This 19-Year-Old Surf Shop Makes $315K/Year — But Would You Buy It?
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The average order value has to be so small. You know, with that level of skews and the type of stuff we're talking about. Now we're talking two and a half million dollars. That's seven something multiple. So on a business that's got a 10% margin. So right there is kind of my biggest problem. This is the problem with all e-commerce businesses that don't sell their own products is that your gross margins are low. So you have to tie a bunch of capital up in inventory. Full set acquisition and auditing.

Hey everyone, welcome back to another episode of Acquisitions Anonymous. I am your host, Bill D'Alessandro, and this is the internet's number one podcast on buying, selling, and operating small businesses.

I am with Mills Snell and Heather Anderson today, and we have a deal that Mills found from Quiet Like Burbridge, who is, in my opinion, the best e-commerce broker on the Internet. It is a 19-year-old surfing accessories business. And 19 years in e-commerce is like 100 in real years. It's like dog years. There's a lot to like about this business, but we also had a lot of questions about it. Really interesting, and I thought kind of was like a perfect example of a quintessential business.

old school e-commerce business that could be bought and have a lot of energy injected into it. It has $315,000 of EBITDA, $3 million in sales. I think you're really going to like this episode of Acquisitions Anonymous.

Okay, so everyone knows that one of the first levers you want to pull in an acquisition is updating their technology, updating their systems that might still be running on a spreadsheet or even on pen and paper. But tech is complicated. There's a lot of solutions out there. So choosing the right cloud platform, the right CRM, the right telephony, compliance, cybersecurity, not to mention implementing all that stuff, that's a job in itself.

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And his business, Enzo, actually dates back to 1989, even before he acquired it. So the company has deep expertise for managing the tech for hundreds and hundreds of small businesses over decades. So if this sounds like something that would be helpful to you, check out EnzoTechnologies.com, I-N-Z-O Technologies.com. Or you can just email Nick directly, Nick at EnzoTechnologies.com.

Happy Friday, everybody. As of recording, it's happy Friday. Yeah. Yes. All right. I love our Fridays. Everybody's in such a good mood. And Heather wakes up bright and early. Yeah, I don't love our Fridays because it's very early on Friday that we record. But I'm here and I have my coffee. My office in Columbia is in the epicenter of where they throw St. Pat's in Columbia. And so like they're erecting stages and like the beer, you know, buses are rolling in and

like it'll all just be like green beer and like, you know, 12 hours. Yeah. Cool. Well, I, I have a couple of interesting deals for us to potentially talk about.

I found, I was starting to look, we had a listener reach out to say, Hey, I really liked the podcast. I'm thinking about selling my business. Do you know a broker in a certain area? So I was kind of going through my Rolodex and trying to see who I knew in that area. And, uh, I came across this website though, that is like a, uh, I think a cheaper version of biz by cell and came across a bunch of just random, interesting listings. Like, uh,

Yeah. Explosive high growth EBITDA e-commerce direct to consumer toy company, a gold mine reserve in Utah for $55 million. Okay. A medical diagnostic lab in Florida. I mean, just, I kept finding stuff and I was like, this is amazing. How many deals are we going to do? Should we roll them all up together? Yeah. We're just going to, we're going to roll them all up. They're all unrelated, but you know, despite having all that

I also came across this e-commerce surfing accessories business that I've been waiting, but we haven't been on the recording recently together. And I thought we have to have, we have to have bill for this one. And Heather brings the California perspective. And here I am just in South Carolina and I don't, you know, I've surfed before, but I wouldn't, I wouldn't consider myself, you know, a pro. So.

Are you guys ready for this? We're ready. I'm ready. When I think of, you know, surfing experts, I do think of Heather Anderson. She is clearly a parkour surfer dude. That's incorrect, but I do have friends that surf, so that's close enough, I guess. And you're probably like in, I don't know what their dispersion of customers is like, but if these are accessories, you've probably seen them walking around, you know, and being used. I probably have. That's true. This is...

Shocking to me. It's a 19-year-old e-commerce business. Bill, how many of 19-year-old e-commerce businesses are there in 2020? That's like a 100-year-old regular business. This business is 100 in e-commerce years. Yeah.

And it's a surfing accessories business with premium domain name and low workload. The revenue right now, what they have is $3.4 million, and they're making $317,000 in, they just say income. I'm assuming this is net income. And they're asking a 3.15 times multiple. So it's a million dollar asking price plus inventory.

It says, launched almost 20 years ago, the Surfing Accessories online store is ripe for a new owner with marketing expertise. The business is the best online store in the world in the surfing vertical. They offer the best selection prices and customer service. It's multi-channel with 80% of revenue coming from Amazon and the remainder coming from their main URL and eBay. Amazon has continued to grow year after year. The seller is carrying a million and a half dollars of inventory.

and stocks just under 30,000 SKUs in his 4,000 square foot warehouse in Colorado.

Sellers willing to consider the inventory to be sold on consignment to a qualified buyer bill. This is just as it's like oozing with stuff that I can't wait. Oh, there's so much stuff to talk about here. Okay. He believes that one of the paths to more sales is carrying more items from industry brands. Stocking more options has led to more sales for his business over the years. Two employees in the facility run day-to-day operations of the warehouse. The seller works part-time in the business. He usually arrives for an hour in the morning and a couple hours at the end of the day.

As mentioned above, marketing is a huge opportunity. They have a database with 80,000 email addresses, but they haven't sent an email in four years. This is so awesome. He has no expertise in areas like the meta pixel in both capitalized or other targeted methods that work with a defined audience such as, quote, surfers.

He's an operator, has done well because he understands that side of the business. With an experienced marketer at the helm, the business could reach new heights. The seller will be an empty nester soon. He has decided to sell this business and try some new adventures. And Brad Whalen, who I know we've looked at some of his deals before, and we've said good things. So what do you guys think about this?

Wow. This is the, I would call this like the prototypical e-commerce old, like 19 year old, a hundred year old e-commerce years, a prototypical e-commerce business for sale. Like just a couple of things really stand out to me. One, the age of the business, which is great. Right. I like that. It's, I like it's been around, like you're approaching Lindy-ness at this point, you know, 20 years old in e-commerce. Um,

The sort of classic, you know, it's niche focused and the kind of statement from the owner here where he's got 30,000 SKUs and also believes one of the paths to more sales is more SKUs on top of the 30,000, which, you know, gives me a little bit of a heart attack because he's got 30,000 SKUs already. But in his 4,000 square foot warehouse. Yeah.

Like these SKUs have to be tiny, right? Like what? Gotta be. But like it's surfing. So I wonder how much dropshipping there is here because I just I would be shocked. I mean, maybe it's possible, but like there's got to be. So this is surfing accessories business. I wonder if it's stickers. Yeah.

I wonder, right, stickers on your surfboard. I don't know if it's like charms or something. Wax, maybe. Yeah, wax, combs.

But like, I'm the first to admit I'm not a surfer. But like, usually when I see people out there surfing, they have a surfboard and some swim trunks. And that's not a lot of accessories. So that's why I'm wondering stickers, you know, or maybe it's something, you know, that you use to carry the surfboards or, you know, bags or car mounts or probably all the above. You've got 30,000 SKUs. But he's also got one and a half million of inventory. So that means I don't think it can be stickers either.

Which is like six, I mean, six months of inventory, roughly. You know, I mean, if he's at around...

Three, assuming that's, you think that's cost or retail? If it's cost, then he's probably got like nine to 12 months worth of inventory. Maybe. So I think this is a retail business, right? I don't know that he's got his own SKUs or his own brands, right? His own product. I think this is a retail business because he's got 30,000 SKUs and also his net margin is 10% here.

Right. And his net margin, 10 percent, and he's not doing advertising. I frequently see e-commerce businesses that are doing advertising with their own branded products at about a 10 percent EBITDA margin. So I'm thinking what this is, is retailer of not his own products, but also not doing any advertising, which they mentioned in the listing as a growth opportunity.

So all these, to me, kind of scream retail or reseller, right? And being that it is reseller and that many SKUs, it also, I would expect some component of dropship here. Because you're not going to stock that many SKUs in a 4,000 square foot warehouse unless it's stickers. And even if it was stickers, that's a lot of dollar value inventory. So I wouldn't be surprised to find some blend of stock and dropship here. Yeah, and I think if they were making, like if it was...

you know, hey, we design our own stickers and, you know, we have somebody else print them. There would be at least some like mention of that dynamic. You know, I think it's just the average order value has to be so small with, you know, with that level of skews and the type of stuff we're talking about. I mean, wax, you know, a comb to like scrape the wax. I mean, I'm just trying to think of like

We talked about average order value for e-commerce. I don't know if this is a website, surferswarehouse.com. I have no idea if this is it, but this is the top result for surfing accessories. So some of the things they sell, fins on the bottom of surfboards, leashes to attach your surfboard to your wrist, board racks, board bags, board repair, wax and traction, everything.

Apparel, which of course we didn't think about, like that can generate a lot of skews as well. Sun care, surfing accessories include

So there's sunscreen here. There's like patches for wetsuits. There's zipper lubricant. There's, you know, racks to hang your surfboards in your garage. Probably like everything except the surfboard. So, I mean, that makes you think they've got to be drop shipping some of that stuff in 4000 square feet. You don't have that.

you just can't have that much stuff. You can't. I mean, I just like, I've run a lot of warehouses and that's not a big warehouse. I mean, that is a, you are an incredible, which maybe this guy is an incredible operator. Like the density to get 3000 square feet in a 4,000 square foot warehouse, unless it is stickers is incredible. So you have to have some dropship here. Well, and let's not forget 80% of their revenue is from Amazon. That's a good point. So they're using FBA. Yeah. So, but like Bill, if you're doing that,

You think the 20% of their revenue, which is basically $600,000, maybe $700,000, that's on their own .com, they're shipping directly, but the majority of their revenue...

You know, is just fulfillment by Amazon. Is fulfillment by Amazon or drop ship. Yes, I think so. Which now they might be, you know, so if you're doing a lot of FBA, that 4,000 square foot warehouse in Colorado becomes a little bit more like a prep and processing center, right? You bring stuff in, you'll kind of kit it in the right size boxes, you'll break it, you'll send it to all the different Amazon fulfillment centers and you'll sticker it as required, et cetera. So you don't have to hold a lot of it.

Yeah. Still, though, it's a lot of complexity at 30,000 SKUs. I would be fascinated to know kind of the breakdown by SKU by channel. Yeah. Right? Because like some SKUs probably rip on Amazon and don't sell on the website and vice versa. Which makes you think – go ahead, David. Okay.

I was noticing the multiples. At first, it sounds good, 3.15. But when we add $1.5 million of inventory, which is more than the asking price, now we're talking $2.5 million. That's seven-something multiple. So on a business that's got a 10% margin.

So right there is kind of my biggest problem. What do you think, Bill? Yeah. So that's, I mean, I understand I'm not ready to say this business is over inventory because to your point, Mel's like, this might be, it's probably a year of inventory. He's got 3.4 million of sales, right? So let's say he's got a 50% gross margin. So that's, you know, 1.75 a year of cogs. He's got nine months of inventory, nine to 12 months of inventory, which is a lot, but not like absurd. Um,

So like I'm not trying to say this guy is over inventory. Just the problem. This is the problem with all e-commerce businesses that don't sell their own products is that your gross margins are low. So you have to tie a bunch of capital up.

in inventory. So you've got, you know, 1.5 million bucks of inventory capital tied up. Maybe you can run a little leaner and get that down to like 1.2, but you got 30,000 SKUs. Good luck. Yeah. You're about to change the whole business model. Yeah. So like, I don't think you can squeeze it a ton. Like I got to believe the seller knows what he's doing. He's been doing for 19 years, which means you're making $317,000 a year on your $1.5 million of capital tied up. You got a 20% return.

On the capital that's tied up in inventory, which is not great. Yeah. You know, because you're gonna have to finance that, right? If you're buying this business, right? And you kind of can't, you can't count like you look at this business, you only asking prices a million bucks, and I make 300 grand a year, that's a 33% return.

But you can't count the EBITDA twice, right? Like it's because you're going to have to put capital in inventory. So you've got actually like 2.5 million into this of capital into this and you're going to make $300,000. Like this is like 12% a year. Right.

Which if you finance it with debt, Heather, like what, what's it going to cost you? You can't, I mean, it's seven, a seven multiple combined the two and a half million, you can only afford about 3.5 turns of SBA debt. So you've got another, what is that? Two and a half turns of equity you have to put in. Yeah. So what you cut your equity demands a return as well. Right. Exactly. Right. And 300,000 is not enough for both.

Right. And now, you know, in fairness, and I think, you know, in fairness here to Brad, the broker, I think he and the seller realize this, which is why they have offered to seller finance or do consignment for the inventory. The seller is willing to consider the inventory to be sold on consignment to a qualified buyer, which is great in that it helps you get the deal done. Right. But you have to replenish that inventory.

So this is more of a financing vehicle, which is great and required, and they're right about that. But as you buy the inventory from seller, this is functionally a short-term note.

Yeah. Right. Seller note. But you still have to, with profits of the business or your own capital, backfill that inventory as it sells through. So once you have chewed through all the consignment inventory, you still are in a place just later, like a year or two later, but still you get to a place where you have two and a half million dollars of your capital in this business and it has $300,000 of you at the top.

which is fine if you're the seller, right? And you didn't debt finance it and you kind of built to this inventory position over time. No problem. But it's a little tough as a buyer with new capital coming in. Bill, you have some experience with doing consignment type deals. You know, that doesn't come up all the time, but what are kind of the

the important things to be mindful of, like the pros and the cons of consignment. Overall, it's a huge pro for a buyer. It's awesome that the seller and the broker here understand that it's needed to get a deal done here, which it absolutely is to Heather's point. You're just not going to be able to finance this with an SBA loan unless the seller helps you out on consignment. In general, it's a very buyer-friendly term. It's really great.

So the way it typically works, or I'll typically see it structured just for in theory, right? As you sell it, you pay the seller for it at COGS, right? So in theory, you would pay the seller every day. That's not workable. So the way I usually see it done is at the end of each month, you run a report that basically shows all the stuff you sold. And then you've got to compare it against the opening inventory.

And you've got to like take the opening inventory each month you run a report for what you sold, all the things that are on because you sold some stuff that, you know, maybe wasn't on the opening inventory report. So like you say, basically how you decrement the opening inventory report by the month sales until you hit zero. And then however much you decrement until you hit zero, you multiply by COGS and you pay the seller at the end of the month.

And then there is also this scenario that presents itself where you go, hey, it's been 12 months, you know, or it's been 24 months or 36 months. And you have some stale inventory that is still on consignment. What do you want me to do with this? I don't, you know, if it hasn't sold in three years and I still have $750,000 worth of your old inventory.

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So if this sounds like something that's appealing to you, if you want to buy a small business and need capital, or if you want to invest in small businesses, go check out CapitalPad.com and tell them that Acquisitions Anonymous sent you. Yeah. So you usually see like an expiry to this because like, you know, you don't want to be continuing to pay out the seller $100 a month, you know, while you continue to store this stuff also. Yeah.

So you typically see one of a couple different terms. You pick a year, two years, three years, and longer is probably better, more reasonable for both parties, like two years or something like that. Because if you got more than two years of inventory, you shouldn't have that anyway, and I'm not going to pay you for it. And usually what will happen is at the end of the consignment period, you can either say the title of the inventory reverts to the seller, right?

But the seller is required to come get it. Right. Like, I'm not going to keep holding it for you. You better show up with a truck. And if you fail to show up with a truck in 30 days, title reverts to me for free. Like, it just becomes my inventory.

Can buyer and seller get in some fights over that at that point? Never. Never. Well, that's why you got to spell it out now, right? Because yes, the fight will be seller will say, you didn't try hard enough to sell my inventory, right? And buyer will go, I wasn't going to sell it at a loss, right? Like I still got to pay you. Oh, that's another thing that is often in these agreements. You will pay the seller COGS or

or the sale price, whatever is less.

So this gives you the flexibility to blow out the inventory. Right. And which seller kind of would want. Right. It's better than zero. Yeah. So you want to only if it's aged past a certain point. Can they do that? I have I don't usually put that in. I just because you but you buy or you wouldn't want to do that anyway because you're losing money, too, because you still have to pick it, pack it, ship like you still got to deal with it. Like nobody's winning if you're selling it below COGS. Right. That's not great.

So you buyer, like it usually never comes to that, right? Usually it comes to Mills' point. It's two years old. You know, it's not moving. Whose stuff is this, right? And if it becomes seller's stuff, he's got to come get it. If it becomes buyer's stuff, then buyer can sell it below COGS and pay seller nothing or buyer will bear the cost of disposing it.

Right. Which might not be insignificant either to dispose a whole bunch of inventory or keep storing. So when you do a consignment deal, you've got to really think through what happens at the end of the consignment period. If this if you've got what is functionally junk. Right. It feels like it has value because it was paid for, but it's also can't be sold.

Right. What happens to that? Because there's cost to dispose of it or keep storing it either way. So in that sense, consignment inventory can be sort of safer for a buyer, right?

riskier for a seller because if you buy all the inventory with an SBA loan, for example, you're stuck with it. You already paid for it. And if you find out nine months into the deal that you've got a lot of obsolete inventory, that's your cost. Oh yeah. You're the one that gets burned. Buyers get killed on this all the time if they don't realize that they shouldn't pay for obsolete inventory. So like it,

To your point, Heather, if you're going to buy inventory up front, you as a buyer, you're going to need to look at all 30,000. Now, this deal is going to be structured consignment. But if it weren't, you, a buyer, would need to look at all 30,000 SKUs and the historical sales data on all those SKUs. And you'll typically see something like all inventory over 18 months of stock is going to be valued at zero. Yeah.

So like you have this blended ratio to say, you know, in this business, I don't think there's really spoilage. Like if you bought a grocery store, right? Like at a certain point, you got to throw stuff off the shelves. Yeah. But with this business, I don't think there's true spoilage, except just that you get stuff that.

doesn't move. And so instead of paying, you know, par value for the inventory, you might pay 60%. And then a lot of times in purchase agreements, you've got kind of a true up, you know, at six months or something like that to say, maybe somebody's held back in escrow or something on larger deals than this to go, hey, we found out that when we got in there and actually did our inventory counts post close, you had a bunch of stuff that was really old that we didn't

We didn't find before the purchase. Yeah, which is all stuff you got to do when you buy inventory up front, which is why consignment inventory is so elegant. It lets you get a deal done without financing the inventory at close. And you get to negotiate this sort of what happens to all the stock nobody wants. You get to negotiate in the sort of like future tense that people are less emotional about.

Who owns the inventory at close in consignment? Seller. Seller still owns it. So if a lender does come along and try to do an SBA loan on the enterprise value alone, they will not be able, their UCC filing, their collateral filing will not include the inventory. So that's a good point, Heather. You'd probably have to talk about that. Yeah.

You could also structure it as sort of like a contingent purchase agreement whereby buyer gets all of the... It's almost like a note that the payment is calculated based on what is sold. Right. That's what a lender would probably require because they want to have a UCC on the business, which has to include the inventory at close. That's a good point. So you need to basically functionally buy...

buy it with a seller note for, in this case, one and a half million dollars. But the term would be two years, let's say. Payments calculated based on what's actually sold, the balance of the note forgiven at two years. Probably you'd end up with something like that. Yeah, that makes sense. This is seriously kudos to the broker and the seller here for realizing that this is the structure, the consignment structure is needed in a business like this.

Don't you just love to like the way that entrepreneurship works? This, this is in Colorado. Yeah. Like this guy, you know, loved the sport, loved things associated with it, started a business and is nowhere near anywhere near to serve. It's amazing.

What do you make, Bill, or go ahead. What's interesting about that, Mills, is one of the stories from very early in my entrepreneurship journey. I was living in Denver and I was doing acquisition through entrepreneurship kind of before everybody knew that word. And I was looking at businesses to buy. And I looked at a business in Buena Vista, Colorado that sold kayaks and like whitewater rafting accessories because Buena Vista in Colorado is a big whitewater town.

and a whole bunch of surfing stuff because it kind of feels related and I was like I can buy this business I can move to Buena Vista Colorado is gorgeous right this this store it's still there I was I was there recently and saw it it sponsors like the annual Whitewater Festival in the town because the river runs right past their warehouse I was like this is if

to just like punch out and move to colorado like this is it buy this business become that guy and like sail off in the sunset but i was you know 27 i wasn't ready to do that but like the lifestyle like this could be an awesome lifestyle business yeah what do you make of 80 000 email addresses which is great i haven't sent an email in four years uh all those email addresses are cooked

If you haven't emailed anybody in four years, you can, you send an email on that list. It's all going to spam.

I mean, you will churn half that list pretty quick. That being said, you still got 40,000 email addresses, you know, and you know they're surfers. The other way that it can be useful is you can upload those lists of emails to Meta as a custom audience because you know these are all surfer people, right? So you can upload that to Meta as a custom audience and then turn on audience expansion and say, find me more people like these 80,000 and you get really good targeting in Meta.

Meta will probably figure it out anyway over time because Meta knows who's surfers anyway, but this would be a nice kickstart to Meta advertising. But I don't think it's like the key to massive growth. Okay.

It would help. Like you should definitely be – they should be emailing these surfers at least once a week during surfing season for sure. Yeah, and probably not doing any – like they're not doing any content marketing or like things that can really keep people coming back to the website. Yeah, that's sort of what I mean about how this is like a quintessential old school e-commerce business for sale. Like this is a probably awesome lifestyle business for the owner.

They self-admitted in the listing he's not a marketing guru. He's certainly – I mean they're not – he doesn't know what – how to use the Metapixel, which means he's never run in a meta ad in his life. So like this – he just hasn't kept up with – like he's not sending email. Like he's – again, no offense to Seller, but he's not really trying. Right.

Right. He's cruising. It's a lifestyle business. And you do like when you see these in e-commerce, it's exciting as a as a buyer and a marketer because there's just there's so many levers that this guy has functionally declined to pull because he is living a great life. So this is still a great bit. Like, I think it's time to do thumbs up, thumbs down. But I'm thumbs up in the sense that I want to talk to this guy.

I want to know more about the business and like what I'm dying to know. What, what do you have 30,000 of in your warehouse? And that's just skews. So there's more than one item per skew. And yeah,

You know, kudos to him. He built a really good business and it's running. We don't know anything historically, like the business could be in free fall, but it seems like he's running a pretty good business with a great audience. It's probably, I did some Googling and it's a small TAM because I think the majority of the surfing TAM is apparel and equipment. So like he may have a really, you know, decent piece of the TAM for just the accessories, which I,

you know, probably not a lot of people chasing. Yeah. So, so like I said, there's a lot to like about this business kind of has this lindyness, old school e-commerce lifestyle business that you can come in and really probably hit the gas on the flip side that I want to understand. I would like it better if it was 80% dot com and 20% Amazon. Hmm.

Because at 80% Amazon, a lot of that doesn't matter. Like the email marketing, like a lot of his business is actually just being driven by discovery on Amazon. I want to understand if it's paid discovery, sponsored products, organic discovery. But like, again, you just have fewer levers on Amazon and

And fewer things that benefit you from your 19 years of kind of business reputation and experience because you're just typing in surfboard leash or whatever and buying one. And you are more exposed to Chinese competition and, you know, that whole pipeline.

of kind of driving your margins down. Now, if you're buying branded stuff, the Chinese guys can't make the brand that everybody knows. And maybe you're the authorized reseller on Amazon and you have a contract and you're the only one. Now I like it way more.

Right. So that's what I want to understand is how defensible is the Amazon side of this business, which is 80 percent of it against kind of cheap Chinese knockoffs who will eventually find you like you can hide in niches for a while. And that has been the story of e-commerce over the last 10 to 15 years. The niches in which you can hide are getting smaller and smaller and smaller. Right. As as the Chinese competition comes for smaller and smaller scraps.

Right. So like I wouldn't want some securities through obscurity in this business. I would want security through, you know, contracts as a dedicated reseller, authorized reseller of certain brands, et cetera, on Amazon or your own products, which I doubt this has considering the SKU account.

So that would make me feel better. I'd be a little bit more nervous if it's 80% of business with no protection on Amazon. Yeah. As a lender, I have to say I would be pretty close to thumbs down. I kind of like the business. I think the right person who understands marketing could have a lot of fun with it. It could be a great business. But as a lender, I think it would be

tough one just it's really thin margin and it's Amazon you know most lenders kind of stay away from any e-commerce that is heavily Amazon especially when it's this small because they feel like the entrepreneur just doesn't have enough control over their margin and then you throw in this consignment inventory that has to be done kind of as a seller note and

And although I think there's a mechanism that could work for a lender there, I think it would confuse most banks that do SBA loans. They would want to look at it like a regular seller note and they'd get very confused about a consignment inventory concept.

kind of seller note hybrid. So I like the business, but I think at least from a financing perspective, it's a tough one. Heather, have you ever seen consignment deals get done with SBA loans? I have, but I've seen them get messed up too. It is typically something that the lender just doesn't deal with very often. And so there's just a lot of confusion all the way through the chain from term sheet, all the way through underwriting and closing on how to deal with that. Yeah.

So it's tricky. It'll be tricky. And that's sort of where I've come down on this deal. Like I think I'm a thumbs up on call Brad from Quietlight, sign the NDA, get the book. Like there's a lot that's really interesting about this business. There's a lot to maybe like, like if you find out that it's an authorized resell on Amazon, you find out that there has been run as a lifestyle business. There's a lot of levers to pull still. Like this could be a strong thumbs up after you read the sim.

Or if you find out that it's not protected on Amazon, you know, and there's not a lot of levers to pull and it's kind of dwindling, it could be less good. But this is this is the type of one you hope to find. Like if you're looking for a business, you know, there's not much more you could see in a teaser than this to say, I want the end then the NDA. Like, let's try it. So I'm cautiously thumbs up. Price and structure, I think, is the biggest hurdle to Heather's point. You know,

Because together you've got $2.5 million of capital into it, and it's got $300,000 of EBITDA. Solving that problem, I think, is the primary problem to solve here. The business problems, it's probably a good enough business to transact, I would think. Structure and price is going to be your hurdle. I'm so glad, Bill, that we waited to do this one with you because me and Heather would have been like... Well, yes. Thank you, Bill. We're like, huh, I don't know. I mean...

Yep. And same if you try to make me do a roofing deal. Yes. Yeah. Shame on anybody who tries to do a roofing deal. Yeah.

All right. This was really fun. Love seeing you guys. Thanks for everybody who listened in. And if you enjoyed this episode, if you're looking for e-commerce, you can go to our website, acquanon.com and look for whatever type of deal you're looking for. Manufacturing, construction, distribution, e-commerce, professional services. You can search by deal and find out more about what you're looking for. Thanks, everybody, for joining. And we'll see you next week.