How to acquire the right practice at the right time
Acquisitions fail when buyers skip the basics: no target profile, thin diligence, emotional pricing, no integration plan. With a clear thesis and disciplined steps, an acquisition can be one of the safest and fastest ways to grow revenue, talent, and capability.
Define your criteria before you look
Strategic fit: Does it deepen your niche, expand geography, or add capability you want to sell?
Financials: Revenue range, profit margins, cashflow stability, seasonality profile.
People and culture: Team tenure, delivery model, owner transition plan.
Client base: Concentration risk, sector mix, pricing discipline, ages, and discount habits.
Systems maturity: Compatibility of core tools and process robustness.
Write a one-page “deal thesis” with must-haves and nice-to-haves. If a target fails two must-haves, walk early.
Build, score, and work a pipeline
Long list (30–50): Networks, introducers, brokers, database research.
Scorecard: 1–5 scale for fit, culture, financial quality, client mix, systems maturity.
Shortlist (10): Highest total scores. Start discreet outreach with simple interest notes.
Dialogue: Qualify intent, fit, and owner goals before diving into numbers.
Structure keeps emotion in check and effort focused.
Negotiate from data, not vibes
Normalize earnings: Adjust for owner perks, one-offs, and timing differences.
Triangulate value: Use multiples, but sanity-check with payback period and debt service coverage.
Structure the deal: Use earn-outs and deferred consideration to bridge expectations; tie to retention and performance.
Protect downside: Clear reps and warranties; escrow for known risks.
If the numbers don’t support the price, change the terms—or walk.
Focus diligence on the deal breakers
Financial: Quality of earnings, WIP health, aged debtors/creditors, revenue recognition.
Operational: Process documentation, throughput capacity, error rates, software licenses.
Commercial: Client churn, pricing power, cross-sell opportunities, pipeline reality.
Legal/compliance: Contracts, data protection, disputes, regulatory position.
Team loyalty
Start with the assumptions your thesis depends on. Prove or disprove them quickly.
Integration starts before you sign
Day 0 narrative: Why this deal, what stays the same, what gets better—for clients and staff.
Client plan: Personal calls to the top 20% of clients within 72 hours; FAQs for all.
People plan: Retention bonuses for key staff, role clarity, and cultural onboarding.
90-day operating plan: Systems alignment, process harmonization, early cross-sell offers, weekly tracking.
The goal: zero surprises, visible benefits, and stable delivery.
Post-completion metrics that keep you honest
Client retention: 30/90/180-day checkpoints.
Revenue quality: Recurring vs. one-off mix; margin stability; write-offs.
Synergies: Cost savings realized, cross-sell wins, capacity unlocked.
Culture: Engagement scores, regretted attrition, onboarding completion.
Act on red flags within a week, not a quarter.
Common red flags (and exits)
Owner indispensability: No second layer; no documented processes.
Client concentration: One whale client >20% of revenue.
Discount culture: Chronic under pricing masked by volume.
Data chaos: Unreliable ledgers, mismatched WIP, unsupported balances.
If your top risks cluster, the smartest deal is the one you don’t do.
To get a one-page acquisition criteria template plus a target score card you can use this afternoon.
Book a 15 minute call below.