Restoration is one of the most unpredictable businesses in the modern economy. Contractors will often go days, or even weeks, without seeing a new and legitimate job opportunity. Then, without warning, generally at 4:30 on a Friday afternoon, the phone will start ringing and the backlog of jobs will pile up two, three, or four at a time. This will go on for days until it just stops again. In most regions of the country, these surges are related to weather events, giving the business something of a seasonal pattern. Even so, some winters and storm seasons are worse than others, making it very difficult to plan and predict the appropriate amount of resources necessary to meet the demand.
Despite the capricious nature of this business, it continues to draw the attention of private equity firms, venture capitalists, and even vertical market investors, because it is considered to be stable over the long term. This is mainly due to the security of the insurance claim benefits associated with the projects. This funding, coupled with deep gross profit margins, makes financing operating costs through leveraged receivables attractive to investors. In other words, restoration companies present less risk and higher returns to the bottom line than companies in other industries.