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A RocketLevel playbook for restoration owners thinking about where their business could fit in a consolidating market, backed by decades of experience in the trade. About a 9-minute read.
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Make your own copy: this is a spreadsheet you can copy and use. Open the spreadsheet. It opens a fresh copy in your own Google Drive, and you fill it in yourself.
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There is a companion page on this shelf for the owner who gets the call out of the blue: what to do when a private-equity buyer approaches you. This page is the proactive flip side. Capital has been flowing into restoration for years, and backed platforms are buying smaller, well-run companies as add-ons, the industry term is a bolt-on, to expand into new markets and services.
Being an attractive bolt-on is a profile you can understand and build toward deliberately. And whether or not you ever sell, the same work makes the business more profitable and easier to own today.
Many owners assume the buyers want size, and size helps, but it is rarely the deciding factor. What platforms are short on is clean, well-run, owner-independent companies in markets they want to be in. A $4M business that runs without its owner, has diversified commercial revenue, and keeps clean books is far more buyable than a $9M business that is one person's relationships, one person's head, and a shoebox of records. The real question is whether you are the kind of company a disciplined buyer can underwrite, integrate, and trust to keep performing after the founder is gone.
When a platform evaluates an add-on, it underwrites the same handful of things almost every time. Build toward these and you become the company they compete to buy.
This is the bolt-on-specific self-assessment: it scores whether you are the add-on a private-equity platform wants to buy. For the broader "are you ready to sell at all" view, across owner-independence, documented systems, and financial health, score yourself with the Exit-Readiness Scorecard.
1. Clean financials and earnings quality. Books a buyer can trust without a forensic dig: accrual-based statements, clear separation of personal and business expenses, documented add-backs, and earnings that hold up under scrutiny. Messy or aggressive books lower the price, and often kill the deal outright.
2. Owner-independence and management depth. The business runs without you. There is a management layer, documented operations, and someone other than the founder who holds the key customer relationships.
3. Diversified, commercial revenue. Revenue that does not depend on a single carrier, a single program, or a handful of accounts, with a real commercial book behind it. Buyers pay less for concentration, so measure it. Take your single largest customer, carrier, third-party administrator (TPA), or program, counted at the parent company, as a share of trailing twelve-month revenue. RocketLevel working thresholds: healthy at or under 10 percent, caution above 10 and up to 25 percent, and danger above 25 percent. Exactly 10 is healthy and exactly 25 is caution, so every share lands in one zone. Then run the stability question separately, because it is a different one: how many points of total revenue one realistic decision by that source could move (a rate cut, a routing change, a program ending). Circle anything above 5 points. Above 10 is not up for debate. Never substitute the stability reading for the share reading. Two sources can both sit at 12 percent while one is locked into a signed agreement and the other can cut your volume with a single routing change, and a platform will not treat those two books alike.
4. Geographic fit and density. You are in a market the platform wants, or you add density where they already operate. Sometimes geography alone makes an otherwise ordinary company strategically valuable.
5. Compatible systems. Software, processes, and data that can be integrated without ripping everything out. The easier you are to absorb, the more attractive and the lower the perceived integration risk.
6. Growth runway. A credible story for why the business keeps growing after the sale: an underpenetrated commercial market, services you have not yet launched, capacity to take on more. Buyers are paying for the years after the sale.
7. A strong safety and culture record. Low incident rates, real safety programs, and a team that is likely to stay. On commercial and institutional work especially, safety and retention are underwritten, not assumed.