Colin Gates Bought a Sub-Scale Painting Business and Worked the Brush Before the Books

The Setup MasterCraft Coatings is a commercial painting business with three decades of history. By the time Colin Gates found it, the economics looked modest by self-funded search standards: about $2M in revenue and $300-400K in seller's discretionary earnings. That sits well below the $800K+ SDE most self-funded searchers target, which usually screens out this kind of deal on day one. Gates took the opposite view. A smaller, operationally intimate business meant he could actually learn how the trade worked instead of inheriting a black box he was expected to run. The Deal Gates bought the company as a self-funded searcher. Specific price, financing structure, and seller terms were not disclosed on the episode. What matters for the lesson: he was willing to go under the typical SDE floor because he saw a 30-year-old book of commercial accounts, an established crew, and a trade he could actually learn by doing. The implied math for a deal this size is roughly a 3-4x SDE multiple on the low end of the SBA-eligible range, with the operator's salary coming out of SDE after close. Thin margin for error, which is exactly why the pre-close immersion mattered. Operating Moves Before closing, Gates showed up to work on the crews. Not as the owner-in-waiting doing ride-alongs. As a painter. Prepping surfaces, running equipment, watching how jobs got scoped, bid, and executed in the field. He framed it as bootcamp. Every hour on a job site was an hour of pattern recognition he would not have to buy back later through expensive mistakes or by being held hostage by a key employee who understood the work while he did not. The practical effect: when he stepped into the owner's chair, he already knew which steps in the process were the ones where jobs actually made or lost money, which crew members were carrying the operation, and what a realistic day looked like. Operating Lessons - Accountability without knowledge is theater. Gates' line: "To hold people accountable to let them succeed, I just had to see how the process worked up close and personal." You cannot coach what you have not done. - Sub-SDE-threshold deals are not automatically bad deals. The $800K SDE screen is a convenience heuristic, not a law. A 30-year-old business with real customers and a teachable trade can be the right platform if the buyer brings the sweat. - Do the field work before you own it, not after. Pre-close time on the crew is free tuition. Post-close, every hour you spend learning is an hour you are not spending on growth, hiring, or financing. - Tribal knowledge is the real handover risk. In trades businesses, the owner's head carries the estimating instincts, the vendor relationships, and the job-level P&L feel. Working alongside the team before transition is the only way to download that without a 12-month consulting agreement. - Investment of time beats investment of capital. For searchers chasing smaller deals, the edge is willingness to get hands dirty, not deeper...