Dear BTF Community,
Buying a business can accelerate growth but experience teaches buyers that finding an opportunity is only the beginning.
At Business Transitions Forum Atlantic, Adam Doiron, Owner of Prince Edward Island Preserve Company and former owner of Coach Atlantic Group; Jalal Jetha, Managing Director of Cascadia Equity Partners; and Dwight Fraser, Founding Partner of Franchise Management Inc., Fensmarket Inc. and Clearstone Capital, joined moderator Jillian Murray, Partner at Doane Grant Thornton LLP, to share what decades of acquisitions have taught them.
Across sourcing, diligence, deal structure and integration, one lesson kept surfacing: knowing when to walk away can be just as important as knowing how to close.
Key Takeaways for Business Owners:
- A clear acquisition strategy makes it easier to know when to say no.
- Look beyond the numbers to culture, management and owner dependency.
- Use due diligence to test the deal, not validate it.
Enjoy,
Mark
Acquisition Can Buy You Time, But Not Certainty
For Adam Doiron, who grew Coach Atlantic Maritime Bus through acquisitions before exiting in 2019 and has since acquired businesses across several industries, the appeal of acquisition comes down to risk and speed.
“When you buy a company, you’re buying a track record, cash flow, employees and customers. Compared with starting from scratch, that can significantly reduce the risk.”
An established business can also be easier to finance because there is a history against which lenders and buyers can assess performance.
What acquisition doesn’t remove is uncertainty. Buyers still need to understand whether earnings are sustainable, how dependent the business is on its owner and what additional investment may be required after closing. Purchase price is only part of the equation; working capital, equipment, property and integration can materially change the economics.
Experienced buyers learn to evaluate the business they’ll own after closing, not just the transaction required to acquire it.
Knowing What You Want Makes It Easier To Say No
Dwight Fraser started with a single Subway location and six employees in 1991. Today, his business has grown to approximately 400 stores and 7,000 employees, with dozens of transactions along the way.
His approach to acquisitions has changed considerably.
“Early on, I was an emotional buyer. We didn’t have a lot of guardrails. If the bank would lend us the money, we were in.”
Over time, opportunity gave way to greater discipline. Rather than simply responding to deals as they appeared, his team became more deliberate about identifying businesses that fit what they knew how to operate.
Jalal Jetha, Managing Director of Cascadia Equity Partners, takes that selectivity even further.
“Having a thesis is paramount because you need the ability to say no. We say no 99% of the time.”
Without clear criteria, it’s easy to find reasons to make the only deal in front of you fit. A strong acquisition thesis creates a filter before emotion or competitive pressure takes over.
Relationships matter too. Jillian noted that many transactions, particularly in Atlantic Canada, never reach a broadly marketed process.
“So many deals happen that never hit the market. They happen because of relationships, and most buyers and sellers prefer that.”
Being clear about what you’re looking for and building relationships before a transaction is on the table can be just as important as watching businesses formally come to market.
You’re Buying More Than The P&L
Financial performance establishes whether a transaction is viable, but the panel repeatedly returned to what can’t be understood from a spreadsheet alone.
Jalal described how his thinking evolved after his earliest acquisitions. Where the initial focus had been on closing and returns, he now spends far more time understanding management, culture and the longevity of the business.
“You’re not acquiring the P&L. You’re acquiring the culture and the people. That’s where the P&L comes from.”
Those qualities are harder to diligence but there are clues. One question Jalal asks is whether, if the owner disappeared for six months, important customers would call them personally or continue dealing with the business.
It’s a useful test for owners too. Customer concentration appears clearly in financial reporting; founder dependency can be harder to spot until someone starts asking who owns the relationships, knowledge and decisions that keep the company moving.
What Diligence Is There To Find
By the time due diligence begins, a buyer may already be invested in getting the deal done. That makes it easy to look for confirmation rather than problems.
Dwight learned this after thoroughly reviewing the operations of an acquisition but not the physical properties. Costly issues emerged after closing, and building inspections became a permanent part of his team’s process.
Jalal shared a more extreme lesson from a transaction his team moved through too quickly because the opportunity looked unusually attractive. After closing, serious issues emerged with the company’s reported revenue, earnings and assets.
“Don’t rush and don’t think you’re going to get rich quickly on something that’s too good to be true.”
The point of diligence is to uncover what could change the deal before you’re committed to it, even when that means changing the terms or walking away.
The Deal Is Only The Beginning
Closing brings a different challenge: taking ownership without disrupting what already works.
Adam cautioned against making changes too quickly.
“Take 30 or 60 days to learn the business and understand the culture. You may have a plan for change but take the time to really understand it first.”
While the panel had different approaches to transitioning founders and management, they agreed that the early days of new ownership require care. Employees and customers are adjusting, while the buyer is still learning things no diligence process could fully uncover.
A successful acquisition depends not only on getting the deal right, but on what happens once you own it.
Final Reflection
Experience brings discipline to acquisitions. Clearer criteria, better questions and the willingness to walk away all help buyers avoid letting the excitement of a deal outweigh what they uncover along the way.
For owners considering acquisition-led growth, that discipline may be one of the most valuable things to build before the right opportunity comes along.