Inside a High-Margin Payment Processing Business | Acquisitions Anonymous Episode 350
This week, Mills and Michael take a deep dive into a payment processing business that’s both wildly profitable and incredibly niche. With $2.1 million in revenue, 81% EBITDA margins, and a foothold in state agency payment systems, this is the kind of deal that grabs your attention. But is it all it’s cracked up to be?
Here’s what we cover:
- How it works: The nuts and bolts of processing payments for government agencies.
- The challenges: Long sales cycles, RFP-driven contracts, and slow adoption by municipalities.
- What makes it tick: Is their niche defensible, or just a fluke?
- Valuation speculation: Could this business fetch 10x EBITDA or more?
- Risks and rewards: Customer concentration, market saturation, and the ever-looming competition.
If you’re a strategic acquirer or someone in private equity, this one’s worth paying attention to. First-time buyers? Maybe not so much.
Why This Episode Stands Out:
1. High-Profit Margins: Seriously, 81%.
2. Niche Market: Payment solutions for state agencies—could be genius or a total headache.
3. Growth Potential: Doubling revenue year-over-year is impressive, but is it sustainable?
4. Also, don’t miss Mills and Michael sharing some of the best banter we’ve had in a while—this one’s as entertaining as it is insightful.
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