Navigating Funeral Home Mergers and Acquisitions in 2025: A Conversation with Todd Reich

In today’s dynamic mergers and acquisitions (M&A) landscape, funeral home owners face both challenges and opportunities as they consider selling their businesses. To shed light on current trends and best practices, Todd Reich, Co-Managing Partner at The NewBridge Group, sat down with Umberto “Berto” Putrino, Director of Social Media and Strategic Communications at Rollings Funeral Service and host of the “A Grave Affair” podcast.

In this interview, Todd shares what’s driving buyer interest in 2025, how funeral homes can best position themselves for a sale, and the common pitfalls to avoid. He also walks us through a recent success story and offers forward-looking advice for anyone considering a sale in the next few years.

Berto: Todd, how did you get into brokering in the funeral service space?

Todd: I had been working in investment banking and M&A for about 20 years when Jeff Boutwell convinced me to join The NewBridge Group. My background involved advising closely held businesses, typically in manufacturing, distribution, and healthcare services, on capital raises and sales, with revenues ranging from $10M to $100M. At first, the funeral service felt like a smaller industry, but I’ve come to love it. Funeral directors are among the most genuine and grounded people I’ve met. Helping them transition into retirement and achieve their goals has been incredibly rewarding. Our process at NewBridge is very similar to traditional M&A. It was a natural shift for me.

Berto: What are you seeing in terms of funeral home mergers and acquisitions here in 2025?

Todd: Deals slowed down significantly in late 2023 and into 2024 due to rising interest rates (cost of capital), inflation, and operational challenges, such as declining call volumes following the COVID-19 pandemic. As a result, businesses that were worth a certain multiple in 2022 weren’t seeing the same valuations in 2023. Fortunately, in late 2024 and now in 2025, rates have decreased, and inflation has cooled. That’s led to stronger offers and renewed buyer activity.

We’re also seeing more aggressive moves from buyers who have recently refinanced. National players, such as SCI and Park Lawn, remain selectively active but tend to focus on larger opportunities. Carriage has not announced any acquisitions in 2025. Buyers we work with, such as Rollings and Pinnacle, are privately held and are paying strong multiples.

Berto: Are we seeing more consolidation, or has the pace slowed down?

Todd: We’re definitely seeing continued consolidation. While it’s not at the pace we saw in the late ’90s or during the boom from 2017 to 2021, it’s picking back up again in 2025 compared to the past decade.

Berto: What types of buyers are most active this year?

Todd:  Some of the public buyers are active again, but more selectively. Size matters to them; they prefer larger operations. Some regional firms, such as Foundation Partners, Anthem, and Heritage, grew rapidly from 2018 to 2022, but we haven’t seen them show interest in acquiring this year.   They seem to be more focused on operating what they own and likely reducing debt rather than continuing to make acquisitions. 

The most active and serious buyers right now are firms like Rollings and Pinnacle. They’re privately financed, recently recapitalized, and putting forward attractive offers for the right sellers.  These firms bring benefits to the table, such as HR, recruiting, strong preneed programs, operations, and financial reporting systems. 

Berto: From a seller’s perspective, what makes a funeral home attractive to buyers?

Todd: There are a few key factors:

• Minimum Real Revenue of $1 million (after netting cash advances)
• At least 150 calls per location
• Strong staffing for the business’s current needs
• Strong preneed program
• Ownership of real estate is a plus
• An on-site crematory is another attractive feature
• Strong financial systems and reporting
• Having management in place after the sale. Being able to explain to a buyer how the business will continue to operate well without the owner there is very important. 

Many years ago, buyers would look at the price per call or other metrics.  However, the primary value driver has been EBITDA (Earnings Before Interest, Depreciation, and Amortization) for over 20 years. Buyers are also starting to consider overhead more closely, as well as capital expenditure requirements. 

We can’t stress enough how much clean, organized financials impact buyer confidence. If an owner takes weeks to provide numbers or is unsure of their revenue, it’s a red flag.

Also, have a proactive succession plan. The best transactions we’ve worked with are those involving owners who finalize the sale while they’re still willing to help with the transition. 

Berto: What are some of the common pitfalls sellers should avoid?

Todd:

• Neglecting financial systems – Disorganized books can make it harder for a buyer to determine true profitability, which in turn makes it more difficult for them to make an offer.
• Believing that business and real estate should be valued separately – Your real estate is included in the sale because it is needed to generate the operating profit.   We see occasionally where it makes more financial sense for an owner to close the business and hire a realtor to sell the property.  But in most cases, the business and real estate should be more valuable than liquidating the assets.
• Rejecting a good offer based on an arbitrary value in mind – Your business’s value is based entirely on the projected profitability.  If owners have a number they want, but it’s not based on profitability, then it makes it really difficult to get a transaction completed.  
• Not having a strong management team in place – Sometimes a buyer can help recruit new employees, but it’s better if experienced staff are already in place.
• Underpricing – Failing to raise prices to match market value can harm profitability and ultimately affect valuation.

Also, avoid waiting until you’re fully ready to retire. Selling before you exit the business usually means a higher valuation and smoother transition.

Berto: Can you share a recent success story?

Todd: Absolutely. We worked with Mike and Matt Haller, second-generation owners of Haller Funeral Home in Chillicothe, OH. They didn’t have a solid succession plan but wanted to be proactive. We gave them a complimentary valuation, and while the number was in the ballpark, they initially weren’t interested in staying on post-sale.

I introduced them to Tony Kumming at Pinnacle Funeral Service, and they hit it off. Once they understood Pinnacle’s culture and the need for a transition period, they were on board. COVID made negotiations tricky, but Pinnacle met their expectations. Mike is now 90% retired, and he’s been very pleased. There’s always a learning curve, especially with new software, but now their team is thriving and much of the admin work is off their plate. Mike seems to be very happy with the transaction and is still somewhat involved with the business.

Berto: What does the sale process look like in 2025?

Todd: If you have your financials ready, we can usually provide a valuation estimate in two to three weeks. At a high level, the process entails:

1. Valuation– For serious sellers, NewBridge can provide a complimentary business valuation, showing what a likely offer (purchase price and structure) would look like and then present those sellers to buyers with a similar culture and fit. 
2. Direct match – Some sellers already know they like a firm like Rollings, so we facilitate that connection directly. Rollings covers our fee in those cases.

The timeline ranges from three to nine months, depending on how quickly the seller can respond to buyer requests.

Berto: How have valuations changed, and what metrics are most important?

Todd: The focus has shifted from “price per call” to EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). EBITDA is a term the larger buyers and bankers use, and it’s basically the Operating Earnings of the business.  With cremation rates on the rise, call volume is no longer a reliable metric. EBITDA gives a more accurate picture of profitability.

Berto: Are there any new regulations affecting deals?

Todd: There are ongoing developments regarding price transparency, possibly requiring funeral homes to post pricing online. While this may impact day-to-day operations, it hasn’t significantly affected business valuations yet. However, some states have restrictions on licensing and cross-ownership between funeral homes, crematories, and cemeteries, so buyers in those markets need to tread carefully. Every state has different ownership regulations.  For example, in Maryland, a charter is required if the buyer is not a licensed funeral director in the state. There are limited charters. In Pennsylvania, similar laws limit the transfer of ownership. 

Berto: What should owners considering a sale in the next one to three years be doing now?

Todd: Start with a plan. Set a specific date. Get your financials clean and organized. Think about succession and talk to someone who knows the landscape. We offer free, confidential valuations to help owners understand their options without pressure.

Berto: What’s your prediction for funeral home M&A beyond 2025?

Todd: We’re seeing more owners interested in selling, which appears to be related to more baby boomer-aged owners ready for retirement. There are fewer buyers now than in the past few years because several private equity-backed buyers got overextended, probably paid more than made sense, and are now focused on operating rather than continuing to make acquisitions. There are a few groups, such as Rollings and Pinnacle, which are structured with permanent investors that appear to be extremely well-funded and are becoming more focused on acquisitions.   

There are fewer buyers now than in the past. Several have made mistakes (too much debt, grew too quickly, poor integration) and are fixing their problems. In the same sense that it’s challenging to find good employees right now, it may also be difficult to find buyers in the future. So, if an owner is contemplating a sale, they should consider it now while there are some strong buyers that are still interested in growing. It’s really difficult to predict which companies will or will not be buying next year. 

Berto: Any final advice for owners thinking about selling?

Todd: If you’re proactive and prepared, you’ll stand out. We see a risk of too many sellers coming to market at once. If there are not enough buyers, then it could become a buyer’s market, and that’s not where you want to be. Don’t wait until you’re ready to retire to sell. Your business is more valuable if you’re willing to stay somewhat involved in operations to assist the transition. If you wait until the day you’re ready to leave the business, you may sell for a discount. Also, don’t assume there will be more buyers later. There are strong buyers right now, and we believe owners should take advantage of that while they can.  We get many calls where owners say, “I can’t take it anymore. I’m exhausted and want to sell.” While these are attractive businesses, a buyer has stronger confidence in a business if the owner is available to help transition to a new management team for 6-24 months. Regardless of the circumstances of a sale, NewBridge maintains relationships with most funeral industry buyers, and we are confident that we can match funeral home owners with the buyer who best fits their needs.

Ready to Start Planning Your Next Chapter?

If you’re exploring your succession options or just want to understand what your funeral home might be worth, please call Todd for a confidential discussion at 404-542-9956.