Post 11: Creating Value in your HVAC business

Over the next couple of weeks, I plan to share a set of HVAC for dummies posts to share a few learnings from my EtA journey in acquiring an HVAC business

An epic journey into the land of HVAC companies! Those thankless workhorses that keep our toes toasty during the winter and our popsicles from melting in the summer.

Imagine you’re running a lemonade stand, simply trying to make enough cash to enjoy school. As I saw with HVAC companies, there are three secret ingredients to making it rain: sell more lemonade everyday, borrow money from your parents to expand your empire, and make your stand the talk of the town!

First, do your job - and sell (Organic Growth): You use what you've got - maybe with variations in the amount of sugar and lemon and just hustle your way to more lemonade sales. You’re not borrowing from your older sister or taking over your buddy’s stand 3 blocks away. You're making the most of your recipes and maximizing the cash you are collecting.

Borrowing Cash from your sister (Leverage): Imagine you’ve got a the chance to buy a bigger table, maybe a sign and a megaphone that lets you do things faster and bigger than before. This can help your business zoom ahead, but if you get too bold and borrow too much, you might have a string of cold days in summer: folks may see your new lemonade stand but may not be interested in buying. Unfortunately, your sister will want her money back!

Making Your Stand the Talk of the Town (Multiple expansion): This is all about creating buzz. The more the kids a year behind you believe your lemonade stand is better than the other, the more they're willing to pay to take it over next year. If investors think your HVAC kingdom has a shiny future, they'll be willing to pay a little fortunate to have it today

If you have any questions about the contents of this article or about value creation for your business, send me a note (I’m not a consultant, but will look to acquire a business in a few months). I will be happy to respond to every post that I can. Look out for follow up posts in the next few weeks in which I deep-dive into each value creation lever.

If you are looking for a thought partner with whom to think through your current business, I’m happy to chat. Send me a note! I look forward to hearing from you!