Jared Johnson takes a different seat in this episode as he gets interviewed and answers real questions from buyers and sellers about entrepreneurship through acquisition. The conversation cuts straight through the hype and focuses on what it actually takes to buy and run a business.

Jared explains why ETA has become so popular in recent years and why much of what people see online does not match reality. He talks through what lenders are really looking for, including experience, liquidity, and consistent cash flow, and why those factors matter so much when getting a deal approved.

The episode also covers the most common reasons deals fall apart. Jared walks through red flags like inconsistent financials, customer concentration, and buyers trying to operate businesses remotely. He shares where buyers go wrong, especially when they skip due diligence, rush into deals, or rely too heavily on brokers and sellers without verifying the numbers.

There is also a personal story from Jared’s first acquisition that shows how expensive mistakes can be when diligence is limited. It is a clear reminder that even deals that look solid on the surface can carry real risk.

This is a practical, honest look at ETA for anyone considering buying a business or currently in the process.

Main Takeaways:

• ETA is real, but it is much harder than it is often presented online
• You cannot treat buying a business like passive income, it requires real involvement
• Lenders focus heavily on buyer experience, available cash, and stable cash flow
• Deals often fail early due to weak financials or lack of buyer preparation
• Customer concentration and inconsistent revenue create major risk
• Skipping due diligence or hiring the wrong advisors can be costly mistakes
• Asking why the seller is selling can reveal important issues
• The best deals match the buyer’s experience with the business they are buying
• Investors can help, but not all investor relationships are good ones
• Patience matters, buying the wrong business is worse than waiting

Connect with Jared:

If you have questions for Jared, visit: https://jaredwjohnson.com

https://www.linkedin.com/in/jaredwjohnson/

DISCLAIMER:

The views and opinions expressed in this program are those of the guests and host. They do not necessarily reflect the views or positions of my employer.

Keywords:

entrepreneurship through acquisition, ETA reality, SBA lending, buying a business, business acquisition mistakes, due diligence, quality of earnings, cash flow analysis, customer concentration risk, deal red flags, acquisition financing, small business acquisition, search fund, lender perspective, acquisition strategy

Jared Johnson sits down with Ivy Millman, CEO of WHIZDOM, to explore a missing piece in many lower middle market acquisitions: customer due diligence. Ivy shares how her background in accounting, Stanford, Apple, and decades of business-customer research led her to build a firm focused on helping buyers, investors, and operators understand what financial, legal, and technical diligence often miss. The conversation breaks down how independent customer interviews can uncover risks around retention, churn, concentration, loyalty, product issues, and transition vulnerability before a deal closes. Ivy explains her process, why customers often reveal more to a neutral third party than to sellers or buyers, and how these insights can shape valuation, confidence, and post-close growth plans. Jared also shares what he is seeing in SBA acquisition lending, including higher defaults, tighter scrutiny, and the growing need for real diligence before buyers commit to multimillion-dollar deals.

Main Takeaways:

- Customer due diligence fills a major gap left by financial, legal, quality of earnings, and technical diligence

- For B2B acquisitions, revenue sustainability depends heavily on retention, loyalty, stickiness, and switching risk

- Customers are often more candid with an independent third party, especially when they want feedback kept anonymous

- Seller-protected customer relationships do not have to block diligence if the process is structured correctly

- Independent customer calls can uncover hidden risks that materially affect valuation and deal confidence

- Customer insights can help buyers decide whether to move forward, renegotiate price, or build a stronger post-close plan

- High customer concentration becomes even riskier when relationships sit primarily with the founder or seller

- What buyers learn pre-close can become a practical roadmap for post-acquisition growth and retention

- Sellers can use the same kind of customer work before exit to improve enterprise value, loyalty, and retention

- SBA acquisition buyers should not rely on lenders, brokers, or sellers alone to validate a deal

Connect with Jared:

If you have questions for Jared, visit: https://jaredwjohnson.com

https://www.linkedin.com/in/jaredwjohnson/

Connect with Ivy:

https://www.linkedin.com/in/ivymillman/

ivy.millman@gmail.com

DISCLAIMER:

The views and opinions expressed in this program are those of the guests and host. They do not necessarily reflect the views or positions of my employer.

Keywords:

customer due diligence, B2B acquisitions, lower middle market, ETA, entrepreneurship through acquisition, SBA loans, quality of earnings, QofE, customer retention, customer stickiness, customer loyalty, customer churn, revenue sustainability, founder dependency, seller transition risk, customer concentration, post-acquisition growth, valuation risk, M&A diligence, independent third party diligence