The Modern Acre 380: Buying (Then Building) A Small Business in Ag with Cody Agee
Dec 3, 2024
Cody Agee, Owner & CEO of Sierra Dairy Laboratory, transitioned from investment banking to acquiring a dairy testing business. He shares his journey from searching for the right company to navigating the complexities of ownership. Cody discusses the shift to digital lab systems, emphasizing efficiency in operations. He reveals the advantages of buying an existing business, detailing the acquisition process and the importance of due diligence. Additionally, he sheds light on urban milk consumption trends and the significant role of the dairy industry in California.
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Finding Sierra Dairy Via A Broker
- Cody found Sierra Dairy Laboratory through a Modesto-based business broker.
- He first learned of the business in 2023 and closed the deal in November 2023 after months of negotiation.
Let Cash Flow Drive Valuation And Lending
- Validate cash flow thoroughly during due diligence because banks underwrite loans based on it.
- Ensure projected cash flow supports financing before finalizing your offer.
Combine SBA Loans, Seller Notes, And Equity
- Leverage SBA 7(a) loans plus seller notes and some equity to finance small business acquisitions.
- Bring personal capital and friendly investors to meet lender and seller expectations.
