This Horse Training School Built a Massive Social Media Following - Now It's For Sale?!

0:00Welcome back, everybody, to another episode of Acquisitions Anonymous. I'm Bill Snell, one of your co-hosts. Me, Bill, Michael, and Heather have probably the most exciting deal episode we've ever done today. We were excited before the episode, before we hit record, before we even looked at it, because it was an equestrian-related business, and Heather, this is right up her alley. So we knew she was going to bring some amazing insight to it. As we talked about the deal, though, we started to like it even more and more and more, and we are actually going to go down the path and pursue it a little bit because it's such a compelling deal.

0:33It's equestrian related. It's in Idaho. It's a school of some sort. And we get into all the details in the episode. It's a reasonably priced company relative to the cash flow. It's got some interesting kind of founder, kind of influencer type dynamics, and they want to transition the business for some personal reasons. We get into all the details. We love this deal so much. I can't wait for you to listen. You'll hear the excitement and we're definitely going to pursue it. So stick around after a quick word from our sponsors and hope you enjoy the episode.

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2:41The information in this ad is for informational purposes only. Oh, guys, there is, you know, every day of the week has its name. Today, we're changing the name of today to Heather Day based on the deal that we have. Yes, this is a very rare situation. We have known we were doing this deal for three days because Heather sent it to us or someone sent it. When it hit the chat, I mean, I could just feel the excitement building. Yeah, we have to do this one. I hope somebody buys it. I'm so excited about this one. Heather, that somebody is you. You are the buyer. That's what we're talking about. You have three partners who are willing to go in and help support you.

3:20I like the picture here. There are four of us and there is one horse for each of us in the photo. That's right. Which one am I? I'm the short one. Can I be the angry grumpy horse on the far right? Yeah, that's you for sure. Cool. Okay. It's the beautiful mayor in the middle in charge. That's what we're talking about. And then one of these is like, you know, I think, you know, Gerds, you're probably like the large horse in the middle that does all the work. That pulls all the weight. That's true. That's true. The people on YouTube, this makes a lot of sense. The people who are audio only are like, what is the deal?

4:00Well, they will have had the benefit of the intro that we're going to record after this. So they do know this is an equestrian school. They told us they wanted more banter. Well, here you go. Sometimes you get what you ask for. All right, let me read you this deal. All right, here it is. All right, so this is on Biz Buy Sell, our future favorite advertiser. It is an equestrian industry school located in Idaho. The picture, Heather, since you're a horse person, has four, I would say, very attractive horses. Yes. Are these like a, I mean, do different horses have different breeds or can you tell any?

4:34Oh, there's lots of breeds. I can't tell from this picture what they are though. I can't. I don't know. The asking price for this is a mere 3.5 million US dollars. Cashflow is about$477 ,000 and it does$1.1 million in revenue. So it looks like it's doing about a 45 % STE profit margin bill. Pretty good. Yeah. It includes$2.2 million, in their opinion, of real estate. Does it include or does it operate on? Oh, I'm sorry. It just says real estate is$2.2 million. I actually haven't read this deal. I just looked at the picture. So it's a very good move. Okay. Founded on a passion for all things cowboy and preserving a way of life, this equestrian school in Idaho has become the pinnacle of its genre in the world.

5:24Demand is extremely high and tuition deposits are backlogged several years. The school was established in 2018 and offers several courses ranging from three weeks to 36 weeks and operates year-round for great cash flow. Local horse owners line up daily with horses for these students to perfect their trade and create a secondary source of income. It looks like a scene from Yellowstone, but this thriving business is highly profitable while sustaining a lifestyle opportunity as well. The owner runs the business remotely from Southern California. I mean, I'm sorry, from Mexico, Heather. Soon to be Southern California.

5:54Which is similar, yes. For seven to eight months of the year. So let me just pause there. So Heather, can you explain what this business does? Because this thing about the second income thing doesn't make sense to me. Yes. What that means, it's kind of like they're borrowing horses from the neighborhood. They're not keeping their own horses. So do you have enough horses for all their students? They're paying their neighbors to use their horses. So the neighbors are bringing in extra horses so that they can have enough for it. I guess it depends on how many students at a time. But it almost sounds like with these margins, maybe they don't own any of their own horses.

6:28They're just always kind of renting the neighborhood horses. So Heather, I had a hypothesis here though. So the way this is written, it says local horse owners line up daily with horses for these students to perfect their trade and create a secondary source of income. I read that as the students are performing a service on the neighborhood horses. Like maybe they were reshoeing them or grooming them or training them or something. Like I was reading it as like, you know how like a barber school, like you can get a discounted haircut from the people who are learning to cut hair. I read it as sort of like that.

7:04Is that a business model you've seen? Well, you definitely wouldn't pay students to train your horse. I mean, this is kind of the way horses work. If you're going to have pay for training, it's going to be a professional trainer because it has to be done a very certain way and very consistently. So, but it is possible that like they're grooming and doing something with their hooves or, you know, it could be stuff like that for sure that they could be performing a service and the neighborhood horse owners are paying for it and or getting that for free and just sort of lending their horses in because their horses get exercised or whatever.

7:42So not really clear, but what it's telling me is they don't own their own herd of horses for this, which is really good for the margins. That's the expensive part is the ownership and the veterinary bills and all, So if they're able to use other people's horses to run their business from, I think that's a big plus. And also that probably makes it more reasonable to run it remotely, right? Because if you own the horses, they live there all the time. Yeah, you could never do that remotely. Yeah. Let me tell you a bit more about this deal. It has$49 ,000 worth of inventory. I guess those are a couple of horses.

8:18I have no idea. How much does a horse cost, by the way, Heather? That's a loaded question. I want to go down to the horse store. How much does art cost, right? The horse store. Yeah, that's like how much does art cost. I mean, you know, there's giveaway horses and there's, you know,$50 ,000,$100 ,000 sport horses, you know, that do whatever sport, whether it's Western or English, you know, depending on how well they're trained. So it's all about what you're going to use them for and how well trained they are. And, of course, how they look, you know, are they pretty? Are they tall? What color? All those things.

8:52and also how well trained are they right Heather? The training is the big one yeah yeah you're going to pay the most for training and if you're planning on showing or doing something competitive then it's all about the horse's competitive show record you know how well how much has it done how well has it been doing so the prices vary greatly and it just it's all over the board. All right so So inventory is included, whatever that inventory may be, maybe feed or maybe a couple of horses or some combination thereof. The real estate is owned and included in the asking price. Okay. It's getting better.

9:29The furnitures, fixtures, and equipment are about a quarter million dollars, also included in the asking price. And the facilities are located on 25 acres. That's included in the deal. This beautiful property boasts a nearly 7 ,000 square foot, three-level custom home. It currently serves as boarding and classroom area for the 20 plus students per class cycle. There are also two smaller homes on the property occupied by instructors. A large heated 5 ,000 square foot custom barn serves as the main student training area complete with a gracious tack room and stables. There is a large riding area and three acre pasture for grazing horses as well.

10:03A pivot line and pump easily irrigate the nearly 20 acres of additional pee. It just says pee. I don't know. Pee. Pee. Pee. Pee. Pee. Pee. Pee. Pee. Pee. First of all, the intangibles are priceless. The business itself boasts great margins and has the ability to double its student body if desired by building additional boarding on large property. The custom home could easily be returned to a single family dwelling and there is a constant influx of students and the nearly 740 ,000 followers on Facebook alone make it easy to market to others. The Facebook page is included in the sale. Additional instructors are easily attainable from graduating student bodies seeking further accreditation.

10:39The ideal buyer could be a businessman. It says businessman, man, but I'm going to change it. The ideal buyer could be a business woman from Southern California who wants to establish, who wants an established business with lots of room for expansion and time to spend with horses and get paid for it. It could also be someone who wants to experience a magnificent horse property with a large custom home and a highly productive business opportunity at the same time. It would be truly a great place to raise a family away from the complexities of big city life in Southern California. The owner will provide assistance to the new owner as to the intricacies of running the business after the sale.

11:14He can also do frequent appearances via Zoom and on location in the future. The owner lives most of the year out of the country and wants to focus his efforts at its stops. Wow. That's pretty cool. I love this. And I googled and found it. You did? I was trying to do that while he was reading it. We're not doing that anymore. I know, but I love it. We're not doxing deals. I love it even more after finding it. Really? Because we were, I think, Bill, you were closer to hitting the nail on the head with what they do. This is the title equestrian industry school is like the real kicker here because this is not just like a boarding place where, you know, the neighbors bring their horses and they teach like kids how to ride.

12:03It's a very, very specific equestrian skill. And y 'all, the tuition on this ranges from$4 ,900 to$20 ,000. Wow. That's a 36-week program, right? It is. Yes. On the high end? Yes. So, Bill, it's very similar to what you're talking about with the barber school where, hey, I need this service provided for my horse. And they bring it to the school. And then you have people who are becoming certified in something. and you get a deal on the service. Wow. Now I know what the service is just from what you said. Yeah. So that is totally, Bill was right. You were right. And that is great. That's even better business model.

12:47Oh, that's my favorite fence in the whole world, Heather. I love that. Say that again. Bill was right. Are you recording this for your wife? Yes. So good. Yes. He hasn't heard that recently. Okay. Now, Heather, the big question to me is like, is Idaho like the Mecca of equestrian? No, not really. But I mean, I think what Idaho is, is a place where you've got a lot of land and good conditions. You know, it's not, it's probably not too cold in the winter, although they do have a heated barn. So that tells you it does get cold because they've got to have heat. It's probably just a good place to have, you know, the property is not too expensive there.

13:22But, man, I love it even more after what you said and after what Michael read, the fact that the residents, that where they board people, the students, is included as well as it's not just dirt and, you know, writing a barn and writing arenas, but it's a house and a pool. I mean, that's a lot. Oh, I'm sorry, not a pool. You know, an area is highly agrarian whenever you look at the satellite imagery and all you see is circles from the irrigation system, just like for miles and miles and miles. This area is very agrarian based. So if you buy their supposition that the real estate is worth$2.2 million, which whenever a seller throws in their real estate and claims a value, you always got to just be like, okay, are they inflating this?

14:12But if you buy that and you say, standalone, if they was to sell this place as a ranch to somebody, they could get$2.2 million for it, regardless of what business was going on. If you buy that inherent value in that, the asking price for this is the difference between$3.5 and$2.2 million,$1.3 million. So that means they are basically charging, asking for two and a half times seller cash flow for a business that is currently being run remotely. Yeah, pretty nice. I just checked the flights you can get from Charlotte to this area. And it's actually not bad. Like under 300 bucks, Bill, round trip.

14:50Wow. Maybe I should bail on buying the new house that I'm about to buy and try to buy this. Yes. And move by. Let's do both. That's right. Let's do both. So Heather, can I guess, is it a farrier school? Yeah, that's what it's got to be. It's got to be a farrier school. So they are, instead of cutting hair for people, they are cutting and trimming hooves. for horse owners and maybe doing and learning shoeing probably. Which needs to happen. How frequently does a horse need to be a reach eater? About every six weeks if they're wearing shoes because they won't wear their hooves down. If they're not wearing shoes, they might wear their hooves down depending on what kind of surface they're working on.

15:28And it could be less frequently, but they've got to be trimmed and shaped and there's an angle. There's, I mean, like the school is pretty technical on this. I mean, it is intense and you'll see lots of horse owners suddenly requiring corrective shoeing, right? So like the horse is having a problem, a tendon problem, just like an athlete would. Now it needs a special angle, a special pad under the shoe, all kinds of expensive stuff that horse owners will spend on so their horse can be sound, basically. So it's really technical. And that's the one part I worry about with this because he says, you know, his transition, the transition that owner is willing to give.

16:06He made a few comments about that. But it makes me think that this that this seller is really a master farrier, you know, that he's maybe well known. And he probably, you know, Mexico has a very big equestrian tradition as well. So he probably does the same thing or, you know, has a business down there, different part, different times of the year. So that would be my only drawback is if you're not, if you don't have that technical skill and you don't have a name in that industry, would that be hard for you to step into this business? Well, so that was the thing that made me a little nervous. So it started in 2018, which is, I guess is getting to be a while ago at this point, but it says it has, uh, it's confusing because in one place here, it says 740 ,000 followers on Facebook alone.

16:52and then another place that says 228 000 followers on on facebook so i don't know which it is but is it and then there's this it mentions the owner who lives in mexico and is this an influencer like a farrier influencer probably the 200 bill is on their youtube okay so they and then the the 100 or the 740 is on and i mean on the website it says that the owner and his wife are, how did I say it? They're visionary creators and owners of the largest horse hoof care YouTube and Facebook channels on the internet. There you go. Dang, it's an influencer business. I've watched a lot of these channels.

17:37This is shockingly good content. Yeah. Like, have you guys, Mills or Bill, have you watched any of this? Heather already has, so I'm not asking. I haven't. I couldn't believe my friend who is not a horse person was telling me about how she's obsessed with watching. I'm like, what? Are you crazy? And then I realized it's everybody. There's a bunch of them. My favorite is actually this guy that's Welsh. His name is the Hoof GP. So he's got like this kind of Welsh brogue to him. And he like drives around the Welsh countryside. And every episode, it makes for great content because it's like an eight-minute kind of rise and fall.

18:11Okay, like I'm showing up. What's going to be my call to action? Oh, this particular horse is lame. are this and he does cows right because it's welsh welsh farmland in the uk but he um you know and then it's like okay well then i get this horse and here are this cow and like she stepped on a nail like now she can't walk what do we do oh my gosh now i get in and i you know like she's got a blood pust pustule inside the hoof like and it starts spraying everywhere and then the horse does better and like resolution happens it is perfect hero's journey social media content and It's very visual. So I could, anyway, I could teach somebody how to be a great social media creator for this.

18:49It is not that difficult. So. Well, it seems like they've already figured it out. Yeah. Yeah. So this has a lot of potential just from what you just said. It's popular for people to just watch the videos. I think you need to buy it though with some kind of licensing agreement to the seller. You've got to have them continue to influence the business. They've got to probably come do some clinics, certain number per year, so that you can still advertise that that person is still coming to the school. I don't think you can buy it outright and that seller can just walk away. I think you really have to have them involved.

19:25Yeah, I worry a little bit that people are coming here to learn from a famous master craftsman and that that is why this school has cachet. Okay. I think though, I'm worried about the same thing, except that they have, you know, six to 36 or three to 36 week courses and he lives in Mexico. So I wonder is, are there, the website doesn't really list a ton of staff. There is a staff page and the husband and wife are two of the three people. but I'm wondering, are there kind of third party, you know, kind of educators or something like that who are here if they're talking about the business being run remotely?

20:05This is a hands-on thing. I don't think it's, I don't think like the primary delivery mechanism is him in Mexico on Zoom and people in Idaho, you know, and he's like, you're doing it wrong. Hey everyone. I just want to tell you that this episode is brought to you by VeriVend, which is the only platform purpose built for independent sponsors and private market investors who want to move faster and eliminate friction. VeriVend is cool because it combines investment management and secure instant payments into one platform. So that means capital calls, deployments, and distributions, they all work like Venmo.

20:36One-click real-time transfers with no transaction limits and automatic reconciliation. So from raising capital to returning it, VeriVend handles it all. Deal marketing, data rooms, KYC and accreditation for your investors, signatures, capital flow, dashboards for your investors, and even fund administration, accounting, and taxes. So whether you're raising a single deal or managing a full fund, VeriVend gives you the speed and confidence to execute all in one single platform. So you can check it out and learn more at verivend.com. V-E-R-I-V-E-N-D.com. He's doing the hard part with any school, the any school, which is how do you fill your top of funnel economically?

21:18And how is he going to solve that? Because unfortunately, education is a tough business because it is not recurring revenue. It's one time you teach somebody and they move on. Maybe you sell them something in the future. But that's the challenge with every single one of these career schools. It's like taking off your lunch. You're starting an airplane. You're having a concert. It's the same kind of economics. You either need to sell all your seats or you're going to run out of loss. And he has solved that problem. Social media is the way they've done it. And you've got to figure out if you're going to own this, how are you going to replace that?

21:52So I did find it also. And I put the link in our chat. We're not going to dox it publicly. What's also interesting is I've discovered that they have a Mexico campus. There's a link on the website to check out our Mexico campus. And it looks like they run the same deal in Mexico. They have slightly different curriculum and the cost is different. But I'm guessing what's happening here. And I actually, I'm going to pitch this as a good thing. that this guy wants to stop going back and forth to Idaho. He lives in Mexico and just wants to chill on the Mexico farm and not worry about Idaho anymore. I think this is actually potentially workable because if he stays in Mexico and keeps making all of the content and he continues doing all of this in Mexico, all you got to do is say, you're going to post it on our pages too and we will run the Idaho franchise basically, basically but it's still we have to use your name it's affiliated with you yeah you got to keep doing it in mexico etc and we're going to continue to benefit from your halo and draft on that reputation it's much worse if he just closes down stops making content and rides off it in the sunset but that maybe this makes it work yeah i think that does make it work and i think maybe that's also why a low multiple makes sense here because you are dependent on him continuing to do that.

23:13If something happens to him, you've got some risk. But if he was agreeable to that, this is probably a very good deal for somebody. In Southern California who loves horses? Somebody. And I'm pointing to somebody. And that's my, I guess that's my next question. Should somebody who isn't a horse lover get into this business? No, I don't think so. Because I think you really have to be able to talk the language and understand the kind of people you're marketing to. It's a very unique hobby and a career. This is a farrier school. To be a farrier, that's a very unique career path. I think you need to understand all that and be a part of it.

23:53Someone could probably be okay, successful without knowing any of that, but I think you'd be a lot more successful if you come from that background. Heather, are you just saying that because you want to do the deal? Yes, that's correct. Without us. Yeah. You don't want to be in the audience to make it all for us. I guess a non-horse person could do it. So would you consider doing this? Yeah, I would consider doing this. Honestly, especially if you could not be there full time, because it sounds like it's pretty rural. It would be a big change for a lot of people to live somewhere like that. And it doesn't even sound like it's a great, you know, like the house is not set up for you to live in.

24:31It's set up for the students to be there. So if you could drop in part of the year and run it and have a place to live nearby, yeah, I would. Okay. I think this has a very, very compelling argument to be the first deal that we do. This is much better than that crappy deal you were telling me about before we started recording, Mills. Yeah, exactly. This is in the vein of worm farm. Is it not? It kind of, yeah. This is better than worm farm. It's better now. This is not, this isn't, I mean, worms aren't going anywhere either. This is not going anywhere, right? No. Like, yes, has the TAM for, you know, for this service decreased?

25:11Absolutely, over the last 200 years. Is it going to, is it going to decrease over the next 200? Probably not. Like, there are certain services, there are certain things about this that are just not going to change. I think the play is that we partner with the founder. He rolls some equity because he loves this. He's pursuing advanced degrees in Scotland for this. Like this person, they don't want to be out of the business. They just want to be out of the business part of it. And you enable them to really focus on content, to take the headache off of their plate. I think a big part of the deal is they keep the real estate and you sign a market rate lease, which can't be that expensive.

25:52This is one of those cases where the rent relative to the real estate value is very disparate and we could rent the property back from him. He continues to own it. Maybe we have an option to buy it so that we don't lose the ability to operate the school there if we need it. And it probably doesn't, I don't think you ever double or triple this business, but that's fine. It's just a perpetual need. And I think that this is an awesome business. I really want to do it. Yeah. Five years in and you'd have a great return on investment. this is a way to buy a horse farm in idaho for free and expensive i mean you go there you could be in socal seven or eight months a year you go to idaho in the summers oversee the fair of your school hang around with the horses you can pop up there for the weekend you probably would need to expense a private plane i would think because i would think so yes yeah and it's perfect this is the lifestyle business.