14 acquisitions and $120m EV HoldCo

Will Thorndike (Housatonic Partners) and Christian Solberg (Sun Mountain Partners) are involved as was discovered on my recent pod...

Will, of course, is the author of "The Outsiders"… keep reading.

If you study the best serial acquirers and the best investors who back the entrepreneurs...

You learn that long-term success often comes from two things:

1.  consistency rather than brilliance;
2.  and being okay to slow down first to allow you to go fast later.

Over the long run, those that completed 1-2 acquisitions per year in the early years tended to outperform those that pursued a faster pace, such as 4-6 deals per year.

The key is to get the strategy right...to find product-market fit in your acquisition approach to be able to scale from a solid foundation.

That is exactly why the following serial acquirer could make some serious gains for their shareholders.

It’s worth noting that Europe is experiencing another hot summer. According to the U.N., extreme heat claims more than 175,000 lives annually across Europe.

Experiencing Spain last week, we got to feel the real heat (39°C / 102,2°)

Demand continues to grow:

“HVAC demand is expected to surge 300% by 2040.”

Will this create new HVAC centi-millionaires, even billionaires?

Let’s move from Spain to Italy, where I have some interesting data.

In Italy, the market is extremely fragmented.

I interviewed Lindbergh Group, an HVAC roll-up, which has completed 14 acquisitions in the last 3 years while still growing 35-36% year over year.

The company was founded in 2008...but it took them a very long time to find the best product-market fit for their capital.

Since 2023, they have acquired 14 businesses.

It’s no wonder that US investors, led by Thorndike and Solberg are key investors.

I had a conversation with Andrea from Lindbergh, where he shared how they’ve been able to execute on acquisitions and where they’re focused in the years ahead.

They are excited for multiple reasons having put in the work around: 

1.  The pipeline they’ve built
2.  The tailwinds from continued demand growth
3.  Acquisition multiples below 4-4.5x EBITDA, significantly lower than in the US

Here are the links (Apple Podcasts, Spotify, YouTube) to the full conversation where we discuss:

- Why the HVAC market is such an attractive consolidation opportunity 
- How they structure acquisitions
- Why technician retention matters more than financial engineering 
- The operational synergies behind the roll-up
- "More plumbers, fewer managers" has become the company's philosophy.

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There is a family office with a direct investment budget of $1.5B that deploys a minimum of $10m per deal.

If you're in the trenches acquiring companies, I'd love to hear from you (reply to this email).

I posted this on X a few days ago and, as expected, received a strong response.

There are these highly experienced and very silent operators quietly acquiring and building exceptional $1-15m EBITDA businesses, both in traditional industries and software.

I’ve already received DMs, so I decided to post this CTA here too.

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Now, talking about family offices in the US and in Europe.

A dear friend from the US was walking the streets of Paris this week and messaged me after seeing the tweet.

“The family wealth in Europe and true long-term orientation must be a fascinating study.”

Interesting…

The United States is only about 250 years old. I can see why walking through parts of Europe makes that seem incredibly young. Some of the streets, buildings and institutions around you have existed for centuries.

It makes you wonder how much capital has been created, preserved and compounded across generations…

When people discuss family offices, they often focus on modern fortunes...

In Europe, there are so many families which have been allocating capital, owning businesses and preserving wealth for far longer than the modern concept of a family office has existed.

For those who haven’t been in Paris:

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I don’t talk too much about private credit but Scott Goodwin - the co-founder of Diameter Capital Partners - recently delivered a stellar presentation at the Sohn Investment Conference in NYC.

Quoting him: “We're going to talk about what the f* is going on in private credit...” (You can hear the whole audience laugh.)

In 18 minutes, Scott gives an in-depth overview of a small piece of the $40 trillion private credit market:

Media may be talking about different things in private credit, mostly conflating different things...

What Scott is talking about, and why I highlight this here, is the $2 trillion slice of that market - leveraged finance/direct lending, a market that dates back to the early 2000s, if not earlier. Very interesting, gives you a great overview.

As my friend said about this whole presentation: “Total stud.” And I agree. Add, I also humbly believe, Scott is dramatically underfollowed on X, give him a follow here.

Link to the presentation on YouTube.

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Lastly, never bet against someone who refuses to give up.

My recent podcast guest, Luca Hany, acquired Edgar Hausmann GmbH.

Luca left investment banking to find and acquire one great SME in Switzerland or Southern Germany.

But no playbook existed.

So he built his own:

- 50+ ETA interviews
- Solo fundraising
- Industry by industry deep dives
- Long-term vision

A masterclass in ETA from someone in the trenches.

About the Company:

Edgar Hausmann GmbH, operating under the Hausmann Aero brand, is a value-added distributor of mission-critical aerospace tools and consumables with an 80-year heritage. Combining third-party brands with proprietary Hausmann Aero products Made in Germany, we serve OEMs, MROs, and defense customers across 50+ countries.

Luca is awesome and this has become one of the five most downloaded episodes on the Buyers & Builders podcast. (Links: Apple Podcasts, Spotify, YouTube)

That’s all for this week.

Take care,
Mikk Markus / PrivateEquityGuy