STOP PICKING YOUR FINANCIAL DILIGENCE PROVIDER BASED ON SOCIAL MEDIA. Enough's enough. It's on us as real diligence providers to get this message out and myself and the Hollywell team are just bad at marketing and getting the word out. We are seeing just awful QofE deliverables on smaller deals (Traditional search and ETA). No, a basic cash proof and a shiny PDF does not pass muster. Regardless if you choose Hollywell or not, make sure the your QofE provider has real deal team audit and diligence experience. THERE IS NO SUCH THING AS QofE Lite. It's a crap marketing term, it is and always should have been full diligence just for smaller deals. Hollywell's FDD team ALL CAME FROM BIG-4 AUDIT AND DEALS. And we don't send the second half bill if we find something that leads to you walking away from the deal. Seriously, skimping on financial diligence when about to spend millions alongside a life changing event is nonsense. GET REAL DILIGENCE DONE DAMMIT. Alright, we'll do better about getting the message out more consistently. Getting off my soap box now. Go get 'em, searchers.

Off the diligence soapbox for a book recommendation. As we approach tomorrow's World Cup 2026 start wanted to encourage any soccer fan (and those that are soccer curious) to read Kuper's "Soccer Against the Enemy". It drives home how soccer is more than just a game to most of the rest of the world.

Recurring revenue sounds great until you find out 40% of it is actually one customer on a contract expiring in 90 days. Or that the 'recurring' fees are really project-based billings that happened to repeat. A Quality of Earnings report doesn't just validate the numbers — it tells you what the numbers actually mean. Get real diligence from a real provider. @Hollywellteam is a great choice for ETA/Traditional Search alongside our middle-market PE client base (I.e., large deals). Regardless of provider, make sure any that you're talking to give you a list of actual procedures they'll be performing and hold them to it.

Adding a 6th session to the Summer ETA Webinar Series on Quality of Earnings with @JermanMichael of @Hollywellteam. QofE is where deals quietly fall apart. Financials look clean on the surface, the searcher commissions a $5K "QofE Lite," and three months later the hidden customer deposits, the missing accruals, or the seasonality-masked AR shortfall surface in a way that kills the close. Mike, Managing Partner at Hollywell, has run PwC engagements from $200M to $40B in revenue, and has served as CFO of multiple PE-backed companies. He's been on our Deal Team and speaking at SMBootcamp for years, and this session opens that same conversation up to the broader searcher community on Wednesday, June 17 at 12:30 PM ET. See you there.

The seller believes in their business. That's their job. Your job is to believe in their financials — and those are two very different things. Passion doesn't make a customer contract renewable or guarantee deposits will turn into work. Confidence doesn't fix a working capital problem. Diligence does. Get real diligence, from a real provider, even if it's not @Hollywellteam. We shake our heads in derision and flat out just feel bad for buyers when we see some of the shiny "reports" others are putting out that don't have serious big firm diligence and audit CPA backgrounds.

Revenue is a story. Adjusted EBITDA is a pitch. A Quality of Earnings report is the truth. Sellers aren't typically lying — they genuinely believe in their numbers. But belief and accuracy aren't the same thing. Before you write a check, make sure you understand what's recurring, what's real, and what's been quietly smoothed over. And on a personal note, brokers in the smaller deal space aren't nearly on average a @JackieHirsch_. Others can be a hinderance to a deal and at worst lead to good deals being passed over.

Most deals don't fail at signing. They fail because no one looked hard enough at the numbers before signing. By the time problems surface — customer concentration, unsustainable margins, deferred maintenance, etc. — buyers are already in bed with the business. Financial due diligence isn't a formality. It's the work that separates a smart acquisition from an expensive lesson. Rebuttals we see on this, especially on maintenance CAPEX or CAPEX in general, typically revolve around "no one cares as it doesn't affect EBITDA". Cash flow is still cash flow. If a majority of a fleet of trucks for a home services business breaks down a month after close, bet potential searchers/buyers are not going to hi five as EBITDA isn't going to take a hit.

To address @EndresenHeather and my last soap box session, financial diligence should encompass the following regardless of deal size: Core financial/audit procedures (Not just a cash proof but beating up the entirety of the balance sheet and income statement with sampled testing, proofs of expenses and other higher risk items, AR and AP aging and reasonableness reviews) for multiple years Addback scrutiny and EBITDA bridge ranges and discussions alongside consideration of free cash flow (This is important as cash charges that don't affect EBITDA such as large CAPEX items you aren't aware of will need to replace/fix is still cash you'll need after close) Contracts, ICC, and off-balance sheet procedures Organization and tax structure considerations Working capital reconciliations and assessments as to the level of adjusted working capital needed alongside any hidden deferred revenue (AKA liabilities the seller should not be taking out of the bank account at close) Revenue concentration and quality of revenue/customer testing Cost of sales/inventory/fixed asset testing, if applicable (We'll also send you as buyers on-site armed with real inventory and fixed asset audit procedure templates to assess quality of both) Employee and 1099 contract and reasonableness testing List above is brief and certainly not the full list of procedures. Point is, make sure you know what you're getting. AGAIN, GET REAL DILIGENCE DONE GIVEN THE $M YOU'RE ABOUT TO POTENTIALLY SPEND.

No, equity distributions are not an add back. It's double counting of profits. We just hung up on a broker that kept insisting otherwise. Nonsense.

Day 2 of LIVE—Tampa focused on the nuances of deal structuring and due diligence. @SMB_Attorney of @smblawgroup walked the cohort through legal diligence and documentation. The three buckets of findings (deal killers, things to negotiate into the PA, things to fix post-close), why asset deals beat stock deals on successor liability, and the real reps and warranties framework SBA buyers actually live with. @JermanMichael and Adam Webster of @Hollywellteam ran through QofE. In their hundreds of engagements, can you guess how often they have seen EBITDA come in above the CIM? The QofE is your home inspector, and the line-by-line P&L review, WC scrub, and addback validation are what keep you from buying someone else's mess. @drew_eckman tore apart addbacks with his 3-part question protocol: (1) one-time or recurring, (2) will the expense exist post close, and (3) can it be documented. Read more in his past thread here: x.com/drew_eckman/status/198…. Drew, @sbabmarks, and I ran a live modeling scenario using our financial modeling template where small groups pitched an actual deal, trying to find the price and terms that work for all four parties at the table: buyer, seller, broker, and lender. Watching searchers wrestle with DSCR thresholds and seller note standby periods in real time is where the playbook clicks. Day 3 of Cohort #20 is officially underway.

Adam, our diligence leader, and I will be speaking @SMBootcamp_ again this week. Hands down the best way to kick deal information asymmetry's tail.

Translating LIV golf to a buy side target- yes it would be a diligence red flag to see overpaid contractors working 3/4 weeks having never generated positive gross margin let alone operating income. Come on back fellas let's see the best every week again.

Just leaving @SMB_ash. So many great searchers potentially making the leap. Enjoy the journey, it can be rough, but it certainly drives purpose and comfort zone expansion.

Before we start posting live updates (starting Wednesday), here is the rest of our lineup! Quite a few will be on the SMBash stage for the first time. As the word gets out about ETA and SMB ownership, folks that have been in this space for years step up to share their industry knowledge. So, who haven't we mentioned yet? Let's get to it! Jacob Hall will be our keynote speaker Friday morning! Don't sleep in! Following that we have a packed schedule, ending at 2:30 so attendees can make their way home for a restful weekend. Don't forget to look over your notes and reflect on everything you learned! Thanks to all of our amazing panelists, we can't wait to learn from you! @justinroffmarsh , Joseph Cabrera, @SuccessWithJake , @JermanMichael , Danny Payne, @chasemurdock , @SMB_Attorney , and @AdamMarkleySMB . More generous sponsors to mention too - more companies that believe in the power of sharing knowledge freely, @Hollywellteam , @smblawgroup , and Elite Video!

Good to see the turnout in Tampa and to celebrate with a crowd again. #PLinUSA #PremierLeagueLive

Diligence tip, there is no "QofE lite". It's just the same level of fact finding diligence we do for smaller deals. We're just bad marketers is all. Pick your provider based on real reputation and case studies, not an "X" account.

The @Hollywellteam is headed to @SMB_ash in April. We'll be the Debby Downers telling real stories on why diligence matters, but don't let it spoil the event. The SMBash and SMBootcamp team are doing the best job of getting real info to those in their search.

Kind of get the clapping after a good aircraft landing in wind. Clapping after a cruise ship emergency training session seems a bit much.