Owner, Capitol Pest
“Ended up getting even more than I was hoping for."
American Pest, an Anticimex company
1 June 2021
To hear more about the details of Capitol Pest’s sale to American Pest, listen to the PMP Industry Insiders Podcast Episode 56: How to Get Top Dollar When You Sell Your Pest Control Company, where Dan Gordon and co-host Donnie Shelton interview Brian Schoonmaker about the deal.
Continuous Improvements at Capitol Pest Lead to Impressive Sale
After about 16 years in the pest control industry and a decade at the helm of Capitol Pest, Brian Schoonmaker sold the business to American Pest, an Anticimex company, for one of the highest valuations in the industry.
Brian’s journey is a unique one. He didn’t grow up in the family pest business or start out as a technician. He worked in retail management for years after college, doing stints with companies like Target, Macy’s and Brooks Brothers. Eventually, a college friend recruited him to work at American Pest. That friend was Matt Nixon, now vice president of North America for Anticimex.
Schoonmaker stayed at American Pest for five and half years, becoming director of business development and helping the company consistently achieve double-digit growth. He left in 2010, seeking a partner role in a pest company, eventually joining Capitol in late 2011. He took over day-to-day operations, transitioned the company to PestPac, ramped up recurring revenue and tackled other projects he knew would improve the company’s value.
“Every winter I’d take on a new project to take the company to the next level,” Brian recalls. “One year was going paperless, next we added in Sentricon, year three was getting customer service up and running better. I was very much trying to make the operations better every year in whatever way I could.”
The Decision to Sell
In January 2021, Brian grew concerned about what would happen to capital gains tax rates if President Biden’s tax proposal became a reality. Although he planned to hold on to his company for a few more years, he reached out to Dan Gordon, managing member of PCO M&A Specialists, to get his take.
“Dan asked what my number was,” Brian says, referring to the ideal price he’d like to get when selling his company. “I told him what it was, and he said, ‘What would you say if I think you can get what you’re looking for right now?’”
With that, Brian decided it was time to sell and hired PCO M&A Specialists to represent him for the sale.
The Experience & Sale
Entering the selling process, Brian’s employees were one of his main concerns. In fact, he went to market two years prior, but it didn’t pan out.
“I was told during that process how many employees they were going to have to let go,” Brian says. He didn’t go through with the deal, but he did learn something.
“I got the road map of what I needed to do as far as changes in the company to make it way more valuable and to protect the employees,” he says. “Back then my adjusted EBITDA was 16 percent, and we got it up over 30 percent in the last two years.”
This time around, with an improved financial picture and Dan and the PCO M&A Specialists team in his corner, Brian achieved his goals for the sale. American Pest, where he started his career in the industry, always remained one of Brian’s top choices for a buyer.
Brian says he appreciated Dan’s ability to dig into Capitol’s systems and data to present the company in the best light.
“He is somebody who understands PestPac, QuickBooks and can find opportunities to add value to the company,” Brian says. “Since the last time I went to market, I started tracking my own EBITDA, but Dan found adjustments I didn’t think about.”
Another benefit: PCO M&A Specialists handles the daunting due diligence process for its clients. “I can only imagine the level of involvement I would have had to do without their help,” he says. On top of it all, Brian says, “I ended up getting even more than I was hoping for.”