High risk — watch closely
● Single customer revenue concentration
● Key installer leaves after close
● Seller inflated add-backs / SDE
● Undisclosed liabilities or liens
● Vendor terms don't transfer
Medium risk — monitor
● Strong seasonality in cash flow
● Aged equipment needing replacement
● Seller non-compete is weak
● Online reviews tied to seller's name
● Warranty claim exposure
Industry tailwinds (positive)
● Outdoor living market growing
● Premium product demand rising
● SE market favorable climate
● Recurring maintenance revenue
Deal structure risks
● Earnout disputes post-close
● Working capital shortfall at close
● Financing contingency issues
● SBA loan approval timeline