Mergers & Acquisitions Series with Orrin Huebner and Neil Swindale
Lessons in M&A with Guest Steve Marx
In the vending and refreshment industry, mergers and acquisitions can feel distant—something reserved for larger operators or later stages of a career.
But Steve Marx’s story proves otherwise.
On an episode of the Mergers & Acquisitions Show, Steve Marx, founder of Royal Vending in Minnesota, shared his journey from a handful of bulk candy machines to building—and selling—a business generating more than $10 million in annual revenue.
His experience offers a clear look at what actually drives a successful exit.
It Started Small—Really Small
Steve didn’t come from money or the industry.
“I was working in law enforcement… and somewhere along the lines, I decided to get into bulk candy vending machines.”
That decision turned into a side hustle—and quickly something more.
“That grew from one machine up to about 300 machines.”
Then came a moment many operators can relate to:
“I had a client ask if we did full-line vending. I didn’t even know what that meant.”
So he figured it out. One beverage machine. Then a snack machine. Then more accounts. Over time, Royal Vending evolved into a full-service operation spanning vending, micro markets, and office coffee.
By the time he sold in 2017:
- $10M+ in revenue
- ~25 employees
- Multiple service lines
Built Without Money—But With Intent
Steve’s early days weren’t backed by capital.
“I did not come from any affluency… had no money other than what I was making from a paycheck.”
He raised initial funds through friends and family, bought out his partner, and steadily built the business from there.
What stands out most is that he wasn’t just building for growth—he was building with an end in mind.
“I think there was always, in my mind, an exit strategy.”
Not an immediate exit. Not a rushed one. But a clear outcome.
“I wanted to make sure that when I did get out, I’d have enough money… and not have to take another job.”
Run the Business Like You’re Selling Tomorrow
One of the biggest M&A lessons from Steve’s story is how he operated long before the sale.
“I always ran the business in a way that if I was going to sell the business tomorrow, I was going to recoup my investment.”
That mindset shaped everything:
- Capital spending
- Equipment decisions
- Growth strategy
“Anything I decided to invest in, there was going to be a return.”
Importantly, this didn’t mean pulling back—it meant being intentional.
“We didn’t run it down… we always ran it as if we were going to be in business the next year. We were just more cautious about how we were spending money.”
That’s the difference between preparing to sell—and actually building something valuable.
The Deal That Didn’t Happen
Steve’s exit didn’t happen on the first try.
In 2014, he was close to selling—but the deal fell apart.
“It was really tough… to walk away from the deal and go back to work the next day.”
But in hindsight, it was one of the best things that could have happened.
“I’m glad it happened… because we grew exponentially in those three years.”
During that time, he leaned into micro markets, refined operations, and—just as importantly—learned what selling actually looks like.
“I had bought businesses before. I had never sold my own business.”
Three years later, the same buyer came back—and the business was worth more.
Revenue Doesn’t Matter If There’s No Profit
One of the most important M&A takeaways from the conversation came around account mix.
Early on, Royal Vending relied heavily on management business and national accounts.
But Steve made a critical shift.
“At the end of the day… we were really making nothing.”
So he walked away.
“We left all management… we had zero left in our portfolio and we were a much better company for doing so.”
Why?
“It’s not volume. You’ve got to have actual cash flow coming through the doors.”
That line says everything.
Too many operators chase top-line revenue. Buyers don’t.
They’re buying:
- Profitability
- Stability
- Transferability
“I didn’t need plaques on the wall,” Steve said. “I needed money in the bank.”
People Drive the Outcome
When it came time to sell, Steve wasn’t just thinking about valuation.
He was thinking about his team.
“I didn’t want to leave these people high and dry.”
He had built a strong leadership group—a controller of 20 years and a trusted general manager—which made the business more transferable.
“I was very fortunate to have really good people around me.”
He also took steps to protect them during the transition.
“I wanted to set them up for success… and make sure the buyer was going to be successful as well.”
That mindset helped create alignment instead of friction.
“You could be hostile when you sell,” he said. “But at the end of the day… they’re paying me.”
The Reality of Telling Employees
One of the more honest parts of the conversation was around communication.
“Usually it doesn’t go well when you tell your people… they get nervous.”
And for good reason.
“They don’t know if they’re going to have a job… and now instead of focusing on customers, you’re focusing on employee retention.”
That shift can impact the entire business.
In Steve’s case, the first failed deal made it even harder.
“I gave them my word I wasn’t looking at selling… and then three years later I sold.”
It’s a reminder that timing and communication matter just as much as numbers in any transaction.
The Second Time Around—It Closed
When Steve was ready again, he didn’t force it. He opened a conversation.
“My intent was to see if we could get some conversation starting… and that’s exactly what happened.”
From there, things moved quickly:
- Conversations restarted mid-2017
- Deal closed in November
Holdbacks Aren’t the Enemy
Holdbacks often create anxiety for sellers—but Steve’s experience tells a different story.
“We really did really well on our holdback… we grew a decent amount of business after the sale.”
In fact:
“Our holdback was significantly higher than stated volume.”
When transitions are handled well and the business continues to perform, holdbacks often become upside—not risk.
The Moment Everyone Wonders About
Then there’s the moment every operator thinks about.
“At some point, I said… where is my money?”
Everything was signed. The buyer had taken over. And he was waiting.
“I just kept hitting my computer button.”
Then the wire hit.
“That is a surreal feeling… you build something from scratch… and then you get that wire payment.”
“I was on cloud nine for days.”
Life After the Exit
After the sale, Steve stayed on and focused on what he enjoyed most: selling.
“When I didn’t have the responsibility of running the show… I was able to go out and close deals.”
Since then, he has consulted, advised on M&A, traveled, and stepped away from day-to-day operations.
“Post-sale has been fantastic… I don’t work too hard. No stress.”
The Bigger Takeaway
Steve Marx’s story is not just about selling a business. It’s about building one the right way.
He didn’t chase vanity metrics. He focused on profitability. He built a strong team. He made disciplined decisions. And when the time came, he executed.
“I didn’t need plaques on the wall,” he said. “I needed money in the bank.”
That mindset is what made the exit possible.
Because in the end, the best exits aren’t created at the closing table.
They’re built years before it.
🟢 Want to be ready to sell when the time is right? Subscribe to Vending Connection so you never miss one of Orrin’s M&A articles.
Orrin Huebner is the CEO of Orrin Huebner LLC. After many years of being an owner/operator, he now consults and is an intermediary to the industry. His experience as a very successful operator and then leading OCS for a Canteen provides great value.
This article was edited by Becca Woll.
Share this Story
Related Posts
