The best acquisition targets aren't listed, they're quietly closing.

TL;DR: Operators treat "find a business to buy" as a search problem, scrolling listings and waiting for a broker's email. Two better sources sit in plain sight instead. Comparable companies in your industry already show what's worth buying if you read their acquisition history, and by the Census Bureau's count more than half a million employer businesses close every year, plenty of them doing fine, with an owner who is retiring or burned out rather than failing, and nobody asking those owners a real question. The sellers aren't hiding, nobody's looking in the right two places.

Ask most operators how they'd find a business to buy and you get the same answer: a broker, a listing site, maybe a banker who calls when something fits. It's treated as a search problem, the way you'd search for office space or a new vendor. You wait for the market to present you with options, then you pick.

That instinct misreads what deal sourcing actually is. It isn't a search problem. It's a pattern-recognition problem, and the patterns are already sitting in public view. Most operators never look at them because the listing model trained them to wait instead of watch.

Here's a method I've written up and walk people through directly. Find a publicly held company in your own industry, or the largest one you can name if there's no public comparable, and favor one big enough to show up in acquisition databases like Crunchbase. Then Google that company's name plus the word "acquisitions." Read what comes up.

We ran this as an exercise using an accounting firm as the example. Searching "Deloitte acquisitions" turned up Deloitte's own page about its acquisitions and investments. Searching Deloitte in Crunchbase at the time showed 39 acquisitions. The pattern isn't subtle: Deloitte acquired an app and CRM business, a cloud service business, and a Salesforce integration business. None of those are accounting firms. All of them are adjacency acquisitions, things Deloitte's own clients already needed, bought so the referral can happen inside the firm instead of going out the door.

That's the whole method. You're not trying to buy what Deloitte bought. You're trying to see what question Deloitte was asking when it bought them: what else can I sell to a client I already have, and does it make sense to own those companies so the cross referrals happen in house? Once you can name that question for your own industry, you have a target list before you've opened a single listing. And a smaller signal precedes the big one: comparable companies often make a small investment before an acquisition, so their investment history tells you what they're circling before they buy it.

The second source is bigger and even less contested. In Zero Down I put the number at roughly 595,000 businesses closing every year, and the official count lands in the same neighborhood. The Census Bureau's Business Dynamics Statistics show 523,958 employer firms closed in the year to March 2023, the most recent year published, up from about 450,000 the year before. Count locations instead of companies and it's closer to 700,000.

What matters more than the exact figure is what it's made of. These aren't all businesses that failed. Some of them are doing well. The owner is retiring and there's no relative or friend who wants to run it. The owner is burned out and just wants out, no crisis required. Relocation, health, a partnership that stopped working, the death of the owner in an owner-operated business, a business that got chased by shiny object syndrome, or simply an owner who started thinking about selling because the economy was up. None of those reasons show up in a listing. None of those owners called a broker. They just quietly wound the business down, because nobody ever asked them a different question at the right time.

That's the opportunity most operators never see, because they're only watching the market that already advertises itself.

Put the two together and the pattern is the same in each case: the good targets aren't hiding, they're just not asking to be found. The comparable-company method works because a big acquirer already did the pattern-recognition for you and left the evidence public. The closures pool works because an owner who's checking out has every reason to say yes to a real conversation, and almost nobody's having it with them.

Both point back to the same gap in how you're built for growth. If there's a hole in what you currently offer, something your own clients already need and you currently refer away, that's the filter. Look at what a comparable acquirer bought to close a gap like yours. Look at who's quietly closing in categories adjacent to your own. The businesses worth buying were never advertising it. They were just sitting where nobody thought to check.

When we work with an operator who's stuck sourcing acquisitions off cold listings, the first move is the same one from this piece: name your own comparable, and read its acquisition list before you read another broker email. Then build the closure side of the pipeline deliberately, not accidentally, by having a real conversation with owners in your category who are quietly approaching an exit for reasons that have nothing to do with the business being for sale.

Neither of those is a database to buy or a service to hire. They're a habit of looking somewhere different than everyone else is looking, and the operators who source deals well are the ones who build that habit early.

If you're not sure where your own adjacencies actually are, the Acquisition Wheel walks through the categories worth scanning for your specific business, free, in a few minutes.

— Roland

If I had to rebuild my 1000+ deal portfolio from scratch with $0 in the bank, step one isn't finding money. It's finding a boring niche.

Nothing exciting. Nothing glamorous. A profitable service business in a category with thousands of small owner-operated shops.

Auto repair. Sign shops. HVAC. Dental. Fitness.

Founder-run is the whole point. Thousands of owners means thousands of conversations nobody else is bothering to have.

That's the same pool this piece is about, and it's step one for a reason.

Want the full breakdown? Read the post.