Landscaping & Mosquito Spraying (PE Roll-Up Hotspot)
Case Study 02
the choice to work
Primary Goals:
“Let’s stage the exit to capture today’s hot multiples and set you up for a tax-efficient second bite.”
Profile
- Entity: S-Corp (pre-planning)
- Size: ~$12M EV; ~60% recurring revenue (mosquito routes), 3 locations
- Owners: Couple in their 40s; growth-minded but time constrained
- Market: Private equity paying premium multiples for route-based mosquito control roll-ups right now
Pain Points
- Not positioned to capture current PE premium (messy contracts, seasonality, key-man risk)
- S-Corp meant no QSBS path; owner wanted a staged exit with a second “bite of the apple”
- Limited buyer list; fear of selling too soon/cheap
How We Helped
Think
“Let’s stage the exit to capture today’s hot multiples and set you up for a tax-efficient second bite.”
Problem
A quick sale leaves money on the table and creates unnecessary tax drag. The business also needed polish to command a top-tier multiple.
Feature (Working with Compound Advisory)
- QSBS pathing: Converted to C-Corp and issued new stock to start the 5-year QSBS clock for future equity growth.
- Estate access + protection: Funded a SLAT to remove assets from the estate while preserving indirect access through the beneficiary spouse.
- Operational polish: With IndustryPros, we tightened customer contracts (auto-renew, price-escalators), stabilized seasonal cash flow, and packaged KPIs for investor-grade diligence.
- Protected themselves with the right types of insurance
Two-step approach:
- Minority recap now (liquidity + strategic partner + management depth).
- Majority exit post-QSBS holding period to target tax-advantaged gains on the second sale.
Benefit
- Value: First transaction at a ~20% higher multiple than initial outreach—thanks to better packaging and a broader PE pool.
- Liquidity + Upside: Owners took chips off the table and retained upside with a credible QSBS track for the second bite.
- Estate: SLAT provided potential estate tax mitigation while keeping practical access.
(Note: QSBS applies to C-Corp stock meeting the 5-year/industry rules; we structured the plan so the future sale could qualify.)
Your Compound Retirement Clarity Assessment™
A complimentary 3-step process showing you how to reduce taxes and improve your retirement success.
It also helps you evaluate our services and make an informed decision about working together.