Happy Tuesday!
Every so often someone comes to me excited about a distressed business they’ve found.
The price is low, the seller is motivated, and they can already picture the turnaround playing out.
I understand the appeal!
But today, I want to give you an honest picture of what this involves if you go down this route.
Josh bought a $3.8M digital marketing agency after joining Acquisition Ace, and said:
“It wouldn’t have happened had I not joined the group... I joined this group and two months later I’m writing an LOI.”
The group brought him the momentum and intention he needed to go from searching to closing his first deal.
👉 Want to become a part of the same community that helped Josh close a multi-million dollar deal? Book a call with our team here.
Why distressed deals are attractive
The math is compelling!
A business in trouble often sells at a steep discount to what it would fetch if it were healthy.
Sellers are motivated (sometimes desperate) which creates room for creative financing structures that you’d rarely see on a well-performing business.
Larger seller notes, longer standby periods, more favorable terms, and if the turnaround works, the upside can be substantial.
(Inside Acquisition Ace, members learn how to evaluate opportunities like these honestly. To see how our community can help you with acquisitions, book a call with our team here.)
What the pitch leaves out
What it doesn’t tell you is what executing a turnaround requires on the ground.
You’re buying a set of problems the previous owner couldn’t solve.
That might mean a demoralized team that’s been through instability and doesn’t trust leadership.
It might mean broken systems, lost customers, damaged vendor relationships, or cash flow that’s declining while you’re still trying to understand how everything works.
Fixing all of that simultaneously - while keeping the business alive - is one of the most demanding things you can do as an operator.
It requires specific experience, meaningful cash reserves, and a level of personal involvement that leaves little room for anything else in your life during the process.
This isn’t meant to talk you out of looking at distressed deals entirely.
But going in with a clear-eyed view of what you’re signing up for is the difference between a calculated bet and an expensive lesson.
Tomorrow, I’ll cover specific questions worth asking before you pursue one.
If you’d like help thinking through what kind of acquisition fits where you are right now, the Acquisition Ace community is a good starting point!
To see if it’s right for you…
👉 Book a call with my team here and let’s talk.
