Matt Bauer, Chris Hartman·August 29, 2024

Exited But Tired: Reflections on 5 Years in a Hard Business | Matt Bauer & Chris Hartman Interview

Matt Bauer and Chris Hartman, two Army veterans who met on deployment in Kandahar, launched a partnered self-funded search from Charlotte in 2017 and acquired American Scale Company — an industrial weighing equipment service and distribution business in the Carolinas — along with a smaller sibling welding entity, for roughly 3.5x on approximately $1.5m in EBITDA using an SBA loan with outside equity investors. Over five years they more than doubled revenue from $5m to over $10m through relentless greenfield sales, early digital marketing adoption, and geographic expansion, while professionalizing an operationally analog business. The core challenge was the business's mission-critical, never-sleeping nature: emergency scale repair calls arrived around the clock every day of the year, routing technicians across a multi-state territory and pushing both founders toward burnout. After a transformational competitor acquisition fell through in early 2023, they sold to a financial sponsor-backed strategic acquirer in July 2023 for an eight-figure exit, delivering strong returns to themselves and their investors. Both now operate 12 South Capital Partners, investing in self-funded search deals primarily in Southeast B2B industrial services.

Deal facts

multiple: ~3.5x EBITDA
sde ebitda: ~$1.5m EBITDA at acquisition (underwrote around $1.5m; actual was a little lower)
revenue: $5m at acquisition; grew to over $10m at exit
financing structure: ~75% SBA loan + equity from founders and outside investors (Matt and Chris were largest equity contributors)
notes: Two businesses acquired together: American Scale Company (~85% of revenue) and American Welding Service (~15%). Exit in July 2023 to a strategic acquirer (financial sponsor-backed platform); described as an eight-figure exit. Investors also co-invested alongside founders.

Why this business

Matt had stumbled across a similar weighing business a few months earlier and thought it was a really cool industry. When American Scale came up for sale in Charlotte, it hit all their criteria — B2B industrial services, Southeast geography, over $1m in EBITDA, owners with military backgrounds who saw themselves in the buyers. Chris said when you see something you have a good feeling about, you just have to move quickly.

What's working

High-growth geography (Charlotte/Carolinas) with constant greenfield industrial development bringing in new factory customers who had no existing scale vendor
Symbiotic recurring revenue model: sell equipment, then service and calibrate it for the lifetime of the asset
Strong revenue quality — mission-critical, non-discretionary spend; customers call at any hour because downtime is extremely costly
Consistent ~15% annual revenue growth compounding to more than 2x over five years with no single massive spike
Digital marketing early mover advantage: basic website with SEO and paid search delivered outsized returns because competitors were doing nothing
Cultivated a young, technically capable workforce (average age under 30) that could grow with the company
Built out a service manager layer and grew a technician into a branch general manager, providing operational resilience
Aggressive greenfield sales approach — cold calling new facilities, driving around, showing up — differentiated them from incumbents

What's hard

The business never sleeps: every after-hours service call from 4pm to 7am for five years went to Matt and Chris's cell phones, including holidays and middle-of-the-night emergencies
Controlled chaos operationally — daily technician schedules changed five times a day as emergency break-fix calls rerouted crews across a large multi-state geography
Mission-critical nature is a double-edged sword: great revenue quality but means customers demand immediate response at all hours
Extreme technical complexity — no training pipeline exists for scale technicians; certifications required for CDL trucks; had to rely on manufacturers for training programs
Burnout: both founders were on the path to burnout, with their minds never truly off the business, which took a toll on family and personal health
Attempted GM hire two and a half years in failed when the individual left six months into training, leaving a gap in the management layer
Acquisition of a competitor (planned as a transformational step) died a month from close in March 2023, forcing a fork-in-the-road decision
Growing the business amplified operational stress — every new sale meant more service obligations and more complexity to absorb
Accounting was rudimentary at acquisition, making QofE difficult and spooking some less-experienced investors
Broker process was prescriptive and poorly adapted to self-funded search structures, slowing the close

Notable quotes

I looked at my income like a Government Bond. Short of me doing something negligent and deserving to be fired or some catastrophic event like a Covid, as a W2 employee it's relatively risk-free. But at the end of the day I was billing hours ultimately the way that I looked at it.

Every after-hours call from pretty much 4:00 PM till 7:00 AM for five years straight went to Matt and I's cell phone no matter what day of the year. We had a service call this Fourth of July.

It was like a five-year deployment — except you could go home at the end of the night instead of go back to your little metal container you were sleeping in and you could see your kids. But your mind was never off the business. It was always forefront and that was a real challenge.

The industry and the employees are really the heartbeat of this country. Getting back and spending time with folks that work with their hands and get to actually physically do something that provides value that's tangible and you can see and feel was just a really good feeling.