Niche Home Inspection Business
This acquisition involved a niche home inspection company operating in the Pacific Northwest, specializing in residential property inspections, sewer scope evaluations, radon testing, thermal imaging, and pre-listing assessments. The company was well known in its metropolitan region for high-volume transaction-based services and had strong embedded relationships with top-producing real estate agents and brokerages. With annual revenue of $1.8 million and adjusted EBITDA of $420,000, the business offered a lean operational model, with minimal fixed overhead and strong gross margins driven by a network of subcontracted inspectors, a licensed general manager, and limited physical infrastructure.
The seller, a former general contractor who had transitioned into inspections nearly 12 years ago, had scaled the business using a volume model driven by agent referrals, online scheduling, and automation. At time of sale, the company completed over 2,200 inspections annually and maintained a net promoter score (NPS) of 94. It operated with five 1099 inspectors, one full-time W-2 administrative coordinator, and the seller in a part-time operational role. The business was entirely remote, with cloud-based scheduling, payment processing, and inspection report generation through the Spectora platform.
The buyer, a former regional operations director in the pest control space, identified the inspection business as a strategic entry point into real estate services, with the goal of expanding to other transaction-adjacent offerings such as pest control, mold testing, HVAC service plans, and pre-renovation consulting. The business was acquired for $1.25 million, reflecting a 2.97x EBITDA multiple, with terms that accounted for seasonal revenue concentration and required normalization for SBA underwriting. The structure included 75% SBA 7(a) financing ($937,500), 10% equity injection ($125,000), and 15% seller financing ($187,500) amortized over five years and contingent upon revenue consistency during the first 180 days post-close.
A core challenge in structuring the transaction was seasonality. The company experienced steep volume spikes during the spring and summer housing booms, with monthly revenue often 2.2x higher than winter months. To address this, the parties engaged a third-party accountant to normalize earnings over a rolling 24-month basis, stripping out anomalies related to extreme weather, market slowdowns, and COVID-related distortions. This normalization allowed lenders to underwrite based on reliable trailing averages, rather than overstated seasonal peak periods.
The seller note included a six-month revenue consistency clause, whereby failure to achieve at least 90% of the trailing 12-month average in gross inspection volume in any three-month period during the first six months post-close would trigger a note principal reduction of 30%. This clause gave the buyer downside protection in the event of client churn or market contraction, while incentivizing the seller to ensure a smooth referral transition.
To preserve the business’s referral ecosystem, the buyer and seller executed 12 distinct “Referral Transition Agreements” with top agents and brokerage teams. These documents were non-binding letters of intent whereby agents agreed to continue recommending the company in exchange for VIP scheduling, post-inspection walkthroughs, and co-branded client education packets. These agreements were not tied to revenue sharing (which would violate RESPA regulations), but rather structured as marketing partnerships and ongoing professional services arrangements. This formalization of informal referral relationships proved critical in retaining volume and winning lender approval.
From a legal standpoint, the transaction was executed as an asset purchase, with assignment of digital assets (domain names, Google My Business profile, Yelp listings, and CRM database), software licenses, inspection templates, and past report archives. All intellectual property, including checklists, report language, and branded educational PDFs, were included in the sale. The seller remained on as a paid consultant at $4,000/month for six months to support client retention, inspector training, and QA reviews.
Technologically, the business was built for scale. Scheduling was handled through a self-serve online portal synced with inspector calendars. Payments were processed through Stripe, with automatic invoice generation. Reports were generated using Spectora with embedded images, video links, and repair request builders integrated with realtor CRM systems. The company maintained a proprietary internal KPI dashboard tracking average inspection time, upsell conversion (sewer scope, radon, thermal imaging), complaint rate, and average report delivery lag. These tools allowed the buyer to manage operational performance remotely and identify training needs in real time.
The subcontracted inspectors were all licensed, insured, and had signed non-compete and confidentiality agreements. Each inspector averaged 450–500 inspections annually and was compensated on a per-inspection basis, with performance bonuses tied to upsell attachment rate and review volume. The buyer retained all inspectors and re-signed contracts with updated SOPs, bonus tiers, and equipment stipends.
Marketing had historically been limited to agent word-of-mouth and a well-ranked Google profile. The buyer introduced structured marketing within 30 days, including a CRM-based drip campaign to 1,100 local agents, regular client feedback surveys, a monthly realtor-facing newsletter, and a co-sponsored webinar series on “preparing listings for clean inspections.” Within 90 days, the company gained 17 new referring agents and added 128 bookings attributable to new agent referrals.
Growth opportunities identified by the buyer included:
Geographic Expansion: Expanding inspection coverage radius by hiring two new inspectors and acquiring a small book of business in an adjacent county.
Service Line Extension: Adding sewer line jetting, air quality testing, and pre-renovation structural assessments.
Partnership Bundles: Offering joint scheduling with local pest control, HVAC, and radon mitigation providers to increase average ticket value and streamline the closing process for agents.
Subscription Programs: Launching an annual “Home Wellness Check” program for homeowners to re-inspect and prevent maintenance issues post-close.
Brokerage Partnerships: Embedding company booking portals into brokerage intranets, backed by service-level guarantees and preferred pricing.
Within six months post-close, revenue increased 14%, with upsell attachment rates growing from 34% to 47%. The average inspection ticket increased from $416 to $468 due to successful bundling. The buyer launched a new Google Ads campaign that contributed 230 new website bookings, while Yelp and Google reviews remained stable at 4.9+ stars.
Risks addressed included inspector classification (confirmed 1099 compliance with CPA and labor counsel), weather disruptions (backlog SOP created), and digital asset continuity (all logins, domains, and admin rights transferred at close and verified with screenshots and backup authentication).
By month eight, the buyer had initiated discussions to acquire a smaller inspection competitor operating in an adjacent zip code, with plans to integrate the staff and route density into the current booking system. The transition of seller relationships was nearly complete, with all original top-referring agents continuing to use the company and new marketing driving a 7.2% increase in agent-generated leads quarter over quarter.
This transaction showcases how a niche professional services business with high referral dependency and seasonal revenue can be acquired with careful structuring, assignment control, and performance-based seller alignment. The buyer used a combination of SBA financing, seller note protections, referral continuity planning, and remote-ready tech infrastructure to secure operational stability and revenue growth without taking on the complexity of facility-based services or multi-layered staff management. The model is now being replicated by the buyer across other transaction-adjacent home services.
