Codie Sanchez: How to Make Extraordinary Wealth Buying Boring Businesses | E319

Summary

Episode Summary: "Codie Sanchez: How to Make Extraordinary Wealth Buying Boring Businesses | E319"

Introduction

In episode 319 of Young and Profiting (YAP) with Hala Taha, host Hala Taha welcomes investment expert and entrepreneur Cody Sanchez. The discussion revolves around Sanchez's new book, Main Street Millionaire, which delves into the strategy of acquiring "boring businesses"—established, low-excitement enterprises like laundromats, vending machines, and landscaping services—as a pathway to extraordinary wealth. The conversation explores why these businesses are undervalued, the misconceptions surrounding wealth accumulation, and actionable strategies for aspiring entrepreneurs to profit from ownership.

---

1. Misconceptions About Wealth

Cody Sanchez challenges the prevailing notion that wealth stems solely from "sexy" industries such as technology, entertainment, or high-profile startups. She emphasizes that many of the richest individuals on lists like Forbes have amassed their fortunes through traditional, often overlooked businesses.

• Rich Women Entrepreneurs: At [04:19], Sanchez reveals that the richest woman in the world, according to last year's Forbes report, built her wealth not from celebrity or entertainment but by growing a roofing company to a net worth exceeding $15 billion. This challenges the stereotype that only those in glamorous fields achieve significant wealth.

• Sexiness vs. Profitability Matrix: By [05:03], Sanchez introduces a conceptual matrix where the sexiness of an industry inversely correlates with its profitability. More "boring" industries tend to offer higher and more consistent financial returns compared to their more glamorous counterparts.

---

2. The Value of Boring Businesses

Sanchez advocates for investing in established, straightforward businesses that provide essential services. These businesses often demonstrate resilience and steady income, making them attractive investment opportunities.

• Recession Resistance: At [19:53], she notes that many Main Street businesses are recession-resistant. For example, services like landscaping and plumbing remain in demand regardless of economic fluctuations, ensuring continuous revenue.

• Subscription Revenue Models: Sanchez points out that many traditional businesses incorporate subscription-based models, providing predictable and recurring income streams similar to those favored by SaaS companies ([20:13]).

---

3. Levels of Business Acquisition

Sanchez outlines a four-tier framework for acquiring businesses, each representing a different level of involvement and complexity:

• Level 1: Solo Venture ([32:30])
  Ideal for beginners, these businesses are small-scale and manageable without significant upfront capital. Examples include vending machines and single-location laundromats.

• Level 2: Hands-On CEO ([33:43])
  At this stage, entrepreneurs may have operators assisting them, allowing for slight delegation. Multiple laundromats or small media companies fit this category.

• Level 3: On-Deck Operator ([34:34])
  Entrepreneurs focus on oversight with experienced operators managing daily operations. Businesses here generate upwards of a million dollars in revenue, such as small furniture stores or HVAC companies.

• Level 4: Market Leader ([35:46])
  The highest level involves significant organizational structure, including a C-suite team and tens of employees. These businesses are poised for acquisition by private equity firms.

---

4. Criteria for Selecting Businesses: The SOWS Framework

To identify viable investment opportunities, Sanchez introduces the SOWS framework, which stands for Stale, Old, Weak, and Simple.

• Stale ([36:51])
  Businesses that have been operational for a long time and have not significantly innovated. Indicators include outdated practices like still using fax machines for invoicing ([37:02]).

• Old ([37:08])
  Companies established for at least five to seven years, benefiting from the Lindy Effect—the longer a business has existed, the more likely it will continue to thrive ([25:36]).

• Weak ([37:38])
  Industries with minimal competition or poorly executed competitors. This allows new owners to enter the market with improved strategies and operations ([37:46]).

• Simple ([37:39])
  Businesses that are easy to understand and manage, minimizing complexity. Sanchez likens this to buying a fixer-upper house rather than a complete disaster to ensure manageable risk.

---

5. Creative Financing Strategies

Sanchez emphasizes the importance of innovative financing methods to acquire businesses without substantial initial capital.

• Seller Financing ([39:43])
  A preferred method where the seller finances part of the purchase price, allowing the buyer to pay over time. Sanchez details a negotiation script to make seller financing a win-win scenario for both parties ([42:16]-[44:43]).

• Leveraging Business Income ([39:48])
  Unlike traditional loans based on personal income, business loans are based on the business's revenue and profits, enabling buyers to acquire larger businesses than their personal finances would allow.

---

6. The Importance of Ownership

Ownership in a business equates to financial freedom and autonomy. Sanchez discusses how owning a business reduces dependency on external employers and provides opportunities for income diversification.

• Ownership as Freedom ([08:04]-[08:49])
  The more assets you own, the less others can dictate your professional and financial trajectory. Sanchez shares her personal experience transitioning from corporate roles to entrepreneurship, highlighting the freedom ownership affords.

• Equity Done Right ([15:32]-[17:03])
  Proper equity structure ensures that owners receive distributions (pro-rata shares of profits) in addition to equity, providing immediate income alongside long-term wealth accumulation.

---

7. The Role of AI in Traditional Businesses

While artificial intelligence is revolutionizing online and digital industries, traditional "boring businesses" are less susceptible to immediate AI disruption.

• AI's Impact on Digital Jobs ([25:24]-[26:13])
  Jobs like graphic design and copywriting are increasingly automated, whereas trades like plumbing and roofing remain reliant on physical labor and are thus more resilient.

• Technological Optimism ([71:06]-[72:35])
  Sanchez expresses a techno-optimistic view, believing that AI can augment business operations and increase profit margins without necessarily displacing traditional trades.

---

8. Exiting Strategies

Planning for an exit is crucial for maximizing the return on investment when selling a business.

• Timing Your Exit ([63:06]-[65:06])
  Entrepreneurs should view their first acquisition as the beginning, not the end. Exit strategies should focus on increasing profits, revenue, reducing risks, and enhancing systems and processes to elevate the business's market value.

• Leveraging Multiple Acquisitions ([55:16]-[56:40])
  Building a portfolio of businesses through strategic acquisitions can compound wealth and create a diversified income stream, akin to the strategies employed by large conglomerates.

---

9. Actionable Insights and Final Advice

Sanchez offers practical advice for listeners aspiring to embark on the journey of owning boring businesses.

• Deal Making Skills ([26:37]-[27:20])
  Mastering deal structuring and negotiation is essential for successful acquisitions and can significantly reduce the risk of financial setbacks.

• Reticular Activating System ([27:50]-[28:32])
  By focusing on business acquisitions, entrepreneurs can train their minds to recognize and seize opportunities that others might overlook.

• Avoiding Passive Income Myths ([29:02]-[31:04])
  Realizing that "passive income" often requires substantial active effort, Sanchez advocates for "horizontal income"—layering multiple income streams for sustained profitability.

• Ownership Over Salary ([68:11]-[69:42])
  Transitioning from being an employee to an owner not only offers financial benefits but also fosters a mindset geared towards long-term wealth generation and personal growth.

---

Notable Quotes

• "Ownership actually is a synonym for freedom. So the more that you own things, the less other people can tell you what to do." — Cody Sanchez [08:04]

• "Most of the money in buying businesses and building businesses is made on the sale." — Cody Sanchez [63:56]

• "The faster you move, the larger your bank account." — Cody Sanchez [73:39]

• "Your salary will never set you free. Your financial freedom can only come through ownership, specifically through equity done the right way." — Cody Sanchez [15:33]

---

Conclusion

In this enlightening episode, Cody Sanchez dismantles conventional beliefs about wealth and entrepreneurship, advocating for the strategic acquisition of established, low-excitement businesses as a reliable path to financial independence. By focusing on ownership, leveraging creative financing, and understanding the resilience of traditional industries, entrepreneurs can build a diversified and profitable portfolio. Sanchez's insights offer a refreshing perspective for those seeking sustainable wealth beyond the volatile realm of startups and digital ventures.

---

Additional Resources

• Book: Main Street Millionaire by Cody Sanchez
• Website: msmbook.com
• Newsletter: Contrarian Thinking
• Company: Unconventional Acquisitions

For more insights and tools on business acquisitions and entrepreneurship, listeners are encouraged to explore Sanchez's book and associated resources.

Transcript

[Hala Taha]

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[Cody Sanchez]

Notes if I go to college and I become a roofer, that's not very cool. But if I become a marketer or a graphic designer, that's cool. Here's the problem. Roofers make way more fucking money. Ownership actually is a synonym for freedom. So the more that you own things, the less other people can tell you what to do.

[Unknown]

How do you see mom and Pop boring businesses really evolving in the next five, 10 years because of AI?

[Cody Sanchez]

The first jobs that AI took were artists, copywriters. Because AI lives online. You know where AI is going to take longer? Painting companies, roofing companies, plumbing companies. The best ways to make money are super simple. If you want to make more money, you should look at and you will have a hard time being poor.

[Unknown]

Young.

[Hala Taha]

And profits as an entrepreneurship podcast, we're often talking about starting new sexy businesses.

[Unknown]

I'm an inventor and so I always.

[Hala Taha]

Love to talk about inventing and innovating and tech and AI and all these sexy things. But sometimes we overlook really great opportunities when it comes to boring businesses buying existing businesses that are often overlooked. I'm talking about laundromats, vending machines, landscaping services. There's so many businesses out there that are ripe for the picking.

[Unknown]

My guest today is an investment expert.

[Hala Taha]

Who has built up her own portfolio of what she calls boring businesses. Cody Sanchez is the co founder of Contrarian Thinking newsletter and Unconventional Acquisitions, a company that helps people learn how to buy small businesses. She's also the author of a brand new book called Main Street Millionaire.

[Unknown]

I read this book. It is totally awesome. And today we're going to dive in.

[Hala Taha]

On all her strategies to buy successful, boring businesses.

[Unknown]

We're going to learn how we can pick these businesses, how we can set up an operator so that we're not.

[Hala Taha]

Buying a job, we're actually buying a business. We're going to talk about when we.

[Unknown]

Should actually sell this business that we.

[Hala Taha]

Acquired and so much more.

[Unknown]

I'm so excited for my guest today.

[Hala Taha]

Welcome to the show, Cody Sanchez.

[Unknown]

Cody, welcome to Young and Profiting Podcast.

[Cody Sanchez]

I'm thrilled to be here.

[Unknown]

Me too. So last time you came on the show, we talked about your background, we talked about your contrarian investment views, and we talked about buying boring businesses, which I absolutely love. And now you have a new book out. It's called Main Street Millionaires. So I can't wait to find out how we can all become Main street millionaires. So my first question to you is trying to really understand some misconceptions that we have about rich people. When I think about rich people, I think about billionaires like Elon Musk and Jeff Bezos and tech entrepreneurs or celebrities like Oprah and Kim Kardashian. But tell me why you are challenging this idea. What stats and facts do you have about rich people?

[Cody Sanchez]

Let's start with a fun one. Do you want to know who the richest woman in the world is?

[Unknown]

This is as of the end of.

[Cody Sanchez]

Last year when the Forbes report came out. If you thought maybe it's T. Swift, I know she had a big tour.

[Unknown]

Wrong.

[Cody Sanchez]

She's like 34th on the list. If you thought it was Kim K. You'd also be wrong. She was like 21st on the list. If you thought that it was somebody like Oprah, Also wrong. She doesn't even crack the top 10. Who is it? Actually, it is a woman who grew a roofing company to more than $15 billion in net worth. And so my point here is I think one of the biggest misconceptions with the really, really rich is that they do things that are really, really sexy. In fact, most of the richest people on the Forbes 100 list, if they.

[Unknown]

Didn'T inherit it from a boring business, they started a boring business or they.

[Cody Sanchez]

Bought businesses, AKA finance. So I think there's a matrix kind of like this. On the vertical side of the matrix.

[Unknown]

You basically have the sexiness of a.

[Cody Sanchez]

Business from artists to musicians to actors.

[Unknown]

And on the right side, you have.

[Cody Sanchez]

The Income or how much money you can make.

[Unknown]

And what it turns out is, if.

[Cody Sanchez]

You correlate the two, the sexier the industry, the fewer the people make an.

[Unknown]

Obscene amount of money in it. The more boring the industry, the more.

[Cody Sanchez]

People make consistent high dollars in it. And so there seems to be a correlation between boring, traditional, everyday businesses that we need nonstop and more of us making money, which I thought was interesting.

[Unknown]

That's so interesting. And we're going to find out later why these boring businesses are so overlooked. But before we do that, you open up your book basically saying that we are programmed to be poor. Tell us why America basically teaches us to be poor our whole lives.

[Cody Sanchez]

I heard a quote once that just.

[Unknown]

Seared its way into my soul, which.

[Cody Sanchez]

Was that you are as rich as you programmed yourself to be. And if you think about it that way, there's a good and a bad side to it.

[Unknown]

The good side is, well, you can.

[Cody Sanchez]

Reprogram yourself just like a computer. You can scrap the software, keep the hardware, and realign what is inside of you. The bad part is that the foundation on which you and I have learned money is actually one that incentivizes us to stay just sort of tracking to our spend for our entire life, which is why most people will die alone.

[Unknown]

And without much in the way of.

[Cody Sanchez]

Resources, which is really, really sad. And so when I started thinking about writing this book, I was like, we can't make ourselves smarter very easily. We can't make ourselves have more money than other people do upfront. So what would be a way to level the playing field? And because I was in finance for 12 years, I watched what the really, really rich did, and they did something completely differently, which is they didn't innovate.

[Unknown]

As often as Silicon Valley did.

[Cody Sanchez]

They didn't come up with some crazy.

[Unknown]

Startup and sleep on couches.

[Cody Sanchez]

In fact, they wore Gucci loafers all the way to the private plane they eventually bought.

[Unknown]

And how did they do this?

[Cody Sanchez]

Because they bought other people's hard work.

[Unknown]

Other people's years of hard work.

[Cody Sanchez]

And then they did a little bit of what's called financial arbitrage, but basically make expenses a little bit lower, increase profits here, and apply the Wall street mechanism for growth to most businesses. And I was like, why does Wall street only do this? I think that we can reprogram ourselves to be rich by realizing that we just have to copy other people's homework from those who have already achieved the thing we want in life. And that's kind of what I strive to do.

[Unknown]

So I'd love to understand the difference between living a life where you have non ownership versus living a life where you actually have ownership in something. Can you compare and contrast that for us?

[Cody Sanchez]

I think ownership actually is a synonym for freedom. So the more that you own things, the less other people can tell you what to do. If your listeners are like, you and I, you and I, we're probably pretty unemployable, right? We're a pain in the ass, which is why we became entrepreneurs. We are just on the other side of diva, which is like, I think.

[Unknown]

We should do it this way.

[Cody Sanchez]

How come we can't do this? Let's go faster. What do you mean I can't make more? That's what a good entrepreneur is. And so I think if you are also like that, you are set up to succeed in some ways, which is that you will fail at being an employee for a long time. And the best entrepreneurs are failed employees. And so you will eventually get to a path where you realize that you.

[Unknown]

Can own the equity in the business.

[Cody Sanchez]

That you have distributions in the business.

[Unknown]

Over a long term, and it can be on legally binding contracts.

[Cody Sanchez]

You can take it with you as opposed to your W2. And the only little caveat there I like to put out there, Hala, is I loved being an employee. Actually the tail end of my career where I was a partner at a few private equity companies. I really liked what I did. I could have done that forever. At one company in particular, I just wanted to do it my way. And so I was annoyed at their speed. And because of that, I ended up going and doing my own thing. But what I wished I could realize at the time is that I could.

[Unknown]

Have had even my own business on.

[Cody Sanchez]

The side and I could have negotiated for more equity and distributions in a.

[Unknown]

Business so that you could stay an employee too, if you want, and own a business.

[Cody Sanchez]

And so I think there's lots of ways to get to the end game of ownership.

[Unknown]

I love the fact that you actually.

[Hala Taha]

Had a corporate job where you were.

[Unknown]

Helping people buy businesses. And I think it's pretty safe to say you probably learned so much, which is why you could then become an entrepreneur who's, you know, has a holding company that buys businesses. So you also learn the ropes on somebody else's dimension.

100%.

[Cody Sanchez]

There's so many people on the Internet now, and you're not one of them because you've done this game too. But there's so many people on the Internet who want to tell you, go be your own boss. Be an Entrepreneur. And that's fine. I do think that that's great. For many people, however, there's risk associated with pure ownership, where you own the.

[Unknown]

Entirety of the business. And so one don't assume that in order to buy a business, you have.

[Cody Sanchez]

To buy the whole thing. You don't. You can actually just own part of it and you can use other things besides your money to buy it.

[Unknown]

That's really cool.

[Cody Sanchez]

We talk about that in the book. But number two is there is no better way to learn the game of business than by getting a salary, learning under somebody else's tutelage, and eventually, if you're a great employee, getting a percentage of their company or getting them to.

[Unknown]

Invest in your business.

[Cody Sanchez]

And this is actually fascinating because people on the Internet don't always love to hear this, but, you know, in finance, most of the companies that we start. So if I left a finance firm, like when I left Goldman, I was too young, they wouldn't have given it to me. But when I left my last firm, which was eec, they asked if they.

[Unknown]

Could invest in whatever my next venture was.

[Cody Sanchez]

They wanted to give me my first checks. And I think more often than not, if we kill it as an employee.

[Unknown]

We can actually push that into capital in our next venture.

I have somebody named Kate on my team who started as an intern four years ago, and now she's a partner who's vesting to get 10% of my business and helps me manage the whole social side of our team. So it just goes to show, you really can get equity in a company. And she's not really an inventor. Right. I'm always inventing things, creating things. That's my skill set. And she's really good at managing. So it's a way for her to become an entrepreneur without necessarily inventing anything.

[Cody Sanchez]

Oh, yeah, I love that. I think you're really smart because a lot of young entrepreneurs don't understand a.

[Unknown]

Few words that will change your life.

[Cody Sanchez]

When it comes to making money and ownership, which is vesting equity, AKA you can give somebody a percentage of your company, but they don't take it right away. They get it over years of work a little bit at a time each year, which is called a cliff. So nothing earned in the first year until they make it to the end.

[Unknown]

Of the first year, and if they're successful, then they earn a portion.

[Cody Sanchez]

Same thing with year two, year three. We talk about lots of the lingo in the book. Another thing that you mentioned that I think is really important is she was a high performer.

[Unknown]

She Kept growing.

[Cody Sanchez]

And so you were rewarding what you had already seen as positive behavior, not.

[Unknown]

Trying to incentivize future better behavior.

[Cody Sanchez]

So I think a lot of times what people don't realize is they give a carrot to somebody who is underperforming or sort of flat and they say.

[Unknown]

You could earn equity in my business.

[Cody Sanchez]

If you do X and Y and Z. What you really should do instead is say, wow, you're the fastest greyhound on the track. You're crushing it right now for me. I want to reward you for what you're already doing now over a multi year period.

[Unknown]

The best predictor of future behavior is past behavior.

[Cody Sanchez]

So your high performers are more likely.

[Unknown]

To continue performing than you changing the.

[Cody Sanchez]

Mindset of a poor performer.

[Unknown]

So true. So entrepreneurship is thrown around all the time. Everybody thinks they're an entrepreneur. Can you talk to us about freelancers, gig workers, solopreneurs? Do you feel that that's the same thing as owning a business? Why or why not?

[Cody Sanchez]

I think we were sold a great lie. And the great lie was essentially this. First we owned our businesses back in.

[Unknown]

The day when we first started in this country, we didn't pay a ton in taxes and we owned our own businesses. And then we apprenticed to eventually take over those businesses. Then one day big corporations came around and they said, instead of you owning.

[Cody Sanchez]

These little things, come work for us. We have this big huge opportunity. You can come work inside of our sphere. Then we worked in corporations and realized the only place that padded walls should.

[Unknown]

Be is insane asylums and I don't want to work in cubicles anymore under floor.

[Cody Sanchez]

So we said, wait a second, startups, that's what it is. It's Silicon Valley backed venture rocket ships.

[Unknown]

We'll go to do those.

[Cody Sanchez]

So then we went and did that as a society and that's what we glamorized. The problem there is, Nobody told us 9 out of 10 of those startups.

[Unknown]

Would fail miserably and they would leave a bunch of us with a mess.

[Cody Sanchez]

On our hand with companies that were failing with heartache.

[Unknown]

Right? And the people who would win would.

[Cody Sanchez]

Be venture capitalists who got to sprinkle tons of dollars across many companies and also fueled a ton of innovation.

[Unknown]

But it's not for everybody.

[Cody Sanchez]

It's a very hard path. And then finally we were like, no more venture, I don't wanna do that. So we were like yolo into freelance.

[Unknown]

And I own my own company or.

[Cody Sanchez]

What I'll call solopreneurship. Solopreneurship is the way.

[Unknown]

Well You've done this before, too. I think the road to hell is paved with individual zoom meetings back and.

[Cody Sanchez]

Forth between yourself and no help. And so we didn't realize that all we did actually, was now go work at the behest of an Uber or at the behest of a substack, where.

[Unknown]

They still own us. Silicon Valley still owns us. We just make a smaller percentage of our total profits as a solopreneur.

[Cody Sanchez]

And now we're like, man, we're not even making enough money in solopreneurship anymore, and we don't really like this. So I think the solopreneur movement is actually not as glamorous as we thought it was.

[Unknown]

And so my hope is the next movement is this Main street movement.

[Cody Sanchez]

Can we go back to the thing we were originally talked out of, which.

[Unknown]

Is let's own a portion of small businesses all around this country that are already profitable, that have existed for a.

[Cody Sanchez]

Long time, that don't have crazy volatility of online businesses, and that are simple, and that you're going to pay, even if it's in a recession, because you.

[Unknown]

Want your plumbing to work, even if it's a downturn.

[Cody Sanchez]

And that's my belief.

[Unknown]

I love that you have this quote in your book and you say, your salary will never set you free. Your financial freedom can only come through ownership, specifically through equity done the right way. So my question is, what do you mean by equity done the right way?

Everybody wants equity, right?

[Cody Sanchez]

That sounds good, but the problem with equity is you can't eat it. Meaning, what are you going to do? I can't take my equity and go pay for something or put a down.

[Unknown]

Payment on a house.

[Cody Sanchez]

It's sort of like up in this.

[Unknown]

Ether, this thing that I can't touch.

[Cody Sanchez]

And if you went and looked at a bunch of Silicon Valley startup employees.

[Unknown]

You'D see, oh, man.

[Cody Sanchez]

Most of them thought they were being compensated like this very high because they had a lot of equity and realized, wow, my equity wasn't worth anything like that. And so I think there's a better way, which is equity plus distributions.

[Unknown]

So that means, hey, I get a.

[Cody Sanchez]

Percentage of a company. You can't really take that away from.

[Unknown]

Me unless I do something fraudulent or crazy.

[Cody Sanchez]

I own, I don't know, 10% of XYZ company that I work at.

[Unknown]

But because I need to eat and.

[Cody Sanchez]

Make money, there's something called distributions, which happen for all owners of a business.

[Unknown]

If the owner takes $100,000 out of.

[Cody Sanchez]

The business, then that means that I get what's called my pro rata.

[Unknown]

So my percentage that I own of the business, I get distributed, too.

[Cody Sanchez]

So let's say the owner is going to take $100,000. I might get $5,000 if I own.

[Unknown]

5% of the business. And that way we can eat as we move along and get equity. That is equity done right?

[Cody Sanchez]

Distributions today, future profits tomorrow.

[Unknown]

So you have this new book that's out right now. It's called Main Street Millionaire. Can you talk to us about what a Main street business is?

[Cody Sanchez]

So Main street business is the business.

[Unknown]

That you pay right now every single.

[Cody Sanchez]

Month, but you kind of ignore it.

[Unknown]

It's your landscaping business, it's your house.

[Cody Sanchez]

Cleaners, it's your roofing companies, it's services, like your podcast production company that you.

[Unknown]

Pay as a vendor.

[Cody Sanchez]

These are businesses that are the opposite of Silicon Valley. They're not something new and innovative.

[Unknown]

They're continuous and compounding.

[Cody Sanchez]

And so when I think about Main street businesses, I look all around our small community and I realize, man, it's not just the local coffee shop that's interesting. It's also the street sweeping business that.

[Unknown]

Cleans up the streets.

[Cody Sanchez]

It's the person who does line painting.

[Unknown]

In the middle of the street to.

[Cody Sanchez]

Make sure that there are parking spaces.

[Unknown]

All of those services are businesses.

[Cody Sanchez]

But we were taught as a generation, you're in my generation, that if I.

[Unknown]

Own a handyman business and I'm a handyman, that's bad.

[Cody Sanchez]

If I go to college and I become a roofer, that's not very cool. But if I become a marketer or a graphic designer, that's cool. Here's the problem. Roofers make way more fucking money. So I think we were sold a.

[Unknown]

Little bit of a bag of goods. Maybe you don't want to stay a.

[Cody Sanchez]

Roofer forever because it could be hard on your body.

[Unknown]

But you learn the trade, then you learn the business, then you own part of the business, then you own the whole business, then you sell it, and.

[Cody Sanchez]

That is how you are able to pass off your work over time.

[Unknown]

Talk to us about how these businesses are overlooked and why they're such steady, reliable businesses.

[Cody Sanchez]

I think a lot of reasons why these businesses are overlooked is really three things.

[Unknown]

Main street businesses have a societal belief that they are less than.

[Cody Sanchez]

We call them blue collar, not white collar.

[Unknown]

Right.

[Cody Sanchez]

They're not shiny.

[Unknown]

They are something that is done by.

[Cody Sanchez]

People who don't have university degrees, and somehow that's a bad thing. So we have a societal sheen on them. The second reason people don't love these businesses is because we've been told, well, these people don't make very much money.

[Unknown]

And these businesses don't make very much money.

[Cody Sanchez]

If I'm going to be a banker.

[Unknown]

Or an accountant or an attorney, I'm.

[Cody Sanchez]

Going to make more. Well, that turns out not to be true over time.

[Unknown]

And then the third reason is because these businesses don't have what's called a moat.

[Cody Sanchez]

So there's probably, I don't know, a couple thousand Handyman companies, maybe 10,000 Handyman companies in Texas. There's like one Facebook.

[Unknown]

Right. And so we thought you had to have this new, sexy, innovative business in order to make money. You don't.

[Cody Sanchez]

In fact, it'd be much easier to compete with your local handyman company than Mark Zuckerberg, who's an animal. And so those three reasons kept us.

[Unknown]

Away from Main street businesses.

[Cody Sanchez]

The other thing that's interesting about Main.

[Unknown]

Street businesses is most of them are recession resistant.

[Cody Sanchez]

So you're going to use a landscaping company if you need to have your driveway shoveled during the winter, no matter what.

[Unknown]

Most of these small businesses have some version of subscription revenue, the thing that SaaS companies, tech companies love.

[Cody Sanchez]

And most of these businesses are pretty simple to understand. Now, I don't want to idealize this. I'm not saying this is like a.

[Unknown]

Fast, easy, 30 day to million type thing.

[Cody Sanchez]

It's not. But these businesses have been overlooked and anytime that happens, there's money to be made.

[Hala Taha]

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[Unknown]

Hey yeah.

[Hala Taha]

Bam. Launching my LinkedIn Secrets Masterclass was one of the best things I've ever done for my business and I didn't have to figure out all the Nuts and bolts of creating a website for my course. I needed a lot of different features. I needed chat capabilities in case anybody had questions. I needed promo code discounts. I needed a laundry list of features to enable what I was envisioning with my course. But here's the thing. All I had to do was literally lift a finger to get it all done. And that's because I used Shopify. Shopify is the easiest way to sell anything, to sell online or in person. It's the home of the number one checkout on the planet. And Shopify's not so secret. Secret is Shop Pay, which boosts conversions up to 50%. That means way fewer carts get abandoned and way more sales get done. So when students tell me that they can't afford my course, I let them know about payment plans. With Shop Pay, it is a game changer. If you're into growing your business, your commerce platform better be ready to sell wherever your customers are scrolling or scrolling on the web, in your store, in their feed, and everywhere in between. Put simply, businesses that sell more sell with Shopify. Upgrade your business and get the same checkout we use at Yap Media with Shopify. Sign up for your $1 per month trial [e-mail] profiting and that's all lowercase. Go to shopify.comprofiting to upgrade your selling today. That's shopify.com profiting.

[Unknown]

Can you talk to us about the Lindy effect and why it matters?

[Cody Sanchez]

I love it. You have read the book. You're going to own a bunch of these things by the end of it.

[Unknown]

The Lindy effect is really important.

[Cody Sanchez]

It's very simple. And I think the best ways to make money are super simple. If you want to make more money.

[Unknown]

You should look at how long a business has existed.

[Cody Sanchez]

The Lindy effect says the longer a business has been in existence, the higher likelihood it will have to continue to be in business. So essentially the opposite of what I thought was true. It was like, this thing's been around.

[Unknown]

For 30 years, must be old, outdated, not work.

[Cody Sanchez]

But in fact, it has a higher likelihood of continuing to succeed as opposed to a brand new startup. Much riskier, much higher likelihood to fail. And so if you look at businesses that have survived for over five to seven years, you have taken away anywhere from 50 to 60% failure rate.

[Unknown]

That means you're left with only 44%.

[Cody Sanchez]

What if I could tell you today you could start a startup and I could decrease your risk of failure by 50%? You'd be like, that's Cool. Yeah, let's do that. Well, that's what you can do with these boring businesses that have existed for a long time.

[Unknown]

Is there a certain personality type or level in which we should be before we should actually go and try to seek out a boring business?

[Cody Sanchez]

So the question usually comes to me, like, when am I ready to buy a business? How would I know? And my question back to you would be one. One skillset that I have never regretted, that I wish I had learned earlier was deal making. Because it will forever change how you make money.

[Unknown]

Even if you never buy a business outright.

[Cody Sanchez]

If you understand terms structuring, deal making and how the world of money works, you will have a hard time being poor. And so because of that, I like to teach people business buying before they even think they're ready for it. So for instance, I gave my cousin this book who's 16, and he's reading through it and he's figuring out ways to do deals right now. And the way that I think, you know you're ready is basically this. If you are in business right now.

[Unknown]

It is a no brainer.

[Cody Sanchez]

If you look at the biggest companies in the world, they grow through acquisitions. Amazon, Facebook, both of them have done over 200 transactions. They grow faster through acquisitions than they do organically, customer by customer. So if you own a business today, you need to understand how to do deal making. It's how you will be harder to compete with. You can acquire 100 customers at a time, while most people are acquiring one at a time. Total game changer.

[Unknown]

If you don't have a business yet.

[Cody Sanchez]

What I'd like to do is turn on what I call your reticular activating.

[Unknown]

System of business buying.

[Cody Sanchez]

So your reticular activating system is what.

[Unknown]

Gets turned on when your brain tells you that something is important.

[Cody Sanchez]

And so when you go and buy.

[Unknown]

A car, for instance, like a Porsche, let's say you go and buy a.

[Cody Sanchez]

Porsche and before you bought the Porsche, you're like, I don't see these things anywhere. After what you buy the Porsche, you're like, fuck, everybody has a Porsche in Austin, Texas. What happened?

[Unknown]

Nothing happened.

[Cody Sanchez]

Your brain just started getting a signal to it, saying that this is important. And so you started noticing it. Right now we're walking around sort of.

[Unknown]

In the matrix, not realizing that all around us are deals, potential deals.

[Cody Sanchez]

And what I want to do is turn on your brain so you start seeing them.

[Unknown]

And what this might mean is if.

[Cody Sanchez]

You work for a small business, you might not even realize that the owner is ready to retire. And if you positioned yourself correctly, you could take over that business using seller financing. If you're a solo content creator online, you might not realize that the thousand dollars they want to pay you to promote XYZ product, you should actually negotiate.

[Unknown]

A deal instead to get future distributions.

[Cody Sanchez]

And a percentage of the company deals are all around you. We just want you to turn it on.

[Unknown]

I know that it's a lot of hard work to have a boring business, but I think people have the misconception that it's like passive income. Like, oh, I'm going to buy a bunch of vending machines, plop them in stores, and passive income, why is that not really the case?

[Cody Sanchez]

You know, I was joking with one of my favorite CEOs that I used to work for back in the day. He runs a company that does, I.

[Unknown]

Don'T know, $300 billion in annual sales.

[Cody Sanchez]

It's a huge company. And when I was talking to him, he was pretty funny. I was like, jim, I'm curious.

[Unknown]

He's older, so he's probably in his mid-70s.

[Cody Sanchez]

And I was like, you've been around for a long time. You've been an investor all your life. You own all these companies.

[Unknown]

You ever met any passive income? And he was like, sure haven't, but.

[Cody Sanchez]

I'm open to it. The way you get passive income is years of active work. And I think we need to be honest about that with each other. Now, that said, there's a lot of people that want to tell you two things. Either one, you can't.

[Unknown]

It's not possible for you. Stay in your lane.

[Cody Sanchez]

It's much easier to be a hater than a hope giver.

[Unknown]

And then the second group wants to.

[Cody Sanchez]

Tell you, hey, it's super easy. Anybody can do it.

[Unknown]

Look at my Lambo.

[Cody Sanchez]

Look at my private plane. Look at my Gucci. And because of that, I'm really successful. You can be too. And they want to sell you something.

[Unknown]

I think the truth is somewhere in the middle. And in fact, with small businesses, I think you should expect for the first.

[Cody Sanchez]

Year, you got a lot to learn, man. It is not complicated, but it is hard. It's not easy, but it is simple.

[Unknown]

And I think when you realize, oh.

[Cody Sanchez]

Running a laundromat is not complicated, but it's hard work.

[Unknown]

Running a vending machine business is actually harder than a laundromat business because you have these tiny little stores, right? Machines that have very limited cap on how much they could make per month. Let's call it max.

[Cody Sanchez]

I mean, if you had a $5,000 a month producing vending machine.

[Unknown]

That'd be incredible. So you have Max, this little $5,000.

[Cody Sanchez]

Machine, and then you got to figure.

[Unknown]

Out the logistics to go back and.

[Cody Sanchez]

Forth to all of them to accumulate.

[Unknown]

Eventually to a business that does, let's.

[Cody Sanchez]

Say a million dollars a year. It's a lot of work. And so I don't like to talk about passive income. I like to talk about horizontal income, which basically means where can you layer your income like a cake so that at any given time, your day is split between a few activities, mostly oversight.

[Unknown]

As opposed to execution.

[Cody Sanchez]

So in my businesses, I run a.

[Unknown]

Big portfolio at Main Street Holding Company.

[Cody Sanchez]

You can see a bunch of the.

[Unknown]

Businesses we own there.

[Cody Sanchez]

And part of my day is spent with like this company up here, which is Pink's. So, you know, I'm talking to the CEO Stephen, and I'm saying, hey, how is the cash flow looking?

[Unknown]

What's going on?

[Cody Sanchez]

I'm actually doing nothing in the business, but I'm at least thinking about it. So I like to be honest about that.

[Unknown]

It's not going to be easy, guys, but it could be very lucrative. Okay, so let's talk about prep before we buy these businesses. We talked about what do we need to get started? In your book, you have four levels. So I thought we could do something fun, quick fire style. I will list the level. I'll say level one, level two. And then you tell us what is this level about?

[Hala Taha]

Who's it for?

[Unknown]

What are some examples of the businesses that we should be looking for? What should we expect at this level? And this is an entrepreneurship show, so we really have people who are want to be entrepreneurs. We've got people who have $50 million businesses listening. And so we've got lots of different people on the show. So I thought this would be fun. Level one solo venture.

So a good level one business might.

[Cody Sanchez]

Be something like a vending machine. These are what I call people, light businesses. So it might be something where you.

[Unknown]

Could be the owner, operator of the business.

[Cody Sanchez]

The business is probably not making eight figures. You're talking about businesses that are, you know, 1 to 3 million and less. These businesses on average are what I.

[Unknown]

Call gateway drug style businesses you can.

[Cody Sanchez]

Dip your toes into. Your first small car wash deal, your.

[Unknown]

First small laundromat, your first vending machine.

[Cody Sanchez]

Your first podcast production company. But you're probably not going to get.

[Unknown]

Independently wealthy working on these businesses.

[Cody Sanchez]

You are in it. It will require some work, but it doesn't require as much cash.

[Unknown]

What was your first level one? Business.

[Cody Sanchez]

Well, my very first one was a website called Selling south back in the day. And I tried a game that I was really bad at, which is I think we made money on ads and affiliates back then. It was really hard.

[Hala Taha]

It was hard.

[Cody Sanchez]

And I didn't make very much money at all. But it was a good entry drug business. And then I had a laundromat business which I would put in this category too in the beginning. And then I also had a consulting business which was right on the edge of a level one. Level two.

[Unknown]

Okay, moving on to level two. Hands on CEO.

[Cody Sanchez]

This business is one where you're going to potentially have an operator right along with you. You might have somebody who's actually in the business. My first business I had a GM in the Laundromat.

[Unknown]

So he's the one actually running some.

[Cody Sanchez]

Of the laundromat specifics. I invest in it, I track things. Overall, I'm still involved in the business, but I have a little help.

[Unknown]

These businesses are slightly bigger in size.

[Cody Sanchez]

There's also a slight bigger complexity here. This could be things like multiple laundromats. Let's say, for instance, this could be things like having a media company. What we have now. I would say most media companies fall into this category. They never get to like a huge daily wire allowance. These businesses also, on average still have most of your time dedicated to this business and are going to have some employees, but not a ton.

[Unknown]

Okay, level three. And this is like it gets harder and harder, right? Or like less likely that you fit in the level as we go along. So level three is on deck operator.

[Cody Sanchez]

This means you got an operator that's.

[Unknown]

Rocking and rolling in this business.

[Cody Sanchez]

You are in oversight mode.

[Unknown]

You basically get to do what I.

[Cody Sanchez]

Do, which is financial Fridays. You're reviewing what's going on. You have an operator who probably knows more than you do about the business. You've got employees underneath that operator.

[Unknown]

This business is doing millions of dollars.

[Cody Sanchez]

In revenue and that means alternatively you.

[Unknown]

Could be doing a million plus in profit.

[Cody Sanchez]

This is a business where you could have almost any type of business imaginal could be in this amount. So you could have a small furniture store. You could also have a roofing or.

[Unknown]

An H Vac company in this amount.

[Cody Sanchez]

These start to get to the level where you're starting to do roll ups in your business.

[Unknown]

And so the idea is that you're actually not the operator of this business. You just invested in this business.

[Cody Sanchez]

That's right.

[Unknown]

Okay.

[Cody Sanchez]

And the way that we think about these levels is mainly does the revenue support, the employees and infrastructure that allow you to work on the business as opposed to in the business. So the first two, not as much. The third one, you start to get into it.

[Unknown]

I'm going to dig deeper on that in a second level four, market leader.

[Cody Sanchez]

So this means we're a big business now.

[Unknown]

Not only do you have a CEO.

[Cody Sanchez]

But you probably have a C suite staff. You've probably got a few other real.

[Unknown]

Pros in there running the business.

[Cody Sanchez]

Now we're talking about tens of employees plus we're making real revenue and real.

[Unknown]

Profit in this business.

[Cody Sanchez]

And you're in a stage where you're either already at or getting to a spot where private equity might buy you.

[Unknown]

Might compete with you.

[Cody Sanchez]

And these all are still in what I consider small and medium business. So this is still sort of micro PE below the level at which you're going to compete with what's called middle market and private equity.

[Unknown]

So you have this framework now we know the levels, we know where we got to start. We're about to go look for our boring business. We need to have some sort of criteria to pick a smart move.

[Cody Sanchez]

Right?

[Unknown]

We can't just go after any business that we find. You've got this acronym sows. Sows.

[Hala Taha]

So stale, old, weak, simple.

[Unknown]

Can you explain and break that down?

[Cody Sanchez]

So when we think about what is.

[Unknown]

The right type of boring business to.

[Cody Sanchez]

Buy really depends on who you are. But if I was to give you a framework, it would be sales, which is when I look for businesses, I look for a business that is stale.

[Unknown]

That means that it's been around for a long time.

[Cody Sanchez]

That means that the business probably hasn't.

[Unknown]

Done much in the way of innovation.

[Cody Sanchez]

Might have something called the fax machine test, which is. They have a fax machine still.

[Unknown]

That's crazy.

[Cody Sanchez]

Do they actually use that thing? They might take invoices on a piece of paper as opposed to putting it into QuickBooks. Then we get to the O, which is old. Has the business been around at least.

[Unknown]

Five to seven years?

[Cody Sanchez]

Is the Lindy effect in effect? Can this business be one that we think has a lower risk? Because the likelihood of future success is.

[Unknown]

Probably based on historical success, then we have weak.

[Cody Sanchez]

This one I really like.

[Unknown]

If there are competitors that are weak.

[Cody Sanchez]

In this space and also the business itself might be semi week. So can I compete with a bunch.

[Unknown]

Of handyman in Austin, Texas?

[Cody Sanchez]

Maybe because I don't know the name of any of them. Can I compete with Dell Computers Hard? That is an entrenched business overall. I want to See weak competition and weak execution by the company. And finally, I want a business that is simple. So I want a business overall that is not difficult to understand, that is straightforward. So easy, your grandma could do it.

[Unknown]

This is so counterintuitive. You wouldn't think like, oh, I want a weak, stale business. I want it to be so simple. This seems so counterintuitive. So is the idea that you could come in and make small improvements and then make more money. Why do you want those things?

[Cody Sanchez]

The fastest way to lose money in.

[Unknown]

Buying a business is to think that.

[Cody Sanchez]

You know more than the owner of.

[Unknown]

The business and to take on more.

[Cody Sanchez]

Complexity than you actually should. So I think about buying a business kind of like I think about maybe buying your first house to fix up and flip. You don't really want to buy a complete disaster on a street.

[Unknown]

Why? Well, you've never done a construction project.

[Cody Sanchez]

Before, and so I don't know about you, but I've never heard of a construction project that comes in under budget and faster than you think. And so what I really want for your first acquisition is the first acquisition to go so well that you go, oh, God, that business was like a little too small, a little too easy. We're going to build it up, then we're going to sell it, then we're going to do our next one. Because your first deal turned out so well. That's why I like really simple businesses for the first one. Business is complex enough, and we can layer on top of it great marketing, we can layer great advertising, we can layer a great team and culture. But we want to make sure we don't bite off more than we can.

[Unknown]

Chew with our first acquisition.

[Cody Sanchez]

Unless you're a pro, in which case we teach some different things.

[Unknown]

I love that you made this analogy to buying a house, but actually buying a business can be a little bit cheaper upfront than buying a house because you don't have to lay out all this cash necessarily. You talk a lot about creative financing. Can you tell us more about some of the creative ways that we can actually buy a business?

[Cody Sanchez]

One of the most beautiful parts about buying a business as opposed to buying a house, is when you go and.

[Unknown]

Buy a house, they want to know.

[Cody Sanchez]

How much money you make, and they want to know how much money you make so that they can determine how big of a house you can buy.

[Unknown]

When you go to buy a business.

[Cody Sanchez]

They, meaning the lenders or the bank, they want to know how much money the business makes and if the business makes enough for you to be able.

[Unknown]

To use the revenue and profits of the business to pay the loan back.

[Cody Sanchez]

Now there's going to be some degree of them vetting you and making sure that you seem trustworthy. And you got to put together a little pitch to show that you are capable of buying a business and getting a loan. But the fascinating part is it's not on your salary, it's on the businesses income. And because of that, we have a unique opportunity to out kick our coverage by buying a business that would be more than we could actually afford if we were only to look at the amount of money we have or our salary. So that's one huge differential. The other is that we teach 21 ways in the book in order for you to buy a business using creative financing. But one of my favorites is seller financing. So you mentioned that 60% of all businesses bought are bought with some aspect of seller financing. And if you understand seller financing, I don't think you'll ever buy anything the same way again. Because what it basically teaches you is.

[Unknown]

That you want to invest in businesses and buy them using some portion of the future revenue and earnings of a business.

[Cody Sanchez]

Now this isn't to say you can run around saying I'd like to buy your $5 million business owner for $0 down. How does that sound? Just like anything in life, you have to treat a business transaction kind of like treating a dating transaction with a woman. You got to get her to trust you. You got to get her to believe that she's going to be better in your hands than anybody else. You got to get her to see that you actually care about this business and you are going to make sure it succeeds. And if you do that, then you can get really creative unfair deals that somebody running around throwing out offers left and right isn't going to get.

[Hala Taha]

Let's talk about the people that we're.

[Unknown]

Buying these businesses from. They are often about to enter retirement. They might be working in their old age. Why is it in their incentive to maybe take a seller financing opportunity?

[Cody Sanchez]

We have this whole section where we show three different graphs on seller financing.

[Unknown]

And once I understood how to pitch.

[Cody Sanchez]

Seller financing properly so that it was a win win, our ratio of people taking seller financing went up about 100%. And here's how I think about it. If I was going to a small business owner, here's the conversation that I would say.

[Unknown]

I would say, all right, small business owner.

[Cody Sanchez]

This is after you've gotten to know them, after they like you, after you really understand the business you've done all of the early stage of dating. You're not asking to take the girl home on your first coffee date encounter, right? So after you do that, you're going to have a conversation that sounds like this. Okay, Mr. Owner, you want $2 million for your business. You think that's what it's valued at, right? And you go, right, okay, let me show you. When I took your business to the bank, based on what you showed me.

[Unknown]

The bank said they would give you.

[Cody Sanchez]

About a mil or whatever the dollar amount is. Usually businesses are not worth what the.

[Unknown]

Owner thinks it is.

[Cody Sanchez]

So you want to introduce a third party saying, sorry, we're not going to pay you for that. So we say, okay, the bank says that it's worth a million instead of two.

[Unknown]

That means that I could give you.

[Cody Sanchez]

A million dollars, plus I got to pay like 8% to the bank because there's an interest rate associated with it. Plus I probably got to wait like 120 days for the loan to fully.

[Unknown]

Go through, maybe 90 at best.

[Cody Sanchez]

Plus you're going to have a higher tax burden because they're going to lump sum, pay you out right now as opposed to over time. We can't get very creative with your taxes. You're going to pay more in taxes also because we're going to go with this loan over time. I can't pay you any of the interest. I have to pay the interest to the bank. Now that means that I can give you a million dollars plus these other negatives. Or there's another way that we could do this through seller financing. Would you want to talk about how we could structure it that way? And they'll probably go, okay, yeah, what do you mean? And you say, okay, other option, I pay you 1.5 instead of 1, so you get another $500,000.

[Unknown]

Plus I will pay you the interest on the loan instead of the bank, except I'll pay you 4% instead of.

[Cody Sanchez]

8%, which increases the likelihood the business.

[Unknown]

Succeeds because it's not as high. Plus you make another 4% every single.

[Cody Sanchez]

Month or year, depending on how you structure the deal. Plus we could get this deal done in probably 30 days because we don't have to go through a traditional bank process.

[Unknown]

Instead of 120 days.

[Cody Sanchez]

And we will structure the payouts over time, which means you pay less because you're getting long term capital gains and distributions as opposed to short term capital gains and distributions. So you're getting 500k more, plus you're getting 4% a year, plus you're getting better tax savings.

[Unknown]

Would you Be interested in at least.

[Cody Sanchez]

Us discussing what that would look like, at which point the owner is going to say, probably, yes. And so that's how you nail seller financing.

[Unknown]

Oh, my gosh, that was a masterclass right there. Anybody wanting to buy a boring business, you could literally just transcribe that script and get your deal. So is it realistic to think that there's actually a lot of opportunity out there for these boring businesses? When I think about this, I don't know, like, I just feel like how many people are really willing and ready to sell their business?

[Cody Sanchez]

Let me tell you some data. So how many people actually will sell you a business today and use some version of seller financing? Well, one, I bought a boring business that was a business marketplace called Bizcout and then plowed a couple million dollars into it. Bizcout is now a marketplace where people.

[Unknown]

Buy and sell businesses. When we first launched, which was maybe.

[Cody Sanchez]

Four weeks ago, six weeks ago, we had 30,000 listings on the platform.

[Unknown]

Today we have 45,000 listings on the platform.

[Cody Sanchez]

At BizCout, there are 45,000 people publicly.

[Unknown]

Listed that want to sell their business.

[Cody Sanchez]

Plus, the other interesting part about Bizcout is we have this backend scraper where we scrape old small businesses. So you could say, I want to buy a, I don't know, sales company in Atlanta, Georgia. I want to buy a car wash in Piedmont, North Dakota. And you could go and see all.

[Unknown]

Of the listings of those there and.

[Cody Sanchez]

Reach out to the owners individually. So that would mean millions and millions.

[Unknown]

And millions of businesses.

[Cody Sanchez]

So I know firsthand there are tens.

[Unknown]

Of thousands of businesses ready to sell right now. Today.

[Cody Sanchez]

The number is growing every single day.

[Unknown]

And then there are millions where the.

[Cody Sanchez]

Owners don't even realize they could sell. So this is happening all over the place. Now here's what you're going to hear from people that is great for you and me, and I love every moment of it. You're going to hear people go, there's no businesses for sale. It's all trash on those sites. Nobody good would sell a business like that.

[Unknown]

And I go, perfect.

[Cody Sanchez]

Just stay in your lane. This is always finance bros who do this, by the way. And they'll be like, no way would this business sell for that. And then I just go, scoreboard, like.

[Unknown]

Bought and sold this newsletter business. Bought and sold pinks.

[Cody Sanchez]

Bought and sold that one painter bought and sold garage up. Bought and sold a brand new roofing company. We're going to launch. There are businesses all around. We're doing it every single Day. In our community called Contrarian Community, people.

[Unknown]

Have done $260 million of deals that.

[Cody Sanchez]

We'Ve tracked hundreds of small businesses transacted. So while other people will always tell you no, you can be the person that makes the money while they sit on the sidelines. Again, always harder than it looks and is going to take work. These businesses are all around you guys, and anybody that's telling you they aren't either wants to buy them for themselves or wants to sound sophisticated because the negative sound smart. The positive make all the money.

[Unknown]

So when people are thinking about boring businesses, because you've been talking about boring businesses for a few years now, I feel like it's sort of synonymous with vending machines and laundromats. But you actually say some of your favorite boring businesses are digital businesses and professional services. So talk to us about some of the little known boring businesses out there and why they're so lucrative.

[Cody Sanchez]

If you go to MSM book, where the book's going to be located, we'll be giving away a bunch of things with the book. And one of them is a list of 130 of my favorite businesses that I love to buy. So let's rattle off some of those. 131.

[Unknown]

I use laundromats as an example because.

[Cody Sanchez]

They'Re easy to understand. It opens people's eyes. They go, oh, I've seen those before. Oh yeah, there aren't a ton of employees in there that could make sense for me. So that was rule one. I wanted to open people's eyes. But really what we teach is what's called deal clarity. So how do you figure out the.

[Unknown]

Right business for you?

[Cody Sanchez]

Specifically, what's the right business for you or your audience? And so those might be things like.

[Unknown]

For instance, I bought a podcast production.

[Cody Sanchez]

Company back in the day. I bought like 49% of one called Strikefire Productions. That was a great business. I think I bought 49% for 10k and we profited 5 or 8 or 10k a month off of it for about a year before I sold it back to the owner of the business because it wasn't a big enough business for us anymore. So podcast production. I've bought a video production company before that's called Viral Cut.

[Unknown]

That's another online business.

[Cody Sanchez]

We've invested in a tax and LLC business. So at school they take accounting, old school accounting practices kind of sex them up, make it really easy for people to access them. That's called Doula. We invested in a company that's called Sense. So it's software for the laundromat industry. So everywhere you have a boring business. You have digital businesses that support them. You have advertising businesses, marketing vendors, software providers, sales systems.

[Unknown]

And those are businesses you can buy just as simply as you can buy.

[Cody Sanchez]

A brick and mortar main street business.

[Hala Taha]

We'll be right back after a quick break from our sponsors. Young and Profits When I started my podcast, I had a volunteer team. I was able to just go on social media, put up a post, recruit some interns and it was no big deal. But as we scaled as a company, I need real A players. I need people with experience. But we're a small company and so I don't have an HR team. However, I found the secret sauce to hiring effectively with no HR team. And the secret is Indeed Indeed is your go to hiring and matching platform where you can find, vet and lock in the best talent all in one place. Stop bouncing around between different job sites and let Indeed's matching engine help you build your dream team fast. I'm super glad I found Indeed when I did, because now hiring is so much easier. We're not just doing it from scratch, we do our hiring all in one place. Indeed matches you with quality candidates. In fact, a recent survey found that 93% of employers agree that Indeed delivers the highest quality matches compared to other job sites. Getting high quality matches the minute you put up a post saves you so much time. Trust me, I know. Join the over 3 million businesses worldwide that use Indeed to hire A players fast and listeners of the show will get a $75 sponsored job credit to give your jobs more visibility@inn Indeed.com profiting. That's Indeed.com profiting and tell Indeed. You heard about them on this podcast. Terms and conditions apply. Need to hire you need Indeed. Yeah fam. If you're anything like me, you didn't start your business to spend all your time managing finances. Budgeting, invoicing and tax prep. Not exactly the fun part of entrepreneurship. My CEO Jason, on the other hand, is great at finances, but even he doesn't want to switch between five different apps for banking, expense tracking and contractor payments. We wanted a tool that could just do it all. And guess what? We found one. And yes, it's called Found. Found is an all in one financial tool made for entrepreneurs and solopreneurs. Found handles everything business banking, bookkeeping, invoicing, vendor payments, and even tax planning. No more juggling multiple apps. Found does it all in one place with smart features like automatic expense tracking, virtual cards for specific budgets, and no hidden fees or minimum balances Found helps us stay organized and save time. Plus, signing up is quick and easy. No paperwork or credit checks required. Join the 500,000 small business owners who trust Found. Get your business banking working for you. Try Found for [e-mail] profiting stop getting lost in countless finance apps and try Found for free at found.com profiting Sign up for Found for Free at F o u n d.com profiting found is a financial technology company, not a bank. Banking services are provided by Piermont bank member fdic. Found's core features are free. They also offer an optional paid product, Found plus what's up? Yeah fam I travel so much for my job these days and on top of that I've been spending more time in Miami. In fact, I'll be down there keeping myself warm most of the winter. I love to travel, but at the same time I feel like my glamorous Jersey City apartment with its pink velvet couch and skyline view of the city, it's just going to waste. But what if it didn't have to? A lot of people don't realize that they might have an Airbnb of their own right under their noses. You can host your whole place or spare room when you're out of town. So many of my successful friends host and it's such an amazing way to generate passive income. And now you can also hire a co host to make the job easier than ever, especially if you're going to be away for an extended period of time. Vetted by Airbnb, co hosts have experience in the hosting space and can help with your bookings, manage reservations, provide on site support, and more for your investment properties. So if you're escaping to the warm weather this winter like me, find yourself a co [e-mail] host.

[Unknown]

Should we diversify our businesses? For example, I own several businesses now. I have my podcast itself, which is a business. I have my social media agency, number one LinkedIn marketing agency, and I have the number one business self improvement podcast network. So I have three businesses. Should I like stay in my lane and go buy podcasts and social media businesses or is it better to actually diversify and think about other lanes?

[Cody Sanchez]

So if you already own businesses today, there's two ways to think about acquisition, strategic acquisitions or diversified acquisitions. So strategic acquisitions, I think are the easiest for business owners to buy. That would be like, can you buy another agency that has talent that you're having a hard time hiring?

[Unknown]

And can you insert that talent inside.

[Cody Sanchez]

Of your agency so you can increase your Capacity and so you can sell more.

[Unknown]

Amazon is notorious for this.

[Cody Sanchez]

And I would say the great thing.

[Unknown]

About strategic acquisitions is you understand the business better.

[Cody Sanchez]

You're going to know if this is a shitty agency or not because you already run it. You probably already know them and have target acquisitions because you know your competitors. You also have a much higher ability to increase the revenue of that company because you're already doing the thing. And so I think strategic acquisitions are.

[Unknown]

The best for current business owners to think about.

[Cody Sanchez]

If you want to create a portfolio in a holding company like I have, because my skill set is finance. I knew how to create a portfolio in holding company because I ran a private equity firm. But if I was a great business operator, I would do more strategic acquisitions than I would diversified acquisitions.

[Unknown]

And the reason is because you're going.

[Cody Sanchez]

To have such a higher likelihood of success and you're going to be able.

[Unknown]

To increase the value of those businesses so materially.

[Cody Sanchez]

So if I was you, I'd be saying right now, and you probably have some in your head even as we're talking about it. You're like, oh, these competitors, oh, I hear she's kind of unhappy. I think they might shut down their business. They're growing really fast. But, man, they don't have X that we have. And those are your target acquisitions, where you can even overpay a little bit.

[Unknown]

Or use potential future revenue that you.

[Cody Sanchez]

Drive them to pay for those companies and close a deal faster than you ever could. Due diligence in a Laundromat, for instance.

[Unknown]

You've really opened my eyes. I never really had thought so much about acquiring companies, but now I'm like thinking. I'm like, oh, we could acquire X Team. So that makes sense.

[Hala Taha]

It's kind of what I did actually.

[Unknown]

With my business partner Jason. He had a production company originally, and then I actually brought him on as my business partner and kind of absorbed him. So I guess I did do that in a roundabout way.

[Cody Sanchez]

It's called an acquihire.

[Unknown]

And the cool part is if you.

[Cody Sanchez]

Start using the terminology. That's why I like people to learn deal making.

[Unknown]

I didn't even know that.

[Cody Sanchez]

Yeah, you can sweeten the deal. In this case, you might have been saying, God, I need better production and I want somebody who really cares about it. So I want a partner.

[Unknown]

I want them to be invested in it.

[Cody Sanchez]

I want them to be a pro. I don't want to have to pay pro salary right now because maybe my business isn't big enough.

[Unknown]

I want them to share my vision Long term.

[Cody Sanchez]

So they take some risk with me. Okay, that means you want an acquihire. So you're like, huh, I'm going to buy acquihire Jason's company and I'm really.

[Unknown]

Just going to use Jason's salary, which.

[Cody Sanchez]

I pay over the course of the year just like anybody else's salary, to acquire his company.

[Unknown]

Jason, congratulations.

[Cody Sanchez]

You got an exit from your business. I am going to acquire and integrate you. You also get to say, I've already done one acquisition because we did it this way. You did an asset sale potentially if you bought any of his assets and you did an acquihire because you bought him. And so a lot of the people.

[Unknown]

In Silicon Valley use this term all the time.

[Cody Sanchez]

They'll be like, I sold my startup to so and so, they got acquihired. And we normal people don't use that same terminology. And so we don't sound as sophisticated, but we're doing the exact same thing.

[Unknown]

So I would keep your eyes open.

[Cody Sanchez]

One of the things I've been obsessing on lately is that rich people do not think the same as poor people when they think about problem solving. Poor people, when they have a problem, they say, how do I fix this problem?

[Unknown]

How?

[Cody Sanchez]

How, how, how? Relatively wealthy people think I have a problem.

[Unknown]

Who could fix this problem for me? Who?

[Cody Sanchez]

Not how rich people think I have a problem. How could I buy an almost guaranteed solution to this problem? Buy who? How? And if you can start when you.

[Unknown]

Have a problem in your business going.

[Cody Sanchez]

All right, pause, don't go to how. Pause, don't go to who, pause, how could I buy the solution?

[Unknown]

I need more revenue in my business.

[Cody Sanchez]

I need to come up with a.

[Unknown]

Brand new product that I could sell.

[Cody Sanchez]

Do you or is there something else out there in the market that you know, your audience would love and you could acquire part of that company, do.

[Unknown]

No fulfillment, not guess what a great.

[Cody Sanchez]

Product is, but know because people are already buying it and you already use it and just integrate that into your revenue line. And the truth of the matter is I forget my own homework all the time. I revert back to the how constantly.

[Unknown]

And I should obsess on the buy more often too.

Oh my gosh, that is so smart. I love that advice so much. Okay, so buying a business, we're of course going to be looking at the financials to some degree, right? So what are you looking at personally when you are trying to buy a business? And then also if we need to hire people, hire an operator, what do.

[Hala Taha]

We need to consider in Terms of.

[Unknown]

The financials, a couple things.

[Cody Sanchez]

We have a framework that we look at for every time you buy a business. What does it need to have?

[Unknown]

I think about it as two words, an income stream.

[Cody Sanchez]

You're buying a business because you want to make money, not because you're doing charity. And so when it comes to an.

[Unknown]

Income stream, an income stream has to.

[Cody Sanchez]

Cover a few things.

[Unknown]

It has to cover the interest expense on your loan.

[Cody Sanchez]

So whatever that costs for how you bought the business, it has to cover your income. So how much money you want to.

[Unknown]

Make from the business. It also has to cover some version.

[Cody Sanchez]

Of an operator's salary so you don't go crazy. You have a manager, you don't buy.

[Unknown]

A job, you buy a business. And then it has to cover working.

[Cody Sanchez]

Capital and that means a little bit extra money in case anything goes sideways.

[Unknown]

Or to grow the business.

[Cody Sanchez]

Those four things, if you remember, that will help you buy a profitable business. And we have a structure that breaks.

[Unknown]

That down a little bit more in.

[Cody Sanchez]

The book, but at a high level, that's it. The second thing that I really want.

[Unknown]

You to think about, if you're thinking.

[Cody Sanchez]

About buying a business overall, is very, very high level. You don't want to make acquisitions too complex. You want to see what do the financials tell you, is the business profitable or not.

[Unknown]

We don't buy unprofitable businesses to start.

[Cody Sanchez]

That is asking for pain. So we want a profitable business according to its financials.

[Unknown]

That means It's P and Ls.

[Cody Sanchez]

We want the financials and P and L to somehow match the tax return or decrease the price so that the tax return is your de risked price.

[Unknown]

And then we also want a breakdown of our due diligence file, kind of.

[Cody Sanchez]

Looking at where's the risk in the business, how many employees are there, what kind of assets do we have?

[Unknown]

So we have a full due diligence.

[Cody Sanchez]

List that we use for this, which is important, but you want to start high level with the financials and the tax return.

[Unknown]

One of my last questions here, tweaks to grow the business. What do you usually see of the.

[Hala Taha]

Small tweaks that you can do to.

[Unknown]

Like really just grow the business when you're looking at these boring businesses?

[Cody Sanchez]

I'll come back on a different time and talk to you about the next book I'm writing, which we're creating some portions of it. It's about an operating system.

[Unknown]

How do good companies scale from 6.

[Cody Sanchez]

To 7 to 8 to 9 figures? I love that. And I came up with something with one of my friends whose name is.

[Unknown]

Eamonn, called nine steps to nine figures.

[Cody Sanchez]

And don't take the nine figures literally. You don't have to create a nine figure business. But the idea is a business so big it makes profitable money for you.

[Unknown]

Is fund to run and is trusted.

[Cody Sanchez]

In that it will continue to make more money.

[Unknown]

So trust fund profitable.

[Cody Sanchez]

And there's really a few steps. First, if you want to have a profitable fund to run business, you got.

[Unknown]

To know who you're selling to.

[Cody Sanchez]

This is what we call Persona. So you need to be able to name and label your target market. Then you got to think about what problem are you solving for that person?

[Unknown]

Where is the pain or the nail.

[Cody Sanchez]

In the foot we call it. That is the problem you're solving. Then you got to obsess on product.

[Unknown]

So what product are you selling this person in order to fix their pain.

[Cody Sanchez]

That this person in particular really, really wants? Then I like to talk about performance. So where in your business are you tracking if you are winning or losing and what does winning look like? Then you want to have a scoreboard or operational system.

[Unknown]

How can I consistently run a business without a bunch of question marks and games?

[Cody Sanchez]

Because I have an operating system I run on. And then we want to have people. So finally, and maybe most importantly, in many ways, who are the people inside the business that I am hiring, firing, and what does our culture look like? We have nine steps, but those are.

[Unknown]

Like the first seven that are so important.

[Cody Sanchez]

Because if you have the Persona, the problem, the product, if you have the performance, the operating system and the people.

[Unknown]

Then you can run a sustainable business over time.

[Cody Sanchez]

And sometimes you don't even have to have the people if you have a solo business as well. So those things are necessary for scaling a sustainable business.

[Unknown]

So let's say we've got our boring business in place, things are rocking, we're making a profit.

[Hala Taha]

Is there any point where we should.

[Unknown]

Think about exiting this business? What are the criterias to like, think about exiting a business?

[Cody Sanchez]

So the end of the book starts talking about the exit.

[Unknown]

And the reason why is because the.

[Cody Sanchez]

First business that you buy probably isn't going be the business that you have forever. You should do your first deal thinking like you did your first job. You know, you didn't plan on staying your first job forever. You're like, I want to be here for two to five years, something like that. I want it to make me money, I want to learn from it.

[Unknown]

And I either want to scale up.

[Cody Sanchez]

Or I want to scale out, right? I want to move up to the C suite position or I want to go on to my next job.

[Unknown]

And it's the same with the business.

[Cody Sanchez]

So the first deal that you do should not be your last deal, in my opinion. It wasn't for me. So since we know that, we want to start planning for the exit and the ability for us to eventually sell.

[Unknown]

Our business to make more money. The cool part is most of the.

[Cody Sanchez]

Money in buying businesses and building businesses.

[Unknown]

Is made on the sale.

[Cody Sanchez]

So, you know, if you have a business that does $100,000 in profit in small business land, you can sell that business for 3 to 5x on average of the profit.

[Unknown]

So $100,000 business sells for 300 to $500,000. To overly simplify, that means that if.

[Cody Sanchez]

I buy a business for $300,000, that makes $100,000 in profit, but I am able to increase the profit to $200,000.

[Unknown]

Well, now I'm selling this business for.

[Cody Sanchez]

Somewhere between $600,000 and maybe $800,000. So I multiple years of potential future revenue and fast tracked them and I moved them up. And so when it comes to thinking about exiting your business, there are really only three levers that matter. And the three levers are, can I increase the profits, Can I increase the.

[Unknown]

Revenue of the business? Can I decrease the risk in the business?

[Cody Sanchez]

And can I increase the systems, processes.

[Unknown]

And people in the business? And if you can do those four.

[Cody Sanchez]

Things, then your business can be worth more when you sell it than when you bought it.

[Unknown]

As a founder, I feel very emotionally attached to Yap Media, right? I really couldn't imagine selling it, at least for a really long time, right? I really couldn't. But with these boring businesses, I feel I could buy one, fix it up, and then have no emotional attachment to just sell it. So do you feel like there's something there? It's just like easier to just buy and sell these boring businesses because there's less emotional attachment for sure.

[Cody Sanchez]

Yap. For you and any content creators listening, that's your distribution mechanism. Yap is your ability for the rest of your life to sell varying things to your audience without using a ton of capital. So you might want to keep yap forever and layer on top of it different products to sell, layer on top of it, different services to sell, layer on top of it, owning part of another content creator who maybe you help distribute, but you take a percentage of future revenue from that content creator. So this is how we build big conglomerates, right? You could do what most media companies.

[Unknown]

Did, which is they acquire assets. Back in the day, Ted Turner was.

[Cody Sanchez]

Famous at Turner News Network for acquiring assets. And he did it the old fashioned way, which is acquire radio stations here, acquire television rights here, acquire distribution rights here.

[Unknown]

And he used to be talent and.

[Cody Sanchez]

He worked his way all the way up to complete ownership and chairman. And so the way to do that in the 21st century version is what Alex Cooper's doing right now with Call her daddy. And unwell, she acquired part of Alex. What's the other Alex's name? Do you remember?

[Unknown]

I have no idea. I don't want paid. I only pay attention to the business self improvement world.

[Hala Taha]

I'm so like, call her daddy.

[Unknown]

Who?

[Cody Sanchez]

I know, I know, but I mean, not typically when I talk about her topic, but brilliant business mind. She looked at Dave Portnoy at Barstool.

[Unknown]

Sports and said, why doesn't this exist for women?

[Cody Sanchez]

I'm going to build it. Dave sold his company for what, 600 million or something like that? She was like, yeah, I'm going to do the same thing. And so she started acquiring up other talent. She also acquired and built part of a pop up and a tour company. You see her doing tours right now all over the place. You see Alex, Alex Earl, that's the other one's name, doing the same thing. Those are smart business women. Like, don't let the sex talk fool you. They are sharks and I'm here for it. And that could be the way that you do it. And then at some point you might do what Barstool does or some of these big media companies do, which is you might say, all right, talent, you want to buy back your rights?

[Unknown]

No problem.

[Cody Sanchez]

You buy back your rights. That doesn't mean you sell yap, but you sold one of your assets and that's how you de link your personal.

[Unknown]

Brand to your business.

Okay, so people are afraid of failing. A lot of people don't actually take the leap into entrepreneurship because they're afraid of failing. I'm sure I have plenty of listeners right now who want to be entrepreneurs, who listen to an entrepreneurship podcast, who haven't become an entrepreneur because they're scared of failing. They've got golden handcuffs. They probably work a nice corporate job. I've got smart listeners. How can Main Street Millionaire help them overcome their fears into becoming an entrepreneur?

[Cody Sanchez]

Well, first of all, Main Street Millionaire is peppered with stories of people just like me and just like you, who.

[Unknown]

Worked in corporate for a long time and leveraged the best form of money.

[Cody Sanchez]

There is, which is a salary somebody else pays into the future ownership of your business. So one, you are exactly where you're supposed to be. If you're already making revenue by a salary that's incredible, you can use that to acquire your company. In our community and in Main Street Millionaire I would say 40% of the people in our community where we teach business buying are W2 employees. Well paid W2 employees that are buying.

[Unknown]

Their first or their second business. What Mainstreet Millionaire will teach you how.

[Cody Sanchez]

To do is two things that I think are invaluable.

[Unknown]

One, negotiate with the company that you work for or with vendors that you work for.

[Cody Sanchez]

For part of businesses you already fully understand. Partial equity that could be your first tiptoe into ownership. Number two, it will teach you how do you layer on acquisitions using operators.

[Unknown]

Family for instance, like my husband runs.

[Cody Sanchez]

One of our companies. My mom ran another one of our companies. My brother and I co own another one of our companies. So how can you use the people around you who maybe don't have your.

[Unknown]

Same salary for ownership?

[Cody Sanchez]

I think it's beautiful to do for husbands and wives. The last thing that a book like Main Street Millionaire will teach you is when it comes to seeing a deal in front of you that feels so.

[Unknown]

Unfair, it is an absolute fuck yes.

[Cody Sanchez]

You will be able to jump on it.

[Unknown]

Baron Rothschild said buy when there's blood in the streets especially and even when.

[Cody Sanchez]

The blood is your own. He was one of the titans of American history, one of the richest men ever to live. And what's interesting I think is if you at all are scared about the economy, the recession, your job, your future, there is nothing better than a little shake up in the market to get better deals. And so what I want you guys to be prepared for is that when.

[Unknown]

That comes, you will already know and.

[Cody Sanchez]

Have turned on your reticular activating system.

[Unknown]

In order to see these businesses all around you and do a smart deal.

So my last question to you before we close out the show is really about future predictions. I just interviewed the CEO of Microsoft AI, Mustafa Suleiman. He was the founder of DeepMind and he told me something mind blowing. He's like listen, like AI. Everyone's going to have their own personal AI. People are going to be going to job interviews with their AI and having to develop their AI. People are going to co found businesses with their AI and that just blew my mind. How do you see these mom and pop boring businesses really evolving in the next 5, 10 years because of AI?

[Cody Sanchez]

Let me tell you what I think about AI and Main Street Businesses, which is the first jobs that AI took were graphic designers, artists, copywriters, maybe even singers in some way. They were online jobs.

[Unknown]

Why?

[Cody Sanchez]

Because AI lives online. Because it's very easy for quote, unquote, online digital robots to take over jobs that are mainly online. So if right now you have a job that you can do completely from Zoom, that has a lot of automated processes in it, where sometimes you feel like you do a lot of automated tasks, be wary of AI, because that will come for you first, as it already has for many people in the digital world. You know where AI is going to take longer. Painting companies, roofing companies, plumbing companies. The hardware is going to take longer.

[Unknown]

To catch up than the software will.

[Cody Sanchez]

And so I feel very strongly that the trades are going to flip as one of the more powerful industries in.

[Unknown]

The world, just in the same way.

[Cody Sanchez]

That people are no longer paying graphic designers the same amount, because we have AI tools that we can use to augment their work. And so think long and hard about AI in the fact of where can I have a moat built around me where it is not as easy for a digital component to take over? And that's what I think about it. And the only other thing I'll say there is I'm a techno optimist. I think by and large our world is better mathematically because we have more technology today, not with technology hurting us. It has helped increase longevity, it has helped decrease poverty levels. I think you could make a very hard argument, except perhaps in the US with anxiety and depression rates, that technology is largely good. So I think AI will continue to.

[Unknown]

Be really useful for us. And with the businesses out there, man.

[Cody Sanchez]

Think about how much we're going to be able to increase our profit margin by using AI right alongside us.

[Unknown]

Yeah, totally. And Mustafa actually told me something about that loneliness factor. A lot of the AI that's being developed is actually developing as emotional support. And so this AI will help you do your work, but also be your therapist. And something that he said was like, really interesting is that he felt like it's going to really help underprivileged kids, because he said that it's almost like every underprivileged kid would have, like a mother or a father who was guiding them. So I just think it's going to be really powerful.

Interesting. That's horrifying to me.

It's horrifying, but it's. It's also like, who knows? Hopefully we can steer it in the right direction.

[Cody Sanchez]

Yeah, hopefully we don't have ads, just straight mainlining into our brain.

[Unknown]

Most likely, that will happen. Okay, so I end my show with two questions that I ask all of my guests. What is one actionable thing our young and profits can do today to become more profitable tomorrow?

[Cody Sanchez]

One of my favorite mentors, Bill Perkins.

[Unknown]

Told me why he thought he was so successful.

[Cody Sanchez]

Where did his billions come from? And he said that he does one thing differently than everybody else.

[Unknown]

He moves fast.

[Cody Sanchez]

By the time that other people have thought about an idea, brought it up to their friends, considered it, Bill has already taken action, made three mistakes, and found a better way. I think the faster you move, the more money that you make.

[Unknown]

The faster you move, the larger your bank account.

[Cody Sanchez]

So whatever you're going to do, take action more often than you think and quicker than you think.

[Unknown]

And what is your secret to profiting in life? And this can go beyond business and money.

The best deal I've ever done was.

[Cody Sanchez]

The one I did with my husband.

[Unknown]

It sounds cheesy, except it's true.

[Cody Sanchez]

And so I think you are going to spend the rest of your life with one human. And I wish I would have known.

[Unknown]

Earlier how important it is to choose.

[Cody Sanchez]

Somebody who had a growth mindset, wanted to continue to progress, and that profits come from profitable relationships done well. And so, especially if you have young women, listeners obsess about becoming a better human. So you attract better humans. And two people is so much more powerful than one.

[Unknown]

So, Cody, where can everybody learn more about you and everything that you do?

[Cody Sanchez]

I think most important is Main street millionaire. That's the name of the book. You can find [e-mail] the idea is we're going to put tons of resources and tools for anybody who picks up the book so that we can all become a little bit more unemployable and have control of our life. That's the idea. Anyway.

[Unknown]

I love it, guys. I read the book. I got an advanced copy. I absolutely devoured it. So I highly recommend it. We'll stick the links in the show notes. Cody, thank you so much.

[Cody Sanchez]

Thank you. You'll have to tell me if you buy a business. I'll help you any way you need.

[Unknown]

Thank you.

[Hala Taha]

Yeah. Bam. I loved having Cody Sanchez on the show because, first of all, I respect her so much as a female entrepreneur, and she always puts things in such an interesting perspective. And it's true what she said about entrepreneurs and us not being good employees. The fact that we're failed employees, and that means a lot of us may have to suffer through some difficult experience, experiences in the workplace before we find our own footing and groove. But the fact that so many of us are somewhat unemployable can also be a superpower when it comes to launching our own endeavors. And if personal and financial freedom is what you're after, then you would do well to listen to Cody as she preaches the gospel of ownership. Simply put, the more things that you own, the less that other people can tell you what to do. And while being a solopreneur has its appeal, of course, it also means you're still likely to work at the behest of someone else. Whether that's Uber upwork or whatever tech company or business controls the platform that you need to be on to get customers. That's why Cody thinks that the real ownership opportunity lies on Main street with the small businesses that have been operating and succeeding for decades. And when you're looking for businesses, remember the Lindy Effect. The longer a business has been in existence, the higher likelihood it will continue to be in business. Main street businesses might not be sexy, they may be boring, but that just makes them all the more undervalued as opportunities. And they're all around us. Landscaping businesses, laundromats, car washes, Printing businesses. There's tens of thousands of businesses like this, often with owners who would love nothing more than to sell their businesses and retire. It's a proven path to ownership and financial independence that's just waiting for somebody like you, a young and profiter, to snatch it up. And there's nothing boring about making a lot of money. Thanks for listening to this episode of Young and Profiting. If you listen, learned and profited from something that the incredible Cody Sanchez said, then why not share it and the gospel of ownership with somebody else? Spread the word. And if you did enjoy this show and you learned something, then please drop us a five star review on Apple Podcasts Spotify Cast Box Wherever you listen to this podcast, nothing helps us reach more people than a good review from you. If you prefer to watch your podcast as videos, all of our episodes are on YouTube. You can also find me on Instagram or LinkedIn by searching my name. It's Halataha. And finally, thanks to my amazing YAP production team. You guys are so incredible. I know everyone's working so hard. I couldn't do without you. This is your host Halataha AKA the Podcast Princess signing off.