oday's guest thought he was getting a great deal.

The HVAC business that Dan Burnside bought generated $800k of SDE, and Dan acquired it for only $2.1m.

That's under a 3x multiple for a business in a hot category with a hefty amount of earnings for an SBA acquisition.

Well, all was not what it seemed with the company.

Dan closed on a Friday, and the very next day, Saturday, before he's even formally announced the news to the team, he uncovers some questionable activity.

A harbinger of the disappointment to come.

Among the challenges Dan dealt with: the business doing work for which is was not licensed; under-the-table unaccounted-for bonuses to employees; key people who were toxic but couldn't be fired; the worst summer for HVAC in 25 years; and employees leaving to compete with him.

And in the background to all of this was Dan trying to establish himself in an insular community.

The business was located in a small rural town, a place where the new guy is seen an outsider.

So if you're someone drawn to so-called tertiary markets to buy a business because you perceive them as being less competitive for searchers, listen closely to Dan's experience.

It may be true that very small markets are less competitive, but they could also come with their own set of idiosyncrasies. So don't forget to diligence that.

Ultimately, despite Dan's heroic efforts to salvage a terrible situation, the confluence of all these challenges overwhelmed his ownership of the business, and he shut it down and filed for personal bankruptcy.

He shares what that's like with us too, and we thank him for it.

Here he is, Dan Burnside, former owner of Parker Mechanical.

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