I have been enjoying SMB/PE/FinTwit Twitter very much. Lot's of valuable insights. Thought I would add a bit on my firm's beginning and what we look for in acquisitions.

My partner and I co founded AH in 2011 with the acquisition of an industrial sales company.  We had 29 employees and not much experience.  I came from a finance background and my partner from RE development.  We found a business selling at an attractive multiple and bought it.

We knew we wanted to build a holding company.  We were inspired by Berkshire, 3G Capital, and Panama firms like Bahia Inversiones.  The way to wealth is long term holding of investments and that the SMB space provides attractive multiples and margins of safety, if done correctly.

We built our firm on 3 core principles. 1. Delegated Management.  My partner and I do not work at any of our holdings. Finding the right people to run our companies is the most important thing we do.  If we cannot figure out who will run a target company, we pass.  Everytime.

2. We reinvest all income in organic growth and other acquisitions.  We do not pay ourselves dividends.  We do not have personal expenses in our companies.  We take a reasonable salary and reinvest all the rest.

3. We never make an investment where its success is dependent on a sale.  We invest with the belief we will hold forever. We are not a PE firm with an exit date or flippers. We are building a company.

After acquiring the industrial sales company, we purchased a business process outsourcing firm composed of medical claims processing, call center, and manpower divisions.  2 years later we purchased a chain of restaurants and then in 2017 purchased another chain of restaurants.

In the last 3 years we have made multiple bolt on acquisitions, but nothing major.  This business takes a lot of patience.  One of the critical skills is saying no.   Passing on opportunities that do not fit our criteria.  It appears that patience is about to pay off.

We are 2 weeks out from acquiring our first major acquisition in the United States, a furniture retailer in North Carolina.  A company with a 40 year history and both the CEO and VP of Sales staying on board.

I am very excited for this next step in our company's story. Setting up the legal structure in the US, completing due diligence, and closing this transaction has been a long process. Especially during the pandemic. But very rewarding and we have met great people along the way.