Colorado Storm Restoration, Denver Insurance-Claim Roofing & Renovation Contractor

$3.6M

Revenue

$596K

SDE

2.9x

Multiple

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Full Editorial Writeup

This is a Denver-based general contractor that performs insurance-claim restoration and renovation work on residential and commercial property after hail, wind, fire, and water events. It started in 2016 as a roofing operation, added siding and windows in 2018, and pushed into interior renovation in 2020. Today it runs on roughly $3.6M of revenue with $596K of owner cash flow, and about 90% of historical revenue is funded by insurance claims rather than out-of-pocket consumer spend.

The structural edge here is the Class B general contractor license, which is uncommon at this revenue scale and lets the company deliver multi-trade scopes single-source. That licensing breadth is the reason it has won public-sector on-call contracts against much larger bidders, including a Denver Housing Authority contract with a maximum value of $8.0M (roughly $800K performed, $7.2M in remaining ceiling capacity) plus a Boulder Housing Authority award and three managed repair programs generating about $1.2M per year.

Customer concentration is genuinely low: no single customer exceeded 3% of revenue in any historical year. The interior renovation and managed-repair work matters because it de-risks the weather cycle, producing revenue in years with no storm activity, which is the classic vulnerability of a pure storm-chasing roofer. Both principals are active and willing to support a transition, which is a diligence flag as much as a comfort given that the relationships winning these contracts may be personal.

Why we like it

Earnings quality is anchored by insurance-funded demand, with roughly 90% of historical revenue paid through claims rather than discretionary homeowner budgets. That means the customer's willingness to pay is largely underwritten by an insurer after a covered loss, which holds up in a downturn far better than cash-pay remodeling. Cash flow of $596K on $3.6M revenue reflects a healthy 16.5% owner margin for a trade contractor.
The moat is the Class B general contractor license paired with earned public-sector relationships. Housing authority on-call contracts are hard to win and hard to displace once performance is proven, and the DHA relationship alone carries $7.2M of remaining ceiling capacity. Winning multi-trade scopes single-source against larger bidders is a durable structural advantage at this revenue scale.
Market tailwinds favor the Colorado hail and wind corridor, which produces reliable recurring storm damage and a steady flow of insurance claims. Layering in interior renovation and three managed-repair programs at roughly $1.2M per year smooths the weather cycle so the business earns even in quiet storm years. Customer concentration is a genuine strength, with no single customer above 3% of revenue in any year.
The operator advantage is a diversified, license-backed platform priced at 2.94x cash flow, which is reasonable for a services business with contracted forward visibility. An acquirer with capital can lean into the public-sector channel and managed-repair programs to build a base of predictable revenue underneath the volatile roofing line. The absence of real estate or heavy equipment in the deal keeps the capital footprint light.

How to improve it

Formalize the managed-repair and housing authority relationships into documented, transferable agreements before close so the recurring revenue does not walk out the door with the principals. Map every active contract, on-call agreement, and program to a named counterparty and confirm assignability. This is the single most important value protection lever in the first 90 days.
Build a dedicated public-sector bidding function to convert the licensing edge into a repeatable pipeline. The company already proved it can win against larger bidders, so systematize proposal preparation, bonding capacity, and compliance to pursue additional housing authorities and municipalities across the Front Range. Turning a couple of wins into a bidding machine is where the multiple expands.
Reduce reliance on weather-driven roofing by scaling the interior renovation and managed-repair lines that generate revenue in no-storm years. Set explicit revenue targets for the non-roofing segments and staff crews accordingly. A higher mix of predictable, contracted work materially improves the resale multiple.
Tighten the insurance-claim workflow with supplement recovery, documentation standards, and adjuster relationships to increase realized revenue per approved claim. In restoration, disciplined supplementing on scope and materials is often the difference between a thin job and a strong-margin one. Small process gains here flow straight to cash flow.
Institutionalize sales and estimating so growth does not depend on the two founding principals. Given both owners are active, hire or promote a general manager and lead estimator during the transition window and document the estimating playbook. Reducing owner dependency is essential to protect the earnings you are paying for.
Invest in a subcontractor and crew capacity plan to absorb the $7.2M of DHA ceiling capacity and future awards without margin erosion. Ceiling is not guaranteed revenue, so build a reliable labor bench that can scale up on award and stand down between projects. Reliable delivery is what keeps on-call contracts renewing.
Layer in a CRM and post-job referral program targeting the residential insurance-claim customer base to capture repeat and neighbor demand after storm events. Storm-damaged neighborhoods concentrate demand geographically, and a systematic canvassing and referral engine improves close rates. This lowers customer acquisition cost on the discretionary roofing side.

Diligence notes

Scrutinize the forward revenue claims carefully, because the listing itself admits the DHA $7.2M figure is a ceiling and not a guarantee, with only about $800K performed to date against an $8.0M maximum. Verify actual work orders, historical draw rates against the ceiling, and whether the contract renews or expires. Do not underwrite the $12.96M identified forward revenue as booked backlog.
Confirm the Class B general contractor license is transferable to a new owner or that a qualifying individual can be retained, since the entire competitive thesis rests on it. Understand the licensing, bonding, and insurance requirements to keep public-sector eligibility intact post-close. Loss of the license or qualifier would gut the moat.
Test owner dependency given both principals are active and public-sector wins may hinge on personal relationships and track record. Determine who owns the adjuster, housing authority, and managed-repair relationships and whether they transfer. Push for a longer transition, earnout, or seller note tied to contract renewals.
Reconcile the gap between $596K cash flow and $396K EBITDA to understand the owner add-backs and whether they are truly discretionary. Examine revenue seasonality and year-over-year volatility tied to storm activity, and separate weather-driven roofing revenue from the contracted interior and managed-repair base. A few big hail years can flatter a trailing average.
Verify the low customer concentration claim and the 90% insurance-funded mix with actual invoices and payor records across multiple years. Confirm receivables aging and collection experience on insurance claims, which can stretch and generate disputes over supplements. Working capital needs on claim-funded work can be significant.
Assess crew and subcontractor structure, including whether labor is employed or subcontracted and any worker classification exposure common in the trades. Review workers compensation history, safety record, and any pending liens or warranty claims on completed roofing and renovation work. Latent warranty liability is a real risk in restoration.

Source

Originally listed on BizBuySell. View original listing →