Buy-and-build

One platform and the companies that make it stronger.

For your thesis I find the company a group can be built on. Then the add-ons it is missing. Owner-managed, in the DACH Mittelstand, outside of auctions.

30 minutes on your thesis

Example platform · maintenance, based in StuttgartSites

Stage 00Platform, 6 sites in Baden-WürttembergBase
Stage 01Refrigeration, Bavaria+3
Stage 02Ventilation, North Rhine-Westphalia+2
Stage 03Building automation, Saxony and Thuringia+3

Example platform. Austria and Switzerland are still open; there is no target number of acquisitions.

What buy-and-build is

Four companies, one back office. Each keeps its core business.

An investor buys a platform and adds acquisitions. Quality, back office, purchasing or IT is then done once by the group for everyone. Team, customers and name stay local. My work sits at two points of this: I find the platform and I find the add-ons.

2418126

Admin functions, per companyshared across the group

01
Each company on its own
Four companies, each with its own back office. Together that is 24 functions.
02
The add-ons hand over
One add-on after another hands quality, back office, purchasing and IT to the platform.
03
One back office for all
Six functions now carry 14 sites. Team, customers and name stay local.

Group · structureExample platform from above, three add-ons

Platform

Maintenance & repairCore · 6 sites

QMQuality management

Back officeBack office

SalesSales

PurchasingPurchasing

RecruitingRecruiting

ITIT

Add-on 01

RefrigerationCore · 3 sites

QMQM

Back officeBack office

SalesSales

PurchasingPurchasing

RecruitingRecruiting

ITIT

Add-on 02

VentilationCore · 2 sites

QMQM

Back officeBack office

SalesSales

PurchasingPurchasing

RecruitingRecruiting

ITIT

Add-on 03

Building automationCore · 3 sites

QMQM

Back officeBack office

SalesSales

PurchasingPurchasing

RecruitingRecruiting

ITIT

Core block height by number of sites. The functions are the same as in the group section on the home page.Example, not a real group

What makes a company a platform

Whether a company can carry a group shows when a site is added.

Two good companies, the same acquisition. In one, everything lands with the owner; in the other, it has a place. That is what I look at before I propose a company as a platform.

01
A site is added
Both companies buy the same business with one site.
02
Where it docks on
At company A directly to the owner, at company B under the head of sites.
03
What it means for the owner
At A the owner now has nine direct lines; at B it stays at three.

Company A · everything with the ownerExample

Reporting directly to the owner89

Systems the site must connect to4

Acquisition relative to the company60 %

A good company, not a platform. Often exactly right as an add-on for another group.

Company B · second management layerExample

Reporting directly to the owner3

Systems the site must connect to1

Acquisition relative to the company20 %

Can carry a group. The site has a place; the owner stays free for the next decision.

Two example companies on the same scale. Your thesis sets the size at which a platform is large enough.

What makes a good add-on

An add-on does not need to do everything. It needs to fit the gap.

Gaps open

01
The profile shows three gaps
Bavaria, refrigeration and healthcare are missing from the platform today.
02
One candidate fits two
A refrigeration firm with three sites in Bavaria whose owner is looking for a successor.
03
One gap remains
Healthcare becomes the next search.

Platform profile · stage 00Maintenance, based in Stuttgart

Region · sites

Baden-Württ.6

Bavaria0+3

NRW0

Central Germ.0

Service · revenue share

Maintenance58 %

Repair42 %

Refrigeration0new

Ventilation0

Customers · revenue share

Industry55 %

Commercial30 %

Public sector15 %

Healthcare0

The candidate closes Bavaria and refrigeration in one step. Healthcare remains open and becomes the next search.

Candidate · short profileExample

GmbH

Service: Refrigeration
Sites: Augsburg, Munich, Nuremberg
Customers: mostly industrial
Leadership: Owner, succession open
Systems: provided by the platform

closes 2 of 3 gaps

The same example platform as on the map above. In a real mandate, axes and values come from your platform's figures.

Where the model works

Each of my sectors has a typical platform and typical add-ons.

REGIONnew territory, same service
SERVICEnew service, same customers
CUSTOMERSnew customer segment

SectorPlatformAdd-ons

Names from my sector pages, combinations as examples. Each row leads to the sector.

Outside of auctions

I approach the owner before anyone sets up a sale process.

Then one investor sits at the table, not a bidding round. There is no teaser and no timetable, just the question of whether your thesis fits the company.

01
The owner is thinking it over
Succession is on the table, a sale is not yet decided.
02
Your investor joins
I approach the owner about your thesis before an adviser is engaged.
03
The auction would come later
With a teaser and bidding round, many buyers share one timetable.

An owner's path to a saleschematic, no time scale

Where you are now

Buy-and-build is not a separate service. It is two, depending on whether your platform is already in place.

You are looking for the platformSearch mandate I look for the one company your group starts with. With a second management layer, systems and enough size.The platform is in placeAdd-on sourcing I look for the companies that close a gap in your platform. Region, service or customer segment.

From the first conversation between you and the owner, you lead. Valuation, due diligence and contract run with your advisers.

Market figures, typical acquisition mistakes and sources (in German) are on dealorigination.de/buy-and-build

Frequently asked questions

Buy-and-build, briefly answered.

What is a buy-and-build strategy?

In a buy-and-build strategy an investor buys a platform and grows it into a group through several add-on acquisitions. Quality, back office, purchasing and IT are run centrally; the add-ons keep their team, customers and name.

What distinguishes a platform from an add-on?

A platform needs a second management layer, systems that can carry further sites and enough size for add-ons to stay small beside it. An add-on does not need any of that. It should close a gap in the platform's region, service or customer segment.

How do you find platforms and add-ons outside of auctions?

I approach owner-managed companies in the DACH Mittelstand directly, before any sale process starts. I always work exclusively for one investor with a specific thesis, so there is no teaser and no bidding round.

In which sectors does buy-and-build work in the Mittelstand?

The model works where many small providers deliver recurring services and customers want one partner across sites. In my work that means buildings and infrastructure, business services, healthcare and medtech, industrial tech and automation, software and IT, and environment and energy.

Do you also handle valuation, due diligence and closing?

No. My work ends with the first conversation between you and the owner. Valuation, due diligence and contract run with your advisers.

Conversation

30 minutes on your thesis.

Tell me which platform you are looking for or which gap your platform has. That is all I need for a first conversation. Afterwards I will tell you openly whether I can help.

Book a call

Or write to me at deals@sourcingclub.de

Your thesis · call notefour lines are enough

Sector: Building automation & MEP
Platform: in place, based in Stuttgart
Gap or goal: Refrigeration, Bavaria
Region: Germany, later Austria

Examples. Your thesis stays with me.enough for 30 minutes