SBA Pre-Approved Employment Agency

Asking Price:

$5,000,000

Financial Overview

Revenue:
$2,047,474
Income:
$1,057,820
Multiple:
4.72x

Business Description

For sale is a 13-year-old Oregon-based business that specializes in work placement for adults who have intellectual or developmental barriers. For example: helping an 18-year-old with autism get a job at the local grocery store and keep it long-term.

The business is not paid as a typical employment agency. Instead it has 75-80% of its revenue coming from Medicaid and another 25% coming from the Oregon state vocational rehab department. The business has audited financials which is a requirement of working with Medicaid. Typically, the business will have 120-150 new clients a year (typically retained for 2 years or more).

As part of the American Disabilities Act, the government is required to spend money on programs that assist disabled people in finding & retaining jobs. The government is happy to pay for this safety net, because the alternative is the disabled person potentially becoming homeless and/or costing more economically. Agencies like this provide coaching and job placement, and receive a monthly payment from Medicaid for that client, as an example. The employer that hires the client (a grocery store for example) does not pay for the match.

The owner currently only works part-time (10 hours/week) and relies and three key employees to run the day-to-day. A buyer could choose to either be actively involved or allow the current management team to continue overseeing operations. The current owner responsibilities are mostly hiring and 1-on-1 lunches with the staff.

– Revenue Stream 1: Brokerage or County pays the business for coaching. Flat monthly revenue to the business under the assumption that the “client” (person with disability) needs 100% coaching. Even if the client ends up only needing 1 hour per month, the business may receive $6k/month as a coaching safety net (as an example).

– Revenue Stream 2: Vocational rehabilitation (as part of ADA, the state sets aside money for people with disabilities). Paid on milestones:
Write a strategy report: $500
Placement bonus: $1,000-1,500
Coaching: $40/hr on average
Retention bonus: when client reaches 90 days in the job, $1500-2000 payment is made.

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