Our conversation with Evan delved into the often-overlooked world of small and medium-sized business acquisitions, the hidden challenges of traditional brokerage models, and the transformative potential of technology in this space.

Bridging the Gap: The Mission of Biz Retire

Evan highlighted a critical, yet often unaddressed, problem: 80% of businesses in the United States never sell. He believes this largely stems from a disconnect between sellers and suitable buyers, especially for businesses with under $2 million in revenue. Biz Retire aims to bridge this gap by directly connecting these parties.

The buyer pool for Biz Retire is incredibly diverse, ranging from large private equity firms and venture capitalists to individuals working traditional nine-to-five jobs who are looking to embark on their entrepreneurial journey. This broad spectrum of buyers underscores the varied motivations and resources driving business acquisitions today.

What Do Buyers Look For? Beyond the Brand

When evaluating a business for acquisition, Evan emphasized that investors, particularly those targeting smaller businesses, prioritize cash flow. Buying a business often involves significant loans, and the acquired entity must generate enough profit not only to cover debt servicing but also to absorb potential costs like employee turnover or supplier changes during the transition. A strong reputation, future viability, and a robust financial standing are paramount. While a distressed business might be an option, it requires a very specific type of buyer with the expertise to turn it around.

We discussed the trend of startups burning money for branding and scalability, often with negative cash flow. Evan noted that while brand value is important, the likelihood of success for an established business (5, 10, even 15 years old) is significantly higher than for a startup. Established businesses come with existing customer bases, brand recognition, and a proven track record – a robust foundation that startups inherently lack. This makes established businesses financially attractive to buyers looking for less risk and a more immediate return.

More Than Just Selling: The Untapped Potential of Business Owners

The name "Biz Retire" might initially suggest individual retirement planning, but Evan clarified that the platform's vision extends far beyond a simple transaction. He identified a significant gap in the market: a lack of education and options for business sellers. While the buyer side is seeing a surge of new entrants, sellers often feel their only recourse is to sell through a traditional business broker or simply close their doors.

Evan introduced the concept of a "triangle": buyers, sellers, and advisors. He believes that many business owners, rather than selling, could benefit from consulting with advisors to explore alternatives. For example, a successful owner who has run a business for decades might consider hiring an executive team to manage operations, allowing them to collect a paycheck without the day-to-day demands.

Biz Retire aims to disrupt the traditional broker model. Brokers typically charge hefty commissions (5-20% on a million-dollar sale, or $50,000-$200,000) for simply listing a business, often employing a "list it and leave it" approach with a low success rate (only 20% of listed businesses sell). Biz Retire, conversely, offers a low monthly listing fee, allowing sellers to retain more capital. This extra capital can then be invested in hiring legal counsel, accountants, and other professionals for thorough due diligence, rather than paying a substantial commission to a broker.

Evan argued that a direct connection between buyer and seller (facilitated by Biz Retire) streamlines negotiations, fosters better relationships, and potentially leads to more favorable terms for both parties, as the "broker's cut" is removed from the equation. He trusts that intelligent business owners and buyers can navigate due diligence with expert assistance, without the need for an expensive intermediary.

The Future of Business Brokering: AI and the "Failure Tax"

Our conversation naturally turned to the role of technology and AI in business acquisitions. While AI is currently used to identify potential sellers, Evan noted a hurdle: the baby boomer generation of business owners, often less tech-savvy and wary of cold outreach, lacks trust in AI-driven approaches.

However, Evan strongly believes that mediocre or bad business brokers will eventually go extinct, primarily due to technology. He sees platforms like Biz Retire, which combine the best aspects of listing platforms and traditional brokering without the high commissions, as the future. As buyer and seller populations become more tech-literate, they will recognize that the value traditional brokers bring doesn't justify the exorbitant fees.

Evan introduced the concept of a "failure tax": since brokers only successfully sell 20% of their listings, the successful sellers end up subsidizing the time and effort spent on the 80% of failed listings. This unfair burden on successful businesses will eventually drive owners away from traditional models, shifting the tide towards more results-oriented, tech-driven solutions. Evan hopes Biz Retire will be at the forefront of this industry transformation.

Vision for the Future: Serving the Underserved and Disrupting Norms

Evan's vision for Biz Retire over the next 3-5 years is ambitious. He aims to create valuable tools for owners, particularly focusing on the "underprivileged population" of businesses generating under $2 million in revenue. This niche, though underserved, represents 97% of all U.S. businesses.

Future tools include a "reverse mortgage" concept, allowing owners to understand the cash flow implications for a buyer financing the business at their desired price. He also envisions a robust referral program connecting owners, advisors, and buyers, along with other innovative initiatives designed to challenge existing industry standards.

Advice for Sellers and Buyers

Evan offered poignant advice for both sellers and buyers:

• For Sellers: View your business as a product you're packaging for sale. Focus on making it as attractive and valuable to the buyer as possible, rather than dwelling on your personal investment or emotional attachment. Also, critically evaluate if selling is truly necessary. Could you hire an executive team to run the business while you enjoy a comfortable retirement, keeping the business within the family?
• For Buyers: While acknowledging the trend of private equity and venture capital acquisitions, Evan expressed a personal hope that businesses remain in the hands of small business owners who care about their communities. For individuals with executive experience and capital, he advised them to thoroughly understand the buying process, get their financials in order, identify clear objectives, and consider working with advisors or taking classes to become a competitive and serious buyer in the market.

Evan Poling's insights underscore a powerful shift in the landscape of business transitions. His vision for Biz Retire is not just about facilitating transactions, but about empowering business owners with more options and fairer processes, ultimately fostering a more vibrant and accessible market for small and medium-sized enterprises.