Growth Through Acquisition
Many business owners dream of growing their business, but not everyone considers doing it by acquisition. In a recent Olive Insights podcast episode, Sarah Petty sat down with Kerrie McGilvray, founder of The Admin Superheroes and the new owner of Virtually Yours, to talk about her firsthand experience buying a business.
Why Buy Instead of Build?
For Kerrie, the idea of buying a business wasn’t always on the radar. But after attending a business summit, she was introduced to the concept of growing through acquisition. Rather than spending years building something from scratch, why not step into a business that’s already established with clients, a brand, and revenue?
That lightbulb moment led Kerrie to start reaching out to people in her network. One conversation turned into a serious opportunity, and just eight weeks later, Kerrie had acquired Virtually Yours, a well-known virtual assistant community.
The lesson? Business acquisition doesn’t always start with a formal plan. Sometimes, it begins with curiosity and a well-timed conversation.
The Power of Strategic Fit
What made this acquisition so successful was the strategic alignment between Kerrie’s existing business (The Admin Superheroes) and Virtually Yours. While the two serve different audiences, they complement each other perfectly. One focused on delivering admin support, the other on developing and mentoring virtual assistants.
This type of strategic fit, known as vertical integration, allowed Kerrie to expand her reach while strengthening both arms of her business. Whether you’re acquiring a competitor or a complementary business, the key is to understand why you want to acquire a new business. What role will the new business play in your overall growth strategy?
To Integrate or Not to Integrate?
One of the biggest decisions after acquiring a business is whether to integrate it into your existing operations. Kerrie chose not to. Why? Because the two brands had distinct identities, audiences, and offerings. Integration might have created confusion or diluted each brand’s message.
Her advice: if the businesses serve different purposes, it might be best to keep them separate. On the other hand, if you’re acquiring a direct competitor or a very similar business, integration might be necessary to streamline operations and avoid duplication.
Communicating with Clients and Team Members
How you communicate an acquisition can make or break client and staff retention. Kerrie took a thoughtful approach by easing into the Virtually Yours community during due diligence, before the deal was even finalised. This gave members time to get used to her presence.
When it came time to announce the acquisition, the previous owner introduced Kerrie to the community, endorsing her publicly. This helped preserve trust and continuity, showing clients that the legacy would continue.
Whether you're acquiring a business or selling one, that personal handover can make all the difference.
The Due Diligence Checklist
Acquiring a business requires careful review. Kerrie’s top recommendation is to do your due diligence.
Here are some key items to check:
Financials: Review the past three years of financials, including revenue, margins, profit, and cash flow. Watch for “add-backs”, those adjustments sellers make to normalise earnings, and validate whether they’re legitimate.
Customer risk: Look for over-reliance on a few large clients. If one client represents 50% of revenue, their departure could be disastrous.
Team and culture: Numbers can look good on paper, but culture is harder to see. Understand the dynamics of the team you’re inheriting and whether there’s any risk of key people leaving.
Liabilities and contracts: Know what debts, obligations, or pending issues you might be taking on.
Business value: Don’t accept the seller’s price at face value. Do your own valuation or engage a professional.
Funding and Deal Structure
You don’t always need a large sum of cash to buy a business. Kerrie encourages creative deal structuring, such as payment plans, earn-outs (where the seller stays involved and gets paid based on performance), or using the business’s own profits to fund the purchase.
The key is understanding why the owner is selling and finding a solution that works for both parties. In some cases, you might pay off a loan on their behalf or stagger payments over several years.
Is acquisition the right step for you?
Before acquiring a business, make sure your own business is stable and not reliant on you day-to-day. If you're still in the weeds of daily operations, it will be hard to focus on managing the new business effectively.
Most importantly, don’t let emotion drive your decision. Even if a business seems like the perfect fit, the numbers and risks need to stack up. There will always be another opportunity if this one isn’t right.
Preparing to buy a business is just as important as preparing to sell one. Get clear on your strategy, do the work to understand the deal, and don’t be afraid to ask for help from experts like lawyers, accountants, and virtual CFOs.
Because if done right, acquiring a business can be one of the most powerful ways to accelerate your growth.