Dwayne Kerrigan, a seasoned business leader with over 35 years of experience and nearly 30 ventures spanning 12 industries, is the host of a dynamic podcast spotlighting unsung yet highly successful entrepreneurs. Through in-depth conversations, Dwayne uncovers their personal journeys, hard-earned insights, and the strategies that fueled their success, offering listeners a wealth of knowledge and inspiration from those who’ve made an impact behind the scenes.
Connect with Dwayne on LinkedIn at Dwayne Kerrigan, follow thebusinessofdoingbusinessdk on Facebook and Instagram, and visit his website at dwaynekerrigan.com. You can also find him on TikTok at Dwayne Kerrigan Podcast.
Here’s some of the topics we covered:
- Misunderstanding Cashflow & The Negative Impact
- Profiting Through Chaos and Crushing It Since the 2008 Crash
- Thriving in the AI Revolution and the Future of Business Ownership
- Mastering Investor Confidence and Unlocking Big Dollars
- Turbocharge Your Research with the ChatGPT Hack Every Entrepreneur Needs
- Business Breakthroughs with the Power of Crystal-Clear Vision
- Unleashing Business Archetypes and Discovering Your Team’s Superpowers
- Dwayne’s Ultimate Game-Changer
- Keeping Your Identity Intact and Not Letting Your Business Own You
To find out more about partnering or investing in a multifamily deal: Text Partner to 72345 or email Partner@RodKhleif.com
Full Transcript Below
01:20:15:21 – 01:20:38:29
Speaker 1
Welcome to another edition of Lifetime Cash Flow through Real Estate investing. I’m Rod Khleif and I’m thrilled you’re here. And I’m actually thrilled that this episode that I’m going to share with you guys today is my very good friend Dwayne Kerrigan. And Dwayne and I actually met working on Tony’s security detail. Tony Robbins, that is security detail. I don’t know how many years ago, but, you know, Dwayne is a serial entrepreneur.
01:20:38:29 – 01:20:54:23
Speaker 1
He’s been in business, like, 35 years. Been he’s he’s built or bought 30 companies, 12 different industries. He’s a freaking entrepreneurial rock star. And he’s got his own podcast as well called The Business of Doing Business. And I’m going to be interviewed on that shortly as well. Welcome to the show, brother.
01:20:54:23 – 01:21:04:00
Speaker 2
Dude. It’s awesome to be here. Yeah, I love I love spending time with you, man. Your energy is so awesome. So thanks. And this is the first podcast I’ve ever, ever actually been a guest on.
01:21:04:03 – 01:21:04:16
Speaker 1
Oh, that’s.
01:21:04:16 – 01:21:06:18
Speaker 2
Crazy. So forgive me if I’m stuttering.
01:21:06:24 – 01:21:26:10
Speaker 1
Well, go. Go big or go home, brother. I mean, we’re the largest in our space, so, you know, if you’re going to if you’re going to do it, do it right. But, God, that sounded so egotistical. Yeah. You know, it’s true that it is truth. But listen, why don’t you, do a much better job on your bio than I just did and kind of give us some background?
01:21:26:12 – 01:21:33:20
Speaker 1
I didn’t even know you’d done 30 different companies. Holy crap. So, yeah. Kind of. Give us give us your chronology. I think that’d be a fun place to start.
01:21:33:20 – 01:21:51:19
Speaker 2
Yeah, yeah. And I’ll keep it tight, because, you know, I don’t want to bore people, but I started as a young entrepreneur, like, really young, 13, 14 years old, selling stuff door to door. But I don’t count that stuff. But I started my first real business when I was 16. I ran that for 3 or 4 years. I ended up bankrupting it, because I didn’t understand cash flow.
01:21:51:22 – 01:22:06:09
Speaker 2
I was spending my money before, you know, you know, I was paying my bills. I was young, you know, 18, 19 years old, partied a lot and just didn’t didn’t have that awareness. So, you know, I didn’t go bankrupt, but I went broke.
01:22:06:09 – 01:22:07:19
Speaker 1
What kind of business was it?
01:22:07:21 – 01:22:22:13
Speaker 2
We we supplied I was heavy into student leadership. And so we supply anything that a school could sell, make money on for teams, their students council. So any type of paraphernalia, fan towels, the fingers.
01:22:22:19 – 01:22:23:02
Speaker 1
Like, like.
01:22:23:04 – 01:22:23:14
Speaker 2
That, like.
01:22:23:16 – 01:22:28:18
Speaker 1
The, the tchotchke stuff that you get that you get it. The pins and all that shit that people hand out, all.
01:22:28:18 – 01:22:48:13
Speaker 2
That kind of stuff. Yeah. That’s it. Yeah, yeah. And so anything you know, back then that’s the only way student students councils could make money or teams could fundraise and all that kind of stuff. So we supported that whole process and it was a pretty decent business. And I and I was doing well with it. And it wasn’t that I was lack of, you know, business and sales and revenue was just I didn’t understand cash flow.
01:22:48:16 – 01:23:10:11
Speaker 2
And I was spending my money before I was making my money and paying my bills. And so I owed like $36,000 to, you know, to suppliers and all that kind of stuff. And I, you know, had, I had moved out of school, I lived in a small town and moved to the city and, and then, you know, a year and a half later, I’m calling my parents to bail me out, and my parents weren’t super wealthy.
01:23:10:11 – 01:23:23:13
Speaker 2
We don’t come from, you know, middle class family, but, they’re bail me out. And so I went back and I saw cars, and in six months made 75 or $80,000 selling cars. Paid my debt off, went back to college.
01:23:23:16 – 01:23:46:08
Speaker 1
Started another business. You for one second, if I may. Guys, the reason, I should have pre framed all this with with Dwayne. The reason I’m excited about this interview is on the show here. We are going to be looking at other asset classes. Okay? I’ve had people in that do assisted living. I’ve had people that do, you know, industrial flex space, mobile home park, self-storage.
01:23:46:11 – 01:24:07:15
Speaker 1
I wanted to talk to Dwayne because I think there’s going to be an incredible opportunity to buy businesses. There are 80 million frickin baby boomers that are retiring. Then many of them own businesses. And I think it’s going to be incredible opportunity to buy them. So do not tune out this in this interview because you could get some incredibly you will get some incredibly valuable insights into entrepreneurship and buying businesses.
01:24:07:17 – 01:24:09:00
Speaker 1
Sorry, I should have said that on the get go.
01:24:09:02 – 01:24:31:06
Speaker 2
Not at all. Okay, so so then, you know, that kind of started my entrepreneurial career is I, you know, I ended up dropping out of college, started another business with some friends. It was a leadership and personal development business. We did summer camps for students, high school students. We had a speaker’s bureau. We did, you know, training programs for students, councils and sports teams and stuff like that.
01:24:31:09 – 01:24:47:24
Speaker 2
And then, you know, I just that I bought and got into the restaurant business and, you know, and it just kind of grew 15 restaurants later and, was in the gym business, the record label business, road building, spores. Yeah.
01:24:47:24 – 01:24:50:28
Speaker 1
So serial entrepreneur, shiny penny syndrome.
01:24:51:00 – 01:25:09:09
Speaker 2
Yeah. Well, I’m a little bit. I like the creativity. I like the I like the creation of it. And I love the dealmaking. And, you know, to your point about, you know, this shift in wealth where, you know, all these baby boomers are, you know, going to be, you know, getting rid of their businesses, selling them.
01:25:09:09 – 01:25:12:06
Speaker 2
And sometimes when I say getting rid of literally just closing the door.
01:25:12:06 – 01:25:44:07
Speaker 1
I have to shut them down if they can’t find a buyer. But see, that’s the opportunity. Because chances are in many of these businesses you can step in and make payments rather than than pay cash for these things. Because when somebody is retiring, they don’t need a big lump of cash. They’d rather have the cash flow. Right. So, I mean, I tell people this when it relates to dealing with elderly sellers for multifamily, you know, if you don’t talk about seller financing, you’re doing them a disservice because, you know, if they can make interest on their money, have the property that they owned, secured that money and and get cash flow not it also saves
01:25:44:07 – 01:26:06:20
Speaker 1
a ton on taxes as well. Because you only pay tax on what you receive every year. So it’s real opportunity benefit to us, to a business owner to sell on terms. If they’re an elderly business owner, you know, because they’re not going to take that money they made from selling that that business and put it into another high risk investments, likely going to go in the bank, you know, who knows what the interest rate is going to be at that point, you know, in the bank.
01:26:06:21 – 01:26:10:05
Speaker 1
So, you know I think there’s some real opportunity I don’t know if you agree with me, one.
01:26:10:05 – 01:26:27:08
Speaker 2
Hundred percent agree. And I don’t think it’s I don’t think it is a lot different from the real estate team right now. It’s like you got people who own, you know, large pieces of real estate, a whole bunch of doors and it’s like, okay, well, this is getting tiring. You know, maybe I’ll unload some. Maybe I’ll simplify my life so I can travel more.
01:26:27:08 – 01:26:54:11
Speaker 2
I can buy some, you know, pay it, buy something a yard or whatever, a vacation home or whatever their situation is. And so the read the re identifying where they want to put their money. And in that process of re identifying they’re looking for somebody who is eager, willing, able, and capable of taking on their business. And whether that’s, you know, so if they are taking vendor financing back you know, we call it a vendor take back.
01:26:54:12 – 01:26:57:12
Speaker 1
Yeah, we call it we call it a seller carry back. But okay.
01:26:57:12 – 01:27:23:04
Speaker 2
Okay. So in the business world, we call the VTB. And so, you know, I, I, we don’t buy companies. We won’t buy a company without a VTB. Really. Yeah. And and I’m not out buying, you know, ten, you know, 20, $50 million businesses. I’m, we’re buying, you know, small businesses from entrepreneurs who have been in the game for 25 years and oftentimes they’re like you said, they’re ready to kind of pull back at whatever level.
01:27:23:04 – 01:27:27:03
Speaker 2
And sometimes, you know, there’s so many ways to structure a deal.
01:27:27:05 – 01:27:37:24
Speaker 1
Well, I’d like to talk about some of those ways. Well, we’re on the show here, but but, let’s finish your story first, because I kind of cut you off in the middle of it. So I guess you probably were finished because you were talking about all these different things you did.
01:27:37:25 – 01:27:58:07
Speaker 2
Do you know what my story really is? It’s. I started one day in a small business, and I rinse and repeat it over 35 years. That’s it. And I and I mean, I love it to me, I love the game of business. To me it is a game. I it’s something I get to play and I will get to play into my, you know, 70s and 80s.
01:27:58:07 – 01:28:22:18
Speaker 2
I hope is is as long as my health is with me. Right. Because no matter how successful I ever got, I just love doing this and, and, so, so, you know, that really is the story of my life. It’s no real crazy secret of, I’m a college dropout. I don’t come from money. I grind out every day, which is kind of what my podcast is about.
01:28:22:18 – 01:28:37:05
Speaker 2
It’s just like, I’m. I just love being in it. And so that really is the fundamental of my story. There’s no real secret sauce. It’s kind of a lot like you, man. It’s like every day it’s like, get up, go at it, go do it.
01:28:37:05 – 01:28:52:13
Speaker 1
And so and you love it though. And when you love it, work is play. And you never work another day in your life, right? I mean, you’re very passionate about it. Super successful. By the way, guys, last time you flew his helicopter over here, you know, so he’s got a lot going on, got horses, all sorts of shit.
01:28:52:15 – 01:29:11:24
Speaker 1
And, but again, I love what I do. You love what you do and, and and, you know, definitely want to check out his podcast. I’m, I’m really looking forward to listening to it myself. But, if you look at the a demographic chart of the baby boomers, it looks like, like a rat going through a snake.
01:29:11:24 – 01:29:30:05
Speaker 1
It’s like such a giant frickin, amount of people. I forgot what the actual numbers are. I need to look up the numbers. Like how many people are turning 75 a day right now. Well, you look that up for me. I’d be interested to know I mean, it or 80, you know, because it’s staggering. I think it’s like 10,000 people a day or some.
01:29:30:07 – 01:29:36:24
Speaker 1
It’s 10,000 a day. 10,000 a day. So, you know, there’s a lot of business owners in there, right? So, well.
01:29:36:24 – 01:30:00:03
Speaker 2
You don’t even have to look at 75 because a lot of these guys now have created some so much wealth in the last, say, 20 years. But even the last decade, right. You know, since the oh eight crash, they’ve made so much money that people are, you know, entrepreneurs are able to leave earlier. And one of the things that I think that we’re seeing is that there’s this next, this next generational shift in the AI.
01:30:00:04 – 01:30:03:06
Speaker 2
Oh, yeah, and technology, the, and.
01:30:03:07 – 01:30:07:12
Speaker 1
Online sales, online market, everything is going on that these guys have never done it.
01:30:07:12 – 01:30:22:21
Speaker 2
And they go and they look at it and they go, you know what? I got my nest egg. I’ve done what I need to do. Right. It’s time for somebody else to take the baton and move this forward, because I don’t want the brain damage of having to relearn this. And then I just learn it, and then I’m ready to retire anyways, right?
01:30:22:21 – 01:30:28:10
Speaker 2
So many people are just kind of looking and going, this might be the time depending on their industry of course.
01:30:28:12 – 01:30:47:26
Speaker 1
Yeah. No, I completely agree. And and if you can bring a knowledge of online marketing, your online, you know, social media marketing, education based marketing, these things that are brand new. And then of course, I, I’m I’m all over I have been meeting with people about, you know, different ways to implement AI in my various businesses as well.
01:30:47:28 – 01:30:58:10
Speaker 1
But but back to back to my question about how you can structure a buy, you know, to buy a business, obviously you can do what you call the is a what you call VTB.
01:30:58:11 – 01:30:59:02
Speaker 2
VTB.
01:30:59:04 – 01:31:14:04
Speaker 1
Yeah. I, I’d like in the, in the, in our space it would be a seller carry back where, where they’re the lender basically. And and so you’ve done you do that every single time you have them stay in the deal with some of their equity.
01:31:14:04 – 01:31:27:23
Speaker 2
Basically it’s it like, you know, it does one of a couple things. One, it ensures that there’s no monkey business going on in the sale. And so that they’re still tied, because.
01:31:27:23 – 01:31:28:15
Speaker 1
If they lied about.
01:31:28:15 – 01:31:47:00
Speaker 2
Something yeah. That’s it. Like you know, or you know, they saw the picture a little different than what the real reality is, which often happens because a lot of times, you know, people’s business, like their children, like, it’s like their baby and they adore it and they love it, and there’s nothing wrong with it. It’s not ugly, but but it can be ugly as hell.
01:31:47:02 – 01:31:50:25
Speaker 1
Or they can overlook things and not not disclose things they should have disclosed.
01:31:50:27 – 01:31:53:22
Speaker 2
That’s right. Yeah. And people can be just outright and yeah.
01:31:53:25 – 01:32:26:10
Speaker 1
Well then you get the dishonest and then you get the ones, you know, like like, as an example, you buy a multi-family apartment complex, you do the due diligence and, you know, if something’s been misrepresented or not represented, or you discover something that they didn’t know about even sometimes, then you reiterate it’s called to renegotiate. But if you’ve if you’ve already done the sale, like with a business and you haven’t done this VTB or sell or carry back, in other words, then you have no leverage to do anything other than sue them, which you know is just a waste of everybody’s time and money.
01:32:26:10 – 01:32:27:22
Speaker 1
Yep. So no, I love it.
01:32:27:23 – 01:32:52:23
Speaker 2
Yeah. So there’s a couple components and I think like you know, listen to I, I’m Canadian and we’re in the process of moving to the US. And so we’ve actually just started that process. And so we’re here now full time and America’s amazing place to do business. Sure. And you have an SBA, a program where the government helps support, you know, entrepreneurs and small businesses get started.
01:32:52:25 – 01:33:18:10
Speaker 2
And so, you know, as little as 10% down, you can buy a business here in the US, get an SBA loan, where the with they will finance the remainder of the purchase deal of the purchase price and and support that process with the bank. And so if the business qualifies, that’s one way. And it’s a great way to get started in buying your own business.
01:33:18:12 – 01:33:18:24
Speaker 2
And you.
01:33:18:24 – 01:33:34:15
Speaker 1
Can find an investor to put up the 10%. If they believe in you and you, you maybe you know that business already or you have a you have some knowledge of it. You know, you can raise the money, find an investor to to help with that piece. Right. So, you know, it doesn’t have to all be your coming out of your hip National Bank.
01:33:34:15 – 01:33:42:19
Speaker 2
Yeah. You can, you know, we call it the four F’s. You can raise money from the Forrest, friends, family, the founder or fools.
01:33:42:21 – 01:33:43:26
Speaker 1
Plus,
01:33:43:28 – 01:34:06:27
Speaker 2
But no, the friends, family and founders, you know, you go to your parents, you can go to your relatives, you can go to your friends, and, and and if you’ve well thought out the deal, everybody is looking to park their money somewhere. Sure. And so, so that would be the one way to structure a deal. And then the other and you can use, you know, the, the, I’ll say the four F’s.
01:34:06:28 – 01:34:22:17
Speaker 1
Let’s go back to the founder for a second, because in that framework, and we see it in the multifamily, now we’re starting to see creative deals like this where the person selling actually stays in the deal for part of the equity, meaning the difference between the debt and the purchase price. You do something similar in a business.
01:34:22:17 – 01:34:34:03
Speaker 1
Yes. Yep. Where they stand for basically part of the down payment. They’re providing their equity as part of that down payment to to minimize the amount of money out of pocket into the deal. Same thing I’m seeing in some multifamily deals right now.
01:34:34:03 – 01:34:51:11
Speaker 2
Yep. 100% okay. And they’re and what they’re really looking for is you know and this is I think one of the big pieces that if you’re looking to buy a business, you know, being really clear on what it is that you want to do, what you what the outcome is, why.
01:34:51:12 – 01:34:52:20
Speaker 1
You do a business plan. Yes.
01:34:52:20 – 01:34:59:25
Speaker 2
What your vision is, you should understand, you know, the industry, the competition. You know what the future looks like.
01:34:59:27 – 01:35:01:00
Speaker 1
How are you going to market it?
01:35:01:08 – 01:35:02:00
Speaker 2
How you going? The market.
01:35:02:00 – 01:35:02:26
Speaker 1
Is that right?
01:35:03:01 – 01:35:32:23
Speaker 2
Absolutely. And so, you know, the more confidence that a seller has in what you’re bringing to the table in terms of your experience or your willingness or your research into the whole market, the more willing they will be to take some vendor take back selling and, some vendor take back, financing. Sorry. And so, you know, I’ve met a lot of people, so I can’t get any vendors to, to, to take back, you know, money.
01:35:32:23 – 01:35:51:02
Speaker 2
And it’s like, well, hey, that’s not my experience. Number one. And number two, you know, most of the time, you know, when you start digging in, you ask them, okay, well, what’s your business plan? Well, I don’t really have a business plan. Or they send, like a one piece of paper, like, you know, printed, typed up stuff that’s not you can see they haven’t really done the research.
01:35:51:02 – 01:35:55:21
Speaker 2
And it’s like, well, it doesn’t inspire confidence. So I would say that that’s a really big piece.
01:35:55:23 – 01:36:10:08
Speaker 1
And let me, let me I keep stopping you only because it’s the parallels between this and multifamily are very, very, they’re prevalent, because, you know, I get people call me say, hey, I call a broker and they ask for a proof of funds letter, and if they’re asking for a proof of funds, they can tell you’re a newbie.
01:36:10:12 – 01:36:27:28
Speaker 1
And they they they don’t have faith in your ability to talk to actually close on the deal. And so it’s the same dynamic when, when, when I have, you know, brand new, people out there in the streets trying to, to get a broker to send them information on a deal and, and they get stonewalled because the broker can tell they haven’t got a clue what they’re doing.
01:36:27:28 – 01:36:29:10
Speaker 1
It’s the exact same situation.
01:36:29:10 – 01:36:47:10
Speaker 2
Yeah, yeah. And I you know, I would just say this to, you know, people who because buying a business could be, you know, a scary, uncertain kind of thing. And, and you know, doing the research, people go, I don’t know where to go to do the research or I don’t know who to talk to or, you know, I ask somebody who has business experience and I can’t get their time.
01:36:47:10 – 01:37:05:12
Speaker 2
And it’s like, yeah, all that might be true. But you had mentioned I earlier and you know, the power of AI and it’s easy to get on to a ChatGPT and start prompting. You know, you ask ChatGPT a question. And for those of you who do use it or who have not used it, if you’ve not used it, you need to get on.
01:37:05:13 – 01:37:17:05
Speaker 1
I’m literally I’m literally ordering a new phone right now. The new iPhones, actually, if you ask it a question, it goes into ChatGPT and answers it. There is freaking awesome. It’s unbelievable. 16 so I’m literally ordering it right now.
01:37:17:05 – 01:37:21:27
Speaker 2
Yeah, it makes it makes Google look like it’s a joke, you know? Yeah, like a telephone book.
01:37:22:00 – 01:37:27:23
Speaker 1
Pretty. It’ll blow your mind if you haven’t used it. What the answers you get to your questions that will blow your mind.
01:37:27:29 – 01:37:31:22
Speaker 2
And so you can use ChatGPT to do.
01:37:31:25 – 01:37:36:01
Speaker 1
A hell of probably do a business plan candidly. And all the research for sure. 100%.
01:37:36:01 – 01:37:48:09
Speaker 2
Yeah. And so you can like get industry specific and then within the industry you can start prompting it. That’s what they call it is prompting your ChatGPT in order to, you know, really dive.
01:37:48:09 – 01:38:01:29
Speaker 1
What are the best ways to market this business online? What are the you know, what are what are different sales techniques to sell this product or service? You know, those are the types of questions that I can’t wait to act. Now, you got me excited about it. I can’t wait to try it myself.
01:38:01:29 – 01:38:11:29
Speaker 2
Yeah. And you and you can even do it regionally. Like you could say. Like if you live in South Florida, you could be like, hey, in South Florida, this industry, or in West Texas or in Northern California.
01:38:11:29 – 01:38:33:14
Speaker 1
Is marketing is different in different in different geographics? Definitely. In the multifamily space, you know, some places you can use some for some places. You know, you use Craigslist even, I mean, archaic stuff, but but oh, that’s, that’s that’s really interesting. I’ve never thought about your ability to really educate yourself on a particular business type when you go in and pursue it, I love that.
01:38:33:16 – 01:38:55:21
Speaker 2
So when you when you do all that homework in the background and, and then you know, what’s the saying? You know, you you get you get recognized for the things you do in public for all the things that you did in private. Right? It’s there’s no it’s no different. It’s like you really got to do the work. You got to really have clarity around, you know, what you’re walking into.
01:38:55:21 – 01:39:01:09
Speaker 2
And when you have that clarity and you, you educate yourself. Now all of a sudden the conversation looks a whole lot.
01:39:01:09 – 01:39:19:15
Speaker 1
Oh, yeah. You go into a seller and you’ve got all this work that you’ve done and, and you’re, you’re, you’re educating him on some of the things he probably hasn’t done or her, and, you know, I could totally see the impact of that, you know, and, and, and if you can come up with ways to innovate that business, that’s when it really gets exciting.
01:39:19:15 – 01:39:38:01
Speaker 1
You know, Peter Drucker says any business is nothing but innovation and marketing, right? So if you can improve the marketing and you can innovate in some way, taking a brick and mortar online, that’s a common one. But, you know, utilizing AI in some fashion. I’m looking at utilizing AI for my coaching business, for my warriors. We’re literally digging into that right now.
01:39:38:04 – 01:39:41:22
Speaker 1
And so, you know, that’s when it really gets freakin exciting.
01:39:41:22 – 01:39:58:12
Speaker 2
Oh, it’s so expansive. There’s like, oh, you, when you think about growth and opportunity, it is going to blow the doors off. Right. And so and scalability to, optimizing your operations and. Oh, yeah, it’s just it’s going to be incredible.
01:39:58:12 – 01:40:18:07
Speaker 1
I love that stuff. And, and, you know, do you and your businesses, do you use, any, like I use the entrepreneur operating system from the book traction, like, to structure business meetings, things like that. Do you, do you use any sort of a framework in your businesses or you just you’ve done it so many times, so long.
01:40:18:07 – 01:40:20:05
Speaker 2
Yeah. Like in terms of when I’m buying a business.
01:40:20:05 – 01:40:41:27
Speaker 1
Well, no, entrepreneur’s operating system is a way where you basically, it, it structures your meetings in a way that they’re incredibly effective. And, and what you and the way you structure your business is you do 90 day goals, okay? They call them rocks, but they’re goals. And you sit with your team, you decide on 8 or 9 goals for that 90 day period.
01:40:41:29 – 01:41:00:29
Speaker 1
And one person is accountable for each goal, making it very effective. You got more than one person. Nobody’s accountable. So you got one person accountable for each goal. And every week you measure the progress with a green, yellow, red, on a on a spreadsheet. If green activities happened, it’s moving forward yellow. It’s stalled out red, it’s dead or just completely stopped.
01:41:01:01 – 01:41:21:01
Speaker 1
And that’s been it’s been a game changer for us. And then and then one of the other pieces is rather than, an organizational chart for your business, you actually have an accountability chart. So, and it’s fascinating. And it’s been I used to use the Rockefeller habits in previous businesses where you, you come up with a mission statement, a code of values and all that stuff, which you do in traction as well.
01:41:21:04 – 01:41:42:11
Speaker 1
But, it’s a guy named Gino Wickman. I, I should get royalties because I talked about him on the show enough times here, but but, it really gives clarity, to a business. So, you know, if you could go back in time, Duane, knowing what you know now about buying businesses, is there anything you might do differently?
01:41:42:13 – 01:42:04:11
Speaker 2
Probably, if there was. One thing I would do differently is had in this conversation a few days ago with somebody in that, you know, I’ve always lived in the small business, kind of small to medium sized business, realm, you know, and I’ve been a bit of, maybe I could use the word squirrel. You. I think you use the word shiny penny.
01:42:04:11 – 01:42:06:29
Speaker 1
Shiny penny. Squirrel. Yes. Squirrel. Like a little be up. Yeah.
01:42:06:29 – 01:42:15:12
Speaker 2
Yeah. Right. So, like, I’ve been kind of all over the place, but I love deals. I love, I’m the guy that kind of get something to about 80%. And then I’m like.
01:42:15:13 – 01:42:15:29
Speaker 1
Then you’re out the.
01:42:16:05 – 01:42:29:24
Speaker 2
Details stuff. I got to get off the board and let somebody else do it, and so, you know, one of the things that my mastermind group is trying to encourage me to do is the next business that we get into is just to you really drive it,
01:42:29:26 – 01:42:31:16
Speaker 1
The home run business, the big one. Yeah.
01:42:31:20 – 01:42:49:03
Speaker 2
Not even just the home run, but it’s like, be in it right through to the end. And, and and I have a, you know, part of my part of my strategy has always been is like, I have a real belief that, you know, the business is there to serve me, serve our family, not me. Serve the business.
01:42:49:06 – 01:43:10:07
Speaker 2
And that’s the sense is, is that operators get tired and owners get rich. And so, you know, in order for me to not burn out, I try to place, you know, executive teams in to manage the business. I think the next one that I’m going to do is I’m going to run it. I will be the CEO, I will drive this, and we’re going to grow.
01:43:10:09 – 01:43:20:23
Speaker 2
You know, one thing I haven’t done is, is I’ve never grown. And I always wanted to grow a business to 100 million in revenue. And so I think the next one that we get into that will be the attempt. Okay.
01:43:20:26 – 01:43:21:24
Speaker 1
Oh. That’ll be the outcome.
01:43:21:24 – 01:43:23:01
Speaker 2
Yeah, that’ll be that outcome.
01:43:23:07 – 01:43:26:09
Speaker 1
You do you’ll you’ll do it. There’s no question in my mind. Yeah. You’ll do it.
01:43:26:11 – 01:43:26:23
Speaker 2
Yeah.
01:43:26:29 – 01:43:50:04
Speaker 1
You know, it’s, Tony Robbins, going back to him for a minute, he talks about archetypes in a business. I. So if you remember these conversations. But he talks about the artist or the innovator, and then there’s the manager leader, and then there’s the entrepreneur. And so, like, if you look at Silicon Valley, the artist would be the tech person that came up with this cool new tech program, whatever it is, Airbnb, Uber, whatever.
01:43:50:07 – 01:44:06:09
Speaker 1
And then the manager leader would be someone that goes in and manages that business. They’re good with people and, and very often, you know, like, the people that, that bring the money in, what’s the word for them? The not the hedge funds, but there’s,
01:44:06:11 – 01:44:07:00
Speaker 2
Private equity.
01:44:07:00 – 01:44:31:07
Speaker 1
Private equity, private equity comes in and they’ll bring in a C level suite of manager leader in all these, the sea level team. And. But the entrepreneur is like you and I, we don’t like to get buried in the weeds. And so I’m a little surprised you’re going to do it, but but, you know, we like to get in, get it started, get it going, get it ramped, and then we’re out looking, you know, shiny Penny looking for the next thing.
01:44:31:09 – 01:44:55:22
Speaker 1
And, you know, I’ve built 29 businesses as well. And you know, you know, I call them seminars when they when they fail. And then they’ll sit several several worth, you know, tens of millions of dollars. Most spectacular flaming seminars. Okay. I, you know, you fail your way to success, but I didn’t go to college at all. And, but, yeah, I wish I had actually, so I could I knew better how to read, you know, more about the accounting side of things.
01:44:55:24 – 01:45:14:18
Speaker 1
For that, I should have done that. I should probably still go back. But, you know, I’ve. I’ve just partnered with people that are good with numbers, but, but let me ask you another question, because you know, you and I are big into motivation. That’s why we spent time with Tony. And and you know, what’s some of the best advice you think you’ve ever gotten as it relates to life or business?
01:45:14:20 – 01:45:38:12
Speaker 2
That’s a loaded question, bro. Yeah. Some of the best advice, you know, for my first mentor or my first real mentor. His name was Harold Cunningham. He’s since passed away, but, he was really big on me, understanding the serenity prayer. You know, knowing what you can control, what you can’t control and the wisdom to have the difference right now.
01:45:38:16 – 01:45:57:22
Speaker 2
Yeah. And so, you know, I think that that was kind of one of the things. And then Keith Cunningham kind of said to me one time, you know, Keith, you know, Keith Cunningham had said, you know, like I was talking about buying another business. And he’s like, look, man, you’re you’re not sitting at home on your couch watching TV and eating bonbons.
01:45:57:22 – 01:46:03:27
Speaker 2
Like, he’s like, you’ve got to figure out what you got to give up in order to get what you want. Yeah. And it wasn’t like what you’re.
01:46:03:27 – 01:46:04:15
Speaker 1
Willing to sacrifice.
01:46:04:16 – 01:46:16:06
Speaker 2
It wasn’t like, give up time with your kids or give up time with your wife. It was like, what are you willing to sacrifice this in regards to what you control and what you don’t control? And so and then so that would be one a.
01:46:16:06 – 01:46:28:05
Speaker 1
Hold on hold on. Yeah. He Cunningham by the way he’s a great guy. He speaks it all the Tony Robbins events and a brilliant guy. I actually have gone to his events and I forgot where they were. Austin. Austin, Texas. That’s right. Austin, Texas.
01:46:28:05 – 01:46:29:24
Speaker 2
Company is called keys to the vault.
01:46:29:24 – 01:46:36:28
Speaker 1
Keys to the vault. Okay. Yeah. A little shout out to Keith is a wonderful, funny as hell, really funny guy. Keys to the vault. But anyway, please continue.
01:46:37:00 – 01:46:53:23
Speaker 2
Actually, if I just, I’ll. I’ll leave aside. Like, since you’re giving a plug to Keith because Keith has been an enormous help. He’s been a fantastic mentor and I wouldn’t be where I am without him. But I will say, if, you know, we were talking about buying businesses, he runs a virtual course called How to Buy a Business, and I’ve attended it like three times.
01:46:53:23 – 01:47:08:05
Speaker 2
I’ve sent my CFO to it like it is. It is such a great, you know, sequence of content that he teaches. He’s an amazing teacher. He’s not a he’s not just a teacher. He’s amazing at it. But he was he did it. He’s.
01:47:08:08 – 01:47:09:27
Speaker 1
Oh, yeah, he’s, you know, lots of businesses.
01:47:09:27 – 01:47:11:00
Speaker 2
Yeah. Yeah, tons.
01:47:11:03 – 01:47:12:26
Speaker 1
And he says that he eats his own cooking. That’s his.
01:47:12:26 – 01:47:22:00
Speaker 2
That’s right. That’s his life. Yeah. So. So, so he. So that would be a great place if you are looking to get some education on how to buy a business, I.
01:47:22:02 – 01:47:22:11
Speaker 1
Want to.
01:47:22:13 – 01:47:23:06
Speaker 2
Ask one course.
01:47:23:06 – 01:47:41:12
Speaker 1
Shout out to him. Do you have a favorite business tool that you implement in your businesses? You know, I talked about this operating system that we use kind of to keep us on track and keep us on focus, but is there like a tool that you like to use? I mean, you’re starting to get into a ChatGPT obviously you’re using that.
01:47:41:14 – 01:47:42:29
Speaker 1
Yeah. Anything else come to mind? Want to know.
01:47:43:02 – 01:47:54:21
Speaker 2
What so, so yeah, there’s so there’s one we use OKRs. That’s the outcome key outcomes and key results that use that Google actually. Okay. And you can read.
01:47:54:21 – 01:47:59:06
Speaker 1
Heard about this. Yeah I heard about this I, I thought I heard an interview with this. Okay.
01:47:59:06 – 01:48:20:07
Speaker 2
Yeah. So it comes from a book called what’s what Matters most. Okay. And and the author of that book, I believe, is John Doer d-o e r d or something like that. Anyways, what matters most. And so we use a OKRs. Okay. And, and it’s, I mean it’s very similar to like it’s a version of the next thing, you know what I mean.
01:48:20:07 – 01:48:39:09
Speaker 2
And I’m not trying to minimize it, but, but I, and I really think it’s, it’s excellent. But also part of the OKRs is, is really leveling down in all areas. It’s like you have an OKR that’s at the top of, you know, the vision for the company. And then and then it delineates down through.
01:48:39:10 – 01:48:40:24
Speaker 1
To daily to daily activity.
01:48:40:26 – 01:48:59:28
Speaker 2
Right. That will and it goes right down to the bottom levels of the org. And through every level of the organization, everybody ties their okay hours to the top. Okay. And and and then we use a program called lattice. And there’s other programs I don’t, I don’t know the names of them. My team does. But we, we chose lattice.
01:48:59:28 – 01:49:21:15
Speaker 2
And lattice is a basically a software that you can move your OKRs into. And it makes it transparent to everybody in the organization. So everybody in the organization can see what my goals are as a CEO and where I am in accomplishing those goals. And they’re all tied. Wow. You know, linearly to the top OKR of the company.
01:49:21:15 – 01:49:27:23
Speaker 2
That sounds really cool. And so it is really, really a powerful tool. Yeah. And and I think then there’s this other.
01:49:27:28 – 01:49:29:12
Speaker 1
Everybody’s role in the same direction.
01:49:29:12 – 01:49:29:25
Speaker 2
That’s it.
01:49:29:25 – 01:49:41:17
Speaker 1
Because that’s the problem in a lot of businesses like like in my, in my business right now with coaching, sometimes sales and marketing are not aligned. And we just had a meeting on this. And so, you know I love that.
01:49:41:17 – 01:50:04:20
Speaker 2
Yeah. Okay. It’s really, really, really powerful. Right. And and just the process of setting everybody, setting the OKRs, you know, as a is a is a process because it goes right to every level of the organization. And they all have to tie back to the main goal. And it and it really kind of came from we read a book a while ago, a long while ago called The One Thing.
01:50:04:22 – 01:50:08:13
Speaker 2
And so many organization killers. One thing. Yeah, yeah, I think yeah.
01:50:08:13 – 01:50:12:01
Speaker 1
The killer. Yeah. Keller Williams, the one thing that’s a great book.
01:50:12:06 – 01:50:12:21
Speaker 2
An amazing.
01:50:12:21 – 01:50:16:00
Speaker 1
Book. Right. I had Jay Pappas on the coauthor on the show here. He.
01:50:16:03 – 01:50:38:09
Speaker 2
Oh, seriously? Yeah, yeah. Oh, amazing. Yeah, yeah. And I mean, so many organizations, you know, they they focus on ten things and they accomplish 10 or 20% of ten things rather than accomplishing 100% of one thing. I love it, and I think a lot of people make that mistake. And and, you know, that kind of leans back to a little bit about what you would ask me earlier about, you know, the, you know, my regret or whatever.
01:50:38:09 – 01:50:53:16
Speaker 2
If I had to do something different. It’s like I’ve been, you know, across so many different industries at so many different times. You know, one thing would be kind of and that’s kind of where I’m used to. Yeah. Yeah. And then and so, that’s what we use to kind of organize our like our teams.
01:50:53:16 – 01:50:53:26
Speaker 1
Love it.
01:50:53:26 – 01:50:58:14
Speaker 2
To make sure they’re moving. And then of course things like teams and, you know, communication and all that.
01:50:58:14 – 01:50:59:23
Speaker 1
Yeah sure. That’s critical okay.
01:50:59:23 – 01:51:09:05
Speaker 2
Pretty basic stuff. But I think, you know, the other conversation we were talking about was what were the things that I learned. And in terms of the model, in terms of the personal development world.
01:51:09:08 – 01:51:25:14
Speaker 1
Oh yeah. Let’s talk. I wanted to ask you what books you like to give because, you know, you saw my library downstairs, like with thousands and thousands of books down there. And I’m an avid reader, but are there any, you know, let’s talk about personal development books or if you know, are there books that you like to gift more than others?
01:51:25:17 – 01:51:28:22
Speaker 2
Yeah. I think we share with the number one book there with Napoleon Hill.
01:51:28:23 – 01:51:42:18
Speaker 1
Oh yeah, they can grow rich. I literally, and I’m not exaggerating. I have given out over 5000 copies. Yeah, I’m not exaggerating. I’m not going to tell you where I like it to be a surprise, but I’ve given away literally 5000 copies.
01:51:42:19 – 01:51:53:05
Speaker 2
It’s amazing book. How that book is not entrenched in our education system is beyond me. Like we’re reading stuff like it’s just insane.
01:51:53:08 – 01:52:13:10
Speaker 1
That book, that book is really the precursor to all self-actualization, self-improvement and motivation. I mean, it literally has every topic that you’re going to find in success, in subsequent books. And, yeah, that’s why. And it’s a book you should really read more than once a year, a couple times a year. It’s that important.
01:52:13:10 – 01:52:15:02
Speaker 1
Yeah. So, yeah.
01:52:15:05 – 01:52:19:16
Speaker 2
Another book that I really love is, the way the superior man.
01:52:19:16 – 01:52:35:24
Speaker 1
Oh, it’s so funny. I’ve got it down on my desk. I’m gonna give it to my son. I’m having dinner with him tonight. Oh, dude, I swear to God, I’ve. I’ve got one. What’s great about the way of the superior man? And this is for men, guys, it’s got a lot of sexual undertones, but it’s it’s it’s it’s it’s incredibly powerful, you know?
01:52:36:01 – 01:52:38:19
Speaker 1
You know, he spoke to the platinum group once for Tony Robbins. I don’t know.
01:52:38:19 – 01:52:39:20
Speaker 2
If you I didn’t know. Yeah. Yeah.
01:52:39:20 – 01:52:55:07
Speaker 1
It’s it’s that’s. I’ll tell you I’ll talk to you about that offline. But that is a fantastic book. If you’re going through a transition as well. Like if you’re going from one business to the next or, or if you’re listening and you’re ready to make a frickin move and, you know, you’re not thrilled with where you are right now.
01:52:55:07 – 01:53:05:23
Speaker 1
You know, you want more and you’re a you’re a male. Go get the way of the superior man. It’s the perfect book when you’re transitioning. And, so but yes. Okay. That’s a great one.
01:53:05:23 – 01:53:25:04
Speaker 2
Well, and then on that note, for women, any women who are listening, I believe it’s Allison Chapman. Writes a book, called keys to the Kingdom. And so that is an amazing book, for understanding femininity and the relationship with femininity and masculinity. So I think that’s that’s an amazing book.
01:53:25:09 – 01:53:42:16
Speaker 1
So, you know, everybody thinks everybody thinks, you know, they see someone that’s super successful, like you and I, and they think there’s no hiccups. So everybody knows about my hiccups. But, but talk about a time you got your ass kicked. You know, you got your nose bloodied. I mean, you’ve got a whole menu of them. Anybody that’s an entrepreneur has a whole menu of them.
01:53:42:16 – 01:54:00:20
Speaker 1
But, you know, maybe, maybe one that can do it. Be a teaching moment, talk about, you know, something that happened that, you know, you had a seminar. You know, I call them Tony calls them seminars, I call them seminars. And, talk about a seminar that you had. And if you can, if there’s a if there’s a teaching that.
01:54:00:22 – 01:54:22:02
Speaker 2
Yeah. Look at, I mean, probably the most recent one. It this probably goes back about ten years. But you know, we invested in some real estate and we had a business on it on this real estate. And, and we, we trusted some guidance from someone. And it’s not their fault. It’s our fault. But that was.
01:54:22:04 – 01:54:37:25
Speaker 1
Our first lesson. What he just did was total frickin ownership. I promise you, was that other person’s fault. But just like me, I’m dealing with it myself right now. I didn’t keep your eye on the ball. I didn’t keep my eye on the ball. And so I’m suffering as a result of a similar situation anyway. But but that’s called total ownership.
01:54:37:25 – 01:54:43:19
Speaker 1
And if you want freedom, own everything that happens to you. Positive or negative. Sorry, I wanted to check on that.
01:54:43:22 – 01:55:08:01
Speaker 2
And you’re right. It is. It’s true. It’s you have to own that. It’s easy to blame others. But where but in blame is is the judgment hatred? Anguish. You know, fear. So why be in that space? But, you know, ultimately the decision rests on on me. And and so, you know, I’ve made some poor decisions and took some advice that I should have done some research on.
01:55:08:04 – 01:55:13:18
Speaker 2
Anyways, we misjudged the market and we had our chips in on this thing, like.
01:55:13:22 – 01:55:14:23
Speaker 1
Like some serious money.
01:55:14:23 – 01:55:21:18
Speaker 2
And we had like almost all of our chips in. Wow. And I can remember, you know, sitting there, I remember.
01:55:21:25 – 01:55:23:06
Speaker 1
It was this 089 or was.
01:55:23:06 – 01:55:25:01
Speaker 2
I. No, no, this is,
01:55:25:03 – 01:55:25:20
Speaker 1
It was so.
01:55:25:21 – 01:55:27:12
Speaker 2
Fast that it’d be 14, 15.
01:55:27:12 – 01:55:28:05
Speaker 1
Okay. Yeah. Okay.
01:55:28:05 – 01:55:42:08
Speaker 2
Wow. And it was, it was wasn’t because of the environment or it was just a complete misjudgment of a market. Wow. Business that we were in. And we had we had a lot of money in the real estate tied up in it. And, and I remember.
01:55:42:14 – 01:55:43:22
Speaker 1
This up in Canada.
01:55:43:24 – 01:55:59:29
Speaker 2
Up in Canada. Yeah. And I remember sitting in the kitchen and facing the reality of, holy shit, like, this could be the bullet to the brain. And, and I and my wife and I were not getting along at the time, and it was like the.
01:55:59:29 – 01:56:00:14
Speaker 1
Stress of.
01:56:00:14 – 01:56:29:29
Speaker 2
This. Yeah, the stress of that. And just you know, we were, you know, early in our marriage, we got married in 2011 and we still were trying to figure some of that out. And, and I remember like, you know, backing myself into the corner in the kitchen and, and thinking, Holy shit, this is it. Like I, I have done what I said I would never do and risk too much that it’s like, look, we can all take a bullet to the kneecap, right?
01:56:30:02 – 01:56:43:05
Speaker 2
Skin, our knee, skin, our elbows. But a headshot is what takes you out of the game. And so. And whether it’s like, you know, when you push your chips in, in poker and you go all in, you know, and this isn’t. But business.
01:56:43:12 – 01:56:45:04
Speaker 1
Business is not to be sure. The hand.
01:56:45:08 – 01:56:53:21
Speaker 2
That’s right. And and but you’re doing that in business and it’s everything and and and a lot of times it’s our identity.
01:56:53:24 – 01:57:09:14
Speaker 1
Oh you need to. Oh let’s talk about that for a second okay. Let’s talk about that for a second. Yeah. So guys it is super important that you never allow that to happen. Right. That you never let your business be your identity okay. It’s your vehicle. That’s why I always call it a vehicle because that’s what it is.
01:57:09:18 – 01:57:34:23
Speaker 1
Because if if it becomes your identity and it fails, you’re a failure, right? But if it fails, okay, that’s apart from you. And this is a I know this sounds silly, but this is a super important distinction that you never let your business become your identity. Yeah. Because, you know, best when people jump out of buildings, that’s when, you know, I just heard about a multifamily operator that shot himself on his wife’s birthday a couple weeks ago because he lost a property and then.
01:57:34:25 – 01:57:40:17
Speaker 1
Yeah. Yeah. So so that’s that’s what happens when you make something, your identity. Okay.
01:57:40:18 – 01:57:44:00
Speaker 2
Yeah. It’s critical not to tie your self-worth up with your net worth.
01:57:44:00 – 01:57:48:01
Speaker 1
That’s a good, good phrase. Yeah. Don’t tie your self-worth with your net worth I like that.
01:57:48:07 – 01:58:11:00
Speaker 2
Yeah, I remember that. And I’m like, holy shit. And and it was like I, you know, I grew up, in, you know, I’m born in 70. So as I was growing up, the Rocky movies were like such a formative impact on me as a kid growing up. And, and I remember back in, into the corner in the kitchen thinking, Holy shit.
01:58:11:03 – 01:58:36:19
Speaker 2
And my mindset was just like, so negative and so like an almost terminal, like, finished. Like I could remember thinking, we’re done. Like I’m finished. I finally I made the mistake because I’ve taken a lot of risk in my life. Sure. And as we all have, right. And and so you thought that was one. I did it and then and I remember going, no, no, this is not true.
01:58:36:21 – 01:58:48:17
Speaker 2
It’s one of the questions I have I often ask myself is, is this true? You know, so that I don’t tie myself up into a way of thinking and, and so and I just, I remember being. That’s a great.
01:58:48:17 – 01:58:50:17
Speaker 1
Question. You that is a great question.
01:58:50:17 – 01:58:51:18
Speaker 2
It is. Yeah.
01:58:51:21 – 01:59:02:20
Speaker 1
I think about that for a second, guys. Like if you’re kicking yourself in the ass, you know, for for screwing something up, ask that question. And very often it’s not so yeah. Sorry, sorry.
01:59:02:21 – 01:59:30:04
Speaker 2
No, no. But but as you say that it comes from a book called, loving. What is by Byron Katie. Okay. Amazing book. That is a absolute. That’s another one that would be a must read. Okay. For, for people because it will help them through some of those transitions. And then and so I remember just kind of, you know, being backed into this corner and just thinking, like, I remember my body’s shrunken over my shoulders down, I’m like, Holy shit, my head’s down.
01:59:30:06 – 01:59:40:13
Speaker 2
And I’m like, no, there has to be another way. And and then I just, you know, I slowly got back into, like, this empowering state of mind.
01:59:40:13 – 01:59:42:19
Speaker 1
And it is probably a creative state of mind. Yeah.
01:59:42:19 – 02:00:08:08
Speaker 2
And and well, you know, it was funny because, you know, I think that there’s, there is a, there’s a power in having an enemy. And, and if we create the enemy within ourselves, something that we are fighting for or fighting against, that it binds, you know, not your own psychological psychology together. And if you create the enemy, it it can empower you.
02:00:08:11 – 02:00:26:00
Speaker 2
If the enemy is created against you beyond your will, then it creates fear. And so I just started to create this like kind of like, no, we’re going to battle back. We’re going to win this, we’re going to crush it. We’re going to overcome, you know, I’m not going down like this. And there’s got to be another way.
02:00:26:00 – 02:00:43:04
Speaker 2
And and then over the next kind of well, we did it pretty quickly. But I just, I went to my wife and I’m like, you know, fuck this. Excuse my language, guys, but I was just like, fuck this. We’re not going out this way. This is I would I will like if it’s my time, I’m going down.
02:00:43:04 – 02:00:58:01
Speaker 2
And so we just re-engineered the entire business and and recreated a whole new clientele. And and honestly, within six months, we were back to, you know, cash flow positive and or neutral.
02:00:58:01 – 02:01:15:28
Speaker 1
It’s crazy. I the same thing happened. I had a litigation support company after I lost everything in oh eight and nine, and I was about to bankrupt it in 2010. And I’m like, nope, same exact same thing. And I’m like, nope. And I rethought about what we were doing. I turned it into a, you know, I don’t know, ten, $12 million company with 60 employees that I sold a few years ago.
02:01:16:00 – 02:01:20:12
Speaker 1
And, and they’re killing it now, but, yeah, very same thing.
02:01:20:14 – 02:01:38:25
Speaker 2
But I think, like, if I had something on this, I would just say to people, it’s like you go like, you know, why do you go to the gym? Why do you jump in the cold plunge every morning? You know, why do you do the hard shit? And and to me, doing the hard things is what builds your nervous system up.
02:01:38:28 – 02:02:14:25
Speaker 2
So that when when something that is not being driven by you, but it’s being driven by an outside environment, whatever that is, whether it’s somebody else did something or the environment or the economy or whatever it is, so that you can handle those tough times more easily because you’ve conditioned the nervous system to react and respond in a way that is productive and proactive and progressive, not reactive and that to me is like it’s critical it and you be in the you know, it’s not a bad thing to feel.
02:02:14:25 – 02:02:35:09
Speaker 2
I think you should feel like people, a lot of people I get sometimes I get a little frustrated with people who are on social media going, oh, you got to be always positive. So look, you can have your times of tears or sadness or, or reflection or whatever, whatever on whatever scale that looks like. You just can’t live there.
02:02:35:12 – 02:02:44:19
Speaker 2
You know, you get down there because if you never get down there, you don’t learn. You actually are unaware of actually what’s happening. And I don’t think you get the lessons.
02:02:44:21 – 02:02:50:14
Speaker 1
If you’re in fear, you’re paralyzed. And I will tell you, you know, pain is going to happen, but suffering is optional, right? Right. That’s a Tony.
02:02:50:15 – 02:02:51:05
Speaker 2
Quotes, right?
02:02:51:05 – 02:02:56:14
Speaker 1
Yeah. You know, I don’t think we finish the topic on on other ways to buy businesses. I think we went down a side.
02:02:56:14 – 02:02:57:03
Speaker 2
Right there which.
02:02:57:03 – 02:03:10:13
Speaker 1
Is common in a lot of recession. Right. So what are some other ways, you know, we talked about the, the three F’s that you go with and then, you know, having a seller involved. We talked about SBA loans. Is there anything else? I mean, maybe there aren’t many.
02:03:10:15 – 02:03:38:08
Speaker 2
So I think like, this is really. Well, I’m just going to say this is good for young people, but it’s actually not. It’s if you’re inexperienced but you have will and desire. And and horsepower. Right. Like that’s the other thing too, if you’re willing to grind the flywheel, you are not afraid of work ethic. Then partnering with somebody who’s looking at selling their business, it’s like, I think there’s a lot of value to for people who they go, well, I don’t have capital.
02:03:38:11 – 02:03:43:11
Speaker 2
You don’t need capital. Like people go, well, you know, when people think about resources, they think about money.
02:03:43:12 – 02:03:44:00
Speaker 1
Only money.
02:03:44:00 – 02:03:55:13
Speaker 2
Money is the least right part of of resources. It’s about being resourceful. And so if you have the will and the desire to be a business owner or to elevate your life, and you can.
02:03:55:13 – 02:03:59:07
Speaker 1
Communicate that and you can communicate that to a, to a to a business owner.
02:03:59:07 – 02:04:20:06
Speaker 2
That’s right. It’s like, hey, give me a shot, I’ll come in. Oh, you know, work at what whatever it is. And and here’s my intent. And we’ll do this for six months. And at the end of six months, if you like what you see, then let’s make it. Let’s negotiate on a, on a, on a business deal. And, and so that is always an option to work.
02:04:20:09 – 02:04:46:04
Speaker 2
You can then you can buy a business. So let’s say you know you’re buying. And I’d actually say this too. It’s like if you’re buying I’ll just use $1 million because it’s a round number. But a business that is making $1 million and depending on the industry that it’s in, tech will sell higher, of course. But you buy a business with $1 million in revenue, it’s probably making somewhere between 100 and 100 and 50,010 to 15% net.
02:04:46:06 – 02:05:15:19
Speaker 2
And so then that business is going to value somewhere between 2 and 4 times earnings. So call it three times earnings and it’s making 10%. The business is worth $300,000. Right. And so in a structured deal you could probably come up with, you know, 20% down or 30% down. So 60 to $90,000. And the bank is going to come in and give you 40 to 60%, let’s call it 50.
02:05:15:19 – 02:05:18:22
Speaker 2
So 50,000. So you show up with.
02:05:18:24 – 02:05:20:09
Speaker 1
All that 50,000 in that example.
02:05:20:09 – 02:05:31:25
Speaker 2
So 150,000. Sorry 300,000 is what the business. Right. So the business the, the, the bank would finance, you know, 150, you’re going to show up with 60 in cash and the vendor is going to take back.
02:05:31:25 – 02:05:32:09
Speaker 1
More the.
02:05:32:09 – 02:05:33:09
Speaker 2
Seller. So the.
02:05:33:11 – 02:05:34:25
Speaker 1
Yeah, the vendor is confusing.
02:05:35:01 – 02:05:35:26
Speaker 2
Is just short of the seller.
02:05:35:26 – 02:05:38:10
Speaker 1
Yeah. It’s really the seller. You know, the owner. Yeah. Right.
02:05:38:17 – 02:05:58:05
Speaker 2
And so then if that math doesn’t work for you then you said the owner, why don’t I buy the business half the business today or whatever percentage it is. And now all of a sudden you’re cutting all that money in half, right? And you’re doing the deal. And then you sit in the sell and the seller as well.
02:05:58:05 – 02:06:12:27
Speaker 2
I really want to get rid of it now. It’s like, well, listen, I want your expertise. I need your expertise. And we should be able to grow the business over the course of the next 3 to 4 years, because here’s some of the things that, you know, I would bring.
02:06:12:28 – 02:06:13:23
Speaker 1
Back to the.
02:06:13:25 – 02:06:16:04
Speaker 2
Changed. And,
02:06:16:07 – 02:06:23:14
Speaker 1
I like the way you said that. It wasn’t a matter of fact, it was just like, I think I can make some improvements here. That’s not going to push the seller back. Yeah, that’s a great technique. Okay.
02:06:23:14 – 02:06:37:13
Speaker 2
And probably the seller, if he’s on this business for 25 years, the last five he’s probably been thinking about selling which and he’s maybe, you know, spending time with his grandchildren. And he’s probably not focused on revenue, sales and growing the business.
02:06:37:13 – 02:06:40:23
Speaker 1
The problem isn’t it hasn’t enhanced the marketing. Stuck with what he’s been doing. Yeah.
02:06:40:23 – 02:06:59:08
Speaker 2
So there’s always lots of opportunity. Right. And so what you do is you tie the seller and say, listen, we’re going to partner for five years. At the end of five years I’m going to buy your 50% back. But now the business, if the business is growing from a million in revenue to 2 million in revenue, now it’s worth 600,000.
02:06:59:10 – 02:07:00:23
Speaker 2
So the seller.
02:07:00:25 – 02:07:01:25
Speaker 1
You’ll make more money.
02:07:02:00 – 02:07:12:20
Speaker 2
The seller’s going to make more money, but you’re making money and you’re going to finance just through the cash flow of the business anyways. And so and so I think that there’s there’s so many ways to structure.
02:07:12:20 – 02:07:12:25
Speaker 1
The.
02:07:12:25 – 02:07:37:06
Speaker 2
Structure a deal. But I think really what’s most important and and what gets lost is and this is my outcome for the first I call the first date. Actually I got that from Keith Cunningham. The first date with the seller is to sit down and not pepper the seller with a bunch of questions about the business. I didn’t even ask to see the financials like I typically you’ll have seen the financials through a broker.
02:07:37:06 – 02:07:42:16
Speaker 2
You have an idea, right? But I don’t talk at all about the I don’t talk about the business. I don’t talk about the finance.
02:07:42:16 – 02:07:43:13
Speaker 1
You just build a relationship.
02:07:43:13 – 02:08:13:05
Speaker 2
I talk about the person. Yeah, well, you know, tell me about your business. Tell me about your journey. Tell me what you love about the business. Tell me what you you hate about the business. Tell me what you would have changed. Tell me if you were ten years younger. What would you do with this business? And that’s a you’re getting to know the seller, but they’re also sharing with you, you know, the, the, the keys and the insights to what has happened in the past, what is currently happening in today and what could happen in the future.
02:08:13:07 – 02:08:25:04
Speaker 2
And when you have a conversation like that, you know, you’re all of a sudden representing a tremendous of that amount of value to the seller because the sellers like this person’s lights are on, like they’re asking the right.
02:08:25:04 – 02:08:26:25
Speaker 1
Questions and you’re bonding with them.
02:08:26:25 – 02:08:27:04
Speaker 2
And you’re.
02:08:27:04 – 02:08:48:02
Speaker 1
Bonding. Seller bonding is a huge seller, especially with elderly seller. I tell you, focus on the relationship first and the business second. And I tell that in the multifamily space, you know, focus on the relationship first and you can cut some incredible deals. I mean, I’ve done nothing down deals. I even did a, a fairly large multifamily where I didn’t make a payment for a year because the property needed too much work.
02:08:48:02 – 02:09:02:09
Speaker 1
I’d bonded with the. So I’m like, hey, I got to put the money into the property and then after a year I can start making payments. It was the truth, and I bonded with them and we did it. And so, you know, that’s the power of that. And but it’s all in, in your preparation. It’s all in, you know.
02:09:02:09 – 02:09:22:03
Speaker 1
And you guys should also read sales, book sales related books to learn how to sell, and communicate and negotiate. But, well, listen, brother, this has been a hoot. I’ve really enjoyed this has been a lot of fun. You’ve added tremendous value. We’re going to do this again. Actually, at some point, maybe we’ll do the masculine feminine energy conversation.
02:09:22:08 – 02:09:24:05
Speaker 1
You bring your bride, and I’ll talk about that.
02:09:24:05 – 02:09:28:18
Speaker 2
That we’d love to do that. I should be fun. Yeah. Yeah. It’s our it’s one of our favorite things to talk about.
02:09:28:19 – 02:09:37:29
Speaker 1
Oh that’s why I say is mine as well. It’s fascinating. It’s fascinating. I talk about it when I’m on a date. You know, it’s it’s fascinating. But listen, I appreciate you being on the show, brother. It’s great to see you, man.
02:09:38:00 – 02:09:52:03
Speaker 2
Dude, I love being. I’m. It’s great to see you. It’s. I’m glad you’re here. The studio is being here with you. It’s always time well spent, man. Thanks. But you were, You are a master of your industry and. And a master of your own self, too. Which is I love about it. And I love you, bro.
02:09:52:03 – 02:09:52:29
Speaker 1
It’s. Thanks, bro. You’re.
02:09:53:05 – 02:09:54:05
Speaker 2
I’m honored to be here.
02:09:54:10 – 02:09:55:09
Speaker 1
I appreciate that, buddy.
02:09:55:10 – 02:09:56:10
Speaker 2
Thank you. No problem.
02:09:56:10 – 02:09:57:00
Speaker 1
Thank you for.
02:09:57:00 – 02:09:58:08
Speaker 2
Listening to the lifetime.
02:09:58:08 – 02:10:00:04
Speaker 1
Cash flow through real estate investing.
