Darryl Lindie·December 7, 2023

Hard but Fun: Transitioning a 77-Year-Old Business | Darryl Lindie Interview

Darryl Lindie, a former Navy Supply Corps officer pursuing a dual MBA/MPA at MIT Sloan and Harvard Kennedy School, self-funded a search restricted to a narrow radius around Newport, Rhode Island and bought a 77-year-old sign and awning manufacturer in Warwick, RI in July 2023 for roughly $2m (3x discretionary earnings of ~$645k) plus $1.6m in associated real estate, financed via SBA 7(a) and conventional loans, a $530k seller note, and equity pulled from his VA-loan home. He nearly passed on the deal because of a typo-filled BizBuySell listing, but an after-hours tour of the shop's in-progress local signage won him over. Post-close he uncovered messy practices — cash revenue, early-invoiced projects, and a seller reluctant to relinquish customer deposits for unfinished work — plus a chaotic, low-trust culture, all while his first child was born days after closing. He stabilized the business by hiring a GM (a supplier who approached him), rebuilding culture through small gestures like monthly team lunches, and drawing on his father (who joined the business) for support. Alongside operating, Darryl runs New Majority Capital, a foundation and fund helping women and BIPOC entrepreneurs pursue acquisitions through a 10-week cohort program (with early acquisitions already resulting) and a companion 'Succession Ready' program for sellers.

Deal facts

purchase price: ~$3.6m total (~$2m business + $1.6m real estate)
multiple: 3x discretionary earnings
sde ebitda: 2021 discretionary earnings ~$645,000
financing structure: SBA 7(a) loan for the business plus a separate conventional loan for a second piece of real estate; buyer equity injection ~$400k+ (funded via home equity from a VA-loan-purchased home); seller note of $530k over 5 years (2 years on standby)
notes: Deal included purchase of two real estate parcels tied to the business (one under a triple-net lease to a tenant, requiring a conventional loan since it wasn't owner-occupied by the acquired business); one property appraised at $1.6m; seller, 78, insisted buyer take on all real estate plus the business as a package to fully wind down his estate.

Why this business

Darryl was a Navy Supply Corps officer who saw small business owners he purchased from living an attractive, fulfilling lifestyle and thought 'why can't I do that.' While pursuing a dual MBA/MPA at MIT Sloan and Harvard Kennedy School, he self-funded a search restricted to a tight geographic radius near Newport, RI (where his wife wanted to stay). After an earlier LOI on a ship-maintenance/fabrication company fell through over geographic fit and cold feet, he found a 77-year-old sign and awning manufacturer (founded 1946) listed on BizBuySell with a typo-ridden, unpolished teaser that nearly caused him to pass. Touring the shop after hours and seeing signage for businesses all over the Newport/Providence community made it click emotionally, and he recognized the business's fabrication capability, full-service model (design through installation), and lack of real competition in Rhode Island as durable advantages.

What's working

Only full-service (design-to-installation) sign and awning shop of its kind in Rhode Island, with limited competition after industry consolidation and closures
Broad, diversified B2B customer base (schools, universities, hospitals) meaning steady demand despite non-recurring, project-based revenue
Hired a GM (a supplier who approached him) who brought technical/industry expertise Darryl lacked, freeing him to focus on strategy and dramatically improving process efficiency (jobs no longer languish unfinished in the shop)
Rebuilt culture quickly with simple, low-cost gestures (monthly all-team lunches, personally checking in on employees) that helped win back skilled former employees who had left under the prior owner
Founded New Majority Capital, a foundation running a 10-week ETA cohort (Providence cohort produced 3 acquisitions out of 29 fellows) plus a for-profit fund to help finance acquisitions for women/BIPOC entrepreneurs, and a 'Succession Ready' program helping sellers exit

What's hard

Discovered post-LOI that a meaningful share of revenue was collected in cash, complicating valuation and creating anxiety about how the SBA lender's underwriting would treat it
Missed in diligence that the seller habitually 'early invoiced' projects before completion, inflating apparent financials, and the seller tried to keep receivables/customer deposits for work that hadn't actually been performed or delivered, leading to an ongoing contentious dispute after close
Never observed daily operations during normal working hours before buying (only visited after-hours or on weekends with the seller), so he lacked a full grasp of how the business actually ran, which he says his wife/father-in-law (CPAs auditing large companies, not small businesses) couldn't compensate for
Walked into a chaotic, tense culture with finger-pointing and no real process; discovered the bookkeeper's relationship with the seller and had to move on without her
Deal terms had to be reworked multiple times because the 78-year-old seller had cold feet/seller's remorse and initially wanted no standby period on his note
Personal timing was brutal: closed the deal, then his first child was born about 10 days later, all while finishing his dual-degree program

Notable quotes

The first company I had under LOI it didn't actually pan out as far as an opportunity, is actually a current customer of mine.

I don't necessarily know if the experience was like necessary for me to get where I'm at right now... if anything I think that it'll just slow you down and maybe you might be talked out of it.

There were a lot of projects that the seller had collected deposits for and was not willing to turn over... this guy has no intention for actually giving me the customer deposit. I was like, this is crazy.

It's always the bookkeeper.