Revenue-Share Business Acquisitions

A strategy for acquiring distressed businesses at zero cost by focusing on their remaining valuable assets and structuring revenue-sharing deals with owners who are closing down.

Core Strategy

• Target businesses that are closing or going under
• Focus on acquiring valuable assets without taking on liabilities
• Structure deals around revenue sharing instead of upfront payments
• Maintain good relationships with previous owners through the transition

Key Assets to Target

• Existing customer lists
• Client relationships
• Business goodwill
• Established brand recognition
• Operating equipment (when relevant)

Deal Structure

• Zero upfront cost to acquire
• Revenue share agreement with previous owner
  • 6-24 month payment structure
  • Tiered payment amounts based on timeframe
  • Payments tied to successfully transferred customers

Implementation Steps

• Monitor Yelp for businesses closing (60% of temporary closures become permanent)
• Reach out to owners before complete shutdown
• Position the deal as helping "annuitize" their closing business
• Carefully transition clients to new business
• Create special offers/discounts for transferred customers
• Maintain communication with previous owner throughout process

Benefits

• Previous owner gets ongoing revenue instead of zero
• Customers get continuity of service
• Acquiring business gets new customers without acquisition costs
• Creates win-win scenario for all parties involved

Example Case

• Gym/fitness studio acquisitions during pandemic
• Previous owners were getting zero value
• Structured revenue share for transferred clients
• Provided customers new "home" for services
• Maintained positive relationship with previous owner