Rory Tire, welcome to Acquiring Minds. It's so good to be here. Well, thanks for having me. Rory, you bought a garden center, a nursery business, and a pretty big one, or at least it generates more revenue than one might think. This is an intriguing, fun type of business. Never had somebody who bought a garden center before. So, let's get into it. Start us off, Rory, with some background on you, please. Yeah. Yeah, I think the the trajectory that got me to where I am now started when I was actually in seminary. So, after college, I went to seminary and studied New Testament studies academically. Uh at the time, my intent was to get the master's and then go get a PhD. And uh a couple things happened over the course of 2 years. I got really burned out academically. Um you When you're in an environment like that, you look around, you start to realize there's some people who are like very serious scholars that are going to get into these PhD programs. Um and I got some advice from somebody I trusted that they said, "If you can see yourself doing anything other than getting a PhD and being happy with it, you should probably go to that other thing because this is all-consuming." And I learned a lot about what people can make, the the the process of trying to get like a a good tenure track teaching job with actual benefits is just very grueling. And I I mean, I was doing a lot of other stuff, man. I was online dating. I was I had a I'm a singer-songwriter. I was in a band. We were playing around. It was outside of Chicago is where the the school was. And uh I just looked around and realized this isn't this isn't me. And um a couple things happened kind of in quick succession. So, for close to a year, I ended up getting hired in the marketing department of the school. I had done some writing for the student newsletter. And uh they needed somebody to create a bunch of content over like a month contract. That turned into a full-time position. Um and I ended up teaching myself videography uh because they we had to revamp the whole website and do a ton of interviews with our faculty. And I got to take that on. Um ended up meeting an a student who was in the the university system had like an adult finish your your degree program and I met one of the students and her her dad and uncle owned a small leadership training company and she I interviewed her for a for a video for the school and then at the end she said have you you know are you happy in your job like what do you you know and I it ended up they hired me to kind of revamp their marketing and so I did that and also it was a remote job and I had all the video equipment that they were using and so I used it to do freelance videography work around the Chicago area also was still playing with my band pretty actively and that company they ended up kind of shutting down about eight or so months later due to cash flow issues and they laid off it was a small team but they laid almost everybody off and and and so by that time my wife and I had thought about starting a family moving away from Chicago and so I ended up getting an executive leadership position in a non-profit in Mississippi so I moved from Chicago to Mississippi which could be its own whole story in cultural intelligence and transition I helped lead that non-profit for four years and I got a lot of leadership experience during that time I would you know I I was over at marketing but really I was helping the CEO who became a good friend and mentor of mine to kind of revamp a very old organization that needed some revamping during that time that CEO and and this is where I started getting into this to coaching so I do a lot of executive coaching now and that had been my kind of my career before this he had worked for this large global leadership training company and he wanted to keep doing that but in a way that served the non-profit so we started an LLC that was actually owned by the 501c3 which was a lot of interesting legal gymnastics and over about four years we revamped the branding of the non-profit grew its fundraising efforts and then also I got trained as a coach I started doing my own essentially I became a consultant without really understanding that that was the world I was getting into So, I got very used to sitting down with senior leaders, mostly nonprofits, but also small businesses, and just kind of articulating back to them, "Here's the challenges I hear you having, and here's how leadership and team development can help probably solve some of those challenges." And so, ended up getting certified as a coach, and um eventually kind of developing my own might call it book of business. Like, I got very used to doing my doing everything end to end. I would build the relationships, develop the program, build the contract, and execute on it, and then try to follow up with the client. Um eventually, we separated those two organizations. Uh we did a lot of change pretty quickly in the nonprofit, and I think that didn't go over well with all the board members. Um and I think the CEO was ready for to go back into that world full-time. And so, we separated the organizations. I I went full-time doing leadership development and consulting. Um that eventually led me I I There's a a very large accounting firm that came to me as a client, and they needed me to develop like this leadership development series for them. They they experienced insane growth. They went from having two prospective partners to 11 prospective partners. They didn't have a formal development program to kind of train them up. And so, I built that, and at the end of that, they offered me a full-time job. And so, I was working full-time for this professional services firm um uh up until the point where I stepped away to focus fully on buying this business. And so, in that capacity, I just And And we ultimately ended up working mostly with commercial construction and manufacturing companies. And so, typically, I'd be coaching one or two members of a senior leadership team and organizing some kind of monthly leader development either um on Zoom with group coaching, or we'd also typically do like quarterly on-sites. And so, it's the kind of thing we didn't use EOS as an example, but um a lot of similar conversations, similar results with, you know, trust building and and that sort of thing. And so, that that has been that had been my world up until about February of this year. Okay. And so, why did that world become this world? What was the trigger? Yeah, that's a great question. So, you know, we moved to Greenville, South Carolina um right before I got offered that full-time role. And getting offered that role was eye-opening for me. Our consultancy that I had that I that I had talked about that I'd helped found was pretty small. And um I when I was offered this full-time role, the compensation was was much bigger and it was my first time being working with a very large organization. I mean, this this firm was like the 25th largest public accounting firm last year. Uh and so it it kind of opened my eyes to um I don't know. I kind of felt like maybe I've been undervaluing myself and not not trying hard enough. Like the ceiling is a lot higher maybe than it needs to be. And that was that was kind of unlock one. Um I've always been more motivated by just people and learning than income. And when this happened, I thought, "Oh, interesting. I can I'm still involved with people. I can still do this stuff, but my income's going up. So, that's that's exciting." Uh it sounds kind of basic when you say it out loud, but it was I don't know why. It was just it was kind of eye-opening to me. Well, then around that same time, um Eric Pacifici, who is the you know, on the he used to be anonymous as SMB attorney, and he released his first version of his M&A masterclass. And somehow somebody put it into my Twitter feed. And um I was fascinated by it. Like I'd never I knew nothing about M&A. I didn't know what EBITDA was. You know, I I was very uneducated in in business and finance. Don't have an accounting background or anything. I mean, I've never worked in banking. But I just I ate it up. I mean, I just I read all of the stuff. It's a lot of it is very technical. Um and so I and then I I followed him and I started following more people. And eventually, I saw somebody talk about ETA. And I saw somebody recommend the HBR Guide to Buying a Small Business. And so a- again, this is like a very common theme here. But once you read that book, I I just remember like I'd sort of looked around me and realized I can't unsee the world um this way. Like I there's a there's a different way of thinking about the kind of life I could build for my daughters. I've got three daughters uh six and under. And um you know, my parents are amazing. They weren't entrepreneurs in the sense we didn't I didn't have a business and I just I hadn't I don't know no one had ever mentored or encouraged me to Like I know some people they grow up reading Rich Dad Poor Dad and they have this idea of buy a cash flowing asset. I just had not been exposed to that world. And so I went through this really whirlwind I started meeting people reaching out to people on social media and just asking them questions and then eventually I started perusing BizBuySell you know. um and and Rory why do you think being an entrepreneur resonated with you because a lot of people hundreds of thousands of people will see these ETA tweets these these monster threads that go viral and they don't take action but you did. Yeah great question. The other thing I realized quickly was that my background being in people and team building and and coaching could be a huge asset to owning my own business. Yes. You know you even people who are very very skilled in finance constantly see things like you can't run a business off a spreadsheet. Yes. You know you can't model out having a drunk employee show up to work. or or all this stuff and I and I realized I've been sitting with these you know right You know you can't you can't account for that in your your Excel tabs and so you know I I realized I've been sitting with these primarily blue collar owners of pretty successful businesses and all the challenges they're dealing with are not really they don't require finance skills to deal with. Now we had a finance team at the firm that would help them with things like job cost accounting construction as an example and and that was awesome and and needed but a lot of it was just like how do we don't trust each other. Like how can we communicate better? I can't we don't know how to hold people accountable our hiring is terrible and I feel like nobody wants to work and you get into it and realize that you don't know how to write a good job post or where to put that or how to have an onboarding process that gets people to stay. And I just kind of started realizing I'm I'm helping to create I think a lot of value not just monetarily but culturally like this is becoming a better team to be a part of in part because of what we're doing. And what would it be like if I had my own business with my own team to treat like almost like a lab of, you know, I believe in this stuff. I I think it's helpful. Uh what if this would be benefiting my own business? Um and and then, you know, autonomy is important to me. I I've been working remotely, I should I should say. So, that helped me in my search. I had a lot of flexibility and time. And so, I I did I worked full-time throughout my whole search process and was very undisciplined, very part-time. We can talk more about what that looked like when we get there, but you know, I that flexibility I realized I value that really, really highly. And the the work I was doing most of our clients are in the Mid-South, Mississippi, Louisiana, Tennessee. Um And I had to travel a good bit for for a lot of this a lot of different things. And that just got really tiring with three young kids and and my wife working full-time. You know, if my wife wasn't working full-time, maybe it would have been different uh in terms of but just the energy suck on the family when I would travel, you just you you hate having those conversations over and over and realizing what it's going to do. And at some point, I realized man, if I own my own business, and in particular if it was either remote or local to me, I just wouldn't have to travel like this. And that became really attractive. Great. Sure. Well, that makes sense, Rory, even for somebody who hadn't really been exposed to or attracted to entrepreneurship before. Yeah. The So, let's hear about this uh how did you put it? Half-ass part-time search? What You go on business by yourself, then what? Yeah, it's not not a model. I mean, I'm you know, I I sort of made time for it as I could. Um I tried to be I mean, initially like so many people do, I tried to be very open. There's some things I thought I didn't want. Interestingly, I would have told you that brick-and-mortar retail was something I did not want as part of my my criteria. Yeah. And I, you know, I just thought I'm used kind of my mind was, "Look, I'm used to talking to business owners about their challenges. I know how to approach them and what questions to ask." So, let me see if I can try to connect with business owners as fast as possible in this search to get past the broker. And um and so, I had, you know, a number of fits and starts. I mean, I met a couple of owners in person that I drove, you know, actually went to an ETA conference at UVA almost 2 years ago now and stopped in Raleigh on the way to meet a business owner. I drove out to the coast to meet with another business owner. Um, and, you know, it was I I kept hitting I kept feeling like I was the dichotomy was these are either businesses that I I don't feel confident are are transactable in the sense of there's just too many holes that the owner's going to going to leave or their valuation expectations are way too high given what I'm learning about how I think I could value a business. Um, or um, it it just wouldn't it it made me realize, oh, this is not this not a fit. Like I I just or there's a bidding process. So, that was the other big deal was realizing I'm going to get in this bidding process. I don't have a huge personal war chest and the more I learned about it, the more I thought, I don't know that I want to take on investors that frankly just seems like a lot of work um, and a lot of coordination and I know a lot of people have done that really well and had amazing outcomes with getting on investors. But I just started realizing I don't want to be in a competitive bidding process alongside other like PE light firms or, you know, searchers that have a lot of investors. That feels exhausting to me. And so some of these businesses look really attractive, but I realize I'm going to have to really fight for it and and have investors and that makes me sound kind of lazy. I don't know. It was just this it didn't resonate with me. Like that's not the experience I would like to have trying to acquire a business and that's not really rational. You know, I think um, I I don't put this forth as a model for for anybody. It was just it did not sit right with me intuitively and with and with who I am. Um, and so gradually what I realized was two things. One, I would like to try to find something proprietary so that I can just begin directly building a relationship with the seller from the very beginning. I had high confidence in my ability to both educate on some of this stuff and and be, you know, the buyer. Um, and then I realized I had even uh hold your thought on part on number two there, but even though you were seeing that one of the classic even in brokered businesses where a broker has hopefully, presumably, educated the seller the business owner and seller on the market value of their business, you were still seeing that many sellers had unrealistic expectations even after the broker. And so, you were going to have to be the bearer of this bad news to the seller if you went direct, and they were going to find you suspect because obviously you are incentivized to tell them that their business isn't worth what they think it is because you want to buy it. Yeah, and you know, and you're not you're not the person they're going to trust to hear that information from for the most part, which I understand. I mean, if you have a broker that you're trusting to educate and run the process for you, you know, that should be your point person for that. I get that. I mean, that that business owner I met in Raleigh, I I followed up that meeting with a list of questions to the broker in email. And I I should have done this on a phone call. So, that was one learning. But, I thought, I've got some questions, let me just put them here, and feel free to work through them, and we can set up a call. And the broker replied back with one sentence. He was like, "We disagree with your assumptions and your questions, and we're not going to move forward." It was just like And I went back and reread that thing. I was like, "Wow, did I say something really offensive?" And it was just I was just asking questions about how did you arrive at this valuation method? Here's a couple things I'm seeing. Can you can you talk about this? And it was just a it just it was a reaction that made me go, "Oh, goodness." Like, I don't want to have that conversation multiple times. But, in retrospect, do you think it was that you that you were fatiguing the seller with your questions or the broker, or that they were basically not realistic about what they should expect from would-be buyers? Like, who was at fault there? In this particular business, I think it was overvalued. Um, I think the owner had an idea in his mind of how the company used to be, and of what it could potentially be. Yeah. And um, it was a it's very project-based business. I They they They produced a product that I sort of fell in love with when I saw pictures of it and I imagined And this was a really big filter for me was can I be proud to tell my friends and my family and my kids that this is my business. And when I looked at what they produced, I thought, "Oh my goodness, I can absolutely be proud of that. These are beautiful." Um uh but just the valuation expectations didn't make sense. And I think they could tell by my questions that that was that I'm was questioning some of the stuff that led them to that that valuation. The major realization I had then had to do with living here in Greenville. So, the Southeast in general is is booming. I mean, we've benefited from And I'm from Virginia originally. Um we lived in Chicago, lived in Mississippi, I spent some time in North Carolina. But moving here to Greenville felt, you know, my wife jokes we're going to get married in our backyard cuz we're just done moving and we love it here. Uh and and I realized, "Wow, Greenville's growing significantly." Um and it's projected to continue to grow. If I could find a business that in any way depends on our demographics, I could probably just be an okay operator of that business and still benefit really well on a 5-to-10-year time horizon. Uh and and so, that what I started to do was just drive around and I I started to I created a spreadsheet of businesses I saw that seemed interesting in like any any industry. I just if I saw their sign, I saw their truck, if somebody told me about it, I would write it down, and I would go look it up. I know several other guests have mentioned this, but like our public library has a subscription to database called DataAxle. And so, I would look up, you know, try to find contact information, some history in the business, and I did a little bit of of of cold outreach. I mean, I did some I I paid somebody overseas to build me a list with certain NAICS codes. Um I I called a few business owners. I had was rebuffed really heartily on a couple um once they figured out that I didn't already own or had no industry experience, which I was transparent about cuz I didn't want to uh you know, lie about that or anything. Um and I had a couple of really good conversations. In fact, um some of my most interesting leads came from a post I made in a local Facebook group. So, our neighborhood has a Facebook group where I know there are business owners that live in the neighborhood. And so, I just made a post. I said, "Hey, here's who I am. I'm looking for a business owner who wants to retire or might want to sell their business. Open to some industries. Let's talk." And I had three leads from that one post. And then, one of those turned into a very short-term consulting project where the idea was, "Let's like get to know each other and do some work together and see if it could be a fit." And it was a smaller business with some revenue concentration, but I I really liked it. And and and that ended amicably. It didn't make sense to move forward, but it was a it was a really good learning experience. And it was funny that just came from like some of my most activity came from a single Facebook post. Yeah, that is super interesting. I'm not sure I've heard that particular proprietary search technique, but does make sense. And I just want to highlight what you said, Rory, about just the growth of the area being an incredible tailwind for almost any business in in theory. And we we do hear that on Acquiring Minds a lot and in particularly actually in the Carolinas, in North Carolina. I think I've heard that two recent guests talk about that. Typically, I feel like they they realize it after the fact, after they've already acquired their business, and they they realize, "Wow, being in a growing market is is really what is helped me along here." But you could see at the outset that that was going to be something that would really serve you. But anyway, so just again a note for the audience that like buying in a growing market can be a giant advantage. As you said, Southeast is is kind of where that's happening these days. Yeah. All right, great. And and Rory, what were So, criteria were local, as you made clear. And what can you give us a sense of like what you could afford, what your balance sheet look like, especially if you were not going to use investors? Yeah, and so this is where I I really marched forward on I would say sort of blind faith. Like we're not you know, we we did not have I didn't have a big war chest of savings. You know, we we could have cashed out some retirement funds if we wanted to. We had a decent amount of cash, but I I really just marched forward on the assumption that like I'm going to find one and when I find it I'm going to fight for it and I'm going to find a way to make it work. And I and I do think that if you're going to especially when you're searching part very part-time like I was, I just I had the belief that that was what was going to happen cuz there were long periods where I felt like I wasn't seeing anything and I didn't really know what the next step was and that was was kind of discouraging. I just knew the more I kept doing it the more I kept wanting to wanting to do it. And and so I I didn't I mean you know, I I think I had the typical like I'd like to have something at least $500,000 of SDE to not come in from day one and be and feel squeezed. I I knew, you know, the consulting and education Well, actually the only other business I went under LOI was a consulting firm that was working with a particular demographic and had kind of the beginnings of what I could see becoming a productized service that could have really high margins and be really easy to implement. And after getting into LOI and having some more conversations, I just realized that I had not diligenced it well enough. There was some There was a a key employee who was treated like an employee but was a contractor and that made me nervous because that It's my understanding that liability for that survives an asset sale. So that person could end up coming after me for back taxes if they decided to. I don't know that they're you know, for for withholding. Um And and I just realized it it was the kind of business that really should have been like a a mentor like an apprenticeship where you come in, partner together and have some transition of equity over time as you learn the business and build the relationships that were kind of at the heart of what made them work. But it was a remote company and that was really attractive to me. And so initially I was looking I know B2B services as I understand consulting and coaching, education. Um and and and I looked at all kinds of things. I mean, there was a restoration business actually here in town that I seriously looked at. Um uh but I I'll tell you I I reached a point I did reach a point where I was like, I don't know whether I'm going to find I mean, I don't know whether I'm going to find anything. Um I I have a lot of interesting ideas about different businesses, but there I I when I look look back at that time now, I have this feeling of like I I would have liked to have felt more locked in on a particular industry. Uh and I could not find that lock-in. I just I couldn't find it. I felt like I had lots of really good ideas and basic understandings of a number of industries. Um you know, some stereotypical ones like home services were attractive for a lot of reasons. But I mean, like with home services, when I I thought of myself running a company, am I the person that's going to take a home service company and scale it successfully and and execute successfully? I just don't I don't think that I am. Uh and I I kind of floundered for a little while, to be honest. Um I And And so, when I In that floundering is when I started trying to do more proprietary outreach, making some phone calls, and just saying, "Hey, let me scrap my need to find an industry and say this is the one I'm going after." And let me just see if I can find a successful business that's clearly local that stands to benefit from Greenville's growth. And it was in the course of that that I thought to call up the former owner of the garden center. And Roy, your initial kind of what you perceived as your the value that you could introduce into a small business, namely the uh built culture building and the your way with people uh and your enthusiasm for people, uh something that many searchers often run away from or they just grudgingly uh expect to have to deal with people problems. Um seems like your briar patch. That wasn't so It sounds like your your confidence in that started to be a little shaken or like you just I guess I'm asking like, did you when considering buying a home services business for example, why did all of a sudden you have doubt? Well, oh well, maybe Rory's not the guy to buy a home services business. When in fact a home services business probably that, you know, could benefit a lot from the the value that you think you have, which I agree with. And the people stuff. Yeah, I think two things. One, I think I kept realizing any brokered home services businesses become very competitive. Okay. And even the ones that Um and like there's a lot of wise people on on Twitter who have who run home services or plumbing companies. Let's take a plumbing company. Plumbing company seems so hot and I think for a lot of different reasons a lot of owners get inflated ideas about how much their 250k SDE plumbing company should go for. Like you should be able to get eight times for this. Uh and and it's it's it's almost like you have the honor as a buyer of getting this at all as opposed to somebody else. It doesn't matter what the price or terms are. That That's probably an unfair uh generalization, but that's the sense that I kept getting and then the ones that I did feel like were fairly priced, I I just knew this is going to be a very competitive process. And I did not manage to I tried to connect with the owners of a few um local plumbing and HVAC companies and just it just did not seem to work. I don't know why. I just never seemed to be able to get them on the phone long enough to try to have a conversation. But but I had the impression the industry you started to feel like the industry wasn't a fit for your personality anyway. Well, and I think I think I was paying really close attention to people who are operating these companies and I started like as an example so much of of lead generation for home services is SEO. Um and that's an area I know almost nothing about. And and just realized is that the game I want to play? Yeah. Like is it when I is that cuz that's the hill I'm going to have to climb whether I hire somebody for it or just try to do it myself, which I really don't want to do. Um and yeah, I don't know. I I I just I just remember feeling like this ah it's not for me. It's almost I I don't know. It was just intuitive. Okay. Okay. Um and then just to follow up on your balance sheet. So, the point was you didn't have a ton of money No. to do here. So, you were really like you said, just to be clear, like it you were not looking at your balance sheet and saying to yourself, "Okay, I'm I'm constrained to this size of business." You were just trying to find any business and you were going to make it work within reason. Sort of thing. Yeah, I Yeah, and I and I've been I've connected at that point with enough other people in the in the space who said I either like there's a guy that owns a business that I've become good friends with who has a father-in-law and he said, "My father-in-law wants to invest. And if you and I do this together in some way, he he'll come on and he could make a sizable investment." I like I knew at this point if I wanted if I needed to go up and put the flags up and and make the contacts to get investors, I could. I just didn't find something that was both big enough and fairly priced where I and and wasn't in a huge competitive process that I just didn't really want to be a part of, which is I mean, that's really restrictive, all the things I just said, right? So, I'm limiting my own options. Um and but I just didn't find something that that that missed those and that I felt like this was this is the right one. Um and and so we I mean, we I'll say this plays into our how I ended up acquiring it. Part of where I knew I was in the funds were going to come from was we took out a HELOC on our house. Mhm. Uh and we had like $168,000 line of credit there. And I thought I'm going to use some of that for my down payment or all of it. I'm happy to do that. Um and and just to fast forward, I found out if you're going to do that and the lender is okay with that, you have to be able to show that you can pay off that loan separate from the cash flow from the business. Uh and since my wife was working full-time, that that would have worked. Um and we had some cash savings. I think I we had My wife and I had a lot of conversations about this. I think we felt comfortable committing to somewhere between 160 and 200,000 that we could inject, most of which would come from that HELOC. Okay. Okay, great. Well, that's helpful. Uh 150 to 2,000. Great. All right. So, the garden center. It's on your radar already. Tell Why is it on your radar? And then tell us about your outreach there. Yeah, yeah. Also, I mentioned we I've been trying to pay attention like what local businesses seem like they're they're great. And we we moved here um in the summer of 2021. And started we I found it on Google, the the nursery. And we went and we started buying plants from there. And when you go on the property, the building is is kind of dilapidated I like looking. I mean, it's it's fine, but it's also I mean, it's a 60-year-old garden center. And so, you drive in, but then you park and you get out and it's kind of in it's kind of down from the road. One whole side of the property border is bordered by the Reedy River, um which I didn't even find out until like our fourth or fifth visit there cuz it's mostly trees. And you're in what feels like a park. I mean, there's all these big mature trees all around the property. There's these big pine trees on the property. It's, you know, a lot There's probably about 5 acres that are on the main property. And so, there's a lot of space to walk around and they have a ton of water features and and they have like a huge koi pond and a bunch of fountains. And it just felt more like a park, I think. And And when I tell you we we kept wanting to go back there because we got this like intangible feeling of peace from spending time there. Like I I can't put it any differently than that. We just really enjoyed being on the property. And at some point, I don't I don't I do not remember why I got this idea in my head, but I thought they are doing something right. Like they they have clearly not invested in a bunch of slick marketing. I've seen zero brand efforts by them around town. They've clearly been here a long time. I I just had the suspicion like this is probably run by somebody near retirement age um and the business seems to be doing pretty well cuz they're carrying a ton of inventory. Well, well, let me say, I kind of had the thought either some too much of their cash is tied up in inventory and I'll be disappointed if I ever get to the point of talking about financials or I'll realize they're able to carry so much inventory in the balance sheet because they're in a really financially healthy situation, which which turned out to be the case. But either way, I mean, it's just like a And and I would love to have people come visit cuz I love it. I I love getting to show up there for work every day now, but um yeah, so we just had this feeling of peace and I thought they must be doing something right. I love plants. I mean, I'm a hobbyist, but I and and then I thought I would be so proud to show my daughters this place and to have them come to work with me. And so like if I had an HVAC company, we're out of an office or something. I mean, maybe one of them could ride around with me in a truck with one of the techs or something, but the office is probably not going to be this sort of place that I want to bring my kids to hang out all the time, whereas a nursery is just like a giant playground and like a like a wonderland. And my kids are super imaginative and and creative and um and so I just got this idea in my head, why wouldn't that be neat? I would be so proud to own a business like that. I just have no idea if it's financially healthy or not, nor do I know whether the guy wants to sell it or whether it's in a condition that I don't want to buy it. Yeah. Um and so at some point I just I sent him an email. This was in May of last year. So April, May, and um June are the absolute busiest time. You make something like 70% of your revenue for the year in those 3 months. And uh so I didn't understand that. Yeah, it's very seasonal. And I didn't understand that at the time, so I sent the owner an email, which he somehow responded to within a couple of days. And the email was just like, "Hey, I you know, I'm I'm learning a lot about businesses locally. I don't know a whole lot about what it's like to have a garden center. Would you be open to being interviewed by me just about what it's like to own this business?" And you know, his reply was sort of short. He's like, "Yeah, that's fine, but right now is terrible, you know, reach back out later." And so I think I got back in touch in July. We got together in either July or August for the first time. I talked to him on the phone. Actually, that was our first communication after that was on the phone. And I'm just kind of getting to know him a little bit. And at some point and he's he's a very straightforward guy I I've come to learn, which I really appreciate. And he just goes, "Why do you want to know all this? You know, like why why are you asking these questions?" And I said, "Well, here's here's my thing. I've been wanting to buy a business in Greenville. I love your nursery, and I don't know whether it's a business I'd like to own, but I'm wondering if you are thinking about retirement, because if you are, I'd like to at least have a conversation if you're open to that. And he said, you know, if you'd gotten to me last summer, I would not have been, but I am now. And and yeah, let's talk about that. And so, yeah, I mean, it's just he was very Rory, let me let me pause you on a couple of things. The So, you said you emailed him and said, let me interview you to learn about your business? I don't know if it's exactly what I said, but it's like I just wanted to ask you some questions. This is a key technique because it got him on the phone and it got you building rapport. So, so I'd like to get you on the phone and ask you questions about your business, basically. Yeah, basically I just want to learn. Like I would love to learn what it is like to own and run this business. And I tried that tactic with a few other people. I've sent LinkedIn messages, I sent some emails, I left some voicemails, and no one it didn't work for it worked for one other person. I got I got a business owner on the phone, it's like a very niche construction company locally, and I got him on the phone and ended up buying him lunch and just asking him a ton of questions. And it turns out he was actually already under LOI with a big another big company that out of out of the city that was but but he was as open as he could be without violating his NDA, and I learned a lot. But that's the only other time that tactic worked. And was the was the sequence of events the same where you asked him questions for 20 minutes and eventually he's like, why are you asking me all this? Did that happen with the lunch with the niche construction business guy as well? Yeah, you know, with that, I think I was clear with him on the phone that this is why I'm calling you. And he said, look, I'm I'm actually already under LOI. It's not a done deal by any means. I can't talk about it much, but I'd be happy to meet you and talk more about it. And so, I mean, in my mind, I think he he probably liked that I was you know, straightforward and and proactive. And I think in his mind, like it's under LOI, it's not done. And I did learn from him there were a couple of wrinkles in the process that that he had a little bit of uncertainty. So, I think at that point he was probably keeping his options a little a little bit open. I would not have been the right buyer for that company which we figured out at that lunch but it was really really interesting. It's when I say niche construction it's like working on underwater stuff. So like earlier in his career he would put on a scuba suit and dive down to work on like bridge pilings and stuff. Almost died at one point so he stopped putting on the scuba suit. It was it was it was a great lunch. I have no regrets about that. Great and then your you said you were a hobbyist you so you have plants or a green thumb or what? Just explain explain to us your level of knowledge about gardening because because you know while I I you know I'm I'm very intrigued by this business but I know not the first thing about plants. So I just I just wonder is is your your your knowledge and your the fact that you were a hobbyist how what role that played? I guess it probably played a big one. I mean that's how you got there in the first place if nothing else. Yeah well I grew up when I was young my my parents had like a small garden in the backyard and really young. And I have some like core memories of like walking through a small corn field and and stuff like that and so when when our oldest daughter was pretty young my wife and I just decided we would like to plant some things cuz it's something they can do together with us. They can learn about how things grow and how to care for things and then we can grow blueberries and and blackberries and just plant some simple you know vegetables to teach them about that and so we we lived in Mississippi. We had you know we planted a fig tree that got huge. Fig trees will get up to like fifth some of them will get like 15 feet tall and wide and two or three years. We we planted several small gardens and it just became like a family hobby that we could really do together and my wife and I my wife in particular it's like a big stress reliever for her to just go work in the garden weed and plant and so yeah it's just something we've always done together. When we moved here to Greenville we the woman we bought the house from had done a great job in the front beds but the back needed a lot of work and so it's this has been our constant hobby project is trying to plant more and make it nicer and yeah we're proud of where it's come. So it's a stress reliever just being around plants. There's actually a lot of research around this that being outside and being around plants and planting can like lower your heart rate, reduce your risk of hypertension. I mean, it's actually really interesting. But, that was my level. I know no specialized horticultural knowledge. But, the other thing I should say is my father-in-law uh, until early this year, he ran kind of a a niche He He would hate to have it called a landscaping business. He called it garden restoration. Basically, he in in Columbia, South Carolina, he would go to somebody who had like a big property typically like a widow, and she would basically say, "I remember what this looked like when my husband kept it up. It hasn't been kept up in 5 years since he passed. I'd like it restored." And so, he could go in and know what's native, what's not, what to prune, and how to prune it, what to plant, and and he had a crew doing that. Uh, and so, as I got to know him over the past I've been married over 10 years now, and so, um, you know, he'll give us books about plants as gifts and stuff like that. And so, that It's always kind of been there, but no more than a hobbyist level of of knowledge before this. Mhm. Really cool, Ryan. Okay. Well, it sound It does sound like a great family hobby, by the way. You're not the first person Well, I Somebody Somebody has recommended to me recently that I get into gardening with my with my own daughter. So, I guess that that's a Well, and I'll tell you the easiest way to do it. They make these grow bags, these like black cloth bags with handles. You just fill them with soil and you plant right in them. And then like we have some on a pallet outside. You can put them on a patio. It's like kind of contained, but you can grow whatever you want. And it's like a great way to introduce kids to it. Just That would That would freak Will. Okay. Fascinating. All right. So, where were we? You are having this conversation with with a seller, and he says, "You know, I would be open to it. If you If you contacted me last year, I wouldn't be, but now I am." Yeah. And then Yeah. And so, I can't I can't remember if we had our first in-person meeting where cuz cuz there was an in-person meeting shortly after that where I went and sat down in his office. And the way the building is constructed, there's no closed-door offices in the building. It's a little bit unique. So, his office has a doorway, but there's no door on the hinges and there's a cutout over his desk where he's got a direct line of sight to the register. And that's just how he's he's he had operated the business for more than 20 years. He's just in it all the time, you know, jack-of-all-trades. Um he has two children who were working in the business and are still working for me. Jim's the name of the the former owner. He he walked out of the office and we talked and but one of those it was either that very first in-person meeting or the second one where I had told him "I don't want you to feel I don't want you to share more right now than you're comfortable sharing, but at some point I would like to have an idea of what I would be willing to pay for the business. And to do that, I really need to know what your tax returns are. I don't need to see all of them, they can be redacted, but I need to know those numbers because eventually I'm going to get a loan and that's what the bank is going to look at. They're not going to look at anything else." And so, I came and he had them printed out like the first page redacted for the past I think 5 years in a Manila envelope with my name on it. And he handed it to me and I I remember this moment because I remember sitting in the chair in the office and I was like, "This is the moment where I'm going to know whether I want to move forward or not. This is going to be really interesting." And so, I open I start looking and I mean the business had done extremely well. Like way healthier than I even thought it was going to be. I mean I I maybe thought it was going to make him 300, 350,000 dollars a year. And I think the average over the past four or five years is something closer to like 800, 850 uh K S D E. Incredible. and and what quickly became clear to me from looking at their turns was that this guy and this jibed with his personality. He wasn't trying to do anything creative with his taxes. I mean he he was just making decent money and paying taxes on it, which was a huge green flag Yep. because you can get in a lot of trouble with trying to value a business and get a loan in a business where there been some creative tax strategies employed or dishonest tax strategies employed. And so, I I looked through his tax returns and I said, "Okay." And then at some point I think in that conversation he shared with me a number that he had in mind as a value and he was willing to sell both the real estate and the business, and he had a number that was in mind for both. And he also shared with me that he didn't have them in two separate entities. I know my accountant has told me I should have done that, but I haven't done that. Uh but they're they're sort of both together. And I said, "Okay, that And And in my mind I thought that seems extremely reasonable. I'll I'll need to I'm going to hold my breath till we do a quality of earnings cuz I want to make sure there's nothing that I'm that I'm not seeing, but that just seemed So, from that moment, I think it was like, "Oh, this business he's got a very reasonable price already in mind." And that was the price story. So, he he had um I think it was between two and I think he said two and a half, 2.5 million. Was the price he had in mind for the real estate, which is 8 acres. Oh, just the real estate. Sorry. No, no, no, no, no, no, no. 2.5 million for all of it. What? 2.5 million for all of it. Yes. And that was inclusive of inventory. So, at the time we were talking, he had about This is the winter, so, you know, getting into fall winter when they have less we have less inventory, but I think it He had something like $650,000 worth of inventory on hand. And that also was was part of that. So, 2.5 million for the real estate, for the business, and for the inventory, all equipment. That's incredible. And And now, what why so low? I mean, it that that's a 3X on a business with really solid SDE, 60 years old, and consistent. What's the quality of this revenue? Despite the fact that it's retail, we don't like retail, it's very seasonal, we don't like seasonal. But, from He gave you 5 years of tax returns, you said? Mhm. How consistent was this 800 to 850 number? Yeah, that's a great question. So, it had grown significantly in those 5 years. Um it it I saw a rise starting in 2018. It started going up in 2019. And then in COVID, it just they went nuts. did really, really well. Uh but then it increased the year after COVID, and it increased the next year after COVID as well, but not so much. And so, there was sort of this like new The way I interpreted the history was they've hit kind of a new plateau um at a very healthy level of revenue and margin without making a lot of any investments in marketing in um you know, a lot of garden centers will will if you look at some of the best in class ones, they invest a ton of money into um making a very slick retail experience. So, really nice fixtures, you know, the property's manicured really well, they'll host events and classes, they'll have like big all weekend events with food trucks and wine tastings and like all this themed stuff. They curate a big newsletter, they're like investing a lot of money in this marketing and this place had done none of that. Um and they've been here for 60 years. And and so the the kind of thesis I quickly developed in my mind was, okay, they've hit somewhat of a plateau. I suspect we're going to have to fight a lot harder the next 5 years for this revenue than they've had to fight the last 5 years, but I'll have to I'll do that with tools that I understand like brand awareness and marketing um as well as tightening up on customer service and um and and making some investments in making it a space that people want to come spend more time and hang out, not just come and buy plants. I want to caveat that because a lot of garden centers again, they invest in having a cafe, right? Serving coffee and food and having all these like tables where people can hang out and they didn't have any of that, but my wife and I still wanted to keep coming back and spending time there. And so I thought, you know, I have this vision for what it could be, but I mean, it's doing great already. So, worst case scenario, we just keep iterating on what is and I I have incremental growth and because I'm not going to have investors, I don't have to worry about posting very normal average growth numbers or or maybe going down, you know, the the J curve everybody talks about. I know it's going to happen and it's happening now. Um I don't have to worry about being accountable to anyone except for myself and my family for that. Um and and so that made me feel good. And why did you just say that you thought you'd have to fight for the revenue harder for the next 5 years than you had for these past 5 years because COVID effects made it easy for you? the garden center industry in in in general saw just huge bumps in in sales post COVID. And in a lot of them there's a very pronounced bump in 2020 2021 and then a fairly pronounced drop in 22 and then 23. And I didn't see that. I saw kind of a plateau. Um So then that combined with a couple of unique things about this South Pleasantburg Nursery, the name of it. So you can see it's on my shirt. Okay. So South Pleasantburg Nursery. Yeah, South Pleasantburg Nursery. So South Pleasantburg is the road that it's on. Um it is in the city limits of Greenville just at the at the southern end of the city. And um so we're the only we're one of two nurseries garden centers within the city limits. The other one is kind of a backyard operation run by one guy and he's really nice guy and he's great. I've talked with him. But the only other garden centers you have to drive between 15 and 30 minutes outside of the city to get to. So our location is amazing. Um and and so and we're Greenville's oldest garden center. Uh which is again not something that I'd seen them kind of double down on in their marketing. Uh and they had some really knowledgeable We still have really knowledgeable team members. And I thought, "Okay, the the COVID effect is it's there because I see the plateau. Um but and that has only been the only thing driving this cuz they haven't been doing a ton of marketing. But what if I can find a way to turn that on, double down on professionalizing, you know, customer service, and just really lean into that we're Greenville's like we're Greenville's garden center. We're Greenville's oldest garden center. Um you know, there are other great options around Greenville. And I thought and I've told the team this, I don't want us to ever assume that people are just going to keep coming back. We can't do that cuz there are other options even if they're a little further. We need to fight for them, fight for the customer, fight for the revenue. And so yeah, I think it's just a COVID effect that all the outdoor living garden centers there there was a dramatic rise post COVID. But in a lot of those you see kind of a relatively dramatic fall in 22 or 23 and that hadn't happened. And so far this year we're we're a little bit below We're and this is again, I'm in a big an industry consulting group with a bunch of other independent garden centers. Most people are posting declines year-over-year this year. We are down, I think about last I checked it was two or three percent top line from last year, which the way I structured the transaction and my expectations going in was I'm I'm that's probably going to happen. And so that's not that doesn't make me scared yet. And and just curious why you had the confidence that it it where revenue was was a new normal. So it had spiked, it had come down a little bit, and then plateaued, but that plateau was higher than it was pre-COVID, so it settled in, or so you thought, or so your thesis was, at a higher level. But why did you have that confidence that it would stabilize there and not just go all the way back down to where it was pre-COVID? Yeah, great question. I mean, look, jury's still out, right? I mean, I took over the business on like May 3rd, you know, so we'll see. But two things, number one, the demographics of Greenville. So so Greenville's going to grow significantly over the next 10 years, and so if we can capture some percentage of those new folks who who want to buy plants, that's good for us. And just existing market penetration, I felt like and since being there every day, I'm constantly running into people who are like, we've lived here all our lives and we didn't know this was here. And and and so those two things convince me, hey, if we can if we can just double down on letting people know we're here, and double down on capturing demand for the people that are going to keep moving here for the next decade, I think we can at the very least maintain, you know, normal five to 10% year-over-year growth, and and potentially much more if if we can double down on similarly creative marketing and events. Great. Yeah. Okay. Had you said why you why his valuation number was so low? Have we gotten there yet? No, we hadn't discussed that. that's three just for the audience. Maybe maybe I said this indulge me again. Three X for a business that does great revenue, although it's seen growth. So it So that revenue maybe the quality of that revenue isn't as it's not super stable. Mhm. Um and but what what do you think the value of the real estate was? So carve out the real estate for us. So his he he assigned a value of $250,000 to his real estate. Okay. Um Great. And uh it ended up appraising for more than double that, which was very helpful to me uh because I I mean I'm getting ahead of myself in the transaction structuring, but I ended up doing two loans, right? A 504 for the real estate and a 7A with SBA loans. And uh I was able to put more of the overall price into the real estate loan because the lender was willing to lend in 100% of that appraised value, uh which which helps the debt service coverage a bit. Mhm. Um But he took To answer your question, why so low? A A number of things that I came to understand. Number one, he got that value from a consultant that he trusted who had There There's a system called the Value Builders System. I don't know if you've ever heard of the system, but it's like a It's It's a essentially a a platform for business consultants. And you interview a business owner and there's this dashboard with something like 12 little metrics on it that help to come up with an enterprise value for the business. And these metrics There's a lot of things that we would that would almost be searcher criteria, like level of management involvement in the business, stability, you know, amount of recurring revenue versus project-based revenue, um uh a bunch of stuff like that. So he had run him This consultant had run him through this and came up with that number. That had been at the time we talked, I think more than a year and a half prior. So the business had grown a little bit since then. And um and the real estate ended up appraising for a little bit more. Um That's one thing. Interestingly, that consultant came back and spent a day with him as we were negotiating the LOI and did that analysis again and came out with a relatively higher number. Uh and the seller's response, Jim's response was uh well, we agreed on a number and I'm going to honor that. Right. Which is extremely humbling to me. Like he the honestly, if I say the the one the one thing that really caused me to just literally stop looking at any other businesses and run really hard at this was I realized the owner of this business has rock solid integrity. He is straightforward. He's not playing games. He just is who he is. He says stuff. I mean he he would tell me things in casual conversation that honestly reflected kind of negatively in the business and he would just there was not the sense that he was fencing anything or mincing his words. And I picked up on that very early and I thought, man, this is the kind of person I want to have as a partner in this process because anything other than that is going to make the process harder than it needs to be. And he he would just The other thing I'll say is he had made good money in the past 5 years from the business. He felt comfortable. I mean, I want to tell you he he put something like 20% of the business in a donor-advised fund before we signed an LOI so that after the purchase, he had to donate 20% of proceeds into this fund so that it could be used for all these nonprofits. Like that's just the sort of person he is. Mhm. Money was not his his main concern. And I know you've heard people say like that sellers are money may not be their main concern. I see people go back and forth like, oh, they say that, but in this case it was genuinely he was so proud of the business. His two kids are working in the business and he wanted them to have the best chance of success moving forward. Um and he just was not personally motivated by money. He was happy with the deal that we struck and felt like he just had to follow through on it from a matter of of integrity, which I am extremely thankful for. Yeah, absolutely. Well, thank you, Jim. Um really remarkable because what uh sure seems like a screaming deal. Okay. And and I will let me add a couple things to that, too. So, for people I mean, you heard me say 70% of the revenue comes within about 3 months of the year. So, I think he's also very self-aware that there's things about this business that are hard. Um the the seasonality is you have to be very good at managing your cash in in the off season I mean all the time but especially when you're not getting the revenue. Um there's also you know we don't have a lot of outdoor covered um shopping on our property. So a lot of nurseries will have all these walkways and greenhouses and all of our stuff for the most part is outside except for some indoor things in our greenhouse and that means if you get like five or six rainy Saturdays like thunderstorm Saturdays in spring you might lose like 30% of your revenue for the year and probably not be able to recover it because that the spring is when people are planting. That's when they're buying plants and so you hope some of those folks will come back in a weekday but of course a lot of them are working and they're not thinking about it and so that's a very real risk um and I think he acknowledged that this is not it's it's just not from compared to other no business is truly easy I don't I don't think except for maybe course creation but once you get to a certain point but you know there's no he just he was self-aware about that and I think he was self-aware about the age of the property you know the fact that there was a number there are a number of staff members who are close to retirement age and so there's sort of a an experience and knowledge cliff coming in the next couple two to three years at most and he was aware of that uh and there was no structure on the staff so no management roles no formal organization they didn't do formal scheduling people just sort of decided when they were going to work and and they had a lot of self-motivated people that got the job done but it wasn't structured at all um and I I haven't fully put in a lot of structure yet because I'm wanting to make sure I do it right Yeah uh and and he he was self-aware about that stuff and I think that also informed he didn't have an overinflated sense of what the business should be worth. Well it it and let's also remind ourselves what something you said at the top which is you you didn't want retail and fundamentally a garden center is a store. You're basically buying a store retail and and we all it's and so retail is unattractive and retail's not going to command a lot of multiples a large multiple. So while this business kind of feels like something different and maybe a garden center does have enough idiosyncrasies to it that it's not traditional retail it's kind of at its core retail, consumer, you know, probably vulnerable to recessions, vulnerable to the weather in this case. So, um Yeah. No no recurring revenue, etc. Garden centers, there's there's a couple models. I mean, we are It's interesting. The word nursery, like we're South Pleasantburg Nursery. I used to think nursery is a place where plants are grown. And garden center is a place where you go buy stuff related to your garden. And there's not really a standard way of thinking about that, but we're pure retail, which in and of itself is a little bit riskier cuz you're not You have You have less control. You In some sense, you're beholden to what your vendors have available, when they have it available, and you need to get I've learned a lot about the ordering process. You need to get your orders in first cuz a lot of other people trying to get these flower, you know, these plants from these growers. And so, that makes it even a little riskier because we're just pure retail. We don't do any of our own growing. Mhm. Okay. And so, wait. So, to be clear, you're a garden center or you are a nursery? Yeah, we're South Pleasantburg Nursery. I don't You know, I don't know. We just I I think people tend to use the terms interchangeably. Uh just as long as you can get plants. We we care for and nurture plants and get them to you. Yeah. Great. All right. So, you decide you want it. You feel really good about, of course, what the financials revealed. You feel really good about the seller. Uh what does it look like to make your offer? Cuz I know that there was This was where your own educating, you know, you're not working through a broker, you're going direct. This is again where your education of a seller comes into play. Mhm. Yeah. So, early in the conversation, I sent him I found I can't remember even the name of this broker, but there's a broker from somewhere in the Carolinas that created a PDF to educate business owners on the whole process of how do you value business and what does taking it to market look like. And interestingly, he wrote it in a way where you could almost feel his like he's experienced so many business owners who have an overinflated idea of their business value, and he's trying to knock that down and get them to be realistic, which I really appreciate. And I And but not disrespectfully, just that's I picked it up. So, I sent that to Jim and I said, "Hey, you know, read this through. This is This kind of shows how I think about the process." We had a lot of conversations about it. I um I I really just coached and and talked him along. Um My The first really big um the first thing that was really important to me was as I said, he's got two kids that work in the business. So, my first first priority was I need to make sure that they're not wanting to buy the business and that or that their dad's not going to change his mind about keeping it in the family. And so, you know, fairly early on, I sat down at his house with him and his son, who would have been really, I think, the one uh to buy it if he was going to. And I just shared with him a lot about my vision. And it turns out his son has had a lot of the same ideas about marketing and about what the business could look like that I have had and just got really excited about the idea of working for me. Um and I I met with him one-on-one for a late night not too long after that and kept talking and I told him, "I'm an open book." I said, "Man, I'm I'm not independently wealthy. I'll If you want, I'll share with how I'm planning to do this and you could probably do it if you wanted to. Uh and I think he just didn't Neither he nor his sister wanted that level of compensation." the business? You teed up your whole You said if you want to do this instead of me, I'll show you how? I'll show you how because I don't I I want to be absolutely certain that at some point at the 11th hour, you are not going to um change your going to change your mind or that your dad is not going to find a reason to change his mind. And so, both he and his sister, like I said, who are awesome and work for me now, uh they they just didn't They They saw the level of complexity required and I think they recognized they they they liked their dad having the opportunity to get you know, to have a sale and to benefit from his years of hard work. Um and uh but yeah, so I met I I first step was talking to both of his kids. The next step was we identified three key employees who'd been there in one case for 40 years. Mhm. So, the the former owner bought the business from the founder more than 20 plus years ago and that guy had been with him then and then has been with him for 40 years. So, I I met individually with them one-on-one as a condition of closing and then there's some language in in the a seller note one of the seller notes that he has about making sure they they stick around for at least a year. And those meetings went really well. So, that was very important to me because I was like, am I going to be able to relate to these guys? I mean, they they know so much about plants about the industry. They've been in it for so long. How are they going to think of me? And I think I'm still learning some of that, but we had a good we had good relationship. I mean, in February So, we went under LOI in December. Is that that's kind of where that we we got and the way I got there, this was suggested by a friend of mine and I want to say this in case this is helpful to anybody. A guy I know who's bought businesses suggested setting up kind of like a three-tiered option presentation and saying, here's three different ways that we could do this. One of which is full seller financing and there's pros and cons to that on both sides. The pro I leaned into was we don't have to involve banks at all and and it can be really smooth. And then there was sort of a middle of the way where it was sort of a shared seller note and seller and and and bank loan. And then there was sort of a third way where it was kind of a still a seller note, but it was minimized a little bit. And I had him over at my house one day. We had actually bought a couple trees that we're going to plant and he brought them over to his truck and then sat down and had had some coffee or something. I just opened my laptop and walked him through a PowerPoint that I'd made and just kind of explained to him, this is how I'm thinking about it. And so then I emailed him that PDF and said, take some time, think about this, talk with your accountant. Oh, I think he told me he's going to talk with his accountant, which was a very big scare for me because I've heard a lot of horror stories of accountants basically saying, no, this is a bad idea. But that didn't happen. And Rory, the presenting the three options, was this one of these like on a pricing page of a SAS product or something where you you were trying to orient him toward one of your preferred option? Yes. And now I will say I was very transparent. Yeah, so my my I mean, my preferred one honestly I would have loved to have gotten full seller financing. I mean that would have been that would have been great. But I was very clear like with full seller financing you're getting the least cash up front. And and I and and so I the middle of the road one which this is so often what happens when you see those pricing matrices right where there's a there's one on the far left and the one on the far right's giving you the most but the one in the middle is like the sweet spot in terms of margin and work product and that's kind of how I structured it and that is base I don't remember I don't have it in front of me I don't remember exactly but that's that's basically what ended up happening. And and so sorry that option was That was basically half and half where he would seller finance half of it and the bank would finance the other half and I provide some equity and the way that that ended up working out was he has two seller notes one that is on full standby for 5 years. And we actually financed some working capital infusion into that. So he wired me at close six figures of working capital just to help because I acquired it in at May. So April is the largest revenue generating month for the business and I missed that whole month because of some delays mostly related to the real estate. I learned a lot about buying real estate which I'd never done before but there were a lot of delays and so I missed that whole month. He in turn got that revenue that he hadn't initially been expecting to get and so we built some working capital into that smaller seller note which I don't begin paying back until 5 years from now. Um and that was where he helped. Well then there's a larger percentage of the business was that? That it was 10 or 11%. It was over 10%. Because I could have gotten the business with no money down per the SBA's regulations because it's a note on full standby. My lender was not comfortable with that. But the I ended up putting 50,000 down. Yeah. Yeah, the SBA would have allowed it. But I ended up putting 50,000 down which is a token compared to the enterprise value that we're talking about. So I feel extremely lucky and thankful. And then there's another seller note for I think it's about 40 or 45% of the of the total. Uh and that's the terms kind of match the SBA 7A terms with the the 10 years. And then with the SBA I've got the two loans, the real estate loan and the 7A loan. Great valuation on the business as as we've already said multiple times and then you get these incredible terms as well. I like very Yeah, you know, there were a few moments during it where I thought that it was going to fall apart um where he was going to have a conversation or where he was delaying it for some reason and it's it's did he not come back from his conversation with his accountant saying, "My accountant says No, so interestingly, he didn't bring his accountant into it until kind of late in the process and by that point he was basically telling his accountant, "Here's what we're doing." And what he came back and told me was his accountant was mad at him. And and I said, "Oh, oh." As he should be. Tell me more, you know, and so this is one of those phone conversations where I'm like, "Okay, what are the next words out of your mouth going to be?" You know, like your accountant's mad at you, surely you've you've worked with this guy for years, you trust him more than me, surely. And nope, he it was just sort of he was just relaying to me a fact that the accountant was mad. And I remember I may have been pacing in front of my wife when this happened. I'm sure my face looks very interesting. But there was a few moments like that where I thought is there's no way, like at some point another moment, the real estate appraised for more than twice what we had agreed on and I went to him and I asked him very transparently. I said, "It appraised for more. It's going to be a separate loan. Would it be okay if I shifted some dollars from allocating to the business purchase into the real estate purchase because that will help me have I'll just have to pay less debt payments every month." And he didn't blink an eye. He's like, "Yeah, sure." Whereas I can easily imagine somebody else going, "Hey, that's great for you, but the value of my business is a separate calculus from the value of the real estate. So, you you know, you can figure that out if if you still want both these things." Uh but he that's just he was just very fair and very I'm just very again Rory, you're you're shifting the valuation around. Um it would that does that Sorry, does that affect him? Did that affect him? Cuz ultimately the lump sum is the same. Yeah, it didn't. If it ultimate lump sum was the same, uh and and that was that was his main concern was as long as my as long as the same total amount remains unchanged, sure, I'm I'm happy for you to do that. Okay. Uh I was expecting him to push back, you know, uh but but he didn't. Okay. Okay, good. And the so the working capital. So, this was something we we've talked about the seasonality. You miss April, so you've got May and June to look forward to, and then it's a dry for the rest of the year. Yep. Uh he but he again, in a very I don't know if it's generous or just fair-minded way, wired you a lot of the the benefit of April. Um so, you have this working capital. You said to me something really interesting on the pre-call, which is you're you're almost glad that you missed part of the busy season when you bought it. Uh yeah, that's a great. So, a couple things happened um because of the delays. Um the one delay that happened and I I worked with Matthias, the loan broker, right? You know, where people know that's the broker I used. Matthias was it? Yes, Matthias was it. And I'm so I'm so thankful for Pioneer um his his guidance. It was just super helpful. But he was pushing me. He said, "You need to get the highest line of credit, the highest SBA Express line of credit that your lender will allow you to get because it's much harder to get a line of credit post-acquisition." And so, I ended up asking for and getting a $300,000 um line of credit, Mhm. which I have safely if I need to use it. Um have not had to yet and and may not have to uh but it's there. And then and then because of the delay, like I said, the owner was was willing to wire me that lump sum of working capital. Um and that between those two things, I felt like I entered May in a relatively similar position to the way that I would have entered it, but with the additional flexibility of that line of credit. Um and it gave me the other the other thing that happened that I forgot to mention is I ended up working in the business for about a month before we closed. Uh so, I mentioned there's five people now out of a staff of about 15 who know about this trend, know, there's there's the owners, two kids, and the three other key employees, so six people. And word started getting out, and Jim talked to me one day, and he said, I I just I feel like maybe I should tell them. I know some people say don't share this news until it's happening, but I just I feel like they're talking about it. And so, we agreed, on a Saturday morning, I came in, I brought Chick-fil-A or something, and had a team meeting, and he kind of announced it, and then I introduced myself, and I was very you know, we're transparent. We said, it's not done yet. There's still some things to do, but I'm going to start coming here because I want to get to know all of you, and I want to get to know the business much better. And um And this was after it was under LOI. Yeah, so this was So, we closed on, I believe, May 3rd, and this was about a month before that, in April, And how did And how did the employees react to your your overture this Saturday morning? Yeah, I you know, I my memory of it is that they were kind of non-committal, but warm. You know, and and knowing the team, yeah. about all you can ask for. Exactly. I mean, I And I you know, I I told them, I'm not Yeah, I mean, it it was a it was a a good morning, and I spent the rest of the day at there, just walking around, watching people, asking people questions. And then, from that day onward, the other thing that had happened, I mentioned I was working full-time, I actually got let go from my job. My my job got eliminated uh in February. So, timeline is, I'm under LOI in December. We're trying to close by March. That's clearly getting delayed, but then I find out that my last day of employment is going to be February, like, 17th, I think it was. And I got a month's severance, but that the way that the stars aligned, that week that my job ended, uh is when the quality of earnings report came back very clean. And so, I ended up going into a month with severance from my employer, and just fully focused on, okay, the quality of earnings is here. That's the last green light I really needed. Now, let's like, run really, really hard at this. And so, the timing actually worked out really well. I will say, we were scraping the barrel of our savings by the time uh you know by the time we actually transitioned in May but I I don't have any regrets about it it was absolutely right decision. Well, congratulations Rory. Let's start closing up here with just some reflections on on how it's been to be the owner. So first of all tell us I'm I'm just going to spoon-feed you this one how much of an improvement to your personal life it is that you own a business 12 minutes from your house versus crisscrossing crisscrossing the southeast. It it's so nice. It's so nice. I mean like I you know when you I park in the back and I walk up to the back of the store and there's all these fountains that already turned on by the time I get there and so you're walking through all these plants and all these fountains and it's just like the most peaceful way to begin a day imaginable. The team is just such a solid interesting collection of people that you know, I I have not had to step into the closest to a critical role I've had to step into I would say is like HR and marketing. But other than that and that's partially due to the fact that the the former owner has been there full-time and he's in fact is coming up end of July is when he's done full-time and I'll have him on a consulting basis as needed up until 12 months from acquisition date and we just yesterday had a long conversation there's a few points he's going to need to step back in later this year cuz again it's so much seasonal there's stuff that happens only in the fall. And I didn't get to see that and and he's going to need to help transition some people with that but you know last week I went to the beach with my family and you know the joke in our family when our kids are there it's a trip not a vacation right so it was a trip but I did not I was not worried. I mean between the former owner being there and he actually took one of those days off last week actually now that I think about it there's just a solid team of leaders who I would say up until they haven't had formally recognized management roles but they've been living that way and it has been such a joy to get to know them better and to watch them run the business. I had my couple weeks ago I had my 6-year-old daughter there with me for like 3 days. And uh there's a lot of credit to her cuz she's a great self-managed creative kid, but like it's just so fun to bring my kids. They're so excited to be there. I'm I'm excited to share with people that I have a nursery. Like I I I tell my team all the time, we don't really sell plants. I think we help people find joy in and outside their homes. Um and plants are a big part of that, but they're not the only part. And I feel so good about that. That's That's amazing work. Yeah. Yeah. And and just going back to some of the the mechanics here, the seller who was so in the business like you said uh wore all the hats, uh had his office right there in that in that kind of uh ramshackle shack that you got as your office. Um but in fact, him not being there as much and you you know, being the new owner who's not going to be as competent quite yet as you ramp up. Um it doesn't feel like maybe the business is suffering from his lack of involvement. Well, I I I I've been telling people close to me I I think our harder times are in front of us, you know, um for a number of reasons. We've got like I said several retirement-aged staff members who are really knowledgeable, very hard-working, and um most of them want to work as long as they can. And I want them to work as long as they can, but I know at some point they're going to not want to work as much as they do. And there's a big knowledge transfer challenge that's there. Uh Jim in particular, he used to build ponds for people, so he's sort of known among our customers as the pond guy. He I mean, and we sell a lot of pond we have I I don't know that anybody else around us has as many like niche little pond repair products in stock that we have. And I don't want to lose that, but most that knowledge is with him right now. And he's done a great job of creating a bunch of guides and how-tos and explainers. And I've been um actually filming him do some education since I've been there. So I'm filming him explaining the property's irrigation system, filming him how to repair sprinkler heads, and um how to run the timer and fix certain things and there's more that we're going to do. He's going to do something about ponds. So, that that's a very real cliff that's coming. Um and I think he his personality is he is always going to want to be helpful. I think he's going to find a lot to do in retirement, but he's also going to miss being there and if I really need him for something, I I have no doubt that we can make that happen, but my focus is going to be the education and the standardization of structure in the team. So, making sure we have identified openers and closers, we've identified zones of the nursery and who's scheduled for those zones rather than who's just going to be there for the day. And and really I have not begun that major change push yet. I've really been going slow because I wanted to learn and wanted to and I've made some changes. I mean, I've I've improved our signage on the property. I'm working on a new logo that is going to be awesome and I've instituted some team meetings which regular team meetings which they did I you know, I was 3 minutes late for this conversation because our team meeting ran a little long and just trying to introduce some of that slowly. But yeah, I do think it's going to be interesting as we get into the fall. There's a little bit of a bump in the fall revenue-wise. I it's going to be more challenging in the future. I feel like I've I've had a one of the gentler post-acquisition transitions that I think people could have. And look, who's to say long run I might look back and go, "Wow, I wish I changed something faster or I wish I had been harder. I would have learned more more quickly." I don't know. But for for where our family is and where my kids are right now, it has been really really nice. And you're in these groups with other garden center independent garden center owners. And you also had your own ideas about this kind of low-hanging fruit that he's not doing any of the best practices, not doing the newsletter, not doing the hosting events on the property. So, are all of now that you're inside the business and understand much more about the business, are all of those levers as pullable as you thought? Are are are are all these opportunities to to improve the business um real as you thought? Yeah, that's a great that's a great question. Um yes, so in particular with local like brand I would say brand awareness, things like partnerships, um marketing, you know, putting a better sign on the street, even improving our landscaping, you know, it's it's a little ironic. The landscaping at the top of our property with all the road frontage is is not good. Mhm. And you know, even just that sort of thing. I mean, a lot of garden centers you drive by and it looks like a garden right there out front. And and ours isn't that. Uh and yet it's done really well. Um so I'm working with the team. I just announced to them this morning that I'm going to be getting soliciting input for ideas of what plants they'd like to see up there and I'm going to have one of them. There's a couple that do landscape design work and so they'll uh assign that to them. I'm building a little river walk, so like I said, the Reedy River runs along the property. Long long term, the city of Greenville has this big greenway called the Swamp Rabbit Trail and our property is actually on the expansion plan. That this is like a 10-year vision, which could utterly transform the business to have that much foot traffic. I don't know if it's going to happen, but in the meantime, we're building a basic little river walk along the river with um that like you could push a stroller on. Um and you know, we'll do an event in the fall just to see how is it like for us to host events. I mean, the property has one bathroom. Uh probably going to get some porta-potties to support the the foot traffic that I'd like to have. Uh but yeah, I do think there's a lot of I see nothing but growth opportunity ahead because every everybody that comes, for the most part, has like a great experience. They're like, "I wish I found out this place sooner. You guys have so many nice plants. Your staff is so helpful." And so I'm just like, "Yeah, let's double down on that and just get more eyeballs, get more eyeballs." That's what I'm telling my team. I'm I'm trying to get more people coming. It's your responsibility to do what you can to give them an incredible experience while they're here because I can't talk to everybody. Uh and that message seems to resonate. And any J-curve stuff other than I mean, I think you said sales have dipped a little bit, but that's sales dipping, not not uh new new expenses because you're a new owner and you're investing in ways that the old owner wasn't. Uh So, what's it what's that look like? Yes, definitely. Um I hired two people. So, I worked in the business for a month like I said, and I did a lot in that month. I did I ran the register. I dealt with an HR sensitive situation. Uh and I hired. I interviewed four people and ended up hiring two of them. One of them started before I acquired the business. So, I was just sort of like, "You'll get paid, you know. Don't worry." Um and so, the the headcount is a little bit higher. My insurance cost almost tripled compared to what the former owner was paying. Um some of that was the replacement cost in the building was way too low given what construction costs are now. Um and some of it was they didn't have a a cyber policy, and we In January, the owner adopted a a very state-of-the-art point-of-sale system that's that's germane to the industry. And uh we're just doing a lot more online now, so I have a cyber policy. Just little things like that that add up. Um I I given a couple people raises who who really deserved it. Um I'm I'm not taking a salary out of the business yet, which I think it's like in part because of my wife is working. I am doing a little bit of coaching and consulting on the side still, uh which helps. And then, I have the two entities now. One has the real estate, one has the business, and I'm paying rent, and you know, I'm going to be taxed on that money regardless. So, I am kind of taking that as my salary right now. Um I think the business could afford to pay me a salary, but I'm being conservative because I can be right now to try and reinvest as much as I can in or really mostly in marketing. And the business wasn't open Sundays or isn't open Sundays. It isn't. Yeah. And is that something you're going to change? I mean, that seems like an enormous opportunity, and I I come across businesses like that where for religious reasons they're not open one of the days of the week. And so, obviously, that seems like the most obvious thing in the world to to improve sales. How are you feeling about that? Well, the joke I make to people is if Chick-fil-A can do it staying do what they do stay closed on Sunday, I think we could probably find a way to do it. I think, you know, the the I'm I'm I'm a Christian. I'm religious. The the former owner is is a very religious person. He honestly says I think the business has been successful because we've honored Sunday. We've been closed. And and I don't know whether or not that's the case, but to to be able to come I mean that that's one of the big challenges of in-person retail is a most of them are open 7 days a week and you've got to manage staffing and people all that time, but having that rest day for the team uh and for me, frankly, is really good. And so I don't I don't I I think there's a lot of other levers I could pull before I would need to to change that. And I don't intend to. I I would not I would like to not do that. And and that's because of your respect for the staff already kind of being used to that or for your own religious reasons or for kind of not superstition, but almost like you feel there's something in you that feels like just in your gut it's like maybe I shouldn't touch this one. No, yeah, that's a it's a great question. It's not not for specifically religious reasons. Um I do think it is helpful in business and in personal life to have a defined rhythm of rest. And so like that is a day that the property can rest from having people all over it. It's a day that the team knows no one's ever going to have to schedule. The only thing that happens is somebody does come to the property for a couple hours and hand water a lot of the plants that need to be hand watered if it hasn't rained uh during the hot season. And so yeah, I just I rhythms of rest are really important to me. A lot of times when I coach people, it's helping them try to figure out what does rest look like for them and how can they get more of it. And so I don't I don't want to disrupt that because it's been working so well, you know. Okay. Rory, anything I didn't ask you? Anything about the story or about the business? I guess let me ask you uh this unless there's something else you want to say. If somebody else is looking at a garden center out there, uh any thoughts on this industry? Any any warnings? Obviously the seasonality would be a big one. Um you mentioned something about uh you mentioned how not being your own grower um means that you're a little bit vulnerable to a value chain. Like you don't have you kind of have supplier risk there. Um so what are maybe what are some of the dynamics that you would flag for people who might be looking at buying a garden center themselves? That's a really good question. I I mean how they approach and handle seasonality is important. Um you know, this this business is open year-round and a lot of garden centers aren't. They open in the spring, they close in the hot summer, they open in the fall, and then they close over the the deepest of winters. And that presents some interesting staffing dynamics and challenges. And the former owner opted to maintain a loyal staff. Um now, there are a few people that voluntarily cut their hours during the non-busy seasons, which which has helped. And if you can find more of those kinds of people, that's great. But you really got to diligence cuz if it's a year-round thing and your thought is, "Oh, I can come in and just close some of these months that they're not they're not profitable or not making very much money." Well, you're going to decimate the staff. And and you're going to you're going to have to discount on having almost a totally different kind of staff. Um you know, look at the gross margins. And I think the the gross margins as a tip of the iceberg for what is the brand fundamentally. And so, one of the reasons I was attracted to my nursery is that they they don't really do sales. And so, a lot of nurseries will have sales all the time. And like you you sort of become known for bargain hunters and bargain shopping. And that's not a great place to be. It pushes your gross margins way down. Um it it pushes your owner comp way down as a result. And and I knew that I didn't want to be I wanted to be more in the premium product kind of vein and then double down on customer service and quality. And um and so, I would say look at the brand because if you if if it has been known as a bargain place and you think you can come in and raise prices to improve gross margins, you you better have a plan to cycle through a large percentage of your customer base and make sure you're bringing in new people. And do the demographics of the area support it? I mean, people are only going to drive so far for the most part unless they have a reputation for these fabulous regionally attractive events, which some people do, but those are expensive. And they they require a lot of coordination and planning to pull off well, a lot of branding. You have to have a lot of eyeballs on your marketing your newsletter to get enough people to come to make the investment worth it. Um and which which we've never we haven't really tried and I don't know if how it's going to go for us. So um I also think you need to look at you know how many suppliers are they beholden are they beholden to too few suppliers? Uh are they accurately tracking inventory? That can be a nightmare. Um cuz some inventory I mean how analyzing turns of inventory I mean Some of this stuff is just like a retail best practices, right? That that it In the garden center world you got a lot of people that are passionate about plants and they're passionate about plant and plant education and landscaping, but they don't have the retail expertise. And some of the consulting groups I'm part of now, that's what they're trying to do is to get the business acumen and the and the retail expertise up so that owners can have profitable comfortable businesses have team members who have leadership responsibilities so they're not putting out all the fires themselves all the time. Um so it's really you know quality longevity of the team. What is their brand? What are they known for in the community? What are the demographic tailwinds of the community? Uh and what are their margins? Um is there room for restructuring how you price uh uh that won't drive people away that can immediately drop some money to the bottom line. Um and then if if you're a grower I know almost nothing about growing operations. I just know it's an additional level of technical complexity, state of the equipment, you know, um uh all all those kinds of things. Yeah. Yep. Great Roy. And and returning to the fact that this is a fundamentally a retail business, one of the reasons retail businesses are vulnerable and less popular is of course because of you're constantly competing with Amazon, one of the most ruthless competitors in the world. Is this uh is selling plants basically shielded from that cuz they're they're hard to buy online or or something maybe where people people want to go have the tactile experience of picking out their own plant or how how does uh online in the threat or or potential threat of online play here. Yeah, that's a great question. I There's There are several companies that I've like I get their Facebook ads all the time for buying plants online. Fast Growing Trees is one that you may have heard of. Mhm. And um you know, I think we're kind of in the early stages of seeing whether companies like that can be profitable and grow over time because to sell to handle all those logistics and still make a profit, you have to bump up the price of the plant a lot. And so people are paying like $99 for a blueberry bush that you could get at my place for a lot less, and I'm still making you know, a 55% gross margin on that plant. And so it and and so some of this is people just don't know. They see beautiful pictures, and they assume that what they get in their mail is going to look just like that, and it almost never does. Um you know, and and so I would say it's possible. It's possible that they could end up making more serious inroads. I think what we are going to try is we don't have any online ordering right now. The website is a relic. Um so I'm working right now to create that for local delivery and local pickup. And so so my thought is I don't need to capture everybody. I just need to capture anybody locally who is in or around Greenville and proud of Greenville, and likes the idea of getting plants delivered to them from somebody that they can actually take the plant in and talk to them about it if they want to. Um I I will also say I think the trend I'm seeing in in successful garden centers is toward being a more of an experience. So it's less transactional, and it's more of you want to spend time here. There's stuff to do. There's classes. There's stuff for your kids. And that's where I'm headed with the property as much as I can is is to make it experiential where people want to slow down and spend time and have knowledgeable face-to-face conversation. Um I think in a I think there's an increasing digital back like anti-digital backlash, or uh I think people crave reality. Yep. And being in person. And I think especially for as we're seeing the ongoing effects of device addiction, especially in kids, and how it's just ruining a lot of people and attention spans and EQ. I think more and more people are going to want to get out like literally touch grass touch plants. And so my that's kind of how I want to lean into with like this is a this is a healthy hobby. It's a passion. It's about making things more beautiful. It's about doing things together as a family, leaving your property more beautiful than it was when you got it. I mean that those are the kind of messages we're going to double down. And then things like native plants, pollinators. I just see a huge opportunity for people that want to feel like they're part of something bigger than themselves and it's a tactile and it's fun and it's peaceful. And I'm hoping that that is enough to stave off the incessant online ads I'm getting from these online plant growers. But we'll see. It could be a more significant challenge a couple years from now. I don't know. Well, Rory, everything that you just said there resonated with me and I I think you've just hit the nail on the head as to why I'm intrigued by this business even though as I said I've never planted a plant in my life. So I'm not somebody who has the hobby at all and yet I I I find myself drawn to it and I think I think it's for all the reasons that you said. Just kind of digital fatigue, have a kid so the idea of doing making this like a family hobby, all of that stuff. I think I think you're on to something there. Rory, this was a fantastic interview and what a great business, what an intriguing business, what a great seller like you. If people have questions, is how do you prefer they reach out? Yeah, so I'm I'm pretty active on Twitter. It's just @RoryTyre. You can send me an email. So my it's rory@spnursery.com. You can find me on LinkedIn. I'm always happy to chat. Great. Well, as always audience, just make sure you've done some homework before you reach out to Rory and ask him for his a very precious time. He's newly in his business so be aware and respectful of that. But it sounds like he's really eager to help. Thank you for that offer, Rory, and thanks for coming on Acquiring Minds. Great interview. Thanks, Will. I hope you enjoyed that interview. Make sure you subscribe to the Acquiring Minds channel below. We are now publishing twice a week So, tons of new interviews and stories to come. Stories that will help you along your own path to acquiring a business.