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The Rise of Entrepreneurial Millionaires in the Home Services Industry: Exciting Opportunities for Business Owners

Many business owners in the Home Services Industry (primarily the HVAC, plumbing, and electrical sectors) are riding a wave of industry consolidation into retirement, becoming millionaires along the way. The consolidation of entire industries is driving this transformation.

Industry consolidation is primarily driven by larger industry players and private equity investors who view highly fragmented industries as an opportunity to build larger, more efficient companies. For instance, the US HVAC sector is highly fragmented, with over 100,000 privately owned HVAC businesses. By consolidating numerous formerly privately owned companies, new owners aim to build larger, more competitive platforms. 

Aaron Rice, a business owner profiled in a recent Wall Street Journal article, “America’s New Millionaire Class: Plumbers and HVAC Entrepreneurs,” provides an example of an entrepreneur/operator who sold his business to a private equity firm at considerable profit.

As the Wall Street Journal highlights, “Rice is part of a new breed of entrepreneurs in the skilled trades who are being hotly courted by private equity.” His tale is riveting for those in the industry, showcasing how embracing growth opportunities can lead to economic and personal fulfillment. “Though he originally would have been reluctant to sell, the move has given him greater peace of mind for his wife and children.”

Why the Boom in Home Services?

  1. Soaring Demand: These services are indispensable, supporting both residential and commercial infrastructures and continuously adapting to modern tech and environmental needs.
  2. Economic Stability: They offer recurring revenue streams, ensuring steady cash flow and cushioning businesses in fluctuating economic climates.
  3. Appeal to Investors:  Private equity sees robust growth in these sectors, leading to increased interest and higher valuations, which is excellent news for current business owners considering expansion or exits.

ACT Capital Advisors: Leading the Charge in the Home Services Industry

At ACT Capital Advisors, we are actively involved in the Home Services Sector, leveraging our expertise to facilitate lucrative deals for retiring business owners. Recently, we represented a business in the HVAC sector in its sale to a large global private equity firm at a multiple of 7x EBITDA. This transaction underscores the lucrative opportunities available to business owners in these spaces.

We’re currently working with another business in the Home Services Industry on a deal set to close this month. In this case, the competitive landscape brought three strong buyers to the table, which enabled us to secure very favorable terms for our client at 7x EBITDA. These examples highlight our successful track record and commitment to achieving optimal client outcomes.

Unlock Your Business Potential with ACT Capital Advisors

We’re here to help you navigate your opportunities during this exciting time. Whether you’re aiming to expand your horizons or thinking about a lucrative and strategic exit, our team offers the expertise you need to maximize your business’s value. Reach out today to explore how we can support you in achieving your dreams for the future.

About ACT Capital Advisors
ACT Capital Advisors is a premier mergers & acquisitions firm representing lower to middle-market companies across all industries. ACT has a 40-year history of deal-making, closing 250+ transactions, and unlocking over $2.5 billion in wealth for its clients. For more information, visit https://actcapitaladvisors.com.

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