Roll-Up Strategy Guide - The Blueprint System

The Roll-Up Arbitrage

Buy small companies at 2.5-3.5x EBITDA
Combine and optimize operations
Sell platform at 5-7x EBITDA
Result: 2-3x value creation in 3-5 years

The Roll-Up Math That Makes Millionaires

Real Example: HVAC Roll-Up

Company	Revenue	EBITDA	Purchase Price	Multiple
Company A (Platform)	$2.0M	$300k	$900k	3.0x
Company B	$1.5M	$200k	$500k	2.5x
Company C	$1.0M	$150k	$450k	3.0x
Company D	$0.8M	$100k	$250k	2.5x
Company E	$0.7M	$80k	$200k	2.5x
Total Acquired	$6.0M	$830k	$2.3M	2.77x

Post-Integration Results:

Combined Revenue: $6M → $7M (organic growth)
EBITDA Pre-Synergies: $830k
Cost Synergies: $370k (45%)
Revenue Synergies: $200k
Pro Forma EBITDA: $1.4M (20% margins)
Exit Multiple: 5.5x
Exit Value: $7.7M
Return: $5.4M profit (235% in 3 years)

Phase 1: Platform Acquisition (Months 1-6)

Choosing the Right Platform

Must-Have Criteria:

$1.5-3M revenue (big enough to support overhead)
Strong local reputation
Good systems in place
Management team willing to stay
Geographic expansion potential

Nice-to-Have:

Unused capacity (trucks, warehouse)
Strong digital presence
Multiple service lines
Commercial + residential mix

Phase 2: Integration Playbook (Per Acquisition)

30-Day Integration Sprint

Week 1: Stabilize

Day 1: All-hands meeting, no layoffs message
Day 2-3: Key employee retention bonuses
Day 4-5: Customer communication
Day 6-7: Vendor notifications

Week 2: Analyze

Map customer overlap
Identify redundant costs
Review all contracts
Assess technology systems

Week 3: Optimize

Eliminate duplicate functions
Consolidate vendors
Cross-sell customer bases
Standardize pricing

Week 4: Integrate

Unified branding rollout
Combined routing/scheduling
Centralized admin functions
Performance tracking

Synergy Identification & Capture

Cost Synergies (Quick Wins)

Synergy Type	Typical Savings	Timeline	Example
Duplicate Management	$100-200k	30 days	1 GM vs 2
Facility Consolidation	$50-100k	90 days	1 warehouse vs 2
Insurance/Benefits	20-30%	60 days	Group buying power
Marketing Efficiency	40-50%	30 days	1 agency, 1 budget
Vendor Consolidation	15-25%	60 days	Volume discounts
Admin Staff	$75-150k	30 days	Shared services

Revenue Synergies (Longer Term)

Cross-selling: 10-20% revenue lift
Geographic infill: Density improvements
Best practices: Lift underperformers
Pricing power: Market leadership

Financing the Roll-Up

Capital Stack Strategy

Platform Acquisition:

SBA 7(a): 75% of purchase price
Seller note: 15% (standby)
Your equity: 10%

Add-On Acquisitions:

Asset-based credit line: 50-60%
Seller financing: 20-30%
Cash flow from platform: 20-30%

Alternative Structures:

Revenue share deals for distressed
Earnouts for growth stories
Equity rolls for key targets

Target Identification System

Building Your Pipeline

Sources Ranked by Success Rate:

Vendor Intel (30% close rate)
- "Who else do you sell to?"
- "Any customers struggling with payments?"
Customer Defection (25% close rate)
- Lost bid analysis
- "Who did you go with?"
Industry Associations (20% close rate)
- Board gossip
- Conference conversations
Direct Outreach (10% close rate)
- Tax assessor data
- Aging owner lists

Common Roll-Up Mistakes

⚠️ Avoid These Pitfalls

Moving too fast: Integration debt compounds
Overpaying for synergies: Pay for what exists, not potential
Cultural mismatches: Cowboys vs. corporate
Geographic spread: Density drives margins
Keeping bad revenue: Fire unprofitable customers
Founder dependency: Buy systems, not heroes

Technology & Systems Integration

The Tech Stack That Scales

Function	Recommended Platform	Cost	Integration Time
Field Service	ServiceTitan	$300/tech/mo	60 days
Accounting	NetSuite	$1,500/mo	90 days
CRM	HubSpot	$800/mo	30 days
HR/Payroll	ADP Workforce	$6/employee	30 days
Marketing	Unified platform	$2,000/mo	45 days

ROI: 20-30% efficiency gain within 6 months

Exit Planning for Roll-Ups

Value Creation Timeline

Year 1: Foundation

Platform + 2 add-ons
Basic integration
Value: 3.5x EBITDA

Year 2: Scale

3-4 more acquisitions
Full synergy capture
Value: 4.5x EBITDA

Year 3-4: Polish

Organic growth focus
Management team complete
Technology fully deployed
Value: 5-6x EBITDA

Year 5: Exit

Strategic buyer courtship
PE platform potential
Value: 6-7x EBITDA

Case Study: Landscaping Roll-Up

From $2M to $15M in 4 Years

Starting Point (2019):

Bought ABC Landscaping: $2M revenue, $200k EBITDA
Price paid: $600k (3x)
45 commercial accounts

Roll-Up Execution:

2019: Added 2 competitors ($1.5M revenue)
2020: Added 3 more ($2.5M revenue)
2021: Geographic expansion ($3M revenue)
2022: Final optimization year

Results:

Combined revenue: $15M
EBITDA margin: 18% ($2.7M)
Exit multiple: 5.5x
Sale price: $14.85M
Total invested: $3.2M
Profit: $11.65M (364% return)

The Roll-Up Scorecard

Track These KPIs Monthly

Metric	Target	Why It Matters
Integration costs/revenue	<3%	ROI protection
Customer retention	>90%	Value preservation
Employee turnover	<20%	Knowledge retention
Synergy capture %	>80%	Thesis validation
EBITDA margin trend	+2%/year	Multiple expansion
Acquisition pipeline	10x needed	Selectivity

Advanced Roll-Up Strategies

The "Hub and Spoke" Model

Keep acquired brands in their markets while centralizing:

Finance and accounting
HR and benefits
Marketing and lead gen
Vendor relationships
Technology platforms

Result: Local trust + scale economics

The "Tuck-In" Strategy

Buy customer lists and assets only:

Skip the entity/liability
Cherry-pick best customers
Leave unprofitable behind
60-70% discount to full price