🔑 How my friend got a 300% return in 4 months

August 2, 2023
Welcome to The Business Academy. The 🔑 key to success is information. I’ll be distilling the most useful information and insights I picked up over the last week so you can save time in your week.

If you have little money, and you want to build wealth there are two paths 1) start a business 2) buy a business.

It will be incredibly hard. But anything worth doing is hard. If you care about building wealth you will need get comfortable being uncomfortable.

I'm going to be purposefully cryptic in this section about who the person is (his code name is Jerry), and what the business does.

I want you to learn the importance of finding the right business, and getting the right structure. I also don't want to divulge his secrets.

My good friend Jerry bought a business 4 months ago. It took him eight months to search, and four months to negotiate the deal.

Here is the highlight so far: he put a $100k down payment and has pulled out $300k of cash in the last 3 months.

He's on track to have a 10x or 1,000% return in his first year.

And this business has a lot of room to grow.

He found the company on BizBuySell. It was sitting on that site for over a year. It had gotten a few offers but no buyers.

  • Service industry
  • $400k of cash flow
  • Union labor

Deal structure:

  • Total Price: $1 Million
  • SBA loan: $700k at 10% interest (floating), 10 year term
  • Seller note: $300k paid over 9 years. No payment for the first two years.
  • $500k of working capital left in the business at close (in the form of receivables)
  • Down payment $100k

If any of these terms are confusing to you, reach-out to me and I'll explain (or try Bard first, I use it a lot).

Some of my favorite parts of this deal:

  • Jerry got close with the owner and got to spend two months with employees before buying the business
  • The whole business was run on paper for 80+ years (his first act was to move them to a CRM and PM software)
  • They had 2000+ past clients that nobody had ever called to check-in
  • The day after he closed he had more business than he could handle

It's also been a lot of work. He gets in at 6am. He works alongside his staff for 8 hours. Then he spends another 4 hours working "on the business". Creating protocols, leading hirings, setting up the accounting.

What are the takeaways?

There are gems to buy everywhere.

At under $2M of earnings, it's a buyer's market.

At this scale, sellers don't have many serious buyers approaching them, so you can get creative with deal terms and price.

⭐️ HIRING - New Role Announcement

CEO and Investor at Enduring Ventures Capital Partners

We are looking for someone with ten plus years of experience sourcing, diligencing, negotiating, acquiring, and managing small to medium cash flowing businesses. You will lead the full cycle of business acquisition.

About Enduring Ventures - We are a long term holding company. We buy beautiful businesses and hold them forever. Today we own a portfolio of 21+ companies.

What’s in it for you

  • Lead your own investments with our support
  • Innovate on the Private Equity model with us
  • Get an attractive base pay and up to 20% interest in the General Partnership (i.e: build a lot of wealth)
  • Work directly with Sieva Kozinsky and Xavier Helgesen who will advise you on investment decisions, fundraising and operations.

Who you are:

  • 10+ years of experience in business acquisitions (Private Equity or IB or similar)
  • You’re tired of the “Buy & Flip” mentality of Private Equity, and you know that it’s better for everyone (investors, customers and employees) to buy great businesses and hold them

To apply → sieva [at] enduring.ventures (this role is remote) or reply to this email

Referral Bonus - $5,000 → If you refer someone who works with us in this role for 6 months

About the leadership team - Sieva Kozinsky and Xavier Helgesen - we are entrepreneurs and investors who have seen the full life cycle of businesses. We’ve started companies, and we’ve sold them. We’ve raised money to build and buy businesses ($250M+).

About this initiative - For a while now, our friends & investors have asked if they can directly invest alongside us in cash-flowing businesses. Having acquired 21 businesses, we have reached the point where we feel comfortable institutionalizing what we’ve learned and opening up direct investing. We are calling this Enduring Ventures Capital Partners.

This will be a partnership model, unlike the Enduring Ventures parent company, where investors will share directly in cash distributions from businesses acquired by the partnership. Enduring Ventures will be an investor in all acquisitions.

If you are an accredited investor, and you would like to get to know us or invest direct in cash flowing businesses sign-up here.

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Have a lovely day,