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Action Academy | Millionaire Mentorship For Your Life & Business
How These First-Time Buyers Bought a $1.1M Business—and Made $320K in Equity Day One (Full Playbook Inside)
00:36:30
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- [00:00]
A
Day one, going into the business, you guys both put 50k down together on a business that's actually decent, that's going to cash flow. You both $100,000 plus per year, and you were able to gain $160,000 equity per person. So you 3x kind of your return on investment overall at the closing table.
- [00:19]
B
Fear is easy because it's just the unknown. And that's the biggest part of this. Like, am I going to fail? But what if you scale this up to 20 million and you're able to just work from an island wherever?
- [00:28]
A
When you're an employee, you can't utilize leverage at all. You're being told where to be, when to do it, how to do it, and when to go home. All right, Tyler and Mike, Action Academy fam. Welcome to Action Academy podcast. How y' all feeling?
- [00:41]
C
Feeling good, man. Thanks for having us, dude.
- [00:44]
A
Yeah, we're, we're a little deep into business ownership now. How long have y' all been in possession of the business? Like 30 days. 60 days now?
- [00:51]
B
About 60. March 5th is when we closed.
- [00:54]
A
60 days.
- [00:54]
B
A little over 60 days. Yeah.
- [00:56]
A
Yeah. So this is a little bit different. So now this is a cool episode because we get to talk not only about the acquisition, but all the way through into the actual day where you take ownership of the company and you guys went through the ups, the downs, you know, kind of got smacked sideways because it's never a smooth. It's never a smooth ride. But that's why you make, you know, the money that we make. I'll let you guys introduce yourself to the audience. So Mike and then Tyler. Sure.
- [01:21]
C
Yep. I'm Mike Henley. I was born and raised in New York. Now I'm an Austin native. Just moved down here a couple months ago. Um, background in finance, went to St. John's University in New York City. Realized kind of that wasn't the. The path for me. Transitioned from doing, like, long term rentals in New York and now fully running Nexum Group, The. The business we just acquired a couple weeks ago.
- [01:45]
A
Talk to us about how you used to think about investing when you were buying single family houses versus why you chose to pivot to small business for replacing a six figure income.
- [01:56]
C
Yeah, so. So my original thought was when I started investing, I just wanted to add on a couple multifamily properties that would cash flow a couple thousand dollars per month each property. I got to a point where, you know, I was making pretty decent cash flow. But I realized to really get to the number that I wanted to. That it would probably take at least 10 deals to do this, and I was only at two or three at that point. So, you know, I went down to, you know, the rabbit hole of business buying, self storage, all those different, you know, routes and everything. And business buying just made sense because we literally just do one deal, replace the cash flow from day one, and just get out of the job.
- [02:37]
A
Love to see it, man. So, Tyler. Yep.
- [02:40]
B
So, Tyler Killian, born right outside of Atlanta, Georgia, and I have had a ton of different shiny object syndrome when it comes to my investment journey. So, like, Mike, started with single family homes, actually bought a duplex, and then I switched to an Airbnb, and then interest rates went up and started learning more about small business acquisitions. So I've actually done two SBA loans. The In July of 23, I purchased a vending machine route here in Austin, Texas. Very small. Basically bought a side hustle because I didn't have kind of the confidence to go after something bigger. So it was, you know, asset based and protected. And then, you know, joined Action Academy. Me and he. And I partnered up and took down this debt collection agency.
- [03:28]
A
So, hell yeah, man. And it's funny because somebody just asked me on Instagram, they said, hey, you got started in real estate. Why are you not talking about real estate anymore? Especially, like residential rental properties? And it's because straight up, like in. Back in the day, in 2019, when I was buying rental properties, I didn't realize that that wasn't the best strategy from replacing a big income. You know, I just didn't know what I didn't know because back then this was like a private equity thing that, you know, some white guy in an office with a, with a suit was doing that nobody knew about. And now we're able to talk about this and give people that are just up and down the street the chance to have access to this information and actually pull this off for them, for their friends, for their family, for, like their financial future. So super excited to watch you guys across the entire journey from joining to partnering, all the way to finding your deal, finding your asset class, and now closing. So, Mike, talk to us a little bit about kind of how y' all came across the deal. Like, what was the process from the very beginning of your journey of start trying to find a business and maybe talk about what was kind of expected versus what was unexpected in the process of getting that first LOI accepted?
- [04:38]
C
Yeah, so the process started back when I, when I joined the group Action Academy in late June of 2024. You know, clearly the first couple weeks were just about, you know, getting to the group, learning all the modules, how to underwrite a business, where to find them, how do you communicate with brokers properly?
- [04:54]
A
Clarity.
- [04:55]
C
Yeah, yeah, just getting clarity on like what exactly we want. But the process up to that, it was just, you know, we start the very generic route going on Biz by Sell, looking at a lot of listings through there. But eventually we kind of exhausted our options through Biz by Sell. We ended up finding the deal through Biz by Sell eventually. But at one point there was just nothing there. We were looking at every single deal and we started doing like outbound efforts, calls, cold emails throughout. Tyler, he had a Zoom info account. So we were just pulling a shit ton of lists, shit ton of businesses, cold calling, just pulling them, email and never had any luck with those. But we looked at probably several hundred businesses and then Tyler eventually found this one on Biz by Sell just out of luck.
- [05:42]
A
So what stood out to you about this business and what made it different from all the other companies that you guys were looking at?
- [05:47]
B
So I think when we started it was a much more niche buy box. Like we were looking moving companies and like home services. But we were trying to, you know, narrow focus down on one thing. And then I think we realized that, you know, we expanded that out and also moved out from Austin. So we did started doing keyword searches of absentee businesses because I think that was our biggest thing was we wanted an owner that was completely or almost completely removed from the business. And a lot of the deals we were looking at, I want to work full time, 40, 60 hour weeks and we weren't trying to buy a full time job. So I think that's what our main thing was was obviously the numbers, the financials. But if we could find a business that the owner was absentee and that it ran on its own. And so this was nexum we found. It's based in Florida actually. All of our employees are remote and we were able to, you know, kind of talk with the owner several times and go over his day to day, which was not much of anything. So yeah, so that's what we decided on.
- [06:47]
A
Well talk about that a little bit because that's the largest red flag that somebody that will derail a business deal is buying another freaking. Yeah, so talk a little bit about what you're looking for with this owner involvement because sometimes it'll be sneaky owner involvement to where in the beginning, like they'll say on the, like the deal docs they'll say, oh yeah, you know, owners also operator of the business of the gm. But then sometimes people bring the companies to Action Academy and they'll say, oh yeah, I want to buy this thing. But it's got like three years of declining profits or declining revenue because the owner like took his foot off the gas.
- [07:19]
B
Yeah.
- [07:20]
A
So can you talk about like maybe some sneaky ways that you guys can sniff out where the owner's a little bit more involved then you. And then they're advertising.
- [07:28]
B
Yeah, I think for this situation, the owner actually lived in Jacksonville and the employees and where it was based was in Orlando. He wasn't even there, he was three hours away. So you can obviously ask where the owner lives, how often he visits the office. And like he was only writing remit checks to the clients. That was the only thing he was doing day to day where there is a running joke of like whatever they say they're working, you can two to three exit and that's probably what, what they're actually working. So. So yeah, I think that, you know, there's just being more interrogative on that aspect of it. You're asking the broker, when you get a meeting with the owner, you're not trying to, you know, you're trying to build a relationship, you're buying their baby. So you want to just, you know, I think that they kind of share, shed more light on what they're doing as you kind of get engaged with them. So we had a couple meetings before, you know, we even went through the whole deep dive of the underwriting or not underwriting process, but the SBA process. So.
- [08:23]
A
So Mike, talk to us about what those conversations look like with a seller. Because a common misconception is that somebody that's a first time business buyer will go into one of these calls and they'll be super, super nervous because they want to make sure that they're talking the right talk, like the right lingo. So sba, ebitda, profit margins, all this different stuff. But what a lot of people don't realize is it's their first time selling a company too, for the most part. And most of the time they're just kind of a normal guy, normal girl that just wants to retire. And it's just you want to have a human to human conversation with them. So walk through, you know, how Yalls conversations went and maybe some tips or tricks for people that are going into their first seller conversations.
- [09:01]
C
Yeah, so I guess so this was through a broker, so a lot of our, our contact was through a Broker. But we did have deals before where, you know, we had under or under loi and they ended up falling apart. But all those, those different deals that we did directly with the seller. I would never really talk numbers from, like the first meeting. I would. I mean, honestly, it was probably stupid, but we were looking at obviously in the Austin market. I was in Houston at the time, and I get on the phone, say, hey, let me take you out to lunch. So I drive to Austin without an loi accepted. So don't do that. And then just really just, you know, get into why they want to sell. Pretty much your motivations and their time span to actually feel them out to see if it's like a potential hit, I guess. So basically that's what I do from the first conversation. And the second would lead into more like the numbers and what you're talking. And then the third, I'd pretty much just be like, hey, this is what we're thinking. And then shoot over the loi. And if they accept, they accept. If they don't, then they don't.
- [10:04]
A
Yeah. So, Tyler, what are you looking for in your underwriting? Because I feel like there's a few different levels of underwriting. So you have the first level underwriting, which is quick glance, you know, the sniff test, like a stuff that's business out real quick. Yeah. Back in the napkin. Then you have. Yeah, so I would say sniff test, back of the napkin, and then a full underwrite. So when you guys are looking at all these companies, I feel like a lot of people maybe underwrite too many deals that could have been sniffed out or back a napkin really easily. So what's some backing napkin math that you can recommend to somebody just to give like a parameter for somebody that's looking through companies?
- [10:39]
B
So this is funny you asked this, because I've had a couple of calls with Action Academy members and I brought this up of us doing this, and people have been amazed. And I didn't think that it was that big of this, like, revelation, but I would just use the shit out of chat GPT, like just literally, like put the numbers in there. Like, even when you get, you know, all the financials, you can just do a quick, like, hey, here's. Here's the revenue, here's the cash flow, here's the SDE, here's, you know, 10, 10 year long on a 10.5% interest rate or whatever it is. You know, give me my weekly cash flow after debt servic, or my monthly cash flow after debt servicing, and Chad will spit all of that out for you. And so I would have chat, like, rank all these and, you know, build Excel sheets for me. And so if. If it passed that back of napkin, then we would go into a full underwrite, and we had a document for that where we put everything in and made sure the numbers were right. But, I mean, we did hundreds of just backup napkin with ChatGPT. And then, you know, we would send deals back and forth to each other that we thought looked good. And then he would underwrite and I would underwrite, you know, just to check each other. But. But yeah, Chad GPT easy.
- [11:47]
A
Yeah, I use the same thing. Honestly, even, like, with large deals, what I'll do is I'll do three offers always. So I'm always going to send three offers in an loi. So it's going to say, okay, here's option one, option B, option two, option three.
- [12:00]
B
Yeah.
- [12:00]
A
And then it's going to say, you know, like, this one's going to be like, higher up front, like, longer terms, like, my. My terms. This one's like your price. My terms. This one's like my. My terms, your price. And so each one of them is going to be a different option. So it's just like, choose your own adventure. Pick whichever one you want to do. And I use Chat GPT help me create those and kind of document those and. And word them in a way that explains to the broker, explains to the seller why that you're negotiating like that. So I really like that idea. So, Mike, how did you guys partner up together? You know, when you guys were first having conversations, you know, who was bringing what to the table and what's some advice that you can give on partnership?
- [12:41]
C
Yeah, so I guess when we originally started out, we got put in the same pod together, and just from initial conversations, we were kind of in the same spot as far as, you know, what we want to deploy to get a business and kind of what we wanted to have for a safety net. To be honest, we didn't really talk too much about the whole strengths and weaknesses between the partnership. I just remember Tyler was looking for nail salons at one point. I'm like, I don't know anything about nail salons. Found a nail salon deal. I sent it to him like, yo, here's. Here's the steal. And he's like, oh, do you want to partner on it since it's in Houston? I'm like, yeah, I'm down.
- [13:18]
A
Nail salon would have been a hilarious buy for you guys.
- [13:20]
B
Yeah, no doubt.
- [13:22]
C
But then in. In all seriousness, like after time we got to know each other, we came to find out that our skill sets, they really did complement each other. He comes from more like a high ticket sales background. I come from finance numbers, I'm good with operations, so ended up just working out pretty well.
- [13:39]
A
Yeah, perfect. So we finally get the LOI accepted on this deal. You guys go through a broker. It is through Biz by Sell. So walk us through the deal negotiation. So how did you guys structure this? Because you guys ended up with a pretty cool result.
- [13:53]
C
Yeah. So originally the listing was for 750,000 on biz by Sell. And we looked at the numbers, ran it through the models and basically it was spitting out like a DSCR of like almost three.
- [14:09]
A
So tell somebody what a DSER is.
- [14:11]
C
Yeah, so it's debt service coverage, Service coverage ratio. So it's basically how much the cash flow is going to cover the, the loan payment for the sba. So basically we looked at those numbers, we looked at cash flow, the revenue is going up from 2021 all the way up to 2024. We're just like, let's not waste any time. We've been looking for way too long. Let's just go in full, full offer. And then of course the broker comes back and says, hey, there's a little competition, what can you do? And he just says, oh, just put a little juice on it. And we're like, all right, whatever, 800,000. It was only going to be like.
- [14:46]
A
What are you going to do here? Spit on it? Like, what the hell? That's what he said.
- [14:51]
C
He's like, just juice it up a.
- [14:52]
B
Little bit, add some juice. He literally goes, he goes, I want to be a good representative of the buyer. He says, it's not quite 800 is what I'll tell you, but it's a little higher. And so the funny story behind this is obviously we're dealing with debt collection owner. They skip traced us and they skip traced the other person that made the offer and found out that she was like a 60 something year old woman and they would rather sell the business to us because we're younger, more motivated, something to do with that. So that was the story behind that and they wanted to sell to us and he was just like, hey, can you do anything? And so we ran the numbers again at 800k. Like, let's just not mess around. 800 didn't make really much of a difference over the life of a 10 year loan. We just offered 800.
- [15:35]
C
It was like $5,000 in the grand scheme of things, over a year of cash flow over a business that's going to cash flow like 220,000 roughly. So it's just like there's. There's no point of going back and forth. Let's just get down to it.
- [15:49]
B
Yeah, so we submitted that offer. I think it took a day and he had it signed. And yeah, that was it. And then we just worked with the broker and the. And the seller along the way.
- [15:58]
A
So. So describe diligence for somebody that hasn't been through diligence before, because I just got out of diligence again and it sucks. It's the worst. So explain Yalls process and diligence and maybe going into it, you know what we' some ideas that you had about diligence and how long it would take or how it was and then maybe things that were different.
- [16:16]
C
Yeah, I'd just say probably try to find a good cpa because to be honest, going into it, we had a good idea of like questions that we wanted to ask and get covered before actually getting the, the purchase agreement signed and everything. But I have a good CPA from back home who kind of led us and like took point on that. So he was pretty good and he helped us out with due diligence a ton.
- [16:41]
A
Awesome. Tyler, anything that you can recommend through diligence?
- [16:45]
B
Yeah, I would say, like you. So one trip up we had, we went under contract with this, this other company here in, in Austin and. And you know, he had provided P and ls, but he would do all of his numbers himself, so he didn't have like official QuickBooks sheets and the P&LS looked great. He also didn't provide tax returns. And so one thing to note is that SBA goes strict of tax returns. They do look at P&LS as well. But tax returns are king. And he had all these things that was included in his tax returns and they're like, we're never going to lend on this. So it's. Whenever you're doing your own due diligence process, even after the NDA is signed, it's making sure they have clean books, they have tax returns. They have everything you're going to need. You need three years of both. And his books were really clean and you could see the revenue consistently going up. He had everything labeled out. He had a CPA that did this for him, them, you know, full time.
- [17:41]
A
So, yeah, when the SBA is underwriting you, you gotta have tax returns. And I even had to submit my tax payments. I had to Literally show from my bank account where my tax payments were coming from.
- [17:51]
B
Yeah.
- [17:52]
A
Which was insane. So who you choose as your bank is also super important because we've used good bank and we've used bad banks. And now I know what it's like to go through a process of doing SBA diligence with a bad bank and then it's just delay after delay after delay after. It's. It's living hell. Yeah, but you guys had a good conclusion to that. So Mike, what happens next? Closing day, closing table, you guys get a surprise.
- [18:18]
C
We ended up purchasing the business for 800,000. We go to get the, the business appraisal and it comes back a little bit more than 1.1 million. So pretty much from day one we had something that we could add to our balance sheet, about 320, 160 between each of us that we could slap on our individuals balance sheets. So that was definitely a good surprise for us.
- [18:42]
A
So, so day one of going into this business, for people listening. Day one, going into the business, you guys both put 50k down together on a business that's actually decent, that's going to cash flow. You both a hundred thousand dollars plus per year and you were able to gain 100 like $60,000 equity per person. So you 3x kind of your return on investment overall at the closing table before you even got the cash flow.
- [19:09]
B
Yeah. Yep. And this was a private evaluation done by the bank. So this was, you know, when we got it, we were shocked. It was like almost reassurance that we had made the right deal. Because you're questioning it the whole way. Just wait, is it's a new thing for anyone. And then that one, when that came back, it was like, okay, we, we got, we struggled so bro, we gotta.
- [19:28]
A
Up our prices, man. No, seriously, it's just like, it's funny to me whenever somebody, I mean, it's not. I understand because like people, you know, have been like scammed before people or they see people online that are just full of crap or like business buying and stuff. But it's just like I see so many times people try to do this by themselves and it's like even if you guys didn't have each other, you probably would have gone to a company where you're like, oh, I'll put 50k in or maybe buy a company for 400, $500,000.
- [19:54]
B
Yeah.
- [19:55]
A
But instead you're able to do this, negotiate it the proper way, partner the proper way, close it the proper way, and then this is the result. So I Wouldn't say that that's necessarily a typical result, especially like through an SBA. And then all of a sudden you manufactured 300k out of th is freaking sick. Yeah, but that's a, that's a sick result, man. So, so walk us through now the, the roller coaster of, of post close because now we try to find out where the bodies are actually buried. Right. So you can go to the perfect diligence. And then at the end of perfect diligence, it's still chaos, no matter what business that you're going to buy. Like, there is no world where you're going to buy a perfect business doing everything perfectly. So walk us through kind of that transition period and, and how you guys have been stabilizing.
- [20:40]
B
So I would say one of the biggest surprises that we had is debt collections. And we knew this to an extent, but debt collections is a very high risk industry.
- [20:49]
A
What?
- [20:49]
B
And so, I mean, we knew, but we didn't know in a sense of how difficult it would be to get all these software systems transitioned over. We, you know, are able to report to credit. So like TransUnion has us fill out insane amount. I had to go get a shredder for my office, like just all of these things that they require. And then the payment processing for us to get credit cards processed took a week longer than we thought it would because they're asking us to send all the same documents that basically we just sent to SBA from the seller. And so I think that was probably the biggest headache was like we thought we were just walking in and owners and it's already got an operations manager in place, employees, everyone is making money, but it took us a week longer to get the credit card payment processor up. And then just one thing after the other of trying to get all of these softwares transitioned over. So that was probably the biggest headache. But it's been great because we have someone in place that literally runs everything day to day. And we're just in there now trying to optimize a lot of different things.
- [21:49]
A
So anything you add, Mike?
- [21:52]
C
Yeah, I mean, I feel like that was the big thing that was the big surprise is the merchant service payment like processing system because we, we didn't know how long it would take and probably the seller should have told us that it would take a little longer to get it transferred over to us.
- [22:09]
A
Of course they won't.
- [22:09]
C
Yeah, I mean, everything exactly. But so we literally weren't able to like accept payments for like the first week of business. So holding payments, which is why we Didn't.
- [22:20]
A
Which is why we weren't doing the podcast then, apparently.
- [22:22]
B
Yeah, yeah. And then too, if you're like thinking of debtors, like, so we would hold payments. Like, we would basically have them. Hey, we'll run this when we get this set up. But you can imagine how many of those actually went through once we did get to get it set up. So we had to call them all over again. They reprocess payment. So it was just, you know, one of those things you look back on and laugh. Because we should have probably, along with knowing that, we should have also been a little more prepared of, like, having this preset up. So.
- [22:50]
A
Yeah, I mean, well, here's the thing. It's like you just don't know nuance until you're in the middle of nuance, right? Like, dude, like, we rented out. I went to Scottsdale the other week and rented the freaking Ferrari 488 Spider. And I didn't realize Ferraris don't have park. Like, y' all know that.
- [23:06]
B
I didn't know.
- [23:07]
A
Yeah, I didn't know that Ferraris don't have park. Like, there is no park lever. There's no, like, gear. There's no. There's no park.
- [23:13]
B
So you press a button or like.
- [23:15]
A
Yeah, so what you do is you keep it in first gear and you just shut the engine off at first gear and then that it automatically parks and you have to pull the E brake.
- [23:24]
C
Okay.
- [23:25]
A
So it's just like a small thing where I was like, huh, this is kind of a good example of like, you just don't know what you're getting into until you sit in the driver's seat. Like, because I was looking around, I was like, how do I. How do I change gears in this thing? Like, where's the parking? You're like, how do I stop rolling? Like, I'm just sitting here.
- [23:43]
C
Google.
- [23:44]
A
Yeah. I'm sitting literally in a parking lot in a Dutch Bros parking lot, and I've got my foot on the freaking brake trying to not roll back. I'm calling the guy like, yo, I freaking park this car. And then I'm going to chat GPT. And so the point of the story is that you just don't. Like, you could underwrite everything, but you just don't know what you don't know. And like, that's inevitable. So, like, you're not getting around that. You can't. You can only prepare so much until you're just in it. And then you learn things as you go.
- [24:16]
B
I think another thing too to add to that is is employees. Like, you see the number of employees on paper, like, so seven employees over here taking over. And it's like, okay, cool, seven employees and operations manager, collectors this and that. And then you get to meet them for the first time because you usually don't really talk to them. The. The owners are usually very careful about letting people know until. Cause they want freak out mode or whatever. So we get on that first zoom call with the previous owner and we meet everyone, see their faces, and then they're telling us about, you know, their families and stuff like that. So you realize you're not only responsible for them, but their families. And so I think that was a big, like, you know, it kind of gives you chills a little bit of like, hey, I'm running a business now that has employees that I'm responsible for. So that was another big thing too.
- [24:59]
A
So, dude, I remember when we hired our first employee, like full time, I was like, oh, like I'm now responsible for your financial well being.
- [25:07]
B
Right?
- [25:07]
A
Like, whoa. Okay, cool. I want to talk about something specifically. So, Mike, a lot of people may be listening to this and they're letting the fear and like this voice in their head of saying, who are you to run a business? You don't know what you're doing. Like, why should. How are you qualified to run a business? Prevent them from even looking at a business. Even if it's somebody that is a badass employee in corporate America that's highly paid and has the capital to do it. What's some advice you can give to somebody that's in that position?
- [25:36]
C
Well, I mean, if you already have a track record of being an overachiever, then what's there to not say that. That want to translate into the business world of you actually doing it on your own. And then number two, you're gonna be more prone to making the thing actual work when it's yours. When it's your baby. Like now, you know, we can go in and we can run it semi absentee, but just because it's mine now, like, I'll put in like 10 hour days just because I want to and I'm having fun doing it. So I think just those two things in addition to obviously, you know, go through your underwriting, if everything's making sense and you feel confident about it, then I would just make a decision and do it.
- [26:18]
A
Yeah. Charlie, what would you say?
- [26:19]
B
I think you hit the nail on the head. I mean, you. I think fear is easy because it's just the unknown and that's the biggest part of this. Like, am I going to fail? But what if you scale this up to 20 million and then you're able to just work from an island, wherever, you know what I mean? So it's. You've got to just have faith in yourself. You're going to constantly overthink every decision. Just the way that it is. It's just the way of being an entrepreneur. We've closed on this business, and I still question everything, you know, and you're like, well, what if this doesn't work? Like. But you kind of just have to jump in the water. You can't just dip your toe and you gotta go all the way in.
- [26:54]
A
So, yeah, it's. It's funny because we're talking about risk, and I think that the largest risk that anybody that's. Especially in their 20s or 30s, can take is taking no risk.
- [27:04]
B
Yeah.
- [27:05]
A
You know, because it's. Everything that you want is on the other side of it. And we talk a lot about, like, you know, none of us have, like, families or anything yet. And I don't know if you guys want to grow families, but I say I want to have a. A, you know, wife and some kids and everything. And you want to be able to have time, you know, with them, and you want to be able to even have time with ourselves right now. It's like you want to have control over your schedule, and you can't have control over your schedule unless you have ownership. Ownership is what yields control over your schedule. And so now you get to build systems and processes and use leverage where, when you're an employee, you can't utilize leverage at all.
- [27:37]
B
Yeah.
- [27:38]
A
Like, it is not. It's not an option for you. Like, you're being told where to be, when to do it, how to do it, and when to go home.
- [27:44]
B
Yeah. Your hours. And you. You obviously only have a certain amount mostly of. Of PTO days. You can't even travel when you want, like, period. It's. It's all of those things, and that's what drives everyone to want to do this.
- [27:55]
A
Yeah. So, I mean, so for people listening, imagine making $120,000 a year. You're probably bringing $3 million value to the company for you to make $120,000 a year. There's a discrepancy. That's employment. So imagine you working that. That same hours, that same work week, but now you own 100% of the upside. It's like, that's what Mike's talking about, where you're like, dude, okay, yeah, I don't have to work this Saturday, but I want to because I've got this new idea that I want to implement and I think that this is a really cool idea. So what are some of the things that we're planning kind of for the roadmap on growing the company? Like, what's the overall goal? Are we looking to do any other acquisitions later on and at what point are we trying to do those acquisitions versus just scaling this thing?
- [28:39]
C
Yeah, so I think right now we kind of have the, the blinders on just making this the only thing and focus on it. And you know, we're very far from it right now, but our main goal is to exit within like three to five years and get evaluation from pe. Who knows what that number is going to look like. But I mean, there have been numerous amount of debt collection agencies that it got acquired over the past 10 to 20 years that are, you know, mid mid seven figure, mid eight figure exits. So the potential is there and we just got to take it one step at a time. I think right now it's just since we're around the, the one million dollar threshold in revenue, I think it's just about doing literally what has been working, but just at a higher volume.
- [29:28]
A
Yeah. So instead of, instead of more better news, like more and better instead of new.
- [29:33]
B
Yeah.
- [29:34]
A
All right, cool.
- [29:34]
B
There's just a lot of things that were old school. I mean, these guys, these collectors were still hand dialing on an office phone and there's all kind of dialers and have been for years. So it's one of the first thing that we're implementing is a dialer that literally costs almost the same amount as these office lines. So it's just improving those systems and then they haven't really been held accountable as much as they should. Like they don't know in the past what the expectations are for how much fee they should be, you know, collecting and bringing in. So it's just creating that those SOPs. And so we're using loom a lot, creating videos and just making sure they're properly trained and also properly supported. And I think as you continue to build up what we currently have, we've already hired, you know, a couple VAs about the higher sales VA, so just adding more to it so that we can take more off our plate and focus on scaling the company to where we want it to be.
- [30:28]
A
Are y' all using like scoreboards or leaderboards yet?
- [30:32]
C
Yeah, we just implemented like L10 scorecards. So basically just to kind of capture our KPIs as like a company as a whole and then narrow down to like individual collector performance.
- [30:44]
B
Yeah.
- [30:45]
A
So what are you. What are the. How are you guys creating the rocks for the collector performance?
- [30:50]
C
So I guess the rocks in general, just in terms of the company as a whole, we just have a target fee in mind per week. So just basically what we're collecting as a, as an agency, after we pay all our clients out and then narrow down as far as the rocks for the individual collectors, we just give them weekly targets and then also like talk time, number of dials, connectivity, you know, things like that.
- [31:19]
A
Awesome. So Tyler, out of like. So you guys came from kind of like a normal existence where you're in corporate, you've got a good paying job, you're learning about money kind of on your own. Then now you both have been in Action academy, what, like a year and some change?
- [31:35]
B
Like I think seven months.
- [31:37]
A
Damn. Okay. Not even a year. All right, we gotta up this freaking price.
- [31:40]
B
Well, July of we joined, basically our first week was the first week of July.
- [31:45]
C
Okay, so almost a year now. Yeah, yeah, yeah.
- [31:47]
A
So now we're coming up on it. So not even a year. Okay, so almost a year. How have your opinions on. And then this will be the same question to you, Mike. So how have your thoughts or opinions changed on money or wealth throughout that period of having exposure to this kind of new world?
- [32:02]
B
I think it's just an abundance mindset. Like we go back to talking about fear. You have an abundance of fear mindset when you don't do something. When you take action and realize, and especially being an action academy and seeing everybody else doing numbers and just being successful and putting yourself in that room, you start to realize that there's an abundance, abundance of wealth out there that, that is literally to be collected. So that's, that's been my, you know, vision of it. And since we've acquired this business, like the world is literally our oyster. To say, like, he quit his job two weeks after we acquired the business. I am likely going to put my two weeks notice in on Monday and just focus all in on this. And then, you know, as we continue to scale this up and take some money, we have other options to, you know, either acquire another business or to be a, you know, capital partner for someone else. Those are all things that are on the table. So.
- [32:58]
A
Oh yeah. What about you, Mike?
- [33:00]
C
I just think, you know, ever since joining, you know, my take on money before was like, I have this amount of dollars in my bank account this is what I got to work with. You know, getting into the group, you just realize that there's an abundance of people that do a bunch of different things. And if you have a deal and you know you're credible and you can talk, talk about it at a high level, then the money's always going to be there. You just have to have a good deal and you have to put in the work to get it.
- [33:28]
A
Yeah, it's all about the operator and it's all about the deal. Like, so for me, I look at. I underwrite the operators even more than the deal because I'm like, if you can give me some, Some badass operators and then you could put them into a good enough deal, they can make it a great deal. Deal. I. I wholeheartedly believe that. Versus, Let me, Let me get some okay. Operators and put them in a great deal. I think that that deal's not going to really improve. I think it's just going to stay kind of flat. So I'm. I'm looking at operators all day, all night. So what's some advice that you would give for somebody that's maybe on the fence? They've listened to this, they're listening to the podcast and they still haven't signed up to like, do a call for Action Academy, man.
- [34:05]
B
Yeah, I would say, like, just, Just do it. Talk to. There's plenty of people and there's over 450 members in the group right now. Talk to somebody. Like, everyone's willing to help in that group and willing to kind of talk you off that fence and tell you how, like, just the community, the support, that's the biggest thing. I went from buying a vending business as a side hustle because I was too scared. I never would have thought that I would have taken down an 800, 000 business and then been quitting my job and at 33 years old. So I think just talk to. Talk to people in the group. You know, believe in yourself. That's the biggest thing. Like, you can do this and then just do it.
- [34:42]
A
Yeah, that's wild. And then, Mike, how do you increase your bench pressing the good questions, man. Nah, man. So, yeah, I mean, it's. No, like, sincerely for both of you, it's. We went and we were able to go out and celebrate after you guys closed and we had a really good time and super proud of both of you. Watching you both, it's been insane. So it's. It's really, really cool. And eventually we're going to get up to a point where we have like all of these logos from these different companies that have been started on a giant wall somewhere or eventually have like an in person office or something for Action Academy. And so, dude, it's, it's freaking sick watching you all go. And it's, dude, like this year I think that we're going to like, we had a goal of 500 million in acquisition and I think that we're going to blow past that. So now we're aiming for a billion dollars in acquisition in Action Academy this year.
- [35:35]
B
Let's go.
- [35:36]
C
So, dude, that's no small plans.
- [35:37]
A
No small plans, baby. So I mean I'm putting 17 on the board myself so it's no, no more small boy stuff. Yeah, yeah, let's freaking go. Sweet. So people want to learn more about you. They want to connect with you, possibly maybe partner with you on in future deals. I quick can they find you and then Tyler?
- [35:55]
C
Yeah, but best place to find me is on Instagram. It's Mike Henley. Underscore. Underscore.
- [36:01]
A
Hell yeah, brother.
- [36:03]
B
Same thing. Instagram. Ty Killian. K I L I A N2 beautiful.
- [36:09]
A
All right guys, go follow them. And I guess if you need any debt collector like call them, they'll take care of it.
- [36:16]
C
We got you.
- [36:17]
B
We got people.
- [36:18]
A
All right, guys, it's been Action Academy podcast and if you're interested in checking out membership, you can go in the show description, the show notes, click the link, book a call for 15 minutes. We are happy to speak with you and you can talk with the current member. Thanks guys. And talk soon.