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35: Reviving a Sleepy Manufacturing Business- with Tato Corcoran
Manage episode 377535848 series 3345299
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Meet Tato Corcoran
Tato Corcoran was born & raised in the San Francisco Bay Area and spent the first decade of her professional career in Silicon Valley. At the beginning of the Covid-19 pandemic, she started flipping homes & building a portfolio of rental units in Milwaukee. In 2022 she acquired Brandt Molded Marble, a sleepy manufacturing business on its way to extinction. Tato has spent the past year+ transforming that business into one worth owning.
You say [you acquired] a sleepy manufacturing business. Can you talk about that a little bit?
When COVID started, and I was here in Milwaukee, and I was still kind of going back and forth between Milwaukee and California. I still had my friends there and whatnot. But I was like, “Okay, now's the time.” What is it that I want to pursue? And it dawned on me one day that I could buy a house here, which you really can't do in California when you're 26. So I thought I'd make it an Airbnb. And so I bought my first house, and that led to an absolute real estate obsession. I ended up flipping, wholesaling, buying followable, I've probably done at least a couple of dozen real estate transactions and have a portfolio now that I've kept. But then it felt like the next natural step that I actually saw some of my peers pursuing was to buy a small business. And I'm sure you ladies are intimately familiar with a statistic about baby boomers retiring, it's like a daily rate of 10,000 or something like that. But essentially, no one has an exit plan. So I had some peers pursuing the acquisition of these businesses for very low dollars. And I thought I could do that. You basically have to be scrappy, resourceful and organized, right? I talked to 1,070,000 small business owners just to get a feel for what interested me. And I ended up I originally found this business near the middle of my search and it was broker listed at way too much. And I said to the broker that I don't know anything about manufacturing, so I can't even consider that. And then sure enough, a month or so went by and he called me and the owners were about 14 days from disclosing store and liquidating. So, turns out that [the former owners] had an owner operated business for 35 years. So very well established, and was absolutely an expert in this particular space. He is chemically speaking an expert on molded marble, and he was very active in the business. By the time that he was trying to sell, he was running a skeleton crew. They had their 12 customers who were super loyal to them, and vice versa. He knew exactly what top line, he needed it to put X dollars in his pocket and only need two people and only work 40 hours. And that was that, like he had it down to a science. And so it was sleepy in that it was just not growing.
How are you setting up Brandt Molded Marble to really find success as you move forward now that you have it?
[The former owner’s] existing customer base, which relatively speaking was quite small, was really strong. He serviced all of the main entry-level specs, single-family residential builders in the area. So again, while his top-line dollars were very underwhelming, I knew that his customers were super sticky like they weren't going anywhere. They dominate the spec space here, which again, is a really hot space. So I was like, “Okay, that's positive.” He had zero commercial customers. He also worked with like two general contractors to renovators. There are a bajillion renovation contractors within the Greater Milwaukee and Madison areas who are a perfect fit for the product, and vice versa. So massive opportunity there. So it was just a matter of (there were a lot of layers) to me taking this thing from something that was nothing to something. The first six months were sheer survival. I have never walked into something so blind and underprepared in my entire life. And I have no regrets at all. It's a blast now.
And so much more…
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