t takes vision and ambition to acquire a business, two things @Gundwolf has in spades.

Knowing the 9-to-5 life would never be for him, @Gundwolf started an affiliate marketing business as a college student. (He stayed anonymous for our interview.)

He stuck with it even after graduating and getting a full-time job as an engineer, which allowed him to pour his engineer salary into improving the marketing business.

After countless early mornings working from 4am to 8am before work, he found success. Now a full-fledged entrepreneur, @Gundwolf saved enough money to quit his day job and focus full-time on growing his online affiliate business.

He did well, but after a while of working in the cutthroat and competitive world of affiliate marketing, the 24-year-old was ready for the next step: he wanted to invest his money in something tangible.

“One of the biggest things I was looking for was some kind of durable asset that I could put my time and effort into.”

First, he considered passive investments like real estate, but instead opted to acquire a business that he could grow.

After years of watching how quickly the tide could turn in the online space — for example, by Google making minor changes to its algorithm — he saw the appeal and durability of investing in a home services business. Specifically, @Gundwolf was drawn to the type of businesses that are necessary and survive not just the booms, but also recessions.

While searching online listings, he found an HVAC company.

He decided to get the opinion of someone who was familiar with the industry. He contacted the father of a friend from high school who owned his own HVAC business. As @Gundwolf described what he was looking for, the friend’s dad said, "That sounds like my business."

After a drawn-out acquisition process, @Gundwolf acquired this friend’s father’s HVAC business in December 2021.

“I wouldn't recommend trying to go down this route unless you have someone trusted that you can rely on that has HVAC experience.”

In this episode of Acquiring Minds, @Gundwolf shares his philosophy for reaching his goals, the challenges that arose during a 10-month acquisition, and surviving algorithm changes initiated by Facebook and Google that he has seen devastate other businesses. He also talks about his desire to maintain a strong family culture while growing the business.

Check out:

✳️ About @Gundwolf

✳️ Top takeaways from the episode

✳️ Episode highlights with timestamps

@Gundwolf's Twitter avatar

Acquisition Entrepreneur: @Gundwolf

@Gundwolf is his Twitter handle; he kept his identity anonymous for this interview.

💵 What he acquired: After deciding he wanted to invest the earnings from his online affiliate business in something more durable, @Gundwolf settled on acquiring a business in the home services industry. He looked at several businesses but found that as a 24-year-old who made his money online, most brokers didn’t take him seriously. He got in touch with an old friend whose dad owned an HVAC business and asked to pick his brain. After @Gundwolf described what he was looking for, his friend’s dad said it sounded similar to his own business. @Gundwolf acquired that business in December 2021 for $4M.

💡 Key quote: “How I was looking at home service businesses was, the business model is not as simple as the past business I’ve been in, but you’re likely to still have a business in any conditions, as long as you keep showing up every day, keeping your employees happy and just getting the job done.”

👋 Where to find him: @Gundwolf on Twitter

Acquisition Tips From the Episode

Top takeaways from this conversation

🔧 Find a way to build trust with blue-collar employees when you’re coming from a white-collar background.

When @Gundwolf acquired his HVAC business, he and the seller had two meetings: one with office workers and the other with the service technicians and installers.

As a 24-year-old former white-collar engineer who made money in affiliate marketing, @Gundwolf admittedly felt intimidated standing in front of his blue-collar employees.

"I think that gave me some credibility from the beginning. They were willing to give me the benefit of the doubt."

To overcome his fear during the meeting, @Gundwolf made it a point to mention that he didn’t grow up with money. He explained that he was able to make this acquisition because he’d had businesses that he alone had worked to make successful.

“After I got through my speech, a couple of guys came up and said that they really appreciate that I said that, because they had worked for people in the past who just inherited the business,” @Gundwolf says. “I think that gave me some credibility from the beginning. They were willing to give me the benefit of the doubt.”

🤝🏾 A strong, trusting relationship with the seller could save the deal.

Despite having a good relationship with the seller, the acquisition process lasted 10 months. It had plenty of ups and downs. One example was that the inventory was worth $300K more than what the seller and @Gundwolf had initially agreed upon. That raised questions involving the purchase price and seller notes—conversations that became difficult at times.

“There are some points that you're not just talking about numbers. There's an emotional piece in there, especially for him … When you're going through those negotiations, things get difficult,” @Gundwolf says.

“There isn't enough emphasis put on the relationship the seller and the buyer have. There are some periods where that's the main thing holding it together, because you're both very frustrated and things could easily fall apart.”

🧰 You don’t need technical knowledge to buy an HVAC business as long as you retain someone who does.

Coming from engineering and affiliate marketing, @Gundwolf knew nothing about HVAC systems or the industry when he acquired the business, something he found quite difficult.

Just a few months into owning the business, @Gundwolf can’t believe all of the things he didn’t know prior to entering the industry. Every day he’s learning, such as the technical side of HVAC, in part by talking to other experts and reading books about running a business in this category.

He also notes that part of what’s allowed him to thrive without knowing the business is the support of the former owner. Keeping the owner active in the business has compensated for @Gundwolf’s lack of HVAC knowledge.

“If I had jumped in day one, and the seller was leaving two weeks after I purchased the business, I don't think I could have done that, because you do need a technical background to be able to do this. It's something that you can’t just jump into and learn in two weeks,” he says.

“I wouldn't recommend trying to go down this route unless you have someone trusted that you can rely on that has HVAC experience.”

Episode Highlights

Inflection points from the show

[3:03] Supporting his affiliate marketing business with the salary from his day job.

[5:28] Not being cut out for a 9-to-5 life.

[7:38] Developing traction with his affiliate marketing business and quitting his day job.

[10:23] The cutthroat nature of affiliate marketing.

[12:12] Getting inspired at a conference and committing to taking his business to the next level.

[17:43] Living a spartan lifestyle and investing in his business.

[21:58] The philosophy that contributed to @Gundwolf’s success at a young age.

[25:55] With nothing to build in affiliate marketing, @Gundwolf wanted something tangible to work on. 

[27:49] Choosing between active and passive investment opportunities.

[29:40] Wanting to acquire a tangible business that will remain stable, whether in a boom or a recession, and that wasn’t subject to the whims of an algorithm update.

[35:35] Calling up a high school friend’s dad for advice, and then deciding to buy his business.

[38:37] Choosing to go the SBA-loan route and coping with self-doubt.

[40:51] Buying a recognizable brand.

[42:04] A 10-month acquisition process and the challenges that surfaced.

[46:04] Tough conversations and the importance of the buyer/seller relationship.

[49:49] Coming into the business as a 24-year-old and trying to ease feelings of uncertainty.

[52:53] Learning the HVAC business from scratch.

[56:51] Growing the business while keeping a strong culture.