Meet Jon Decoste
From engineering to ownership: How Jon DeCoste found focus and acquired his dream business.
Hey, it’s Alex!
This week, we’re diving into the archives to revisit a conversation from Spring 2024 with Jon DeCoste — an entrepreneur who left a thriving engineering and sales career to pursue his dream of owning a business.
At the time, Jon was deep into the Entrepreneurship Through Acquisition (ETA) process — a unique approach where entrepreneurs buy an existing business instead of starting one from scratch. Jon navigated the highs and lows of self-funded entrepreneurship, balancing risk, resilience, and opportunity.
Spoiler alert: in December 2024, he successfully acquired a fantastic Alberta-based business that checked all his boxes!
Jon’s journey is filled with valuable insights, including:
How to stay focused and resilient in a self-funded search
The importance of aligning your goals with the right opportunities
Lessons learned from evaluating hundreds of businesses
This one’s a must-read for anyone interested in business acquisition — check it out below!
Quick Stats:
💰 Target EBITDA: $750,000–$4M
🌍 Target Region: Alberta, BC, Saskatchewan
🏗️ Target Industry: Oil & Gas, Industrial, Manufacturing, Distribution, and Services
✉️ LOIs Sent: 4
📞 Business Owners Spoken To: >400
How He Got Here…
I'm definitely the guy who changed things up mid-career, although it wasn't overnight — it was a progression.
I’ll give you a bit of history, though.
I came out of Dalhousie with a mechanical engineering degree, and was introduced to the oil and gas industry.
Being from the Maritimes, I wasn't that tuned in to what was happening out in Alberta at that time, but I got a job and worked on the rigs as an engineer.
I spent about five and a half years with large Canadian midstream businesses doing a bunch of different roles — some technical, some commercial, and that's where I ended up doing an MBA specialization in entrepreneurship ~ I am grateful Mick Dillger, at the time VP of my business unit, for supporting my MBA which I believe helped in executing some huge wins for the business. During this time I really had that itch to start something myself.
I did some business consulting, started a tech company — which was a disaster — but still a fun journey and invested in some startups as well.
In a nutshell, that’s what I did before the current adventure that I'm on.
Shifting to entrepreneurship…
I'm just not the typical engineer, if there's such a thing. With my generation, the options were like, be a doctor, an engineer, get a business degree, or go into the trades. I liked to build things, so engineering seemed like the best choice.
There was lots of opportunity, and the path was laid out very nicely. There’s always upward mobility, but there was something more that I had an itch for: people dynamics.
When I was early in my career, I used to look at salespeople and think,
Oh man, they're pushy, have fake charm, and make false promises
They're just going out and drinking beers and trying to persuade people…
I'm never going to be that…
Luckily, I was shown over a period of time what sales really was.
It's helping people solve a problem to make their future lives better than the current state — better measured by their values and perspective. Sophisticated sales is more psychology than anything else. There’s lots of strategy involved, and I find it very interesting.
I think that's just where the draw came from. I was just more interested in that than doing calculations.
At 38, I woke up and kind of said, this career has been awesome…you keep hitting new highs, and every time you hit the goal, you’re making more money, but shortly after, it’s kind of empty, right?
I thought it was time to maybe step back and take a little bit more of a purposeful step forward in the second half of my career.
Past failures…
Back in 2013, I had an idea from my MBA around short-term labor markets and people having side hustles.
So we tested that out, had some conversations, and there was some demand. Then, during a startup weekend, we got together with seven people and started to build a MVP. Four of us stuck around after that.
We did all the wrong things with some great potential in between. We had a brilliant programmer who did all the tech work, and we had maybe 100 users on the application, so it was working, technically. But the four of us had a conversation, like, Alright, where are we taking this?
And there were four different answers.
Interesting side note: I think in Austin, Texas, there was a company called Rig Up — maybe they've been acquired by now — but the foundation of what they built was exactly what our use case was, and I think they turned into a multi-billion dollar business.
At one point it was like, Shit, we really should have stuck with that.
But obviously, there's no way of knowing whether or not things would turn out the same way, and likely not as there are many challenges and some luck in going from zero to one.
Finding the right opportunities…
So there are different ways to go about buying a business. There is the funded avenue, meaning you’re backed by some type of private equity firm or equivalent, , and there's ‘self-search’, where you don't necessarily have funding behind you.
When you’re a self-searcher, you have no salary — you’re out of pocket on all expenses for search process and you're also putting up the money to buy a business.
When I started this, I did an assessment, looked at all the different options, and self-search just fit my personality and goals better.
I was fortunate to have some dollars saved— which now I've spent a bunch because I've been doing this for a while — but I think it was ultimately the right choice.
There are a lot of down periods, so it’s great if you have a support system in place that can pick you up and say, Hey, head up, keep going. You've got more to do here.
The funded approach usually has that, and also things like a team of advisors that are there on a bench waiting to support you — legal, accounting, and subject matter experts.
And typically, when you’re going the funded route, you’re also getting paid a stipend while you search. It’s not a huge amount of money, but you’re getting paid for the 18-24 months that you’re usually given to find something.
So yeah, there are some pretty clear advantages going that route.
You have more security when you’re funded, but that security comes with sacrificing a degree of freedom. If you’re doing a self-search — you just do it your way.
With self-search, at the end of the day, whether things go good or go bad, you get to look in the mirror and know that you own it.
My advice, take your time in evaluating what route works best for you. Not what I chose, not what your peers chose, but what fit with what you want to get out of this journey.
Make no mistake, this journey will challenge you and has many decisions that are ‘one-door’, as Bezos defines them.
Knowing when to move forward…
When I left my last business, within the first week, I was running around taking meetings, and there were several people in my network that were like, JD, chill out, man. How often in the middle of your career do you get to take a break?
That had a big impact on me.
After that, I slowed down, and focused on just learning as much as I physically could about ETA, so that’s what I committed to for the first three months last summer — not working, no real timeline, just learning and revisiting my purpose, goals, and vision of the future.
From there, I divided up the savings I had and designated a certain amount as my “Investment Pot” — stuff I can’t touch until a business is found.
Then, with my remaining savings, I essentially looked at how much money I had, and then I said, alright, what's my runway to be able to live life as we currently do?
It was about 14 months. So I knew my runway.
After looking at the data from searchers over the past decades, it looked like it should take me no more than 24 months to buy a business. But I don't have 24 months. I have twelve.
Nothing better than a little pressure to keep one focused on a task. laughs
Daily habits & process…
The first thing I realized was that there's no way I was going to be successful if I was going to do it just by myself. Sure, I am the driving force behind it, but several people are helping me along the way.
Starting out, it was identifying brokers and M&A advisors that deal flow could come from.
After that, I started to network with bankers, largely because I knew I was going to need senior debt to finance a deal.
Generally, bankers aren't that interested in chatting with you before you have a deal.
And it makes sense—they can't talk to everybody.
There's a small percentage of people who are ever going to come with a transaction.
That being said, everyone I reached out to and met with was extremely gracious with their time.
Essentially, what I was trying to do was give them a download of who I am and that I am committed to this journey. I also do check-ins every so often. The idea is that when it finally comes time, I can call Benito at BDC or whichever bank it is and tell them that I have a deal, they've got some context to keep things moving.
Once you've done those rounds and know who you need to be connected with — who to send regular or frequent updates to — then it's time to focus on deal flow. You virtually forget about everything else.
That's really where all my time was spent during prospecting. It’s a matter of reaching out to brokers frequently, looking at their websites, and seeing the deals that they're posting. There are also deals that don't get posted online, and those are the ones where it takes a little bit of time and connections to tap into.
A lot of the work goes into proprietary outreach — which is a huge conversation in itself — but it's essentially going out and cold calling and emailing people. Usually, you’ll try to connect with someone around eight times before you move on.
It's a lot of conversations with people. I haven't looked at my stats for that in a while, but they're huge. The emails aren't even worth counting, I just focus on the calls that I have and in-person meetings, because those are the valuable ones.
The big key to outreach is that it multiplies on itself. Every time you go for a coffee, or have lunch with a prospect, or even have a phone call — you can get an introduction to somebody else, and then it builds and builds.
All of a sudden, you have a great problem: you don’t have enough time to do all of it — to have conversations with everybody.
Qualifying a ‘good’ business to buy…
The company profile has developed over time.
When I started, I was very broad. I was looking at $1 million or $5 million EBITDA across Canada, and the list of business types I wouldn’t look at was short.
For a while I would tell people I was agnostic to type of business however that was a mistake - telling people you are agnostic in the business you are looking for is about as valuable as having them guess as to what you’re looking for - thanks for the lesson Brenda.
There's a sweet spot where the opportunities come, in my opinion. It's around $950,000 EBITDA up to about $2.5M, where I just see a lot of businesses that have a lot of potential and a lot of value.
The focus now is on Western Canada, ideally within 3 hours of home.
No matter what business I end up acquiring, the first year, I expect to be at their operations the majority of the time. From an interest perspective, the number one priority is the people dynamic. I'm going to be an operator, not just an investor, so I need to be in there, connecting with people and learning from them.
My perspective is that the numbers are important but they only tell a fraction of the story about the business. Once you determine the numbers work, focus on the people, stories, culture, and impact the business has had - the difference between good and great businesses live here.
But generally, after a year, I’ll be looking at, how do I move from working in the business to working on the business?
Obviously, in Alberta, there's a pretty good chance you're going to find a business that is involved with oil and gas. There's always cycles within oil and gas, boom and bust, so if you're looking at a business and they have a high contribution of their revenue coming from oil and gas, that's something I want to be aware of.
It doesn't scare me away, but I want to be able to identify what my plan would be to diversify that revenue stream. So if they have say 90% of revenue coming from oil and gas, how do I get down to 50? If I can't see that, if they have a product or a service that can't be adapted to another industry, that's a no-go.
But don’t get me wrong, my career has been rooted in Energy, and I remain long on Canadian and USA Oil & Gas. While the industry seems to face an ever-growing ledger of challenges and criticisms—whether valid or not—all I see are opportunities for businesses and individuals willing to embrace the challenge.
Maybe it’s my fascination with the grit and resilience of Wildcatters, or my early career days working on the rigs in Zama City, but I don’t think the industry is on its way out.
In fact, I believe it’s ripe for innovation.
Value-add vs. solid businesses…
Some people approach it with the idea of getting a smoking deal. Finding an owner that doesn't know what they've got and buying it. I want to buy a business for market value and think it's the smart way to do it.
I want the Sellers, six months after closing day, after the transition, to still look back and go, that was a good value.
It's going to be different for different opportunities, but I expect to have a good transition and relationship with the seller even beyond that transition period of the business.
If I can find a business that doesn't have a sales team or function, but they've been growing, or they've been around for say 30 years, that is brilliant.
You have to dig more into it, but there's a great opportunity there.
Fears & worst case scenarios…
What scares me are the unknown unknowns — and there's nothing I can do about those, so I don't let it keep me up.
One thing that kind of freaks me out: let's say I find a business, it checks all the boxes, but they've got this industry revenue contribution risk or customer concentration risk — so a lot of the revenue comes from an industry or a small set of customers.
I look at that and say, how quickly can I find the solution?
How can I reduce that exposure?
By building up sales in other parts of the business?
How quickly can I do that?
And what is the likeliness of a downward cycle happening before I can get there?
Starting a business vs. buying…
To over-generalize, there are three paths: One is to get a corporate job. That's deemed extremely safe, even though there is always a risk that is typically understated.
Another option is to go to a startup, and with doing that, you're swinging for the fences. You're going for the big outcome, but it’s extremely risky. I think 96% of startups fail, and of the 4% that don’t, 98% of them never get to a million dollars of revenue.
I wish I would have read something like that earlier in my career.
Going the buy-then-build route, it is less risky. But there's still risk to it. Sure there are some brutally bad outcomes, but any upside in life also has risks associated with it.
The individual needs to ensure the risk and reward fit them.
Newton’s First Law — an object in motion stays in motion…
A business that's been around for 20 years has usually gone through several cycles, and it's probably going to stick around as long as you don't screw it up.
There are caveats to that, but that's how I think about it.
Lessons learned…
The only way I was going to make sure I got this done was to put pressure and hurt in the process for me. To see my bank account every month with nothing going in. And even like the psychology of going, Jon, you've been “out of work” now for twelve months, what the heck are you doing?
Just being my own biggest critic.
There are pros and cons to that for sure — but I needed that pressure, and I've been able to do a lot of work and learn so much by doing that. The amount of knowledge and insight I can give to other people on this journey, compared to where I was even six months ago, is crazy.
Would I have been able to do that while I was focused on another job?
There's no way.
I think for other people it can work, especially if you've got constraints on what you're looking for, but for me, it wouldn’t.
Part of this is really getting in tune with what you are good at — defining what is that thing that you're just obnoxiously great at, and then making sure that whatever it is, you leverage it at the core of that business or that opportunity.
Best & worst parts…
The best part of this whole process is that I'm feeling confident I will find and close on a business in 2024. I won't share a bunch of details now, but things are going well, and I’m extremely excited.
I've made a bunch of phenomenal friends on this journey thus far and that's going to blossom into something awesome over the next years and decades.
Then there’s the learning…
The process of buying a business provides you with so many learnings that can apply to business and life in general.
The downsides… Man, there are dark days.
If you are doing this as a self searcher and you're at your home office and you get those dark days, it’s hard to get through them. I underestimated how tough those are.
The best thing is to surround yourself with people that are on this journey, some earlier than you, some that are ahead of you.
Also, make sure you're doing everything that you want to do in your daily life, just like you would when you're running your business.
Think of it as a marathon without a finish line.
That’s it for this issue!
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If you, or someone you know would like to be featured, or just want to connect, feel free to message me on LinkedIn, or, if you’re building a business of your own and need some support, we should chat!
Interview by: Alex Tribe
Edited by: Angus Merry