Big Deal Small Business: Power of Community
January 13, 2022 | Issue #58
My SMB deal is progressing, we’re in the “grind it out” / high deal fatigue stage right now. I’m hoping to have more concrete updates for you in the coming weeks.
I wanted to express some gratitude for the Entrepreneurship Through Acquisition (“ETA”) community we’ve collectively built online on Twitter or in-person or wherever.
No matter what happens with this specific deal I’m working on, I’m so glad to have joined this community.
For those of you who are newer to the community, I strongly encourage you to dive in & get to know folks.
This post should give you a sense of the sheer power this community provides to searchers.
I roughly break it out into three buckets:
Getting Started
In The Weeds
Emotional Support
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Getting Started
I've been consistently shocked at how patient folks are with newcomers. There are a million & one basic questions, many of which are repeated over & over again, and yet so many folks took the time to go through it with me.
Looking over my notes from when I started diving into search seriously, I had roughly 20 intro calls over the course of 2-3 months.
I've had countless more since then, but re-reading my notes, I'm almost embarrassed at the questions I was asking these super knowledgeable, experienced people. I had done my basic prep (read the Stanford primer, HBR guide, etc.), but these folks made it "real" for me.
I mean...I literally cold emailed Will Thorndike (author of The Outsiders and prolific search investor) and he took the time to walk me through many search basics.
Similarly, I was connected by a former colleague to Prof. Royce Yudkoff at HBS (co-author of the HBR Guide to Buying a Small Business and active search investor), who spent an hour with me debating the relative merits of the Harvard approach or the Stanford approach, SBA-financed vs conventional debt, partnered vs solo search, etc.
In hindsight, that's crazy - any of those guys could easily have told me to just read their books/watch their videos/etc, but they took the time to talk to me.
That mentality is fundamental to the ETA community and is crucial to keep paying forward. It's part of why I write this newsletter.
So - open invite as always from me, feel free to hit me up with any questions you've got, no matter how basic. I'm available over Twitter DMs, replies to this email account, or phone/Zoom calls.
In The Weeds
As you delve deeper into search, I encourage you to build out your own personal peer cohort. This is usually a function of personality fit, values fit, etc. You can't force it, you just gel with some folks.
Your peers will generally be fellow searchers who are on a similar path & timeline to you, plus or minus 3-6 months. You'll also want to find a few mentors who are 1-5 years ahead of you on the search path and actively interested in supporting new searchers.
This peer group is huge. You don't realize today how badly you'll eventually need very specific questions answered.
Early on this will be "how do I open an LLC" and "how do I draft an LOI".
Eventually, it will be "who did you use for QoE" and "who did you use for insurance".
Then it'll be "what bank did you use for a checkings account" and "how did you get this specific license in this state".
That's as far as I've gotten, but I can imagine the future questions will be "how does escrow at closing work", "what PEO do you use", and "what CRM did you implement".
The issue is that all of these questions are easy to Google, but the answers can be a bit vague. It's hard to find trusted advice. As a result, your peer network is crucial.
That trust is built over months of searching side-by-side and mutually agreeing that you see the world in similar ways, so can trust their views on other items.
Emotional Support
You're going to hit some walls through search. As I've discussed in the past, search is not a marathon. It's a series of sprints, one after another, and you have no idea how many sprints are left until you cross the finish line.
So you're going to need help at two distinct spots:
After one sprint, you have to take a break to re-charge. But after that, it can be very hard to self-motivate to start the next sprint. Hearing about your peers' activities can be the inspiration you need to get back on the horse.
During a long sprint, your peers are the only ones who understand how tiring it is. They'll be the ones to push you over the hump and get to the end of each sprint, even when you're facing setbacks along the way.
These peers are crucial during these periods. The 30 mins to vent or commiserate are a huge deal. Don't try to do this alone.
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Conclusion
For the first Getting Started section, you should feel comfortable reaching out to anyone & everyone in the community.
For the second two (In The Weeds and Emotional Support), I'd strongly recommend you find a handful of peers on a similar timeline to you and meet with them regularly.
Build up a cadence - regular check-ins ensure that you're there for them when they need help, and vice versa. You get to celebrate wins & losses together, every step of the way. Search is a lot more fun this way!
For all of you who helped out when I was getting started, and to all of you in my peer/mentor/investor group today, a big, big thank you. Who knows if I'll get my deal across the finish line (these things are never done until wires have cleared), but I wouldn't have gotten even this far without your support.
I'm looking forward to paying that forward to future searchers.
As always, I’d love to hear your thoughts & feedback. You can hit reply to this email or find me on Twitter.
Thanks,
Guesswork Investing