Business Buying
Hi All, Looking to connect with fellow business buyers - whether you have already purchased one or are just starting to get curious about it or anywhere in between.
I bought my first business (a wine & liquor store) over twelve years ago and it has led me down a FI path.
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Hi Tim, I am definitely in the "curious about it" stage. We are currently 5-7 years from full FI, but as we are 38/39, we still need to earn income to cover our costs until that time and will likely want to have some income/cash flow beyond our portfolio for at least another 5-10 years after that to help us bridge through early retirement. I follow the BizBuySell website and have talked with a close friend who is in the market to buy a business about ideas for picking a good one.
My husband has no desire to own a business that requires him to be face-to-face with customers. He is currently working full time and theoretically willing to do so until we reach FI. I am 11 months into a mini-retirement and really don't want to go back to working full-time for someone else!
Not sure if buying a business is the right path for me, and if so, what business type would be ideal. I love to hear you've had a long-running success story!
Hi Cailin, There are definitely business opportunities that don't require your husband to be face-to-face with customers or if you are both doing it you could take that end of things. You can also hire (or keep the current employees) that are handling the face to face side of things.
It was a great path for me in terms of the freedom and flexibility it provided. I would recommend targeting a business with a substantial cash flow so that you can afford to hire people while you work on growing the business. Personally I don't like the restaurant/food service industry, but other than that I'm open to many industries. It is best if you spend some time eliminating things you know you wouldn't like and then narrowing in on businesses you would enjoy. It doesn't have to be your life's passion, but the more you enjoy it the more you will want to focus on it.
I also have a podcast where I interview other people who have purchased businesses called Business Buying for Financial Independence. It can be a great resource to learn more, but I also have no problem answering more questions here.
Thank you for this insight. I'll check out the podcast. All good points to consider as I keep browsing and day dreaming.
One thing that I struggle with is assuming a business isn't worth buying if someone is selling it. At least as someone who wants to retire from full-time work before my 60s. While I would expect full-time or more work at the beginning, I'd be trying to find something that can be a semi-passive income generator akin to owning real estate and using a property manager for day-to-day stuff. And if that is possible, why would someone be selling their business? I do know there are reasons, just saying that is a question that keeps me on the edge of things. I bet hearing from business buyers directly on your podcast, especially those who purchased an existing business, would be helpful.
I used to struggle with the exact same thought.
The reality is that despite how good you get the management there is never time where things will be truly 100% passive. This is the same in real estate even when you have management in place. So, some owners (in both scenarios) just get tired and decide it’s time to get out. Or maybe they are trading up. Or maybe they are sick, or have already passed and family members are selling.
What you are describing is exactly what I did with my wine & liquor store. I bought the store 13 years ago at age 33. I spent a sold 5 years working long hours and focusing on it 100%. Now I barely go in for a couple hours/week. Even with great team in place, things still come up from time to time that are an annoyance. And while I have no plans to sell now, I could see a point in the future where those annoyances get the best of me.
I have also built a large real estate portfolio over the last few years, so between that and the cash flow from the store I am in a great financial position.