How to Structure a $1.2M Deal Without Overpaying

Welcome to the JackQuisitions newsletter,

A couple weeks ago my podcast co-host, John Wilson, announced that the JackQuisitions newsletter would be moving to a home of its own.

So, hello and welcome. Let me start with this:

Thanks for sharing your thoughts :)

I couldn’t run this newsletter without my sponsors, and today I’ve got a good one for you…

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Ready For Your Next Acquisition?

Finding your next acquisition target can be just as challenging as the process itself. Let me help. Here are some listings for your review:

This $1.48M revenue HVAC business nets $210K—90% residential, no new construction or refrigeration, 180 maintenance agreements, and flat-rate pricing with QuickBooks and a CRM in place.

This $1.75M revenue HVAC and trade services business nets $440K—80% residential, no new construction, 14 years in business, long-term clients and staff, with Pazerware CRM and QuickBooks in place.

This $1M revenue HVAC business nets $217K—13+ years in business, 1,600+ loyal customers, 261 five-star reviews, and strong systems in place to support growth. Seller financing available.

This $1.39M revenue HVAC business nets $324K—steady year-over-year growth, nearly 300 maintenance agreements, and revenue from service, installs, and new construction.

Creative Deal Structuring Is More Than Possible

Most acquisition entrepreneurs structure deals with a basic playbook: pay the asking price, get an SBA loan, plug in a seller note, and move on. But one operator took a different approach—and used it to reduce risk without killing the deal.

Instead of offering full price for a $1.5M pressure washing company, he proposed $1.2M. The structure: $900K paid at close, then all profits above a capped salary redirected to the seller until the full amount is reached. No interest, no seller note—just a performance-based earnout tied to actual business results.

That sounds risky for the seller. So he layered in protections: quarterly financial reviews, a 10% cap on expense increases, and third-party accounting through a top-100 CPA firm.

The result? Both sides got what they wanted. He avoided overpaying, the seller got a clear path to their number, and the deal stayed alive.

Key takeaways

Creative structures reduce risk (if you build in trust). Capping income and redirecting overages provided downside protection. But transparency and cost controls were what made the structure work.

Traditional seller notes aren’t your only option. This wasn’t a loan with interest. It was a structured earnout with upside for the seller—if the business performs.

Sellers care about certainty. The offer wasn’t the highest. But it was designed to feel safe, simple, and executable.

Handcuffs aren’t always bad. He gave up some growth flexibility for the first few years in exchange for peace of mind. For a first acquisition, it was the right tradeoff.

Know your goal, then design around it. This buyer wasn’t chasing upside. He wanted one solid win, a stable base, and room to grow later. The structure reflected that strategy.

If a deal feels too risky, don’t walk. Redesign it. You don’t need to follow a template to close. You just need to write terms both sides can trust.

Want more information on acquisitions, operations, and growth in the trades?

➡️ Behind the Scenes of Buying a Business
real-world strategies for sourcing and securing small business acquisitions
🎧 YouTube | Spotify | Apple

➡️ Trying to Buy a Business: Here’s What No One Tells You
The inside details of buying a home service business
🎧 YouTube | Spotify | Apple

➡️ SBA Loan Strategies for Acquiring a Business
How to buy a home service business with an SBA loan
🎧 YouTube | Spotify | Apple

Say Hello to First Internet Bank

Buying a Business? Start With the Right Lender.

First Internet Bank is a national Preferred SBA lender specializing in acquisitions in the skilled trades.

Whether you're a first-time buyer or expanding through acquisition, Alan Peterson and his team structure SBA 7a loans with up to 90% financing—plus optional lines of credit for future growth.

Best part? They take a “how can we” approach, not a “we can’t.”

🎁 Bonus for readers:
Mention the show for a reduced deposit and free deal review + prequal.

Get in touch with Alan here.

Tell Me What You’re Thinking

Feedback, good or bad, is the best way to help me improve the JackQuisitions newsletter. Thanks for coming along for the acquisition ride.

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