Monte Marcum·June 22, 2023

What Buying Small Is Like When Crises Happen | Monte Marcum Interview

Monte Marcum, a 25-year corporate and management consulting veteran from the Raleigh-Durham area of North Carolina, bought two contiguous territories of Filter Services — a niche franchise that cleans commercial deep fryers and manages cooking oil for B2B clients like hospitals, universities, and food retailers — for a combined ~$1 million at roughly a 3x multiple in January 2023. The business model is genuinely compelling: near-100% recurring B2B revenue, strong value proposition, low competition, and sticky client relationships. But the acquisition became a crash course in the dangers of buying small: equipment failures began on Day 3, a van blew out for 5 weeks with no capital reserve to replace it, employee turnover required continuous hiring and weeks-long training cycles, and Monte's father was simultaneously diagnosed with serious cancer. With only five machines and a small team, every crisis cascaded — a single technician calling out sick or one machine going down meant customers went unserved. By March-April 2023, Monte describes being in fetal-position moments, losing 15 pounds from stress, and feeling completely unlike himself. The business was held together largely by his operations manager St. John, who worked 25-hour stretches during the worst periods. By June 2023 (recording date), Monte had stabilized — his first week without an equipment issue — and remained committed to the roll-up thesis long-term, but the episode is an unflinching account of what 'buying small' actually means when multiple crises hit at once.

Deal facts

purchase price: ~$1m (combined for two territories)
multiple: ~3x SDE
revenue: ~$800k (combined)
notes: Bought two contiguous franchise territories of the same brand (Filter Services — commercial deep fryer cleaning/oil management) from two different owners simultaneously. One territory had been operating ~17 years, the other ~6-7 years. Combined revenue roughly $800k. Guest had been targeting SDE of $400k+; these were smaller individually but made sense combined. Multiple described as 'slightly higher' than typical, justified by near-100% B2B recurring revenue with well-known clients. Closed January 18, 2023.

Why this business

It checked all the boxes: recurring maintenance revenue, niche B2B service, environmentally friendly, strong value proposition, and two contiguous territories that rarely come up together — giving a roll-up platform opportunity. Monte wanted something close to home (co-parenting situation ruled out relocation), and the adjacency of the two territories made the combined deal strategically attractive even though each was individually smaller than his original SDE target.

What's working

Near-100% B2B recurring revenue with large, well-known clients (hospitals, universities, Whole Foods) — extremely sticky; customers design their menus and oil-ordering around the service schedule
Strong value proposition: eliminates the worst kitchen job (fryer cleaning), improves food quality, reduces safety risk, and saves money by extending oil life — customers rarely churn voluntarily
Key operations manager St. John held the business together through multiple simultaneous crises, working 25-hour days when a van broke down
Low direct competition — the competitive set is essentially self-performance by kitchen staff, with no direct service competitor in the same niche
In first ~100 customers since transition, lost only one account (a corporate budget cut, not a service failure)
Within the franchise network, a franchisee in the DC area has scaled to ~12 technicians and ~8 box trucks, providing a concrete proof-of-concept for growth
Territories estimated at only ~1% penetrated, indicating large runway without needing to acquire new territories

What's hard

Equipment failures were relentless — specialized filtration machines degrade from working with hot oil, and breakdowns started on Day 3 post-close; with only 5 machines, a single failure means 20% service capacity loss
Van failure took the business down ~33% service capacity for nearly 5 weeks; no capital reserve to quickly replace it
Father diagnosed with serious cancer the day of closing, creating extreme personal and emotional drain concurrent with business crises
Wife was laid off in March, eliminating backup income and health insurance at the worst possible moment
Employee turnover: one tech had lingering injuries from a prior car accident, another (a veteran) gave 12 weeks notice citing sciatica/family reasons, others didn't work out — all requiring continuous recruiting and training
Training new technicians takes weeks because every commercial kitchen has different access protocols (corporate security, bio-hazard checks, etc.)
Being in constant reactive mode was antithetical to Monte's personality and prevented any strategic or operational improvement work
Buying small means no management layer, no backup equipment, no financial cushion — one crisis cascades into several
Monte had not emotionally prepared his family support network for the magnitude of difficulty, which compounded personal strain
Lost 15 pounds in three months from stress, poor eating, and lack of exercise; described feeling like a different person at his lowest points

Notable quotes

Late February March April were probably the most stressful times I've ever had. I mean it was you know all of these hiccups going on with the business equated to like air traffic control — like when a plane has an issue all the flights the rest of the day are screwed up so then people start complaining and you can't just fix it immediately.

I think a lot of it is the extent that you have zero bloody control — like you can't, there's no control over it when some of these things happen. You got no control. And so this feeling of like you're spiraling because things are breaking that shouldn't be breaking but you have no control to get ahead of them to prevent them from breaking.

Buying small can be okay, but thinking that you're going to be able to work on the business when you buy small from the very beginning — you're going to be into the weeds far more than you think. You're going to be in it.

I would not do it ever again — something I still would want to have done — but I probably would have deferred, like knowing where I am now in my personal life.