How a federal employee bought a government contracting firm

Happy Monday!

I’m going to share a story about Alex today, a federal government employee turned private-sector contractor who had been exploring business acquisitions for over a year.

Six months after formally joining Acquisition Ace, he closed on a medical consulting company serving federal agencies - in the exact niche he’d spent his career working in - for $315K, which he funded the down payment for with a 401K loan.

Community Spotlight

Before getting into Alex’s story, here’s another success story from the Acquisition Ace community.

Josh bought a $3.8M digital marketing agency after joining Acquisition Ace, and said:

The group brought him the momentum and intention he needed to go from searching to closing his first deal.

👉 Want to become a part of the same community that helped Josh close a multi-million dollar deal? Book a call with our team here.

Before the Deal

Alex and his wife had been investing in real estate and looking for ways to grow their income beyond long-term rentals.

He started browsing broker sites before he even joined any program, reaching out cold, learning the basics on his own.

When he found Acquisition Ace, he described it as getting a clear roadmap for a journey he’d already started, but didn’t quite know how to finish.

Finding the Deal

Alex first spotted this company in November 2024, listed at $500K. Before he could move on it, the seller went under LOI with another buyer.

When he joined Acquisition Ace in March 2025 and found the same listing still active on SMBMarket, he had the deal reviewed by the coaching team.

The feedback was direct: it wasn’t worth $500K based on historical performance.

Armed with that analysis, Alex came in at $280K. The seller countered at $315K.

Alex accepted, and the numbers worked.

(Inside Acquisition Ace, members get their deals reviewed by experienced coaches before submitting an LOI, so they’re not negotiating blind. To see how Acquisition Ace could help you land your first business acquisition, book a call with our team here.)

The Deal Breakdown

Original listing price: $500K

Final purchase price: $315K

Revenue: ~$920K annually

Net income/SDE: ~$110K annually

Financing: 70% SBA loan, 20% seller note ($65K over 3 years, payments starting March 2026), 10% buyer injection

Down payment source: 401K loan

The seller note originally was structured as a two-year repayment, but SBA rule changes mid-process required it to be on standby for the full loan term.

The seller agreed, and Alex negotiated three years of deferred payments to give himself additional breathing room.

What He’s Doing Now

Alex is splitting his time roughly 50/50 between his W2 advisory role and the new business, both fully remote, which makes it manageable.

His wife has stepped in to help implement systems and processes, and the existing team includes an HR specialist, an executive administrator, and the former owner’s son handling IT and backend operations.

The former owner stayed on as a consultant, though the transition was less hands-on than Alex expected, a learning he’s quick to flag for other buyers.

He hired a Fiverr consultant to build out process flow maps and SOPs, which the team responded to enthusiastically.

His goals for year one: win three new contracts, form three new vendor partnerships, and streamline the hiring process with documented SOPs.

The Key Lesson

“You don’t need $100,000 sitting in an account to do this. You can do it with a lot less, especially when you find a deal in a niche you already know.”

Alex used a 401K loan for his down payment, and bought a business in his own industry.

He closed in six months while working a remote W2 job, and is now generating six figures in cash flow on top of his salary, with room to grow as he wins new contracts.

The deal wasn’t that complicated.

He just had to take the first step.

Ready to find and close your first acquisition?

Join the Acquisition Ace community with 2,000+ members who are learning to find, finance, and close deals just like Mark.

👉 Book a call with our team here to see if it’s a good fit.