← Action Academy | Millionaire Mentorship For Your Life & Business
Action Academy | Millionaire Mentorship For Your Life & Business
Why Most People Should NOT Buy a Small Business (And How to Know if You’re Different)
00:16:20
Loading summary
Transcript1 lines
- [00:00]
A
What's up, beautiful people? I'm a member of multiple masterminds that both invest in business and in real estate. And one of these high level masterminds that I'm in where you have to have a minimum net worth of $2 million to be in. So it's high level guys, high level girls in there. There's this comment on Facebook that prompted a discussion between a few dozen of us and I wanted to read you guys the comment and riff on this a little bit for today's podcast episode, which you can obviously tell the topic of by the title. And here's the comment. I've had multiple friends who are, to put it nicely, not exactly geniuses and have never owned a business, come to me with this story, recently saw an ad and now I'm buying small business X. It costs $0 out of pocket. I don't have to do anything. It's 100% passive and it should pay me $750,000 a year. That's not just misleading, that's dangerous. That is a lie. There is no business that you could buy that's going to do that. I could promise you that here now. So what I want to actually do is take the opposite approach of what I normally do, which is teaching you guys how to buy small businesses and actually cover today. Who shouldn't buy a small business? Because here's what's really important to me. And I know that this isn't like maybe the best marketing, right? But what's important to me is business buying is the single greatest, I believe, wealth generation vehicle that will exist over the next 10 years. Learning the skill of buying businesses the right way and scaling businesses and leading teams right now is the same equivalent skill set as learning how to buy apartment buildings in 2010. It's that level of skill set. It's that level of opportunity. People are going to make hundreds of millions of dollars to billions of dollars taking advantage of this opportunity. But what will also happen is you're going to have a lot of people that are going to get absolutely washed out with the tide because they're doing it the wrong way and they're pitching it as a really good marketing opportunity and they're really great marketers and they're selling you guys bullshit and they're selling you guys this product and this service that is just candidly a lie. And I'm not going to name any names, but anybody that's listening to this, that's in the space, you guys can figure it out. And five years from now I've already spoken to my team about this, I've spoken to my community about this. Five years from now, when everybody's looking back on the million and a half business buying communities that have now popped up, or business buying coaches, or business buying workshops, or business buying blah blah, blah, blah, blah, I want people to say, out of everyone that crashed, burned, did things the right way, did things the wrong way, Action Academy and Brian Lubin did it right. Like out of everyone, maybe they grew a little bit slower, maybe they didn't spend millions of dollars in ads, but they took their time to get this stuff right and they helped people do it safely. So maybe I can't help a million people as fast as I want to, but it's important for me to teach you guys how to actually do this in a safe and secure way. And so what I want to do today is a little bit contrarian. So I'm going to tell you guys who should buy a business, of course, at the end of this. But first, I want to actually take care of some of the misconceptions around business buying right now. Because as I'm recording this, we're about to close on our fourth business through acquisition. So I've built for bought for. So that sounds pretty cute off of the tongue, right? But it's really cool. Like we've bought some really cool businesses and me and my operators have really done this the proper way. And I want to make sure that we are continuing that through the education, through this podcast, and especially through my content and any advertising that we do. Do I want to be the one guy that's telling you, hey guys, this effing hard, all right, but it's worth it. So who should not buy a business? So if any of these bullet points apply to you, this is not the asset class for you. Number one, if you are looking for a hands off, 100% purely passive investment, this is not going to be it. Business buying and passive income should not be in the same sentence. A business is not passive. It's a living, breathing organism that needs care, feeding and direction. When you think of business buying, don't think of passive income, think of massive income. That's a really good rule of thumb. When you think of business buying, don't think of passive income, think of massive income. Now the main reason that we focus on business buying in Action Academy, we actually just did a survey and over 50% of our members are actively buying businesses. That's our primary asset class in the group now in the community. And the reason we do that is because I, both myself and through other people realized that buying some single family houses, passively investing in multifamily syndications isn't going to get you the cash flow that you need to to make the shift from employee to entrepreneur. It's either you're gonna be you build your own company or you buy your own company, period, like full stop. That is how you leave corporate, especially within a 6 month to 12 month time period. Otherwise you're gonna be doing it for five years plus straight up. So businesses can become more passive when you learn the skills, but in the very beginning they are very much so not passive, especially during the transition phase. So if you're looking for, for continuing to work your job and buy a business as a side hustle so that you can just magically work on it two hours a week and print out a hundred thousand plus of profit per year, that doesn't exist. I don't care what people are selling you, I don't care if it's a FedEx route, I don't care if it's an ATM machine route, I don't care. Like I've seen all the businesses, like none of them will do that. And if you see a business and you say, oh wow, that looks really easy, it's because you don't know enough, period. Any business, any real estate that you see that, see that where you say that seems simple. It's because you don't know enough. That's a good rule of thumb to keep for the rest of your life for anything. When you're looking at somebody else's relationship, oh, that looks really easy. It's because you don't know enough. Moving on. If you hate people, don't buy a business. Employees, customers, vendors. If dealing with humans drains you, stay out. A business is people, not spreadsheets. I can make an argument here that you can partner with somebody that that's the people person and you don't have to be the primary customer facing person for sure comma, but if you want passivity, passivity comes from other people managing things straight up. So that includes with your single family rentals. Even. So people say, oh okay, well my single family rentals are passive. I'm like, yeah, because you have a property manager that's managing them. And so for me, my property manager quit, stole my money and then my tenant had to be evicted from my property. She trashed it, caused $20,000 of damage. So all of a sudden that real estate wasn't too passive anymore. You see what I'M saying it's all people, all people, processes and profit. So the profit is needed to get more people, to get better people and to build more processes. Number three, if you crumble under stress, if you don't like variability and you like low, slow and steady, but buying a business isn't for you, period. It's never going to be low, slow and steady. It's going to be a freaking emotional roller coaster for me and for the guys and girls in Action Academy that are wanting to buy businesses. We love that, we crave that. Our ADHD thrives on being an entrepreneur because we're constantly doing something, we're constantly stimulated. If you don't want to be constantly stimulated and constantly handling things and doing, working on stuff, even if you're a business owner, not even the operator, if you're the owner, you're still thinking about things proactively to work on. So an example of that is where I'm not running the day to day of Action Academy anymore. I'm thinking in the future. So I'm working on that. What Action Academy is going to be three years in the future from now. So I'm still proactively working, but it's just proactive instead of reactive. So if you crumble under stress and you don't like stress, you can't handle solving problems. Don't get into business because business is the art of solving problems, period. Number four, this is a big one and it's a serious conversation that some of us need to make and some of us need to have. And not everyone is capable of running a business. If you have no developed or discernable skill sets and you have no savings, don't try to buy a business like it. It's, it's, it's common sense. But also common sense is uncommon if you are paycheck to paycheck right now. And that is not to say anything is wrong with you as a human or as a person. You just need to get your skill sets up, which you can get through your current employer or go through listening to this podcast, reading books, education, real estate, meetups, mentors, all this, all the different stuff. If you're paycheck to paycheck right now and you're not crushing it in your current role, I don't know why you would think that you can go creatively finance a business, buy a business for $0 down and successfully run that thing. You need to have three things. You need to have high levels of skill, so high skill set. Number two, you need to have High agency agency. So you need to have a high, say, do ratio. You need to be a type of person that doesn't sit around and waiting for other people to tell you what to do. Like you need to be that default leader. You need to be the driver, you know? So if you don't have high agency, you can't do it if you rely on other people to tell you what to do. Don't buy a business if you have no savings. Don't buy a business. Like don't book a call to Action Academy. Don't, don't do it if you. And it's not because we're trying to take your money. It's just straight up like we had this woman join, and again, this is no shade on her. This is just me giving you guys the real, real. This poor woman joined and we realized one week into membership, she paid us thousands of dollars to be a member of Action Academy. She was $100,000 in debt across all these different credit cards, across all this different stuff. She signed up for all these masterminds, all these things. And she just was addicted to signing up to masterminds and signing up to different things. And her and her family were so deep in debt, we could not in good faith let her continue. We had to morally give her her money back. And hopefully one day she comes back to us with her debt cleared and she's clear to go. You know, don't whip out your credit card if you got $4,000 in your bank account, don't whip out your credit card to join a business buying course or a business buying mastermind. And no, don't do that. At least have some savings. And the reason I want you to have some savings is because you need to have money management skills. Because all of business is money management. It's cash flow management. So if you can't manage the cash flow that you have today as your personal income, you're not going to be able to manage the cash flow that you need in your business. And where other people's livelihoods are depending on you to make payroll, right? So cash flow management is a huge, huge, huge, huge thing. And so a lot of you guys are trying to do this on your own. And I share an example here. I sent out a newsletter that I'm reading from here and the franchisor told him all you need to do is just check the numbers once a week. The systems run themselves. Six months later, sleeping on the office couch because his manager quit, staff was stealing inventory and the business was bleeding cash he didn't buy a business. He bought himself a very expensive and stressful job. And this is what I see all the time, is you, like, you guys, and this isn't anything to you. It's just in general, people are buying businesses because they're low price. And you think that low price means and represents a discount. And so you see a $2 million company versus a $200,000 company, you're like, ah, well, that seems less risky. Buy yourself a freaking job. And so you're making all these mistakes. And a lot of people, 90% of people should not buy a business. 10% of people should buy a business. And we see that represented in America and in the world. Like, only 10% of the population, probably less, are entrepreneurs and business owners. Not everyone can be the business owner. So you need to take a look in the mirror and say, is that you? Because by this point in the podcast, if you're still listening, you probably are a freaking business owner. If you're listening to this, you're like, all right, dude, like, keep talking your talk. But, like, this ain't me. Then that probably is you. And that's who I speak to on this podcast. So who should buy a business? If you're a high performer in corporate who's tired of being capped, and you're like, dude, I'm fine with working hard. Give me hard work all day, give me a brick wall, and I'm busting through it, dude. That's what I'm built for. If that's you buy a freaking business, dude, you're going to take off or do that. You're going to take off. You're going to be perfectly fine. If you have high agency, if you don't need to be told what to do, you tell people what to do. You're like, come hell or high water, I'm making things happen. If you're not about resources, you're about resourcefulness, buy a freaking business. My brother and sister. If you want control, not comfort, if you want to be the one holding the wheel instead of being a passenger in somebody else's car, buy the business. If you willing to put in years, not weeks, get rich. Slow isn't sexy. It's how fortunes are built. You understand leverage, capital, people, systems, and you're ready to play with bigger tools than the W2 allows. W2 is like playing the little league. Like, entrepreneurship's the show. Like, it's the show. Like, you're coming up and you're learning some big boy, big girl skills. Like, you learn fast and that's the last thing. If you want, if you have a growth mindset, if you're like, dude, I want, give me the challenge, give me the problems, I'm going to turn them, turn these lemons into lemonade. Like, I got this all day. I want to grow like fricking crazy by literally running a business for three years is more, will give you more experience than people. People reading entrepreneurship books for 30 years, like, I'm so serious. It makes you freaking sharp, it makes you lethal. So if you don't want to make six figures, you want to make millions and you want to have impact, you want to make your team millions. Being a business owner is it. So with all this being said, owning a business is not passive and it's not about escaping hard work. Owning a small business is about choosing what hard work to work on. And you are going from work that benefits your employer and benefits your CEO that's off in some mansion somewhere, probably in a tax reduced state that you're never going to see. Instead you can use that same hard work. If you're working for a decade or two decades or three decades, every ounce of sweat, every drop of effort is going to compound towards your dream, your legacy and your family's future. All right, so it's just like the way that I see it is I am not trying to escape hard. I want to work for the boss. The only boss in the world that I know that can't fire me. And that is me. All right, so you're going to have long nights, you're going to have uncertainty, you're going to have all of this stuff. But if you want to go from passive income to massive income and you really want to make a dent in your family's future in a good way, that is gonna be business ownership. So if this resonated with you and you guys wanna do this the right way, we are hosting a webinar tonight. I will put the link in the show description. This is posting on Wednesday, September 3rd and at 7pm Eastern tonight we're gonna be doing a 90 minute webinar. I've got like 200 slides. We're gonna be going step by step through how to do this the right way. So if you guys are interested in that, you can go in the show description and you can click the link to sign up for the webinar. It's just like first name and email and. And then you will be on the webinar with me. Or if you want to go ahead and just book a call with our Action Academy team. This is what we do. Like we are hiring three or four more additional roles that are small business specific just for mentorship and coaching. So if that's interesting to you, actionacademy.com you can also find that in the show description. So, A, you can sign up for a webinar completely free. B, you can sign up for our intro call. It's a 60 minute call, completely free again. And then if you choose so you can come join us in Action Academy. But regardless, I'm honored to serve you guys. Five years from now, I want to be the one that when the tide goes out, we're swimming naked. I want to look really, really freaking good. So thanks guys. If you got any value from today's episode or the Action Academy podcast, please share this with somebody else. That's how we grow the show. That's how other entrepreneurs or future entrepreneurs are helped. So send this to your peeps in corporate and that are maybe on the fence about should they buy a business? Should they not buy a business? This should help. Thank you so much, guys. Talk tomorrow.