White Collar Sisters Buy a Blue Collar Business | Julie and Janna Interview

Deal Structure

Julie and Janna Hottinger structured their acquisition deal with a classic approach, purchasing the business for $2.1 million with a 10% down payment, a seller's note for another 10%, and SPA financing for the remainder 1. This straightforward setup included a line of credit, initially set at $250,000, which was crucial for their financial management 1. The business boasted impressive margins of 33%, a rarity in the subcontracting construction industry, which Julie found surprising given the previous owner's minimal investment in growth and marketing 2.

   

Financial Challenges

Post-acquisition, Julie and Janna faced significant financial challenges, particularly with cash flow management. They discovered that payments were often delayed until job completion, sometimes extending up to six months, which strained their finances 3. To navigate these hurdles, they relied on a working line of credit and cultivated strong relationships with their bank and vendors, allowing them to negotiate payment terms when necessary 3. Julie reflects on the learning curve, noting, "We learned that you don't have to give up absolutely everything to do this," highlighting the balance they struck between financial stability and business growth 4.

   

Acquisition Journey

The Hottinger sisters embarked on a two-year journey to acquire a business, exploring various opportunities before settling on Signature Woodworking 5. Their search included diverse ventures, from fabric curtain upholstery to epoxy flooring and asphalt companies, each offering unique insights into the acquisition process 6. Julie recalls the importance of flexibility, stating, "You can't be too rigid," as they navigated the complexities of buying a business in a field they were unfamiliar with 5.