The Situation
A $2 million construction subcontractor came to us at a crossroads. The owner wanted to sell his business for $1.5 million — a number that reflected his years of hard work, not the financial reality underneath it.
When our team reviewed the books, the picture was complicated. The owner operated four different companies, and their finances had become deeply intertwined. Personal expenses, unrelated businesses, even luxury cars from a racing venture were showing up on the construction company’s books.
The honest assessment: the business would be lucky to sell for $250,000 in its current state. That was the starting point — not the ending point.
What We Did
We didn’t sugarcoat the situation. We got to work on it. The engagement unfolded in three phases.
Phase 1 — Untangle the books. We separated all four companies’ finances cleanly, stripping out every dollar that didn’t belong to the construction business. Once the noise was removed, we could see the real business underneath.
Phase 2 — Reorganize the financials. With clean books came a credible story. We reorganized the financials to accurately represent what the business was generating — and what it was capable of generating with the right strategy in place.
Phase 3 — Identify the growth opportunity. While doing the cleanup, we noticed something: there was an underserved niche in the market. Small commercial properties — rental buildings and hotels under two stories — were being ignored by the big contractors and overcharged by residential players. Nobody was serving them well. This business was perfectly positioned to fill that gap. We helped the owner see it and act on it.
The Results
The combination of clean financials, a clear niche, and an operational improvement to equipment efficiency produced results that exceeded anyone’s initial expectations. The private equity firm that originally hired us to evaluate the business eventually stepped back — the company had grown beyond their target range. Other buyers came to the table. Two separate offers came in over $4 million.
The owner was still in his forties. He decided to keep the business. Not because he had to — because he finally understood it, controlled it, and believed in where it was going.