Tomorrow’s Fortune

Welcome to the action-packed newsletter designed to help you navigate the world of business and investing. If you missed last week’s post, check it out here. 😎 

Today’s Digest: 

• The Art of the Roll-Up: Before you execute tuck-in acquisitions, you must first pick the right industry… think I found a goldmine for roll up hunters

• What’s Happening in the Markets? Inflation edging higher, Trump’s end to offshore renewables, Gas prices are dirt cheap rn and NVDA earnings (beat?)

• Deal Review We found a cash flowing Farm Equipment Sales business in Wisconsin ($240K of Cash Flow). Click HERE for the listing

TOP STORY

Best Industry to Roll-Up in 2025…

Everyone wants to roll up HVAC, plumbing, dental, or home services.
That’s where the herd is. Multiples are rising, competition is fierce, and sellers know it.

But the best roll-ups? They happen in industries hiding in plain sight.
Industries where there are dozens (sometimes hundreds) of mom-and-pop operators, a real customer need, and margins no one is paying attention to.

Enter: Used Corrugated Packaging. (btw… don’t tell anyone about this - this is fire intel for my fav newsletter subscribers only :). This could make one of you a billionaire)

Why Used Corrugate?

Here’s the 30-second pitch:

• Every retailer, distributor, and e-commerce facility needs boxes — lots of them.

• Sustainability mandates are pushing supply chains to reuse and recycle.

• Small “box brokers” already exist, sourcing used boxes for pennies and reselling them for dollars.

It’s not glamorous. It’s not on CNBC.
But it’s a genius business.

Think about it:
A local brewery, auto shop, or distributor needs to get rid of their boxes. Normally, that’s trash. You step in, solve their disposal problem, and flip those boxes to a retailer or shipping operation who would rather pay 40% less than buy new corrugate.

That’s arbitrage + sustainability in one model.

The Economics

Procurement cost: cents per box.
Resale price: dollars per box.

Gross margins routinely clear 50–70%.
Working capital needs are low (inventory literally comes from people throwing it away).

And because most of the industry is hyper-local, penetration is still tiny compared to the $80B+ U.S. corrugated packaging market.

Why This is a Roll-Up “No Brainer”

1️⃣ Fragmented Market
Every metro has small brokers — 2–5 trucks, a few warehouses, working with local distributors. No one has national scale.

2️⃣ Secular Tailwinds
E-commerce growth + corporate ESG mandates = accelerating demand for sustainable packaging. Customers want recycled corrugate.

3️⃣ Recurring Revenue
Clients (retailers, distributors, 3PLs) reorder monthly. Once you’re their supplier, churn is low.

4️⃣ Platform Potential
With better systems, logistics, and marketing, you could easily roll up 5–10 local brokers and build a regional or national footprint.

5️⃣ Multiple Arbitrage
Mom-and-pops trade at 2–3x SDE. Roll them into a $10M+ EBITDA platform and you’re suddenly looking at private equity interest in the 6–8x range.

What Buffett Would Like Here

Warren Buffett always said he loves:

• Simple, understandable businesses → Check.

• Essential products → Every business ships something.

• Moats through cost or scale → Aggregators with better logistics + ESG positioning win.

• Owner-operator fatigue → Many of these brokers are 60+ and ready to retire.

This is the kind of “boring, profitable, durable” business he built Berkshire on.

Bottom Line

If you want to play where others aren’t, start looking at used corrugated packaging.

It’s recurring, high-margin, sustainability-aligned, and sitting wide open for someone to professionalize.

While the herd chases HVAC and dental roll-ups, the smartest investors will be quietly building the national platform for recycled boxes.

Because when you can procure for cents and sell for dollars, that’s a business you want to own.

Another roll-up play: Funeral Services. I dive deep into this sector and a real deal on this YouTube video!

Find other cool videos on my channel HERE (👈 Click)

WHAT’S HAPPENING IN THE MARKETS?

• Core Inflation Rises to 2.9%, Highest Since February

  The Fed’s preferred inflation gauge, core PCE, rose to 2.9% in July, up from June and marking the highest level since February. Consumer spending climbed 0.5%, while personal income increased 0.4%, suggesting continued demand resilience despite price pressures.

  Why It Matters: The uptick complicates the Fed’s rate-cut timing. Persistent service inflation could keep policy tighter for longer, leaving bonds range-bound and equities exposed to downside if growth begins to cool.

• Trump Cancels $679M in Offshore Wind Funding

  The Department of Transportation pulled $679 million in federal support for offshore wind projects, including $427 million for Humboldt Bay Offshore Wind in California. The cancellation is the latest move in Trump’s campaign against U.S. wind development.

  Why It Matters: Offshore wind developers lose a key subsidy lifeline, raising project risk and cost of capital. The policy pivot strengthens relative tailwinds for oil & gas while deepening uncertainty for renewables-focused investors.

• Gas Prices Hit Cheapest Labor Day Since 2020

  National gas prices are expected to average $3.15 per gallon this Labor Day, the lowest since 2020. Prices are below $3 per gallon in 15 states, including Georgia, Texas, and North Carolina. Softer oil prices remain the main driver.

  Why It Matters: Cheaper gas offers a consumer spending boost heading into Q3, especially for discretionary categories like travel and retail. For energy markets, subdued oil pricing highlights supply stability but pressures upstream producer margins.

• Nvidia Beats Earnings, AI Capex Still Surging (but Stock Still Falls)

  Nvidia beat on both earnings and revenue but forward looking growth was a bit cloudy. The business is growing… but just not as fast as it used to. Sales to China remain restricted, but ~$180M in inventory released to a non-China client provided a boost. The stock dipped after hours before recovering.

  Why It Matters: Nvidia remains the tollbooth on AI infrastructure spend, with hyperscaler demand continuing at breakneck speed. Export restrictions pose headwinds, but broad-based global demand keeps the growth cycle firmly intact.

SO YOU WANT TO BUY A BUSINESS… 🏦

Deal of the Week: Wisconsin Farm Equipment Sales & Service – Asking $600,000

Opportunity Overview

Founded in 1968, this Wisconsin-based agricultural equipment dealership has operated for over five decades, selling and servicing farm implements across 12 manufacturer lines. The business offers both parts and field service, with much of the repair and maintenance work conducted directly on customer farms — a value-added differentiator in rural markets.

With only two employees, the model is lean but heavily owner-dependent. The business includes ~$150K in inventory and ~$100K in equipment, and the seller is willing to lease the current facility until the buyer establishes a new location (roughly 6,500 sq. ft. on ~3 acres is recommended).

In an industry with stable demand drivers — replacement cycles, aging equipment fleets, and continued investment in farm mechanization — this acquisition represents an entry point into a recession-resistant niche.

Cash Flow and Profitability

The business generated ~$1.77M in revenue with $239K in SDE, implying an ~13.5% SDE margin. At the $600K asking price, the deal trades at ~2.5× SDE, squarely in line with agricultural dealership comps.

Margins are respectable given the thin headcount, but there’s evidence that additional technicians could drive incremental revenue capture — particularly given service revenue often carries 30–40% higher margins than equipment sales.

What We Like

1. Long Operating History
   Nearly 60 years in business provides brand credibility, established customer relationships, and proof of staying power through multiple ag cycles.

2. Manufacturer Breadth
   Carrying 12 different lines diversifies revenue and reduces dependency on a single OEM, a common risk in equipment distribution.

3. Embedded Service Revenue
   Farm-side repair work provides stickier customer relationships and higher-margin recurring revenue compared to pure equipment sales.

4. Defensible Rural Market
   With only two competing dealers within a 30-mile radius, there’s geographic insulation that protects against pricing pressure.

5. Seller Transition Support
   The owner is offering four weeks of training and ongoing facility lease flexibility — reducing transition friction for a new operator.

What We Don’t Like

1. Owner Dependency
   With only two employees, institutional knowledge and OEM relationships are likely concentrated in the owner. This creates key-person risk during transition.

2. Limited Staffing
   Two employees is insufficient to scale. The listing itself notes that 1–2 technicians could unlock more growth, but that’s an execution burden for the buyer.

3. Capex Demands
   Farm equipment businesses often require significant working capital tied up in inventory. The $150K included is a starting point, but seasonality and OEM requirements could push this higher.

4. Succession Risk with OEMs
   Dealer agreements often require OEM approval for ownership changes. If relationships aren’t smoothly transferred, revenue continuity could be disrupted.

5. Thin Scale
   At sub-$2M revenue, the dealership lacks scale to negotiate better OEM discounts, which larger regional competitors can leverage.

Key Questions for Diligence

• What are the terms of each OEM/dealer agreement, and are they transferable?
  Losing even one manufacturer could materially impact sales mix and volume.

• How much of revenue comes from parts and service versus new equipment sales?
  Service and parts carry stronger margins and customer stickiness; a sales-heavy mix creates volatility.

• What is the age and tenure of the existing customer base?
  If customer concentration skews heavily toward a small group of large farms, churn risk is elevated.

• What is the backlog for service work, and what capacity is currently going unserved?
  This will quantify how impactful adding technicians could be in terms of immediate revenue lift.

• What OEM incentives, rebates, or floorplan financing arrangements are currently in place?
  These can make a material difference in profitability but can also represent risk if terms change post-transaction.

Bottom Line

At ~2.5× SDE, this is a fairly priced acquisition of a long-standing agricultural dealership with built-in service demand, OEM diversification, and limited local competition. The playbook is clear: add technicians, professionalize operations, and expand service capacity to lift margins.

The risks are classic for the niche — owner dependence, OEM transfer hurdles, and inventory working capital requirements. For a buyer with agricultural industry experience or an existing platform seeking geographic expansion, this deal offers a bolt-on with immediate cash flow and room to scale.

Think of it as acquiring a 60-year-old local brand with entrenched farm relationships — the raw material for a larger regional roll-up in agricultural equipment distribution.

This newsletter is for informational purposes only and does not constitute investment advice. The content is based on publicly available information, and the author makes no representations about its accuracy or completeness. Readers should conduct their own research before making any investment decisions.