on Ryan's model here, which isn’t quite a holdco, not traditional private equity, and not a roll-up. Which I appreciate because it feels like Ryan and his partners didn't just copy the existing models out there. Instead they worked from first principles to arrive at a model that aligns incentives, and generates compelling economics even while being conservative with respect to debt & risk. Enjoy this interview with Ryan Sullivan, managing director of North Park Group.

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00:00:00. Introduction to Ryan Sullivan
00:06:28. Entrepreneurs are risk mitigators
00:13:27. First acquisition: Electron
00:19:51. The real estate aspect of the Electron acquisition
00:25:54. Electron’s small size
00:31:14. Making changes after transition
00:35:35. Second acquisition: Phoenix Electric
00:42:47. Acquisition drought
00:44:02. Third and Fourth Acquisitions: Dickey Manufacturing and Neverleak
00:48:37. The challenges of finding good deals
00:53:24. What Ryan likes about small business
00:55:16. The operating partner model
01:03:11. Small deals with big percentages
01:07:15. Their equity to debt ratio
01:11:42. Generating returns from cash flows, not exits
01:22:56. Ryan’s long-term vision
01:28:06. Closing thoughts and contact information

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ABOUT Acquiring Minds
Acquiring Minds is a podcast about buying businesses. Acquiring an existing business is an awesome opportunity for many entrepreneurs, and host Will Smith talks to the people who do it. New episodes 2x per week.

#business #acquisitions #holdco