Over the years I have spoken to a lot of people who are thinking about buying a business. They come from different backgrounds and have different financial situations, but the questions they ask are remarkably consistent. The same handful of concerns come up in almost every conversation. So this week I want to answer them directly, the way I would if you were sitting across the table from me.

These answers draw heavily from what I cover in Creative Acquisitions and Built to Run, so if you want the full picture, those books are where you will find it. But this post should give you a solid foundation to think from.

How Much Capital Do I Actually Need?

This is the question that stops more people than anything else, and the honest answer is: less than you think, if you use the right structures.

Most people approach business acquisition assuming they need to have the full purchase price in cash, or close to it. That is not how most small business deals actually work. The majority of small business acquisitions are financed through some combination of SBA lending, seller financing, and earnouts. In many cases, a buyer with strong qualifications can close a deal with as little as ten percent down if an SBA 7(a) loan is in play. Seller financing, where the seller takes back a note for a portion of the purchase price, can reduce the cash required even further.

The point is not that you can buy a business with nothing. It is that the capital requirement is often a fraction of what you assume, and creative deal structure is how you close that gap. This is the core argument in Creative Acquisitions. Stop asking "do I have enough money?" and start asking "what deal structure makes this work?"

How Do I Find Businesses That Are Actually for Sale?

There are two ways to find businesses for sale. The first way is to look at listings. BizBuySell, business brokers, and their databases are the most common starting points. These deals are visible, accessible, and competitively priced. Everyone who wants to buy a business knows these listings exist, which means you are bidding alongside everyone else and paying full market value for something that has already been reviewed and passed over by other buyers.

The second way is to go directly to owners before they ever list. This is where the best deals come from, and it is the entire premise behind The 7 Minute Phone Call. When you reach a business owner who is quietly thinking about their next chapter but has not committed to selling, you are the only buyer in the room. You are having a conversation, not competing in an auction. The terms are more flexible, the price is often lower, and the seller has a reason to work with you specifically.

Direct outreach is more work than browsing a marketplace. It requires building a list, making calls, and tolerating a lot of conversations that go nowhere before you find one that does. But the quality of what you find on the other end makes it worth it every time. I have yet to meet a serious acquirer who regrets learning to make the direct call.

What Should I Look for in Due Diligence?

Due diligence is where deals get made or killed, and most first-time buyers do not know what they are looking for until after they have already closed and found a problem. Here are the things that matter most.

Revenue quality is the first thing I examine. Is the revenue recurring? Is it concentrated in a small number of customers? Concentration risk, where one or two customers represent a large percentage of total revenue, is one of the most common value destroyers in small business acquisitions. If the top customer walks after the sale, what does the business look like?

The second thing is owner dependence. How much of the business runs because of the specific skills, relationships, or reputation of the current owner? Some degree of owner dependence is fine and expected. Total owner dependence, where every key relationship belongs to one person who is leaving, is a serious red flag. The transition plan matters enormously here, and the price should reflect the risk.

The third thing is cash flow normalization. Sellers often run personal expenses through the business, and EBITDA as reported does not always reflect what the business actually earns under a new owner. Work with a CPA who understands buy-side quality of earnings reviews. The cost of that work is trivial compared to what it can save you.

What Happens on Day One After I Close?

This is the question most buyers do not spend enough time on before closing, and it is the one that trips up the most first-time acquirers after the deal is done.

The first ninety days after a business acquisition are critical. Employees are anxious. Customers are watching to see what changes. Key vendor relationships need to be confirmed and transferred. If you have not already built a plan for this transition, you are starting behind.

The framework I recommend comes from Built to Run. Before you close, you should know the answer to three questions: What does the team need from you in the first thirty days to feel stable and motivated? Which customer relationships are at risk and how will you personally secure them? And what operational knowledge lives only in the previous owner's head, and how will you extract and document it before they walk out the door?

The buyers who transition well are the ones who answer these questions before the wire transfer goes out, not after.

Is It Better to Buy a Business in an Industry I Know?

The conventional wisdom says yes, and there is logic to it. Domain experience helps you evaluate the business accurately, spot operational red flags that an outsider would miss, and earn the trust of the team faster. If you have spent twenty years in a specific industry, acquiring a business in that space gives you genuine information advantages.

That said, I have seen plenty of successful acquisitions where the buyer had no industry experience at all. What they had instead was strong operational skills, financial discipline, and the wisdom to hire people who knew the industry better than they did. If you are a strong operator and you find a good business at a good price in a stable market with a competent team already in place, industry experience matters less than you think.

Where industry ignorance becomes dangerous is in commoditized markets with thin margins and highly technical operations, where being wrong about what you are buying can cost you quickly. In those situations, getting close to someone who knows the space before you close is not optional.

One More Thing

Every question I listed above has a longer answer than I can give in a single blog post, and the details matter. If you are serious about buying a business, I want to point you to the full resources. Creative Acquisitions covers deal structure, sourcing, and evaluation in depth. The 7 Minute Phone Call is the complete playbook for finding off-market deals through direct outreach. And Built to Run is what you read after you close so the business you worked hard to buy does not fall apart in transition.

The path to owning a business that generates real wealth is well documented at this point. The people who take it are the ones who do the reading, ask the questions, and then actually make the calls. Learn more about the framework at drconnorrobertson.com.

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