How To Sell Your HVAC Company w/ Joey Lieber (His Firm Closes 125 Deals a Year!)

Joey Lieber talks to seven or eight owners a day at Florida Business Exchange. His position is simple: buyers do not price your revenue, they price your risk. This post breaks down what that means in practice: real closed multiples on HVAC, plumbing, and landscaping deals, the revenue mix that moves your number, the deal killer that shows up in most files, and what buyers need before anyone takes them seriously.

Most owners who want to sell their HVAC business start with the wrong number. They start with revenue. Buyers start somewhere else entirely, and the gap between those two starting points is where most deals fall apart.

Joey Lieber handles first conversations at Florida Business Exchange, a brokerage founded in 1990 that has closed more than 1,600 transactions and now runs 26 brokers across 35 states. He speaks with seven or eight owners a day and sits on roughly 125 closings a year, which means he sees the same preventable problems in file after file. For an operator building toward an exit, that volume is the point. He knows what gets a business priced and what gets it passed over.

This post covers what he told us on TradeOps Radio: how valuation actually gets calculated, what recent home service deals closed for, the two factors that move a multiple more than anything else, and the preparation that has to happen years before a listing goes live.

A business valuation is a payback calculation. The buyer looks at annual cash flow, decides how many years of that cash flow they are willing to pay for, and that number is the multiple. Three years of cash flow is a 3x. The only question underneath it is how confident they are that the cash flow continues.

<blockquote>”When it comes to valuing a business, it really all comes down to one thing, and that word is risk.”<br>Joey Lieber</blockquote>

That framing changes what an owner should be working on. Every question a buyer asks is a risk question wearing different clothes.

Does one customer account for more than 30% of revenue? What is marketing cost against the lifetime value of a customer? How much of the operation lives in the owner’s head?

Joey sees the same overvaluation pattern constantly. Owners run their math on gross revenue. Buyers run theirs on net profit: EBITDA, or SDE on smaller deals. A $3 million top line means nothing on its own; the number that gets multiplied is what the business actually keeps.

The other source of inflated expectations is the internet. Joey regularly meets owners carrying a valuation they generated from a chatbot or picked up from a social post about someone else’s deal. Those numbers are not anchored to anything.

Joey walked through three recent closings. A landscaping company producing $1.7 million in cash flow sold for $9.2 million, roughly a 5.2x. An HVAC company only a few years old, doing about $3.3 million in revenue and $500,000 in net profit, sold for $2.2 million. A plumbing company with cash flow in the $1.3 to $1.4 million range sold for $8.3 million.

The spread between those three is not about which trade is hottest. It is about what was inside each business.

Multiples step up in tiers as profit grows: under $500,000 in net profit, $500,000 to $1 million, $1 million to $2 million, $2 million to $5 million, and $5 million and up. Once a business clears $1 million in EBITDA with the risk factors handled, Joey sees multiples reaching four, five, six, and sometimes seven times.

The reason is inventory. Very few businesses ever get there. Research from the JPMorgan Chase Institute tracks how small a share of firms ever cross $1 million in revenue, and net profit at that level is rarer still. Fewer sellers, more buyers, higher price.

Geography shifts demand too. Joey named Florida and Texas as his firm’s most active markets, and the logic is seasonal. A Florida landscaping company does not need snow removal to keep crews busy in January.

But a company in a cold-weather state that keeps its pipeline full year-round trades just fine. Climate is a convenience. Predictability is the actual asset.

Two structural factors move a multiple more than industry, geography, or size. The first is where the revenue comes from.

“The higher the amount of retrofit in an HVAC company and the lower the amount of new construction, the higher the multiple is.”Joey Lieber

New construction revenue arrives in blocks, depends on developers and their funding, and stops when they change direction. That is customer concentration in a different costume. The builder becomes the key man. An HVAC company running close to 100% new construction will struggle to reach three, four, or five times, no matter how healthy the top line looks. Businesses that generate their own repeatable demand carry less risk than ones inheriting it from a single source.

The second factor is owner dependency, and Joey gave the clearest diagnostic in the episode.

“Step away for like one day. Just start with one day. See what breaks. Fix those things.”

Then a week. Then two weeks. Then a month.

When an owner can be gone three or four months and the business runs without fires, the business is transferable. That is the whole test, and it costs nothing to start running it this quarter.

Be honest about the finish line, though. Joey pushed back hard on the truly absentee owner, calling the sipping-margaritas version fairy tales. Every buyer wants less babysitting; nobody is buying a business that runs itself.

Below $1 million in EBITDA, more owner involvement is expected. Above it, more independence is assumed.

He described a roofing company doing $10 million in revenue and $2 million in net profit where the owner works 60 hours a week and touches every contract. That is harder to sell than a company half its size with a leadership team in place. Owner dependency remains one of the most cited reasons businesses never find a buyer at all.

The single most common reason a deal dies has nothing to do with the business model.

“The number one thing that kills deals that I look at is the books are not in order.” Joey Lieber 

This is not a small-sample opinion. Roughly 70 to 80% of privately held businesses listed for sale never close, and poor financial documentation sits near the top of the failure list every time it gets measured. It is also the cheapest problem on that list to prevent.

“If they had just kept up with their books for the past three years, it probably would have saved the deal.”

Cleaning up three years of records retroactively runs $20,000 to $30,000 at minimum and lands during the most stressful window of the process. Preventing it takes a bookkeeper who stays current, an accountant filing taxes correctly, and a valuation once a year. Joey compared the annual valuation to a physical. It tells you what the business is worth and whether the records would survive scrutiny.

One counterintuitive lever sits inside this. Paying more in taxes can raise an exit number. Aggressive deductions lower net income, and recovering that income at sale requires add-backs the SBA may not accept. A cleaner, higher reported profit is easier to underwrite, and the valuation gain frequently exceeds the tax paid to produce it.

Owner compensation follows the same principle. Pay yourself a reasonable market salary, enough that a buyer stepping into the role could pay themselves properly and still have cash left. A $50,000 salary on a business producing $500,000 in cash flow raises questions nobody wants raised during diligence.

The buy side has its own preparation problem. Joey described a market where every quality deal draws a crowd, and the buyers taken seriously show up with the same two things: an SBA pre-approval letter from a lender and documented proof of funds. That combination separates a buyer from the large majority who never close anything. Tire kickers are common enough that brokers screen for them by default.

The cash stack matters more than the purchase price. SBA acquisition loans generally require a 10% equity injection of total project costs, with a full-standby seller note able to cover part of it in some structures. Closing costs and diligence run about another 5%.

Joey adds what most buyers skip: six to twelve months of personal reserves. Acquired businesses commonly dip before they climb. That is the J curve, and being cash-strapped while learning the operation is where deals turn into problems.

There is one real no-money-down path. When an existing business acquires another in the same 6-digit NAICS code with matching ownership, the SBA treats it as an expansion rather than a change of ownership, and the equity injection requirement can be waived. An HVAC operator buying another HVAC company should have this on the radar. The rules have been revised more than once, so confirm the current standard with a lender first. A personal guarantee still applies either way.

Three actions come out of this conversation, and none of them require a listing.

Start the vacation test this quarter. One day, then a week, then longer, fixing what breaks each time. That exercise attacks the risk factor that costs owners the most value at exit.

Get a valuation annually, not when you are ready to sell. It shows where your books stand while there is still time to correct them.

Shift revenue toward what repeats. Retrofit over new construction, maintenance over install, owned demand over borrowed demand. That mix is the difference between a 3x and a 6x on identical profit.

The full episode with Joey Lieber is on the TradeOps Radio YouTube channel, and subscribing there is the easiest way to catch the next one.

If your revenue mix leans harder on new construction than you want, that is a marketing infrastructure problem before it is a valuation problem, and it is fixable long before an exit is on the table. Book a free strategy call with TradeOps and we will look at where your demand actually comes from.

Related: TradeOps plans and pricing.