SMB Acquisition Series
How to Buy & Own a Small Business
This series is your fundamentals-first guide to entrepreneurship through acquisition (ETA)—designed for rational, long-term thinkers who want to understand how real businesses operate before making the leap.
Buying a small business can be one of the most direct paths to owning a durable, cash-flowing asset—but only if you approach it with the right process. This SMB Acquisition Series walks through the full journey, from finding quality opportunities to evaluating financials, structuring a deal, closing, and operating the business after Day 1. Use the videos in order, or jump to the topic you need most right now.
The Real Economics Behind SMB Acquisitions
In this first episode of our series, Matt DePaola explains why entrepreneurship through acquisition (ETA) has become one of the most compelling wealth-building strategies for rational, fundamentals-focused investors.
Should YOU Buy a Small Business?
Is this actually the right path for you? In this second episode of our SMB Acquisition series, Matt offers a grounded perspective on the personal demands of business ownership—and why the decision to acquire should never be driven by hype alone.
What Is SMB Acquisition and ETA?
Clear definitions matter. What do we really mean when we say “SMB Acquisition” or “ETA”? In this episode, Matt breaks down two of the most important—and misunderstood—terms in this space.
What Is Seller Discretionary Earnings?
If you’re evaluating a small business to buy, you’ve probably seen the term SDE or Seller Discretionary Earnings tossed around. But what does it really mean? In this video, Mattbreaks down this commonly misunderstood term—and explains why it matters so much during due diligence.
What Is EBITDA?
If you’re analyzing a small business acquisition, chances are you’ve heard the term EBITDA —often as if it’s synonymous with cash flow. But here’s the truth: EBITDA is NOT true cash flow. And relying on it without understanding its limitations can lead to costly mistakes. In this episode, Matt breaks down what EBITDA really means—and how to use it responsibly.
The Right Way to Measure Cash Flow
You’ve heard of SDE. You’ve heard of EBITDA. But here’s what most small business buyers miss: Neither of those metrics tells the full story. In this episode , Matt shares why it’s essential to think like a banker or lender when evaluating a deal—and introduces a more accurate measure: normalized free cash flow.
How to Calculate Normalized Free Cash Flow
If you’re buying a small business using debt, understanding cash flow isn’t optional—it’s essential. In this episode, Matt walks through how to properly calculate normalized free cash flow when a business is running at a steady state—no growth, no major reinvestment.
Normalized Free Cash Flow in a Growth Scenario
If you plan to grow the business you’re acquiring, you need a better measure of cash flow than just EBITDA or SDE.
In this episode, Matt explains how to calculate normalized free cash flow (NFCF) in a growth scenario.
How to Value a Small Business Using Normalized Free Cash Flow
How do you actually value a small business the right way? In this episode, Matt explains how to begin applying normalized free cash flow (NFCF) in real-world valuation—and why getting this right is especially important when using debt to finance a deal.
Multiples & Market Value Balance Sheets in SMB Valuation
Once you’ve calculated normalized free cash flow, how do you actually value the business?
In this follow-up to Part 1 of our valuation series, Matt walks through how to apply multiples, estimate enterprise value, and build a market value balance sheet—all essential steps in the SMB acquisition process.
How to Analyze Debt Service Using Cash Flow
If you’re financing most of your business acquisition with debt (like 80–90% through SBA loans), you’d better be sure the cash flow can cover the debt service. In this episode, Matt explains how to assess whether your deal produces enough cash flow to safely support the required loan payments.
Debt Service Coverage Ratio Explained
How do you know if a small business can safely support the debt you’re about to take on? In this follow-up to Part 1, Matt walks through a real-world example of calculating Debt Service Coverage Ratio (DSCR)—using normalized free cash flow, loan structure, closing costs, and interest rate assumptions.
What Is a Searcher?
If you’re exploring SMB acquisitions, you’ve probably heard the term “Searcher”—but what does it actually mean? In this episode, Matt breaks down the two most common types of Searchers: self-funded and traditional search fund-backed—including how they differ in structure, incentives, and deal size.
Where Should You Search for SMB Deals?
If you’re looking to buy a small business, one of your first decisions is where to search: Do you work with a broker or go off-market? In this episode, Matt explains the two major deal sourcing paths: broker-listed and off-market—and how they differ in process, access, and timing.
Broker-Listed vs. Off-Market Deals
When you’re ready to acquire a small business, should you search on listing sites—or go direct to business owners? In this follow-up to our previous video on deal sourcing, Matt breaks down the advantages and disadvantages of broker-listed vs. off-market SMB acquisitions—specifically from the buyer’s point of view.
The #1 Mistake New Owners Make After Buying a Business
You’ve closed the deal. You own the business. Now what? In this episode, Matt breaks down one of the most common (and costly) mistakes new owners make in the first year after acquisition—and why it often leads to silent, slow decline.
Working IN vs. ON the Business
In the previous video, we warned against jumping too quickly into branding, strategy, and growth while ignoring core operations. In this episode, Matt explains why staying stuck in the day-to-day can be just as dangerous—and how failing to build infrastructure and elevate others can lead to burnout, stagnation, and low resale value.
The #1 Operating Risk in Small Business Today
In today’s small business environment, one operating risk stands above the rest: labor. In this episode, Matt shares the realities of managing teams post-acquisition—and why failing to attract, train, and retain employees can halt your growth, destroy culture, or even shut down operations.