Investigatory Report Concerning Ted Leverette - “Partner" On-Call Network LLC

This research and report was prepared by Artificial Intelligence (AI). It is supplemented with links to verifiable resources. Simply reading this report will equip you with dozens of practical and actionable facts, tips, and strategies that you can immediately put to use to protect yourself.

This is the kind of verifiable research, analysis, and insight you need to increase the probability that what people are pitching you is likely to be the good news you expect if you rely on them for anything related to your personal or financial security.

Ted J. Leverette, “The Original Business Buyer Advocate,” and founder of “Partner” On-Call Network, LLC, offers a distinct and highly practical methodology for acquiring small and midsize businesses (SMBs).

His advice is geared towards equipping prospective first-time buyers with the knowledge and strategies to navigate the M&A landscape effectively and avoid prevalent pitfalls. He emphasizes a “street-smart” approach, contrasting it sharply with deceptive online schemes and unrealistic promises.

Ted J. Leverette’s Core Principles and Methodology for Business Acquisition

Leverette’s approach is rooted in a buyer-centric philosophy, aiming to empower buyers to make informed decisions and secure advantageous deals. His methodology, often referred to as the “Street-Smart 22-Step Acquisition Sequence™,” integrates six essential advisory services: preparing, searching, due diligence, financing, valuing, and dealmaking. He positions himself not as a business broker, but as a “Business Buyer Advocate,” with 100% loyalty to the buyer.

His core principles include:

Thorough Preparation: Emphasizing that buyers must first prepare themselves before searching for opportunities. This includes understanding their own objectives, capabilities, and financial readiness.
Proactive Search: Advocating for a proactive and strategic search process, including developing a “Business Buyer Marketing Plan” to attract sellers and brokers and be their “first choice.” He suggests that the best deals are often found in the “hidden market” and not necessarily listed online.
Rigorous Due Diligence: Stressing the critical importance of in-depth investigation, including insights from employees, to uncover the true state of a business.
Realistic Valuation and Financing: Guiding buyers to realistically value businesses and explore diverse financing options beyond conventional loans.
Strategic Dealmaking: Focusing on flexible negotiation and deal structuring to achieve win-win outcomes.
Risk Mitigation: Identifying and minimizing risks throughout the acquisition process.
Ethical Acquisition: Promoting a transparent and honest approach to buying businesses, in contrast to exploitative or predatory tactics.
Buyer Advocacy: His firm, “Partner” On-Call Network, LLC, acts solely on behalf of the buyer, ensuring no conflict of interest with sellers or brokers.

Common Pitfalls He Identifies in the Buying Process

Leverette frequently highlights pitfalls that often lead to bad deals for buyers:

Failure to Adequately Investigate from an Insider’s Perspective: Many buyers rely solely on information from owners and managers, missing critical insights that employees can provide. Employees can be the “best reality check” for a buyer, revealing the true reason for sale, improving negotiations, and uncovering hidden issues.
Lack of Proper Preparation: Buyers who are not adequately prepared, financially or strategically, often miss out on good opportunities or make costly mistakes.
Misallocation of Dealmaking Funds: Buyers often mismanage their resources, leading to poor investment objectives or an inability to close deals.
Poor First Impressions: Unqualified searchers who don’t know how to present themselves effectively to sellers and brokers often get overlooked.
Over-reliance on “Easy Money” Schemes: Falling for promises of “no money down” or “quick-flip” deals without understanding the inherent risks and complexities.
Inadequate Due Diligence: Not digging deep enough to uncover all the actual and pending vulnerabilities of a business.
Ignoring Employee Dynamics: Failing to understand employee attitudes, opinions, and intentions, which can significantly impact post-acquisition success.
Lack of a “WINNING Business Buyer Marketing Plan”: Not actively positioning oneself as a desirable buyer, leading to missed opportunities.
Misunderstanding Competitive Advantage: Failing to correctly assess or price the elements contributing to a business’s sustainable competitive advantages.

His Recommended Due Diligence Steps

Leverette emphasizes that due diligence is an ongoing process that begins even before a Letter of Intent (LOI) is submitted. Key aspects of his recommended due diligence include:

Pre-LOI Diligence: Identifying enough information to submit a reasonable and flexible LOI. He offers coaching on the scope and business ramifications of pre-LOI diligence.
Interviewing Employees: This is a crucial and often overlooked step. Leverette stresses the importance of learning about employees’ attitudes, opinions, and intentions. This can reveal the real reason for sale, improve negotiations, and uncover potential risks like a key employee planning to quit and compete. He advises on how to safely handle these interactions, always with the seller’s permission, and what questions to ask (e.g., about HR matters, differing perspectives, red flags, former employees, and hidden costs related to employees).
Scrutinizing Financials: While historical financial performance is important, Leverette emphasizes understanding the future profitability and direction of the business. He warns against “Quality of Earnings (QoE) Reports” that can be “Ripoffs, Risks, Misunderstandings.”
Assessing Competitive Advantage: Deeply investigating the elements that contribute to or detract from a business’s sustainable competitive advantages.
Reviewing Contracts and Legal Documents: Ensuring a thorough legal review of all agreements and relevant documentation.
Evaluating Operational Aspects: Understanding the day-to-day operations, systems, and potential areas for improvement.
Learning from Insiders: Emphasizing that employees can offer an invaluable “insider” perspective that owners and managers may not (or cannot) provide.

Key Negotiation Strategies He Advocates

Leverette’s negotiation strategies focus on creating win-win outcomes and avoiding common pitfalls:

Flexible LOI Crafting: Developing an LOI that is flexible enough to adapt to discoveries made during due diligence and anticipate potential deal-killing actions by sellers.
Anticipating Seller Actions: Preparing for and mitigating risks associated with seller behaviors that could derail the deal.
Mitigating “Potential” Risk: Developing strategies to address the perceived “potential” of a business, which can be an area of significant overvaluation or misjudgment.
Focus on Win-Win: Aiming for deals where both buyer and seller feel they have achieved a favorable outcome. This often involves understanding each party’s motivations and finding creative solutions.
Leveraging Employee Insights: Using information gathered from employee interviews to materially improve negotiation positions.
Strategic Use of Information: Deploying insights gained from due diligence to strengthen one’s negotiating leverage.

Specific Criteria He Suggests for Evaluating SMBs

Leverette’s criteria for evaluating SMBs go beyond superficial metrics:

Historical Pretax Net Profit: While historical earnings are important, he stresses that future expectancy and the business’s trajectory are more critical.
Industry Analysis: There are no inherently “worst types of businesses.” A strong company in a temporarily troubled or declining industry can still be a “street-smart business investment.”
Competitive Advantage: This is a crucial element. Buyers and sellers often misunderstand or misprice the sustainable competitive advantages (or lack thereof) of a business, leading to a “fatal flaw” in deals.
Operational Health: Evaluating the internal workings of the business to identify efficiencies, inefficiencies, and areas for improvement.
Seller’s Rationale for Value: Insisting on a credible rationale for the goodwill of the business to avoid paying for “blue sky.”
Marketability to Buyers/Sellers/Lenders: Evaluating how the business is positioned in the market and its appeal to various stakeholders.
“Seller-Willingness” to Sell to You: Positioning oneself as the preferred buyer to gain an advantage in competitive situations.

Risk Management Approaches He Recommends

Leverette highlights several risk management approaches to help buyers minimize exposure:

Early Risk Identification: Identifying potential risks early in the process, as many lie hidden “like an iceberg.”
Comprehensive Due Diligence: The thoroughness of due diligence is a primary risk mitigation tool, especially regarding employee insights and financial scrutiny.
Reality Checks: Obtaining external validation and feedback to ensure a realistic assessment of the deal.
Avoiding “No-Money-Down” Pitfalls: Understanding the inherent dangers and often unrealistic nature of such schemes.
Strategic Deal Structuring: Crafting flexible deal terms that can accommodate unforeseen circumstances.
Buyer Advocacy: Utilizing an independent “Business Buyer Advocate” to ensure loyalty to the buyer’s interests and minimize conflicts.
Pre-Acquisition Planning: Preparing for post-acquisition integration and potential challenges.
Understanding Hidden Costs: Being aware of latent costs, particularly those related to employees, that may not appear on the books.

His Advice on Deal Structuring and Financing

Leverette’s advice on deal structuring and financing moves beyond traditional approaches, encouraging creativity and a deep understanding of available capital:

Beyond Traditional Bank Loans: He acknowledges that a significant percentage of small business loan applications are rejected by big banks. His book, “How to Get ALL the Money You Want For Your Business Without Stealing It,” explores 500 proven ways to get cash for a business.
Internal Financing: He details over 100 “internal financing” or cash flow improvement projects that can add cash to the bottom line, many of which are quick and easy to implement.
Creative Deal Structuring: Leveraging various financing techniques that may not involve traditional debt or equity, such as seller financing (with appropriate safeguards for the buyer).
Optimizing Cash Flow: Identifying and implementing strategies to increase cash flow, which can directly impact a business’s ability to afford larger installment payments or reduce reliance on external capital.
Understanding Seller Financing: While he warns against misleading seller financing claims, he also implicitly suggests it can be a valuable tool when structured correctly, as evidenced by his “No-Money Down Deal” example where cash flow was optimized to pay the seller faster.

His Warnings About and Critiques

Leverette is a strong critic of deceptive and predatory practices prevalent in the M&A space for SMBs:

‘No Money Down’ Business Buying Schemes: He directly challenges the feasibility and practicality of “no money down” or “$1” business buying pitches, especially for first-time buyers. While he has shared a case study of a “no-money down deal” (below), his general stance is that these are rarely practical for most and can lead to significant risks if not executed with extreme street-smartness. He suggests these ideas “don’t have any value” but that it could be “a very long time before buyers achieve a worthwhile deal using the techniques.”
Weekend Seminar Quick-Flip Promises: While not explicitly found in the provided search results, his overall skepticism towards “get-rich-easy-with-no-risk ideas” strongly implies a critique of such seminars that promise rapid, effortless profits.
Predatory Business Buying Tactics: He implicitly warns against these by advocating for ethical acquisition and emphasizing the need for buyers to protect themselves from deceptive sellers and intermediaries.
Misleading Seller Financing Claims: He encourages a thorough understanding of the realities of seller financing and the need for careful structuring to protect the buyer’s interests.
High-Pressure Sales Tactics Targeting Aspiring Business Buyers: His emphasis on thorough preparation, independent advocacy, and avoiding “sucker bets” in the search process is a direct counter to such tactics.
Unrealistic ROI Promises: His focus on realistic valuation and historical/future profitability analysis serves as a warning against exaggerated return on investment claims.
Deceptive Broker Practices: He identifies himself as “not a business broker” and highlights that his loyalty is “solely to buyers.”¹² This inherently points to a concern about potential conflicts of interest or practices that may not fully serve the buyer’s best interests. He also states that “brokers know how to sell businesses; most sellers don’t,” implying brokers have significant influence and their practices should be scrutinized. He also mentions the “Most Common Ways Business Sellers Trick Buyers.”

His Perspective on Ethical Business Acquisition Versus Exploitative Approaches

Leverette consistently advocates for ethical and win-win business acquisitions. His core philosophy revolves around:

Transparency and Honesty: Encouraging clear communication and a realistic assessment of the business by all parties.
Fair Dealmaking: Aiming for transactions where both buyer and seller achieve a favorable and sustainable outcome.
Buyer Protection: Providing buyers with the knowledge and tools to protect themselves from manipulation and deceptive practices.
Long-Term Success: Focusing on acquiring businesses that offer genuine long-term value and growth potential, rather than short-sighted, exploitative “flips.”
Building Relationships: Implicitly, his advice on how buyers should present themselves to sellers and brokers, and how to communicate effectively, suggests the importance of building trust and ethical relationships.

His Advice on Identifying and Avoiding:

Leverette provides clear guidance on how to avoid problematic individuals and schemes:

Unlicensed Business Brokers: While not explicitly detailing how to identify them in the provided text, his emphasis on qualified advisors and his own clear declaration of not being a business broker implies a warning against those operating without proper credentials. He also discusses the role of “Authorized Business Buyer Advocates®” as part of his network.
Unqualified ‘Experts’ and Coaches: His offering of “2nd Opinions” and “On-Call Advisory Service” suggests that many buyers seek guidance from unqualified sources. He stresses the importance of hiring “competent advisory teams” and getting “a reality check.”
Pay-to-Play ‘Business Buying Clubs’: While not explicitly named, his general critique of schemes that don’t provide practical, sensible methods for buying a business would encompass such clubs. His focus on individualized coaching and guidance, rather than generic group advice, also suggests caution against such models.
Hidden Fee Structures: His transparency about his own services (e.g., “2nd Opinions for Buyers and Sellers of Businesses $250.00,” “On-Call Advisory Service $250.00″) implies a warning against opaque or hidden fees from other service providers.
Predatory Lending Schemes Disguised as ‘Creative Financing’: His book “How to Get ALL the Money You Want For Your Business Without Stealing It” distinguishes between legitimate “creative financing” and deceptive or predatory lending. His focus is on “proven ways to get cash” and emphasizes that not all “creative” options are sound.

His Online Presences, Including Hyperlinks

Website: https://partneroncall.com/
LinkedIn Profile: www.linkedin.com/in/tedleverette
YouTube Channel: Ted J. Leverette, The Business Buyer Advocate (various videos available through Google search, for example: https://www.youtube.com/channel/UCSbV0olKKTETU-PtZv4bHBg, https://www.youtube.com/watch?v=lpbtq6YVYJk, https://youtu.be/CrRVYFkxnfA, https://www.youtube.com/watch?v=2xrMpXFuwcQ)

Specific Examples and Case Studies He Has Shared

One notable example he shares, highlighting a “no-money down deal” achieved through creative cash flow optimization, contrasts legitimate methods with potentially deceptive promises:

“Actual Case — No-Money Down Deal (p. 171)” (from “How to Get All the Money You Want For Your Business Without Stealing It”):
- The Business: A very old moving and storage business generating $150,000 annual profit. The buyer lacked cash for a down payment.
- The Problem: High vehicle maintenance costs (two full-time mechanics, $80,000/year payroll), significant space dedicated to repair ($15,000/year rent), and inventory of spare parts ($10,000). Also, $5,000/year in late-delivery penalties due to truck breakdowns.
- The Solution:
  - Sold all 8 old trucks (proceeds used for delayed down payment).
  - Laid off mechanics.
  - Returned spare parts for a refund.
  - Avoided late-delivery penalties.
  - Leased brand new trucks with a maintenance contract for $8,000/month.
  - Freed up 3,000 sq ft of warehouse space, generating $10,000/year from customer storage.
- The Outcome: Increased cash flow by $125,000 per year (or $11,000/month). After truck lease payments, the business was ahead $3,000/month ($36,000/year), allowing larger payments to the seller and a faster payoff. This illustrates a “street-smart” approach to leveraging internal business assets and operational changes for financing, as opposed to simply getting a loan with no collateral.

Another example that highlights the importance of understanding employee perspectives:

Insights Savvy Business Buyers MUST Detect from Employees of Companies for Sale: Leverette recounts a searcher whose deal “cratered” because they failed to adequately investigate from an insider’s perspective. The buyer ultimately withdrew their LOI after devoting considerable time and attention, emphasizing the need to anticipate and prevent deal-killing actions by sellers, often revealed through employee insights.

Source Material

The information provided is based on insights derived from Ted J. Leverette’s publicly available resources, including:

Website: “Partner” On-Call Network, LLC (https://partneroncall.com/)
- Sections such as “Minimize Business Risks,” “Searcher and Search Evaluation Order,” “Business Buying Dos, Don’ts & Profit Strategies,” and various articles/blog posts.
Books:
LinkedIn Profile: www.linkedin.com/in/tedleverette
YouTube Channel: Various interviews, webinars, and discussions featuring Ted Leverette, often linked from his website or found through searches (e.g., “Ted Leverette, The Business Buyer Advocate” channel, and appearances on channels like “Top M&A Entrepreneurs” and with individuals like David C. Barnett).
Published Reports/Articles: Documents such as “Insights Savvy Business Buyers MUST Detect from Employees of Companies for Sale” (e.g., found on VelocityLaw.com).

That’s it. Whew!

Can you see how this kind and depth of insight, which you can gather and read, within an hour, better-informs you, so you don’t make mistakes?

Here’s the link to an AI prompt, which was used to obtain AI’s report, above, which you can quickly adapt and use to investigate anyone. Thoroughly. Before you let anyone risk your peace-of-mind and money: Buyer Beware—How to Investigate Anyone.

I’m hoping you thoroughly research everyone. (And don’t pay too much attention to glorious testimonials or self-serving bloviating. Instead, review what is available during your independent research of people pitching you.)

At the least, please consider getting a second opinion from me before you take important actions, especially if you are bothered by anything or anyone.

And, if you’re getting started, get a reality check: Searcher and Search Evaluation.

Best wishes for your continuing success!

Ted J. Leverette
The Original Business Buyer Advocate ®

“Partner” On-Call Network, LLC

Searcher and Transaction Advisory:
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