Instead of opening a small business, you can buy an already existing one. In this Expert Insight Interview, Carl Allen discusses this type of self-employment. Carl Allen is an experienced entrepreneur, investor, and corporate dealmaker with an impressive $48 billion in transactions. He is also the editor of the Dealmaker Wealth Society.
This interview discusses:
- Finding the right business
- Belief System
Find the Right Business
The research showed that in 2019 more than 6 million Americans started their own business. Around 50 percent of them will fail within the year. So, you can use the Leverage Buyout strategy to buy an already existing small business. People differ, so the first thing you need to do is to determine what kind of business you want to buy and why. Logically, if you worked for IBM, buy the IT company instead of a laundromat. That way you will bring the value of experience and human network in the business. Search for business is the same as a search for a house, you do not pick the first one. The perfect business to buy is the combination of the right business, right seller, and business that has some financial assets or cash flows to use for the purchase as well. The business should be profitable with around 10 percent a steady profit margin. For instance, baby boomers usually have businesses with steady profit margins and great word of mouth reputation. That type of business would be a great option to buy and to use modern marketing and technology tools to scale it.
It is important to believe in yourself to be able to go through two stages of buying a business. The first one is acquiring a business which means building a trustworthy relationship with the seller. Sellers want someone who will respect their legacy and cherish their business. And secondly, after you buy the business, you need to decide whether you want to build your portfolio as an owner/investor, or you want to be present owner/manager. People who choose to be owners/managers usually are resistant to hire somebody who will be their number two in business until they feel overwhelmed. But you should hire an assistant who will take care of the daily operations so that you can take a more visionary CEO role.
Like everything in life that is meaningful, buying a business takes time as well. On average it takes around 90 days. This is not something that you can watch a YouTube tutorial on it and do it. It takes commitment, dedication, effort, and mastery of skills. This can be very rewarding if you invest yourself in it. And the reward that will come is not just financial, but it is intangible as well. The reward can be the freedom of being your own boss and having more free time for other things that make you happy in life as well. In conclusion, to be successful in buying a business and in life in general, find a clear purpose and never stop learning.
John is the Amazon bestselling author of Winning the Battle for Sales: Lessons on Closing Every Deal from the World’s Greatest Military Victories and Social Upheaval: How to Win at Social Selling. A globally acknowledged Sales & Marketing thought leader, speaker, and strategist. He is CSMO at Pipeliner CRM. In his spare time, John is an avid Martial Artist.