Acquisition Aces - Issue 1

Read Time - 4.5 minutes

Boring Businesses Are The Ultimate Time Hack (Only 2 Core Skills To Master)

My wife and I recently welcomed a new addition to the family. Our first two kids arrived in this world without a hitch. The pregnancy, delivery, and first few months were pretty standard. Selah, on the other hand, decided she wanted to make an entrance and add a level of complexity to every step of the process. Everything is OK, but let’s just say things have not been going to plan.

Because of this, I had to take a step back to help with the new baby and navigate these challenges. Add in the fact that going from two kids to three is a big change. You can no longer play man-to-man defense anymore. You either have to play zone, or give the oldest free rein while you handle the younger ones. This is an acquired skill and we are still getting used to it.

Even though my available time for work went way down, I was still able to build up my acquisition pipeline. Over the last 10 months, I continued to refine the SOP’s and close deals. I was even able to take the family to Ireland for an entire month in July. Check this out:

How was I able to do this given everything that was going on? The answer is keeping it simple. It is much easier to focus when you only have a few levers you need to pull to run your business(es). In fact, you only need 2 core skills to be an Acquisition Ace. Before I run you through those, let’s look at why almost everyone online is getting entrepreneurship wrong.

The Founder Failure Rate After Five Years Is 90%

A lot of the so-called “gurus” online flex about being a founder. Sure the optics are nice, and when it works out it is great. Here is a contrarian take: Betting on yourself as a founder is a terrible bet. Here are some fun facts:

• The failure rate for new startups is currently 90%.

• 10% of new businesses don’t survive the first year.

• First-time startup founders have a success rate of 18%.

Source: https://explodingtopics.com/blog/startup-failure-stats

Unless you are a skilled operator, with multiple successful start-ups in your history, with access to a large pool of capital, nine times out of ten you are going to fail. It doesn’t matter how loud the internet voices yell “Build, scale, and sell is the only way!” it does not change the realities on the ground.

Think about the process of scaling. The bigger a business gets, the more complex the operation. The more complex the operation, the easier it is for things to break when stressed. The risk increases exponentially as you grow. This means that catastrophic failure becomes more likely, not less, continually over time. This is a huge reason why businesses fail. They cannot sustain their own attempts at growth.

Now don’t misunderstand what I am trying to say. Owning a business is the best way to get to what you want financially. The problem is that most people adopt an “achievement” model. They base their definition of success on becoming a profitable founder. I prefer to stack the deck in my favor and practice the “acquire” model.

Acquiring A Business With A Proven Five Year Track Record Has A 90% Success Rate

Any founder will tell you that going from zero to one takes an immense amount of energy. When you acquire an existing business, going from one to two is much easier. The reason is that things are already moving. When you buy a company, it already has these three things:

• Existing Revenue

• Existing Product

• Existing Team

The key here is that you piggyback off someone else’s effort and vision. It is the ultimate hedge against market and business risk because somebody has already taken those risks and survived.

I understand that you want to bet on yourself. Most smart people do. Doesn’t it make more sense to put yourself in the best position to succeed? In the acquire model you only need two core skills to run a business.

Skill 1 - Grow Revenue

There are a lot of different ways to do this. Introducing a new product. Get rid of a product that isn’t profitable. Build in new revenue streams. The key here is that this skill translates across all businesses. It doesn’t matter if it is managing parking lots, a CPA firm, or a storage facility. When you boil it down, the methods to grow revenue are the same. You only have to learn the skill once.

Now, you might be saying: “But Ben, I don’t know how to manage a CPA firm. I’m not a CPA.” This is where the second part of the Acquisition Aces skill stack comes into play.

Skill 2 - Build The Right Team

I don’t have to be an expert in the company I am acquiring. It doesn’t matter if it is construction, website design, or yes, a CPA firm. All I need to know is how to evaluate talent and put them in the best position to succeed. This may mean removing someone on the existing team of a company you have just purchased. This can be a hard choice, but the right team is the difference between winning and losing. Once you have your “A” players in place all you have to do is manage the team and let them manage the business.

If you can master these two core skills you are on the way to be able to take month-long trips with your family and step away when life demands it. You even get to scale, except you are scaling the number of businesses you own, with the accompanying cash flow.

Stop Obsessing Over Scaling, Obsess Over Cash Flow (And Where To Find It)

If I have done my job, you are at least considering acquiring a “boring” business. What’s next? Part of the acquisition game is going into the field and physically looking at potential deals. It is important to experience what they are like. What type of neighborhood is it in? Is it maintained well or does it look like an episode of Hoarders? You are buying a tangible asset. No wi-fi money here.

To experience what that feels like I want you to pick one of these 3 options that interest you:

1. Self-Serve Car Wash

2. Laundromat

3. Oil Change Service

Get on Google and find three of whatever you picked and go visit them. Get a small journal. Take notes. What is working? What isn’t? What would you change? Are the employees nice? If there aren’t employees, is the signage clear? If you do this, I promise you it will get the wheels turning in your head. You are on your way to becoming an Acquisition Ace.

P.S. - Email me with what you discovered. If you didn’t like the previous options, here are 7 more businesses you can check out in my thread on X (the app formerly known as Twitter) that got 3.7 Million views:

P.S.S - Next week we are going to delve into the strategy for sourcing deals once you have an idea of the type of business you want to acquire.

P.S.S.S. - If you enjoyed this week's issue make sure you subscribe here (if you are already subscribed forward this issue to one person you think might be interested in escaping the “Founder's Trap”).

Ben, I Want to learn more...

If you feel that you are constantly working "in" the business instead of "on" the business and feel that your goal of financial freedom has led you to a prison of your own design.

You are not alone, I used to be there as well.

I have 5 companies and counting and work less than 20 hours a week on them - COMBINED.

It is not rocket science and I can help you do the same for your business.

Choose a time on my Calendar and we will get to it.

Onward,

Ben

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