Those with systems networking and data communications knowledge, or know someone who can fill the gap, will be impressed with what has been created and what can be leveraged from this cloud based IT services company. It has created a strong book of recurring revenue and is well-positioned in their space to deliver meaningful value to their customers by cutting customer IT budgets by 30% or more.
A few highlights of this business include:
1. An average customer is a small business with approximately 10 users, although there are several customers with a larger user base, and some smaller. Remote installations are possibles for businesses with less than 20 users.
2. Business could easily double in user count without any additional staffing required. Strong leverage!
3. Future growth in users will come from ongoing trade shows, or other means of delivering the value proposition (should you choose to seek them out).
4. No inventory and no receivables.
The sale is structured as a sale of 100% of the authorized and issued share capital of the company. Working Capital shall be adjusted at $0. By completing the NDA and becoming a qualified buyer, we'll be happy to send you a full Offering Memorandum that will answer most, if not all, of your questions.
Please note, the advertised Annual Revenue and SDE are a weighted average of the 2023 projections, 2022, and 2021 results, which are considered to be the stabilized earnings of the company. As you will learn, the upside growth that can be created is heavily favoured compared to the downside risk, supporting a strong future for a new qualified operator.
Growth Potential:
Revenue: $2,000,000
SDE: $1,050,000
2023 Projections
Revenue: $950,000
SDE: $385,000
2022 In-house Financials
Revenue: $715,000
SDE: $270,000
2021
Revenue: $780,000
SDE: $250,000
2020
Revenue: $620,000
SDE: $160,000
2019
Revenue: $480,000
SDE: $140,000
*Seller's Discretionary Earnings (“SDE”) is a calculation of the total financial benefit that a single full time owner-operator would derive from a business on an annual basis. SDE is the pretax and pre-interest profits, before non-cash expenses, owner's benefits, one time investments, and any non-related income or expenses. SDE may require that expenses be adjusted if a new owner (Purchaser) will necessarily need to take on a new expense. SDE is also referred to as Adjusted Cash Flow, Total Owner's Benefit, Seller's Discretionary Cash Flow, or Recast Earnings.
** Our expectations are for a minimum 40% down payment on the final negotiated purchase price. Feel free to run some of your own calculations here:
https://www.bdc.ca/en/articles-tools/entrepreneur-toolkit/financial-tools/business-loan-calculator
The business currently requires a 18' x 18’ data centre. The owner would be willing to rent the current space (with 3000 kilowatts of power included) for $1200 per month.
