Chirag Shah·February 20, 2023

How I bought a $2 Million Dog Training Business | Chirag Shah

Chirag Shah, a former SBA loan underwriter and product manager who joined Acquisition Lab to pursue ETA, acquired a Sit Means Sit dog training franchise resale in Austin, Texas in October 2022 for $1.71m — financed through an SBA 7(a) loan, a ~$300k seller note, and ~$200k equity from his real estate portfolio and HELOC. The business covered two territories, generated roughly $1.95m in revenue with ~$600k SDE in its 2021 banner year (normalized ~$525-550k), and came with an experienced general manager already in place. The deal was discovered through his systematic broker outreach process — serendipitously, Chirag and his wife had already considered using the same business as customers for their adopted dog. The franchise's unusually low fee structure (no royalties, only ~$1k/month territory fee) and the seller's robust Salesforce CRM system were major attractions. Chirag's tech and PM background lets him innovate on operations and systems within the franchise's loose business-practice constraints, while the franchisor supplies the proprietary e-collar training methodology. He is paying himself a reduced salary in year one, reinvesting profits, and is actively considering opening additional territories as demand builds in the spring and summer.

Deal facts

purchase price: $1.71m
multiple: ~3.1x SDE (on ~$550k normalized SDE)
sde ebitda: SDE ~$600k (2021 banner year); ~$500k in 2019/2020; normalized ~$525-550k
revenue: ~$1.95m (2021); ~$1.7-1.8m (2019/2020)
financing structure: SBA 7(a) loan + ~20% seller note (~$300k) + ~10% equity injection (~$200k from HELOC, rental income, family)
notes: Two territories in Austin, TX. Seller note was unexpected — required because trailing 12 months didn't fully meet bank requirements. Business included a general manager already in place. Seller (also a former product manager) started the franchise location 12 years prior.

Why this business

Chirag and his wife had already looked at Sit Means Sit's Austin website as prospective customers for their newly adopted dog, and had noticed how happy and profitable the business seemed. When the listing appeared in his deal flow, recognizing the exact company felt serendipitous. Beyond the coincidence, he was drawn to the low franchise fee structure (no royalty, only ~$1k/month territory fee), the high SDE margin, the existing general manager, Austin's growing affluent population, and the fact that the franchise gave him training methodology while leaving business operations and systems wide open for his own innovation.

What's working

High contribution margin (~70%) on training packages ranging from $800 to $3,000
Existing general manager who is highly tactical and a great cultural fit, freeing Chirag to focus on growth and systems
Franchise structure with very low fees (no royalty, ~$1k/month territory fee) maximizing profitability
Proprietary Salesforce CRM instance built by the seller, which they also re-sell licenses to other franchisees in the network
Austin's migration of affluent residents increasing demand for premium pet services
Seller remains reachable for technical questions and has been a strong transition partner
Founder-owned franchisor (Sit Means Sit) with direct access to founders, rather than private equity-owned
Rotating trainer model between two locations allows flexible capacity scaling

What's hard

Q4 is seasonally slow for discretionary service businesses, constraining near-term demand
Trainer capacity is a bottleneck — opening a new territory requires hiring more trainers first
Seller note was unexpected and required to bridge a shortfall in trailing 12-month financials that the bank needed
Chirag is paying himself a small salary well below his prior PM compensation
Previous seller attempted multi-location expansion (San Antonio, Seattle) prematurely without the right systems, suggesting scaling risk

Notable quotes

I opened the listing and it was actually a dog training company that my wife and I had considered literally using for our most recently adopted dog. We fostered a dog that we really loved and we wanted to get him trained and this was like — it was funny because when we were reviewing this website we're like oh wow like how great would it be to like be these owners.

He was a product manager he used to be a product manager so he acquired — he as a franchise he started like this specific location 12 years ago after becoming disengaged as a product manager and so like immediately him and I hit it off.

The only fee that I pay is like a territory fee and it's like a few hundred dollars a territory and that's it — there's no royalty fee there's nothing like that so my fee is around a thousand dollars a month.

I'm an extremely — it's like I'm pretty aggressive when it comes to like experimenting and growth and like trying to move the ball forward but I'm very conservative when it comes to like estimating expenses.