SMB Distribution Guy

@Will_Schryver Pretty interesting. Wonder what the next trade roll up will be..

Had lunch with a friend who works at a private equity group invested in the residential HVAC space Multiples for small add-ons are still strong at 6x - 8x+ Champions trading for 18.5x, Redwood for 17x+, and Sila 17x, all validate private equity’s investment thesis in rolling up these small HVAC companies But he confirmed what I’ve seen from other PE-backed HVAC platforms - buyers are very selective now PE will pay a strong multiple for 100% residential with 0% construction Anything with 10-15%+ construction or <85% residential, and the buyer universe shrinks quickly And multiples contract quickly for an HVAC or Plumbing company that doesn’t fit the ideal profile

@lhamtil Excellent book

This is now an infrastructure account for a few weeks

@bonapartay Brutal, but you can hopefully still win this one

So my greediness caused me to lose out on a $1.6m EBITDA deal for $3.4m. I squeezed the owners pretty hard and had a well hedged deal in place. It may come back around it may not. Could have done it with no equity as it was in the same NAICS code. Would have taken us from $10M

@PEoperator I need to take lessons from you lol

Claude is changing my life right now.

@STLChrisH Is it really a tax if you generate a 5x ROAS though ? Seems excellent, especially given scale against smaller competitors, no ?

In January, HVAC and plumbing contractors paid an average of $104 just to show up at the front door of a new customer. Before paying for wages, vehicle, insurance, overhead… The “Google tax” is real, and painful for customers and contractors alike.

@jaimalik @AmcaInc Awesome work, congrats

@AmcaInc has acquired Electrocube, a premier supplier of aerospace and defense electrical components since 1961. For six decades, their products have powered nearly every major aerospace and defense platform. This is our fourth acquisition since launch. The story of Electrocube is an increasingly rare one in America. What began with a few friends after the Korean War became a family business. When their time came, they turned to their children to learn the work and carry it forward.

@Will_Schryver Absolutely unreal. Cannot believe those multiples, but there just are not enough assets in that market that move the needle, I suppose

Brad Jacobs is one of the most successful M&A roll-up entrepreneurs having founded or led multiple billion dollar companies His buy & build track record: United Waste Systems - Founded 1989 - Acquired dozens of garbage companies - IPO 1992 - Sold to Waste Management for $2.5B in 1997 United Rentals - Founded 1997 - Acquired 250+ equipment rental companies - IPO early 200s XPO Logistics - Controlling interest in 2011 - 18 acquisitions - Spun off GXO for $7B (2021) and RXO for $5B (2022) QXO - Launched in 2023 - Rolling up building products distribution - Acquired Beacon Roofing for $11B (2025) - Acquiring Kodiak for $2.25B (2026) Now he’s at it again in the building products space with $QXO

@shots_goal Spot on comment. Even if you do make it up the ladder (increasingly unlikely), so much of the economics are already gone. Will incentivize a lot more folks to leave, just is a challenge to raise a 1st time fund. Probably will see a lot of independent sponsors…

You're also seeing this compounded by the growth of GP stakes sales... tough to grind it out as a jr partner when you know 30% of the carry pool is gone forever. If you have an entrepreneurial bone in your body (& talented dealmakers usually do), you will have an eye on the exit

@PrivatEquityGuy Pretty inspirational - gets me fired up..

Had a conversation with a GP of a PE fund that acquires $50-$500m revenue manufacturing companies. They love “hairy” deals and did 7 acqiusitions in the last 18 months “We're Midwest guys who’re willing to do the hard work.” In terms of value creation, they have two phases: Phase I: Improving EBITDA (they never buy negative EBITDA!!!); they try to improve it 2–3x and then enter Phase II... Phase II: Growth, M&A, new channel entry... all to grow the top line. He believes the most MOIC is generated in Phase I, but too many folks get too excited about Phase II... Three interesting takeaways: 1. One of their pre-fund deals was an $80 million corporate carve-out where they generated a $54 million gain on a $300 thousand investment for a 180x gross MOIC. 2. They raised Fund II, a $300 million fund, in 2025. Oversubscribed, and they hit a hard cap. 3. The GPs absolutely love their jobs. You can see it when listening to them share how they think about companies and value creation. “I’d do this job for free, because it’s the most intellectually challenging work.” Great news below:

@rossiadam EXIM does a tremendous amount of work with Boeing...

A little-known government agency created during the Great Depression is now financing the future of US-built satellites. Last month, the Export-Import Bank (EXIM) authorized $185 million for a 270,000-square-foot satellite factory in Texas under its "Make More in America" program. It went to a company I bet on in 2019 when they had around a dozen employees and a handful of early contracts: @CesiumAstro. CesiumAstro builds the comms systems that connect satellites, aircraft, and drones. My thesis in 2019 was stupidly straightforward: • There's going to be a lot more satellites • They all need to talk to each other and to the ground stations • CA builds the ‘off-the-shelf’ hardware that connects them. They're now shifting from component supplier to delivering full “ground to space” satellite missions. And that control over the entire production process is exactly what reshoring requires: full production capability on American soil. CEO Shey Sabripour says “We’re building things from the ground up again in America and selling it to the world.” That’s where that $185m comes in, and what’s interesting to me (as a Made In America maximalist) is the mechanism behind it. EXIM was set up by President Roosevelt in 1934 to help US products stay competitive abroad. For 90 years, it financed foreign buyers of US goods like aircraft. But in 2022 it expanded its mandate with Make More in America, allowing EXIM to finance domestic factories for the first time (as long as 15-25% of output serves export markets). In the past 4 years it’s deployed about $525 million under this program. But CesiumAstro's deal is the largest yet — putting space communications in the same policy priority tier as chips, critical minerals, and energy storage. The goal is reshoring, ie bringing critical supply chains fundamental to national sovereignty back to American soil. What’s even better is that it isn't taxpayer money in the traditional sense. EXIM operates like a bank, lending, charging interest, and historically it has turned a profit for the Treasury. That cash is going toward a mega factory in Texas, which is expected to be operational by next year. Design, manufacturing, assembly and testing all under one roof. Build American, sell worldwide. That's the policy design. For founders in defense-adjacent sectors, if you're building critical hardware and you're willing to manufacture in America, this shows there's serious federal capital available that didn't exist five years ago.

@McMasterDaily I think a lot of these jobs involve a ton of automation, not a usual warehouse role

Okay so there is magic sauce and part of it is paying your warehouse workers $100k+

@sohaventures Keep it up !! One day at a time.

18 loan payments later Biggest tech upgrades: - cancelled fax line (machine remains) - 10mbps internet to 500 mbps - unlimited calling / set up a voicemail - domain name (still under construction)

@RockwoodNotes Man, one degree of separation on so many interesting people from that era..

It was pointed out to me that the attorney who argued Dirks case in front of the Supreme Court in 1983 was future billionaire David Bonderman. Bonderman also was the bankruptcy attorney for Braniff. Here’s a transcript of Dirks v SEC, Bonderman on behalf of Dirks: supremecourt.gov/pdfs/transcrip…

@aphysicist These are totally awesome

industrial propaganda of the 40s-50s went so hard

@dirtcheapbanks Can you accumulate enough shares to make it worth your time and energy though ??

Example of a dirt cheap bank I am looking at. - 3.5x P/E ratio - 0.60x TBV - Growing like crazy - EPS went from 0.65 to $5.21 in a decade - Has buyout offer - bank is in play Zero public write-ups on the bank. Insanely cheap.

@TheIcahnist Great doc

The best thing you’ll watch this week

@__el__toro__ Really cool - thanks for the context, always trying to learn more here...

@SMBDistribution *I meant 150ksi tensile. It's 130ksi yield.

I N T E R N A L E X T E R N A L > etd-150 splined extension shafts > both ends cut on a Fellows 10-2 gear shaper

@sindap Comical... the cycle has gotten totally out of control in recent years

ft.com/content/356e22… Private equity firms launch delayed recruiting drive after summer outcry:

@TheIcahnist Two great books and the third is still on my shelf to read !

Venezuela Dealmaking Reading List