Gas Station, Car Wash, Fast Food - Owning Unsexy Businesses

Most entrepreneurs my age seem to be focused on creating the next amazing app or website, which frankly bores me because I'm not a tech geek.

Anyone else give much thought to acquiring an unsexy business like a gas station, car wash, fast food restaurant, etc., and then building out an entire network of them?

I feel like I hear about stories like this all the time. Joe Shmoe buys a gas station, then buys another a year later, then buys three more, and within a decade he owns an empire of 40 in five states.

Roll-up opportunities like this intrigue me, but how difficult are they to actually accomplish?

 

I'm like you, OP, I see know appeal in those useless apps, and would rather invest in a sure thing.

I wouldn't mind being a franchisee of Subway or McDonald's or something, but you have to be fucking loaded if you want to own a good amount of restaurants. We're talking over a mil CASH per location.

 
Best Response

i have a lot of family friends in gas station and car wash business

the margins are razor thin for gas station (you make a few cents PER gallon sold). the majority to most of the profit really always comes from the convenience stores inside beacuse of the markup that they charge on drinks, chips, gum, candy etc. etc. Also, owning 1-2 gas stations isnt enough. lets say each station has a net margin of 2% (i dnt knw if its at this level, just an example) you'll get 200k per station pre tax off of $10M in top line. so you can see the model here and more is always better when its a low margin business

car washes, i've heard similar things. but its VERY cyclical and has to be in high income regions. middle to lower class people dont/cant afford premium car washes more than maybe 2x a month sometimes where as i know people in LA that get like $30 detail car washes like 4-5x times a month. also weather is a big factor lol has to be in a sunny place because literally rain = death for car wash business. so you need sun shine like 365 days a year optimally

BUT, yes, i do know people that made it big and are doing big things because they buy portfolios of gas stations that have been repossesd by banks by going to auctions and bidding on the notes (im talking about about families that own like 20-40 gas stations and use the cash flows to leverage up on commercial real estate and are easily worth like $30million -70million now).

and op, im like you (same edumondo) i dont like this app shit. its not here to stay. im more into hard/physically businesses where strategy, operations management and business decision/sense really matter.

I don't throw darts at a board. I bet on sure things. Read Sun-tzu, The Art of War. Every battle is won before it is ever fought- GG
 

If I had a banana I'd throw it.

Someone throw him a banana for me?

AnalystMonkey2769:
i have a lot of family friends in gas station and car wash business

the margins are razor thin for gas station (you make a few cents PER gallon sold). the majority to most of the profit really always comes from the convenience stores inside beacuse of the markup that they charge on drinks, chips, gum, candy etc. etc. Also, owning 1-2 gas stations isnt enough. lets say each station has a net margin of 2% (i dnt knw if its at this level, just an example) you'll get 200k per station pre tax off of $10M in top line. so you can see the model here and more is always better when its a low margin business

car washes, i've heard similar things. but its VERY cyclical and has to be in high income regions. middle to lower class people dont/cant afford premium car washes more than maybe 2x a month sometimes where as i know people in LA that get like $30 detail car washes like 4-5x times a month. also weather is a big factor lol has to be in a sunny place because literally rain = death for car wash business. so you need sun shine like 365 days a year optimally

BUT, yes, i do know people that made it big and are doing big things because they buy portfolios of gas stations that have been repossesd by banks by going to auctions and bidding on the notes (im talking about about families that own like 20-40 gas stations and use the cash flows to leverage up on commercial real estate and are easily worth like $30million -70million now).

and op, im like you (same edumondo) i dont like this app shit. its not here to stay. im more into hard/physically businesses where strategy, operations management and business decision/sense really matter.

 

I just want to second the banana throw request if anyone else comes upon this thread.

He who is not contented with what he has, would not be contented with what he would like to have. Socrates
 
AnalystMonkey2769:
i have a lot of family friends in gas station and car wash business

the margins are razor thin for gas station (you make a few cents PER gallon sold). the majority to most of the profit really always comes from the convenience stores inside beacuse of the markup that they charge on drinks, chips, gum, candy etc. etc. Also, owning 1-2 gas stations isnt enough. lets say each station has a net margin of 2% (i dnt knw if its at this level, just an example) you'll get 200k per station pre tax off of $10M in top line. so you can see the model here and more is always better when its a low margin business

car washes, i've heard similar things. but its VERY cyclical and has to be in high income regions. middle to lower class people dont/cant afford premium car washes more than maybe 2x a month sometimes where as i know people in LA that get like $30 detail car washes like 4-5x times a month. also weather is a big factor lol has to be in a sunny place because literally rain = death for car wash business. so you need sun shine like 365 days a year optimally

BUT, yes, i do know people that made it big and are doing big things because they buy portfolios of gas stations that have been repossesd by banks by going to auctions and bidding on the notes (im talking about about families that own like 20-40 gas stations and use the cash flows to leverage up on commercial real estate and are easily worth like $30million -70million now).

and op, im like you (same edumondo) i dont like this app shit. its not here to stay. im more into hard/physically businesses where strategy, operations management and business decision/sense really matter.

Great stuff, SB to you buddy.

I've heard the same about gas stations - very low margins, especially on gas which you essentially give away to get people to come in and buy your high-margin soft drinks and hot dogs.

How did your family members enter these industries? Did they grow up in the business and already know the ins and outs, or did they just go out and buy a gas station one day? Did they keep their full-time job while they grew beyond one or two stores?

Based on what you've seen, how do people actually fail in these businesses?

 
Bowser:
AnalystMonkey2769:
i have a lot of family friends in gas station and car wash business

the margins are razor thin for gas station (you make a few cents PER gallon sold). the majority to most of the profit really always comes from the convenience stores inside beacuse of the markup that they charge on drinks, chips, gum, candy etc. etc. Also, owning 1-2 gas stations isnt enough. lets say each station has a net margin of 2% (i dnt knw if its at this level, just an example) you'll get 200k per station pre tax off of $10M in top line. so you can see the model here and more is always better when its a low margin business

car washes, i've heard similar things. but its VERY cyclical and has to be in high income regions. middle to lower class people dont/cant afford premium car washes more than maybe 2x a month sometimes where as i know people in LA that get like $30 detail car washes like 4-5x times a month. also weather is a big factor lol has to be in a sunny place because literally rain = death for car wash business. so you need sun shine like 365 days a year optimally

BUT, yes, i do know people that made it big and are doing big things because they buy portfolios of gas stations that have been repossesd by banks by going to auctions and bidding on the notes (im talking about about families that own like 20-40 gas stations and use the cash flows to leverage up on commercial real estate and are easily worth like $30million -70million now).

and op, im like you (same edumondo) i dont like this app shit. its not here to stay. im more into hard/physically businesses where strategy, operations management and business decision/sense really matter.

Great stuff, SB to you buddy.

I've heard the same about gas stations - very low margins, especially on gas which you essentially give away to get people to come in and buy your high-margin soft drinks and hot dogs.

How did your family members enter these industries? Did they grow up in the business and already know the ins and outs, or did they just go out and buy a gas station one day? Did they keep their full-time job while they grew beyond one or two stores?

Based on what you've seen, how do people actually fail in these businesses?

thanks for the SBs broski. my family isnt in this at all, but i have affluent friends that have families which made millions doing this gas station/car wash (or even restaurant franchising business) line of work

so a lot of these families originally started out in owning and developing commercial real estate and just kept growing and growing (throughout the 1980s, 1990s and 2000s) until they developed very strong relationships with their banks that would provide financing for a land acquisition or construction. this eventually led to these families being invited to bank auctions where a bank would forclose on a business that failed to service the debt (similar to a mortgage on a house). Banks never were and never will be in the business of running a business so to speak. so when these previous franchisors of gas stations couldnt properly pay back the debt, the banks would reposses, and often many at once, a portfolio of these gas stations.

these notes on the gas stations or portfolios would then be auctioned off, and if enough money is under the same family (or a pool of families put money tgthr) they were able to purchase a portfolio.

the beauty and curse of gas stations is also that once a gas tank is inserted under the ground and the infrastructure for the gas station is built, this land is now considered "contaminated" to some degree and would take the bank millions to clean up, remove the infrastructure and have testing done to prove clean. this poses a problem for banks because they cant/dont have the expertise to run a gas station and cant just demolish it and try to auction off the land (contamination problem and costs to clean the land for commercial use) so it makes a perfect candidate to be auctioned off.

im actually really really happy that a thread like this has gained some traction and alternative conversation takes place rather than something fucking stupid like "OMG pls rank MS LA, GS SF, Qatalyst and Moelis LA pls!"

hope more threads like these can be made so we can get our creative juices flowing and not worry about just finance/modeling/exit opps all day long.

cheers

I don't throw darts at a board. I bet on sure things. Read Sun-tzu, The Art of War. Every battle is won before it is ever fought- GG
 
AnalystMonkey2769:
i have a lot of family friends in gas station and car wash business

the margins are razor thin for gas station (you make a few cents PER gallon sold). the majority to most of the profit really always comes from the convenience stores inside beacuse of the markup that they charge on drinks, chips, gum, candy etc. etc. Also, owning 1-2 gas stations isnt enough. lets say each station has a net margin of 2% (i dnt knw if its at this level, just an example) you'll get 200k per station pre tax off of $10M in top line. so you can see the model here and more is always better when its a low margin business

car washes, i've heard similar things. but its VERY cyclical and has to be in high income regions. middle to lower class people dont/cant afford premium car washes more than maybe 2x a month sometimes where as i know people in LA that get like $30 detail car washes like 4-5x times a month. also weather is a big factor lol has to be in a sunny place because literally rain = death for car wash business. so you need sun shine like 365 days a year optimally

BUT, yes, i do know people that made it big and are doing big things because they buy portfolios of gas stations that have been repossesd by banks by going to auctions and bidding on the notes (im talking about about families that own like 20-40 gas stations and use the cash flows to leverage up on commercial real estate and are easily worth like $30million -70million now).

and op, im like you (same edumondo) i dont like this app shit. its not here to stay. im more into hard/physically businesses where strategy, operations management and business decision/sense really matter.

During my freshman and sophomore year of college I helped a family friend bring a down and out gas station back to life. You hit the nail on the head, about profit margins on gas, they're atrocious. The consistent and good money is in drinks and snacks. Even cigarettes, and other little knick knacks don't have very good margins. If you can get at least half of your customers who pump gas to come inside and buy something, you'll be making good money.

It's a pretty interesting industry that really hones your business acumen like no other. Having to negotiate and haggle with vendors, dealing with different suppliers (depending on franchise restrictions), sorting out all the logistical/administrative bullshit. Surprisingly it's led to some pretty interesting conversations during interviews.

 

and there aint ANYTHING "unsexy" about these businesses. Because you knw what? To me, cash flow IS sexy. And having physical assets like property or equipment to use as collateral to get leverage up the ass is king. leverage used the right way = better than equity

I don't throw darts at a board. I bet on sure things. Read Sun-tzu, The Art of War. Every battle is won before it is ever fought- GG
 
bfin:
Dry cleaners is another one to consider.

I have always wanted to open a drycleaner that sold coffee and booze. When you are dropping of your drycleaning on the way to work, what do you need? Caffeine. When you are picking up your drycleaning on the way home after work to see your wife and kids, what do you need? Booze. Getting a liquor license for a drycleaner could be difficult though…

"Give me a fucking beer", Anonymous Genius
 
joey joe joe shabadoo:
bfin:
Dry cleaners is another one to consider.

I have always wanted to open a drycleaner that sold coffee and booze. When you are dropping of your drycleaning on the way to work, what do you need? Caffeine. When you are picking up your drycleaning on the way home after work to see your wife and kids, what do you need? Booze. Getting a liquor license for a drycleaner could be difficult though…

do you have any idea how bad drycleaning chemical are for you?

 

Seems that it would be quite difficult in the US today as there are probably too many gas stations as is. Fast food could be successful depending on the concept. Chic-FIl-A has a really cool business model for franchisees. I believe you only had to commit like $5-10K or something ridiculous like that and your more or less were a partner with the company. You basically split Op. Profits 50/50 with the company. Haven't looked into in a long time but I believe those were the terms several years ago.

 
subrosa:
Seems that it would be quite difficult in the US today as there are probably too many gas stations as is. Fast food could be successful depending on the concept. Chic-FIl-A has a really cool business model for franchisees. I believe you only had to commit like $5-10K or something ridiculous like that and your more or less were a partner with the company. You basically split Op. Profits 50/50 with the company. Haven't looked into in a long time but I believe those were the terms several years ago.

Generally Chick-fil-a gives those opportunities to current employees, though some outside folks get in. Seriously, they choose like 20 people every year out of like 500+ applicants. Also, you can NOT be an absentee owner, you must be the operating partner at that location and work full time. Then, you have no clue whether or not you will ever become a franchisee. They don't sell their franchise rights for any locations, so you can't just roll in with a wad of cash like you could a McDonald's. You essentially have to bust your ass for a year or two and hope they offer you the opportunity to open more. The plus side is, you are likely making $150k-$250k per year working 50-60 hours. The down side is, you work at Chick-fil-a with a bunch of high school and college students 50-60 hours per week. Also, you just don't know where they will want you to open up new locations.

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 

ChikFilA still has the same initial costs but you have to be able to operate full time, have a successful track record & not have any other active business interests.

He who is not contented with what he has, would not be contented with what he would like to have. Socrates
 

You can definitely make some money in these types of businesses. When I did more commercial banking, I had a customer (actually a few of them) who owned a few Mickie Ds. One in particular was able to take over some nice operating agreements the previous owner had that gave him great lease rates/franchise fees for quite a few years before they renegotiated. If my memory serves me correctly, he had 3 stores which produced a cash flow of about $600K. Prior to this experience, a friend of mine told me that MCD was really in the real estate business. I realized this after I started working with these guys. MCD does all of the analytics, e.g. store placement, traffic counts, demographics, planned developments surrounding the potential location. By the time they offer you the store, they already know how successful the store will be, within a certain margin. If you don't hit the numbers, they'll make you sell the store or they'll buy it back. You buy the franchise, they own the real estate. Since they've done the analytics and offered you a turnkey business, they've have gradually increased the lease rates from the 5-6% range to around 15%, but can still get paid. The guy I was talking was still hovering around the 7-8% range. It is designed to payoff after 7 years. After that you straight. When you get to this level, you can hire a "district manager" to run the stores and you monitor the performance and metrics against MCD's budgets, which can be more stringent than the bank's. And let's say the store costs $1.4MM, you probably only have to come up with about $350K. If you netted $100K, that would be a 29% return on your equity. Plus, the franchise could still be worth millions. So, if you've paid it off, you could exit with a couple of million in hand.

Had another company that bought and started a Cajun style restaurant franchise. Three guys went in together and to cover the upfront cheese and brought in a restaurant consultant to help get it started. Once they had a chance to operate for a full fiscal year, they pulled in about $2.5-3.0MM in revenues and about $330K in net earnings. They chose a great location. Total costs were about $700K in hard costs and $150M in soft costs. And by using SBA loans they only kicked in 10-20% of the costs upfront. They also obtained the franchising rights for the whole state and had exclusivity to open any new ones in the area.

No matter what you decide to get into, "don't quit your day job!" (LOL) Treat it truly as an investment, do not depend on the earnings to live, partner up if needed, and allow the cash flow generated to extinguish any debt you incurred to get it going.

If your able to enter high finance and make $1MM+/yr, then by all means do it. But you could also start a business that pulls in a few hun, expense your Benz payment through the company, and head in to the office only when you fuckin feel like it. Either way...If you can rip apart a F500 10-K and analyze a multibillion dollar acquisition, you're light years ahead of the average guy who starts a small business.

 

I've given this a fair amount of thought and, at one point, was working with a buddy and we were going to raise a mini PE fund among a few friends to buy a laundromat. Eventually one of the guys ran across of government red tape that had to do with waste water and that pushed us away.

This is still something I would like to do. Hopefully I get into bschool this year and can make my way into MM IB post MBA. My thought is, I can use the majority of my bonus to buy into a few businesses, or maybe just one to start off with. I'm fairly certain you can find some absentee owner style businesses that can cash flow $50k-$100k per year, that you can buy fairly cheap.

My crazy plan is to talk my parents into retiring near where I'll be living and see if I can get my dad, because my mom might still be working, to help run these places. Realistically, if I'm in banking, I won't be able to spend any time with the businesses, so I will need the workers in place when I buy the business and then someone to keep an eye on everything so I'm not getting raped behind my back.

The idea would be to find some small, random, one-off type business, that you can get for a steal. Use the cash flow from that business and your following year's bonus to bankroll another store, possibly a different type altogether, and repeat the process every year or two. After you get half a dozen of these businesses, you should be at the point where you can look at legitimate franchise businesses and then truly start your empire.

Certainly easier said than done, but that's the plan.

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 

I'm going to write this down. Have a SB.

cphbravo96:
I've given this a fair amount of thought and, at one point, was working with a buddy and we were going to raise a mini PE fund among a few friends to buy a laundromat. Eventually one of the guys ran across of government red tape that had to do with waste water and that pushed us away.

This is still something I would like to do. Hopefully I get into bschool this year and can make my way into MM IB post MBA. My thought is, I can use the majority of my bonus to buy into a few businesses, or maybe just one to start off with. I'm fairly certain you can find some absentee owner style businesses that can cash flow $50k-$100k per year, that you can buy fairly cheap.

My crazy plan is to talk my parents into retiring near where I'll be living and see if I can get my dad, because my mom might still be working, to help run these places. Realistically, if I'm in banking, I won't be able to spend any time with the businesses, so I will need the workers in place when I buy the business and then someone to keep an eye on everything so I'm not getting raped behind my back.

The idea would be to find some small, random, one-off type business, that you can get for a steal. Use the cash flow from that business and your following year's bonus to bankroll another store, possibly a different type altogether, and repeat the process every year or two. After you get half a dozen of these businesses, you should be at the point where you can look at legitimate franchise businesses and then truly start your empire.

Certainly easier said than done, but that's the plan.

Regards

 
swimguy246:

@cphbravo96 This is definitely something that I have considered as well! I believe this can be done with the right execution and highly trusted employees running the business. How are you coming along with this strategy and what are your current plans for execution.

The #1 thing to remember in a small business, especially one that handles a lot of cash, is that no one is "Highly Trusted". You know who steals from you the most? The "trusted". You uncles, cousins, friends, & long-standing employees.

 

Gas stations are getting harder and harder. The big super chains are squeezing everyone else out.

Buying land strategically is never a bad idea though if you can afford it. Try and anticipate where someone (business, cemetery, etc.) will need to expand and buy the land near it. A guy I work with made an absolute killing this way buying shitting buildings for the location and just waiting to be bought out.

Commercial Real Estate Developer
 
CRE:
Gas stations are getting harder and harder. The big super chains are squeezing everyone else out.

Buying land strategically is never a bad idea though if you can afford it. Try and anticipate where someone (business, cemetery, etc.) will need to expand and buy the land near it. A guy I work with made an absolute killing this way buying shitting buildings for the location and just waiting to be bought out.

This ain't really a bad idea. I have a professor who constantly references "the richest man back home," who essentially purchased options on land. Many people in the less urban/metro areas haven't really thought about selling options on their land, so the price might not be too expensive. It would at least give someone leverage to get started.

 

Also, one other option. If you are at your wits end with finance but maybe have some knowledge of a particular industry or type of business, talk with every business broker you can find and see if they can find something you can buy. Hopefully you have a few hundred thousand saved up from your finance career and can get aggressive with the seller. Maybe they will take the few hundred thousand cash, a larger than expected seller note and retain a smaller equity piece, instead of all cash. Probably a long shot, but worth a try.

Also consider finding some smaller PE shops that might back you in the business. OPM, right? My shop has done this on a couple of occasions and the results look good thus far. You put up the few hundred thousand you have and they bring a large chunk of money to the table as well, either equity or debt. That buys the business and you just have to figure out what the ownership split will be with the fund. We've used claw backs in many cases that gave us 80% or so of the business up front, but lowered that amount depending on the equity value at the end of 5 years.

We've done this with both 'industry experts/executives' and finance/ex-PE guys. The industry exec is trying to build out a business in an industry that he worked in for the last 20 years, except he was an internal manager for very large companies that utilize the his new business's services. That particular business hasn't taken off like we thought it might given his industry contacts, but he is executing on the plan we came up with and things are starting to fall into place. Cost are coming down and the build out of the necessary pieces have occurred so the next year should really show us whether the guy was worth the risk.

At the end of it all, the guy says he wants to keep the business over future generations, but if he sells the business in a few years, assuming things go according to plan, he could walk away with a $3mm-$5mm...maybe more if he knocks the cover off the ball...which is great for 5 years worth of work and for not putting up much money at all.

Ideally you want to be able to buy a business with OPM, but not give up much equity. Of course, PE groups are too smart to let you get away with that, so you might have to take a hit and only receive a small portion of your first sale, but bank roll that into another opportunity where you keep most or all of that new business.

The key is going to be negotiating purchase price and deal structure. If you can get a handle on those two points, you are going to be off to a great start. And, truthfully, most of the folks here will have the advantage of knowing what those two points are and just how to use them to their advantage.

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 

I think it would be cool to open some kind of hybrid store, that is ideally slightly upscale.

For instance: There is a restaurant/laundromat up towards Hartford and it seems to do really well. It's laundromat with a bar and pub food. It was always packed. I basically used to scowl at it Bateman style, but I can see now why it is popular and a good idea. I personally think some type of upscale car wash would be cool... Park your car, go in and eat, come out and it's washed... Full service or bust.

"That dude is so haole, he don't even have any breath left."
 
FeelingMean:
I think it would be cool to open some kind of hybrid store, that is ideally slightly upscale.

For instance: There is a restaurant/laundromat up towards Hartford and it seems to do really well. It's laundromat with a bar and pub food. It was always packed. I basically used to scowl at it Bateman style, but I can see now why it is popular and a good idea. I personally think some type of upscale car wash would be cool... Park your car, go in and eat, come out and it's washed... Full service or bust.

I think there are some inherent problems with a pub/car wash combo ;)

Commercial Real Estate Developer
 
CRE:
FeelingMean:
I think it would be cool to open some kind of hybrid store, that is ideally slightly upscale.

For instance: There is a restaurant/laundromat up towards Hartford and it seems to do really well. It's laundromat with a bar and pub food. It was always packed. I basically used to scowl at it Bateman style, but I can see now why it is popular and a good idea. I personally think some type of upscale car wash would be cool... Park your car, go in and eat, come out and it's washed... Full service or bust.

I think there are some inherent problems with a pub/car wash combo ;)

"Park your car, go in and EAT, come out and it's washed"... Let's not jump to conclusions/paint me as a retard, please.

"That dude is so haole, he don't even have any breath left."
 
FeelingMean:
...I personally think some type of upscale car wash would be cool... Park your car, go in and eat, come out and it's washed... Full service or bust.

I know of one of these down here in Atlanta. I don't know how 'upscale' it really is, but I have seen some insane cars getting cleaned there.

Personally, I will probably shy away from the food businesses unless it's a franchise of some sort.

From a dry cleaners standpoint, I liked this concept when I first heard of it. 24 hour access is great for people like us that get stuck in the office.

https://www.tidedrycleaners.com/WebPages/Franchising.aspx

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 

I'll give you all the secret to success. Open a hugely popular chain in Mary Brickell Village in Miami, FL. I've lived in Brickell for the past 3 years and the amount of new construction is absolutely mind boggling. I don't think Chipotle franchises, but I always say if someone opens a Chipotle in Mary Brickell Village it would absolutely crush.

Also, the maid services around Brickell are shitty, overpriced, have no web presence, and they don't advertise. To clean my 1 bedroom the going rate is $120ish.

 

I didn't read any of the replies, but I have to say, unsexy is the NKI.

I bought some some CSV in the $5.00 range and that fucker has already quadrupled on me in about two years. They run funeral homes. It's a fantastic business. Company is like SCI was in the '80s with top management and a huge roll up opportunity. There are ~20,000+ mom & pop funeral businesses in the country and most Gen Y kids don't want to go into the family business, so many of them will be sold in coming decades -- it's practically limitless roll up potential and they have a good M&A team running the show with a real corporate finance model in place (instead of your average small cap company that doesn't even know what their cost of capital is). Go baby go.

Gas stations are a shitty business because contrary to what your average tard on the street thinks, they hardly make any money on the gas (we're talking pennies a gallon). And they have huge EPA liabilities from having the tanks in the ground. They also get raped mighty hard by Visa and MasterCard on swipe fees.

QSR is a pretty solid concept but you need to have capital to scale it. I've looked into franchise arrangements extensively and most of them are terrible, like you have to put down big capital for the privilege of incurring most of the risk and paying large royalties. McD's are a cash cow but those are harder to get licenses for and you're probably not going to find a great deal on any. I'd be looking for cheap BKW restaurants right now because 3G is cleaning house at that company and they're poised for a nice turn around over the next 5 years.

It would be hard to start a new chain of QSR without having some heavy backers or getting access to the capital markets. The concept is too capital intensive.

Lastly, apps are gay. Don't make an app.

 

I've also been considering unsexy businesses, mainly laundromats and dog kennels. Money is money.

My face is sexy enough anyways, and my body? fuggetaboutit.

on a more serious note... what's the most "unsexy" business you guys would be a part of? at least publicly? would you mind being known as the guy who owns a small porn studio and three strip clubs? or would that be a bit much?

n fuck you app haters. I'm gonna be making one over the summer, mainly because I'm a CS major and need more experience than school assignments.

If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 
wolverine19x89:

I've also been considering unsexy businesses, mainly laundromats and dog kennels. Money is money.

My face is sexy enough anyways, and my body? fuggetaboutit.

on a more serious note... what's the most "unsexy" business you guys would be a part of? at least publicly? would you mind being known as the guy who owns a small porn studio and three strip clubs? or would that be a bit much?

n fuck you app haters. I'm gonna be making one over the summer, mainly because I'm a CS major and need more experience than school assignments.

Dead serious. I would own a gay strip club if it cash flowed 20% per annum on my equity investment.

Array
 

Strip clubs make a mint. You can't even get a license for one anymore in most counties, which means there will be no new competition... and titties never go out of style. If you know the business, you can buy a strip club at like 3x EBITDA using seller financing, and then improve EBITDA through hard work. Most people running strip clubs just want to bang stripper-hookers in the back and don't actually manage their businesses well. Don't buy one in Vegas or whatever though, you want it in a solid blue collar neighborhood in a city with stable or growing demographics.

The industry is wide open (oh snap!) with almost no strategic buyers except RICK and it's not an industry that private equity has any interest in even though it has awesome cash flow (makin it raaaaainnnnn).

Apps still suck though, never forget that.

 
Ravenous:
Strip clubs make a mint. You can't even get a license for one anymore in most counties, which means there will be no new competition... and titties never go out of style. If you know the business, you can buy a strip club at like 3x EBITDA using seller financing, and then improve EBITDA through hard work. Most people running strip clubs just want to bang stripper-hookers in the back and don't actually manage their businesses well. Don't buy one in Vegas or whatever though, you want it in a solid blue collar neighborhood in a city with stable or growing demographics.

The industry is wide open (oh snap!) with almost no strategic buyers except RICK and it's not an industry that private equity has any interest in even though it has awesome cash flow (makin it raaaaainnnnn).

Apps still suck though, never forget that.

In theory a great idea, in practice maybe not so much. My uncle used to own two strip club in my home town - Fist fights and stabbings were the norm; twice he had to shut down for shooting investigations. He was constantly dealing with local police, DEA, and even the FBI once.

The straw that broke the camels back was when one of the managers was kidnapped and murdered. The crooks nabbed him thinking he was the owner and kept all of his cash at home in a safe. When he couldn't produce the dough, they blew his brains out.

 

anybody have an opinion/know anything about running a bail bonds business? I don't know much, but I do know that people are always going to get arrested, and I'm thinking that business may increase when the economy dips. then again, people skipping their court date and the regulations (I'm assuming there are a good amount) may be a pain in the ass.

If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 

I'm surprised nobody has mentioned a 7-Eleven. I heard about 2 years ago they were considered one of the best franchises to own, based on start-up costs and chances of going out of business quickly. The year of that article only 3 new locations had failed to survive out of 300+. Seems to me like the gas station idea, without having to deal with the low margin gas portion. Also in that article was Servpro (a water/fire/mold cleanup franchise) which said it was easy to start and had a good chance of survival. Those have been popping up all over Southern California.

 

To me it's simply;

Unsexy = inelastic services and goods in a fragmented market.

Acquire portfolio (conglomerate without bringing a unified brand) and then just let them do their things.

E.g. If you can acquire a portfolio of London pubs and keep them liquid, there's your cashflow, I read something I think in 'How the Mighty Fall' by Ian Collins stating that Pubs are the longest lasting businesses, because a simple corner pub is happy just serving regulars.

Strip clubs/nightclubs are exposed to 'fashionable' risk, pubs remain... pubs. GP's remain GP's. If you have a portfolio of businesses that cater to local-needs, and you control of diverse demographic background, you'd be able to create constant cashflow.

Being profitable however is another issue as margins are usually very thing as the previous poster said.

 

A lot of good ideas here. The one I don't think is so hot is gas stations. Ravenous mentioned a few of the negatives, which I agree with. The EPA concern is very real and could put you out of business through no fault of your own. Another concern is that demand may diminish (in the US) if electric cars gain significant traction. One type of business that would have been near the top of this list in the 1980's were pay phones. The thought process was that you could be an absentee owner and you just collect your money. Few people had cell phones in the eighties and nobody really took that threat seriously. Obviously, I don't know if electric cars are going to take off, but I'd hate to have a significant amount of my net worth in gas stations and looking to retire in 20-30 years and not being able to sell them for anything.

Of course, maybe you could convert it to a charging station and make even more money.

 
SirTradesaLot:
A lot of good ideas here. The one I don't think is so hot is gas stations. Ravenous mentioned a few of the negatives, which I agree with. The EPA concern is very real and could put you out of business through no fault of your own. Another concern is that demand may diminish (in the US) if electric cars gain significant traction. One type of business that would have been near the top of this list in the 1980's were pay phones. The thought process was that you could be an absentee owner and you just collect your money. Few people had cell phones in the eighties and nobody really took that threat seriously. Obviously, I don't know if electric cars are going to take off, but I'd hate to have a significant amount of my net worth in gas stations and looking to retire in 20-30 years and not being able to sell them for anything.

Of course, maybe you could convert it to a charging station and make even more money.

What are your thoughts on ATMs in high traffic areas. Finding a way to put ATMs in an area surrounded by cash only businesses could be fairly lucrative. Strip clubs and businesses that only accept cash make a killing on the ATMs they have on site, but I feel like if you can pick locations well, the only thing you have to do is go and pick up the cash. Obviously there is downside risk regarding vandalism, etc but you can get insurance.

You think ATMs would be a reasonable play? The only issue I see is being able to put them in high traffic areas. No business owner is going to let you put one there without taking a cut, but assuming you are fronting the cost and paying for everything upfront, my guess would be that you could get pretty aggressive with them regarding what cut they could take. I know I've been stuck in some random ass towns in the south on business trips and there isn't an ATM anywhere in sight, and I was just thinking, someone could do pretty well if they put one here.

 
rufiolove:
SirTradesaLot:
A lot of good ideas here. The one I don't think is so hot is gas stations. Ravenous mentioned a few of the negatives, which I agree with. The EPA concern is very real and could put you out of business through no fault of your own. Another concern is that demand may diminish (in the US) if electric cars gain significant traction. One type of business that would have been near the top of this list in the 1980's were pay phones. The thought process was that you could be an absentee owner and you just collect your money. Few people had cell phones in the eighties and nobody really took that threat seriously. Obviously, I don't know if electric cars are going to take off, but I'd hate to have a significant amount of my net worth in gas stations and looking to retire in 20-30 years and not being able to sell them for anything.

Of course, maybe you could convert it to a charging station and make even more money.

What are your thoughts on ATMs in high traffic areas. Finding a way to put ATMs in an area surrounded by cash only businesses could be fairly lucrative. Strip clubs and businesses that only accept cash make a killing on the ATMs they have on site, but I feel like if you can pick locations well, the only thing you have to do is go and pick up the cash. Obviously there is downside risk regarding vandalism, etc but you can get insurance.

You think ATMs would be a reasonable play? The only issue I see is being able to put them in high traffic areas. No business owner is going to let you put one there without taking a cut, but assuming you are fronting the cost and paying for everything upfront, my guess would be that you could get pretty aggressive with them regarding what cut they could take. I know I've been stuck in some random ass towns in the south on business trips and there isn't an ATM anywhere in sight, and I was just thinking, someone could do pretty well if they put one here.

I certainly don't know. Around here I avoid those ATMs that aren't bank owned because you can only get a maximum of $200 out at a time. I assume that if you have something in an area where there aren't a ton of ATMs already in place, they're probably more costly to service. I really don't know though.
 

When I was in school I had a decent sales gig that allowed me to buy a condo across the street from my Univ. knowing full well it was an investment that I can rent out to college students for the rest of my life. That was 4 years ago. I give some property management co. 8% of the monthly rent to take care of the little stuff. While I understand this isn't my nest egg that will get me to the beach drinking all day, I do know that if I come across a decent opportunity in 10 years I can use the equity in the condo and will hopefully have another stream of income.

A year ago I found an "Anytime Fitness/ Curves" workout place in a strip mall in a growing part of town for $60k and kick myself everyday for not doing it.

Tanning salon idea is another money grabber, even here in Plano, Tx they are constantly swamped (and not a hard sell to the mrs.) Storage Units is another (no real tennant issues) if you can find someone with the capital to get you in the door, a "friend of a friend" in CA owns a bunch (He claims $150MM)

I for one am all about the hardwork "unsexy" aspect of doing time and being smart with your money to get your fortune.

 
Cmoss:
When I was in school I had a decent sales gig that allowed me to buy a condo across the street from my Univ. knowing full well it was an investment that I can rent out to college students for the rest of my life. That was 4 years ago. I give some property management co. 8% of the monthly rent to take care of the little stuff. While I understand this isn't my nest egg that will get me to the beach drinking all day, I do know that if I come across a decent opportunity in 10 years I can use the equity in the condo and will hopefully have another stream of income.

A year ago I found an "Anytime Fitness/ Curves" workout place in a strip mall in a growing part of town for $60k and kick myself everyday for not doing it.

Tanning salon idea is another money grabber, even here in Plano, Tx they are constantly swamped (and not a hard sell to the mrs.) Storage Units is another (no real tennant issues) if you can find someone with the capital to get you in the door, a "friend of a friend" in CA owns a bunch (He claims $150MM)

I for one am all about the hardwork "unsexy" aspect of doing time and being smart with your money to get your fortune.

I like the fitness studio idea. Small box footprint, hire a few personal trainers and do classes with limited equipment. Would need to locate within the right demos through, e.g. people with jobs and money.

 

I know a guy who owns a couple Chic fil A's, they're unique as the selection process to franchise one of their stores is pretty strict but you only have to put $5,000 down. I was talking to him the other day and off just those two stores he pulls down $300,000+ for himself.

Give me a kid whose smart, poor, and hungry...............
 

I forgot about Rick's. Idk why, but something about a publicly traded titty franchise makes me lol.

Also, residential real estate ftw. Markets have got to be near a bottom. Buy, fix, rent, wait. Majority of people are looking to rent now anyway. Use the CF to pay down the mortgage and wait for the bubble to inevitably re-inflate and then sell out. Several HFs are already getting involved. Blackstone's already put $2.5 billion into it and I know of at least one other HF that just raised $140 mil for it. I doubt you need money like that to get involved though.

 
FrankD'anconia:
Also, residential real estate ftw. Markets have got to be near a bottom. Buy, fix, rent, wait. Majority of people are looking to rent now anyway. Use the CF to pay down the mortgage and wait for the bubble to inevitably re-inflate and then sell out. Several HFs are already getting involved. Blackstone's already put $2.5 billion into it and I know of at least one other HF that just raised $140 mil for it. I doubt you need money like that to get involved though.

I would never want to do residential, unless you're talking multi-family where you live in one of the units (which is somewhat of a mix between resi and commercial)

Too many headaches and the worst tenant issues. Even "mom and pop" stores and businesses are absolutely awful

Commercial Real Estate Developer
 

Look into thrift stores. They have an interesting business model that is sort of behind the scenes.

The retail side of the business doesn't generate much cash, but these places are often connected with different charities. For example, you own a few shitty retail locations where you sell $1 t-shirts etc, but the whole purpose of these locations is so you have somewhere for the community to drop off their old junk aka your inventory FOR FREE. The real cash is generated through partnerships with different charities. Let's say your thrift biz is partnered with something like the wounded warrior project. The wounded warrior project will pay you for certain items; lets say they need jackets, they will pay you for a pallet of jackets (that you collected for free)... I think often times thrift stores have contracts with charities where you're getting recurring monthly revenue no matter what.

Just a thought.

 
puma149:
Look into thrift stores. They have an interesting business model that is sort of behind the scenes.

The retail side of the business doesn't generate much cash, but these places are often connected with different charities. For example, you own a few shitty retail locations where you sell $1 t-shirts etc, but the whole purpose of these locations is so you have somewhere for the community to drop off their old junk aka your inventory FOR FREE. The real cash is generated through partnerships with different charities. Let's say your thrift biz is partnered with something like the wounded warrior project. The wounded warrior project will pay you for certain items; lets say they need jackets, they will pay you for a pallet of jackets (that you collected for free)... I think often times thrift stores have contracts with charities where you're getting recurring monthly revenue no matter what.

Just a thought.

I personally know some of the largest thirft store owners in the country. Not sure if this is exactly accurate. The retail side of the business generates a TON of cash. They also don't sell their merchandise to charities. The whole partnership with the charities is so when they collect items on behalf of the charity, they give the charitiy a small donation. For example, if you leave old clothes out for a thrift store to pick up, they will come by and get it and give the charitity 50 cents to a dollar, or whatever is agreed upon. There is not typically an exchange of goods to the charity, but rather a small amount of money. The people I know who run these make about $300-500k a year in take home pay for each store.

 

Pretty much all the comments on gas stations here are spot on. There are a few in our lending portfolio and we are trying to get them out fast. Thin margins on gas? Try negative after card processing fees, few people pay in cash anymore. The mark ups on the store goods is where all of the money comes in. There are a ton of licenses you need to have and maintain, the EPA will put you under if anything ever happens with those tanks, and location is big. Bad area? Low traffic.. dead in the water. Even in nicer areas, the DOT is constantly doing construction in one area or another, your street/corner/ on-off ramp gets closed or restricted due to construction= FUCKED.

Most stations are actually split between the real estate and the operating co. not always the same owners, and leases can be hefty if you're on the operating side. Huge insurance requirements, upkeep costs etc. And like I said before... If you own the RE, make sure those tanks are tip top. The EPA is a mother

 

Friend's father owns a McDonalds in CT and makes bank. He got into an expanding area earlier and makes a lot of money from it now. Also, all you have to do is signup to money launder with the mafia and you can increase profit tenfold :)

Frank Sinatra - "Alcohol may be man's worst enemy, but the bible says love your enemy."
 

Great ideas everyone.

For most of these "unsexy businesses", it sounds like the only real hurdle to getting in the door is the up-front equity, which seem fairly reasonable if you start with one location. SBA loans, bank loans, and/or seller financing would be able to cover the rest.

But in terms of actually operating these businesses, how do people learn the ropes? If I've never even worked at a convenience store, would it be financial suicide to just go buy one and try to figure it out? I can't imagine they are that difficult to figure out once you get your feet wet, especially for most posters on here that likely are smart and have high finance experience, but there still has to be a steep learning curve, right?

For instance - staying with the convenience store angle - how do you figure out who to source your in-store products from, how to use the IT system, how to track inventory, etc? I assume starting with a franchise would be the best option, as 7-Eleven corporate would probably help out quite a bit with these issues.

But a lot of people do their own thing rather than open franchises - how the hell do they do they learn the process without destroying the business in two months? Do they typically come in with industry experience?

 
Bowser:
Great ideas everyone.

For most of these "unsexy businesses", it sounds like the only real hurdle to getting in the door is the up-front equity, which seem fairly reasonable if you start with one location. SBA loans, bank loans, and/or seller financing would be able to cover the rest.

But in terms of actually operating these businesses, how do people learn the ropes? If I've never even worked at a convenience store, would it be financial suicide to just go buy one and try to figure it out? I can't imagine they are that difficult to figure out once you get your feet wet, especially for most posters on here that likely are smart and have high finance experience, but there still has to be a steep learning curve, right?

For instance - staying with the convenience store angle - how do you figure out who to source your in-store products from, how to use the IT system, how to track inventory, etc? I assume starting with a franchise would be the best option, as 7-Eleven corporate would probably help out quite a bit with these issues.

But a lot of people do their own thing rather than open franchises - how the hell do they do they learn the process without destroying the business in two months? Do they typically come in with industry experience?

It's not THAT hard to learn the business. Most of these are pretty easy to run.

I'm sure I'll get flamed out by the prestige police of WSO, but if you wanted to build an empire of McD restaurants, it wouldn't be a TERRIBLE idea to go through their management training program (I'm sure as a college graduate you could skip a few levels -- maybe come in as an assistant manager). Do that for a year, figure out how everything works, then leave and start your own thing if you had the equity to get started. That would be a pretty low risk way to figure out if even wanted to shell out all that cash in the first place -- if you can't handle working in a McD's and wearing that stupid uniform, why would you ever want to buy one?

 
Ravenous:
if you can't handle working in a McD's and wearing that stupid uniform, why would you ever want to buy one?

because there is an enormous difference between earing profits on the side and yelling at someone who doesn't care and is most likely high because they flipped fake burgers incorrectly?

Idk...I'd own a McDonalds but I would never work there. I've done non-food service retail management as a kid and even that is the worst.

Commercial Real Estate Developer
 
Bowser:
Great ideas everyone.

For most of these "unsexy businesses", it sounds like the only real hurdle to getting in the door is the up-front equity, which seem fairly reasonable if you start with one location. SBA loans, bank loans, and/or seller financing would be able to cover the rest.

But in terms of actually operating these businesses, how do people learn the ropes? If I've never even worked at a convenience store, would it be financial suicide to just go buy one and try to figure it out? I can't imagine they are that difficult to figure out once you get your feet wet, especially for most posters on here that likely are smart and have high finance experience, but there still has to be a steep learning curve, right?

For instance - staying with the convenience store angle - how do you figure out who to source your in-store products from, how to use the IT system, how to track inventory, etc? I assume starting with a franchise would be the best option, as 7-Eleven corporate would probably help out quite a bit with these issues.

But a lot of people do their own thing rather than open franchises - how the hell do they do they learn the process without destroying the business in two months? Do they typically come in with industry experience?

Honestly, your best bet is to structure a decent training period with the outgoing owner. I would make them commit to sticking around for 3 or 4 months, depending on the business, so they can show you the ropes. Also, if possible, structure a seller note so they have a vested interest in the business surviving. An earnout is another option but with the tiny deal sizes we are talking about, an earnout just isn't very likely.

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 

This thread is really one of the only benefits for me having to start in commercial banking. Learning about 'unsexy' money makers for a year or two will pay off later. Lol

 

I don't know why you would want to own a business if you are uncomfortable working there. I'm not saying you need to work there every day, obviously you hire people for that. But if you find it that distasteful, buy something else instead.

It's also hard to believe you could be a great owner if you don't have any experience actually running the business. I see that all the time in microcap public companies where some guy with a "great background" comes in and has no idea what he's doing and messes it up. Not saying that's you, but it helps to actually have experience operating a business before you start calling all the shots.

 

This whole conversation brings up a point I have been telling people for awhile.. they should strongly consider this instead of going to B-school, especially if you are able to save up 20-50k. You can easily buy a business already cash flowing, in conjunction with historically low interest rates, it is a great time to leverage up and buy. Or spend two years of your life and lose hundereds of thousands of dollars to tuition and hundereds of thousands of dollars to opportunity cost..

 
valuationGURU:
This whole conversation brings up a point I have been telling people for awhile.. they should strongly consider this instead of going to B-school, especially if you are able to save up 20-50k. You can easily buy a business already cash flowing, in conjunction with historically low interest rates, it is a great time to leverage up and buy. Or spend two years of your life and lose hundereds of thousands of dollars to tuition and hundereds of thousands of dollars to opportunity cost..

I agree... Especially if the business is in line with their interests, or something they are enthusiastic about.

"That dude is so haole, he don't even have any breath left."
 
valuationGURU:
This whole conversation brings up a point I have been telling people for awhile.. they should strongly consider this instead of going to B-school, especially if you are able to save up 20-50k. You can easily buy a business already cash flowing, in conjunction with historically low interest rates, it is a great time to leverage up and buy. Or spend two years of your life and lose hundereds of thousands of dollars to tuition and hundereds of thousands of dollars to opportunity cost..

Are you talking about businesses that cost 20-50k or ones that require a down payment in the 20-50k range and then finance the rest of the purchase? I am transitioning from a non-traditional career into business and I seriously considered this option because I had saved up about 30k. But, when you look at businesses that cost in the 20-50k range, most of the stuff I found was pretty bad. As in junky laundromat in a bad part of town, crappy gas station/liquor store in a dangerous area, random restaurants that are not popular, or really small businesses that could be started from scratch just as easy as buying them. If you were able to get good financing, then it could be different and you could obviously purchase something a lot more expensive, but it just didn't seem as easy to find financing as I thought it might be.

 
flats:
valuationGURU:
This whole conversation brings up a point I have been telling people for awhile.. they should strongly consider this instead of going to B-school, especially if you are able to save up 20-50k. You can easily buy a business already cash flowing, in conjunction with historically low interest rates, it is a great time to leverage up and buy. Or spend two years of your life and lose hundereds of thousands of dollars to tuition and hundereds of thousands of dollars to opportunity cost..

Are you talking about businesses that cost 20-50k or ones that require a down payment in the 20-50k range and then finance the rest of the purchase? I am transitioning from a non-traditional career into business and I seriously considered this option because I had saved up about 30k. But, when you look at businesses that cost in the 20-50k range, most of the stuff I found was pretty bad. As in junky laundromat in a bad part of town, crappy gas station/liquor store in a dangerous area, random restaurants that are not popular, or really small businesses that could be started from scratch just as easy as buying them. If you were able to get good financing, then it could be different and you could obviously purchase something a lot more expensive, but it just didn't seem as easy to find financing as I thought it might be.

I am talking about that amount of money as a down payment. Leverage is your friend. I think financing is easing up right now. I can't speak to your particular situation though.

 

Very interesting thread.

My father owns two major cafe's in Midtown NYC, both of which are very profitable. Before starting his own businesses, he worked in retail (i.e., not as employer, but as employee) for 15+ years, so he definitely obtained a lot of the "knowledge" required to efficiently operate a food/cafe business. He learned quite a bit from other family members who were also in the food & beverage industry.

It did definitely require, not surprisingly, a lot of work, determination, and quite a bit of luck to get where he's at today.

 

[quote=onemanwolfpack]This is what I envision I'll need to do, given I've spent 5 years as a generalist now...No deep knowledge of any sector, but a good understanding of how businesses operate..

The WSJ has a database to buy/sell small businesses like this

http://www.bizbuysell.com/search/the-wall-street-journal/businesses-for…]

Nice find.

This business I stumbled on looks incredible. Locked-in contracts, virtually no maintenance, and it is selling for less than 5x cash flow. Why would they ever want to sell?

http://www.bizbuysell.com/Business-Opportunity/Billboard-company-for-sa…

 

[quote=Bowser][quote=onemanwolfpack]This is what I envision I'll need to do, given I've spent 5 years as a generalist now...No deep knowledge of any sector, but a good understanding of how businesses operate..

The WSJ has a database to buy/sell small businesses like this

http://www.bizbuysell.com/search/the-wall-street-journal/businesses-for…]

Nice find.

This business I stumbled on looks incredible. Locked-in contracts, virtually no maintenance, and it is selling for less than 5x cash flow. Why would they ever want to sell?

http://www.bizbuysell.com/Business-Opportunity/...[/quote]

Bizbuysell is a great site. Always check it out and have a business broker. People sell their businesses all the time for all sorts of reasons. I have worked on a ton of projects where people were selling and the business was perfect, there was no catch, they just wanted out for various reasons. It happens.

 

I have a buddy that created a small business in a college town focused on tutoring and babysitting. He and a few of his buddies handled the tutoring (primarily math and SAT stuff) and hired a bunch of college kids as babysitters. Before hiring anyone, he made applicants complete a 50 question survey and did fairly detailed background checks. He made them sign a non-compete and took a % of the weekly pay. Not a bad gig.

 

I grew up in NY, and my father owned an autobody repair shop.

With just one shop, he was able to do 4M in profit a year. I started working for him on/off at age 8 and into my mid teens. I spent my summers sweeping floors, sanding down cars, managing the CRM, checking part deliveries, etc. I learned the value of property ownership. He owned the building, which took up half the block and sat on a major road. Moreover, it is impossible/highly unlikely that any other potential competition could get the proper zoning and licenses in order to compete. Due to this economic moat and being tired of work, he sold his business 10 years ago and retained ownership of the building. Now he has a tenant paying 25K a month in rent, cash.

This is the rosiest picture of his career and decisions. There were several bad decision that led to federal leans on the property, major loss of the family's wealth in 2000s, and a lack of attention which lasted for years due to my parents divorce. Despite his missteps, he was able to build a business, buyout a partner, and make a killing without having ever gone to college.

I never really had an interest in the business, but I cant stop think about the property. If I can buy the rest of the block in my lifetime, it could make a great site for a major retailer or an expansion for the current tenant.

I can still remember being a kid when all of these lawyers/doctor types would ask my father how he could afford the lifestyle he had. He just smiled and replied, "I take a little hammer, and I bang the dents out of your car."

 
NavalMonkey:
I can still remember being a kid when all of these lawyers/doctor types would ask my father how he could afford the lifestyle he had. He just smiled and replied, "I take a little hammer, and I bang the dents out of your car."

Hahaha that's epic. Good share.

I had a flair for languages. But I soon discovered that what talks best is dollars, dinars, drachmas, rubles, rupees and pounds fucking sterling.
 

I know a guy who owns a few Gold's Gyms in the area, he is pretty loaded. Drives a nice car, lives in a nice house, kids drive new escalade and cts coupe, go to private school. So I am pretty sure over the years if you accumulate you can make some serious money. Something I often thought about, the financing was the problem though. 2 years ago this guy open a Sonic in my area and made a profit of over 100k on the grand opening!

Mps721
 

organic drycleaning! hippies will eat that shit up...

hell, just put "organic" before anything

If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 

Real estate in the right location can generate great earnings. If you create a retail biz, buy the whole strip center. You keep the day job and the cash from the job and let wifey oversee the operations.

I had Indian customer who had a small convenience store and retail biz. He bought a 7 bay strip center that had 3 or 4 of the bays occupied for $1.8MM that appraised a few years ago for $4.5MM. He used an SBA loan, since he was going to occupy more than 50%, and the cash flow from his existing businesses was almost enough to cover the whole debt service. When he pays that off, he's golden.

 

Don't forget about places like laundromats, too. They're virtual cash cows, depending on whether or not they need to be staffed. One near me has staff and a lot of older machines that need to be watched. A brand new one near my parents has a card machine you use to add money and then swipe it in your machines. Almost no cash on site to worry about (all debit/credit) and very little on-site staff/help needed most of the time.

 

easily the best thread on this site..B-school kids take note..unless you have a job at a PE Shop or whatever prior to B-school..you'd be better off setting up some boring ass business with that money instead of hob-knobbing with other B-schoolTool hopefuls who will be lucky to grab another shift at the Red Lobster

if you can find someone willing to work for you..owning a food truck near a college looks like a good idea'r

alpha currency trader wanna-be
 

Other options for the underground tanks is to drain them, clean them, and fill them with concrete. You can obtain environmental studies, phase 1 & 2, for a few thousand during your due diligence process. This can tell you the problems if any and what remedies are allowable. You may not have to dig them up.

 

When I was in college, my one roommate's dad was a MD at a bulge bracket IB and my other roommate's dad owned a bunch of fast food restaurants. The fast food guy could buy and sell the MD 10 times if he wanted. That's a lot of chicken mcnuggets.

 

McD - All the good locations have been taken. Great business model; somebody pointed the whole real estate bit and how they buy out the land. It's not a question of whether you have the money for a McD, but whether there is a spot for you to install it...

Somebody mentioned pubs in England, there is about a pub closing per day. Awful business with the crisis, "locals" don't have the cash to go there anymore. Also most pubs are stuck to a brewery that owes them by the ball, a bit like gas station. Now most pubs have been bought out by massive chains in the UK, no more easy private owned pub to operate. Horrible business...

Real estate cost, (lease, rent, etc...) Is a massive draw back in London - can't possibly envision starting any business easily. Easier to do in the US, land is cheap in some decent cities, and that is your biggest hold back here in London and NY for that matter.

 

Didnt read the whole thread but my family's business is a carrier of gasoline and jetfuel in the tristate and I can tell you that the margins on owning a gas station are RAZOR thin, like pennies. The margin for error in making money per load of gasoline (say 8000 gallons) is tiny. You've gotta own alot of stations and look after them like a hawk if there going to be profitable

 
youngblood90:
Great thread here.

Interested in hearing people's opinions of liquor stores.

I would think that really depends on the state. There's a lot of uncertainty in Pennsylvania right now, for instance, because it is possible that they will be privatized soon as opposed to being "state stores."

Commercial Real Estate Developer
 

Not sure what the app hate is. You can do that crap at night and there is nearly no capital investment. Even if you don't have a knock out success the experience you gain can help you develop apps for people with better ideas.

As for businesses, gas stations are just trouble. Banks don't like them because of the environmental issues. As mentioned you have slim margins and basically make money on coffee or branded goods.

IMO, owning a franchise is great, but I would want to work there for a year or so before hand. There are so many nuances in these different businesses that you want to learn before you jump in. Besides, you start hiring and paying people to do the job YOU should be doing and there goes your margins.

I have some things I'd like to do one day and am looking to maybe take a night job in those areas to gain the experience. I think that is just the best way to go about learning whatever business you might be interested in.

 

I'm gonna ask this question again because I received no responses the first time... any opinions on bail bonds businesses?

If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 
wolverine19x89:
I'm gonna ask this question again because I received no responses the first time... any opinions on bail bonds businesses?

Go with Christ, brah, go with Christ

Commercial Real Estate Developer
 
wolverine19x89:
I'm gonna ask this question again because I received no responses the first time... any opinions on bail bonds businesses?

Much like a lot of other areas of finance with a decidedly sketchier target market.

I only have limited experience dealing with bail bondsmen, but the first time I had to do it was a little over 20 years ago when my first wife (then girlfriend) bailed one of her loser ex-boyfriends out and he predictably jumped bail. So she was on the dangle for a bunch of money she didn't have, and the bail bondsman put us in touch with his bounty hunter.

We met the guy in a Denny's and I'm here to tell you he was nothing like what I expected. He was sharply dressed, not overly big (though in shape), and was completely professional. I think I was expecting something along the lines of Dog the Bounty Hunter, and when I mentioned this to him he jerked his thumb toward a booth across the room where a giant biker was sitting and told me that was his muscle.

Anyway, we paid this guy a grand (if memory serves) and basically told him right where the scumbag would be, and he and his biker friend went and picked him up. I even asked him if he'd let me tune the fucker up for a couple hundred bucks, but he was all business.

My point in this mini-dissertation is to illustrate that bounty hunting is the near-zero risk side of that particular business. Lots of people think the bail bondsman pays the bounty hunter (and maybe sometimes they do) but the reality of the situation is that most of the time it's the client who pays (because they're on the hook for a shit ton more money if they can't get the guy to court).

 

Somebody mentioned land acquisition for appreciation then leasing or sale. Here is one of the best pieces of information I received. When you want to buy land for appreciation; find a city, town, or area that is expanding. (You can find cities land development plans in the public record. Or you look for where highways connect to other highways and look for construction, base economic creation, etc. But this is another discussion in itself.) After you find a place of development go to the land that is selling by the foot, then continue to where it is selling by the plot, and finally to where it is selling by the acre. Then you buy it by the acre as fast as possible. You'll get this land for cheap and it will increase in time if you've done your dd.

I come from the southeast where everybody has a lawn service. Owning a landscaping service can be HUGE money. Highly competitive, but the market share will continue to increase as more snowbirds move to FL and the baby boomers continue to age.

 
Non-TargetRTK:

Somebody mentioned land acquisition for appreciation then leasing or sale. Here is one of the best pieces of information I received. When you want to buy land for appreciation; find a city, town, or area that is expanding. (You can find cities land development plans in the public record. Or you look for where highways connect to other highways and look for construction, base economic creation, etc. But this is another discussion in itself.) After you find a place of development go to the land that is selling by the foot, then continue to where it is selling by the plot, and finally to where it is selling by the acre. Then you buy it by the acre as fast as possible. You'll get this land for cheap and it will increase in time if you've done your dd.

I come from the southeast where everybody has a lawn service. Owning a landscaping service can be HUGE money. Highly competitive, but the market share will continue to increase as more snowbirds move to FL and the baby boomers continue to age.

As you may know, fracking and gas exploration in Susquehanna PA is starting to pick up, and advice on purchasing land with possible gas exploration opportunities, or is this probably already been taken advantage of?

 

Multifamily real estate is great if you stick with it for 30-50+ years. It's such a pain in the ass, but there are families worth $100M+ after a few decades. I know a few and just keep in mind only a few people retain the equity and the others slave away operating it for you ... but hey .... labor's not that expensive!

 

I have been skimming this site for some months now but this thread compelled me to contribute and be involved.

That being said, there have been several comments posted here offering some great insight into multiple aspects of business including demographics, property value, market share, and cash flow. All of these I think need to be considered and analyzed. More in depth details have been touched on but I want to take this perfect time to share some fundamentals and mindset (that many of you seem to already be aware of) from a great book that I have been reading lately. I use quotes because he spins it best.

"Rule number one in becoming an entrepreneur is to never take a job for money. Take a job only for the long term skills you will learn."

"The biggest mistake people make is that they work too hard for their money... Most people do not get ahead financially because when they need more money, they take a part time job. If they really want to get ahead, they need to keep their day job and start a part time business."

..A part time job holds you as an employee, but a part time business moves you towards being a business owner. Most big companies are started as part time businesses (Altered for ease of reading)

"When people ask me if I loved my product line- a line that consisted of colorful nylon wallets, nylon watchbands, and nylon shoe pockets that attached to the laces of a running shoe and held a key, money, and an ID card- I answer, "No. I was not in love with the product line. But I did enjoy the challenge of building the business."

"The world is filled with great ideas for new products. The world is also filled with great products. But the world is short of great business people. The primary reason to start a business part-time is not so much to make a great product. The real reason for starting a part-time business is to make yourself a great businessperson. Great products are a dime a dozen. But great businesspeople are rare and rich."

He goes on to cover how Bill Gates did not INVENT but BOUGHT his software product that now is one of the most powerful and influential companies in the world. "Gates did not build a great product, but he did build a great business that helped him become the richest man in the world."

.. Michael Dell and Jeff Bezos starting part-time businesses out of a dorm room and a garage. Both billionaires today.

"Many people dream of starting their own business but never do because they're afraid of failing. Many other people dream of becoming rich but don't because they lack the skills and experience. The business skill and experience is where money really comes from."

"The education you receive in school is important, but the education you receive on the street is even better."

(Chapter 28 of Rich Dad's Guide to Investing: What the Rich Invest in that the Poor and Middle Class do not, by Robert Kiyosaki)

Opportunities are limited by being an employee or self-employed. Your goal should be to employ and create opportunities for others.

In other chapters, Robert covers the value of a business system that seems to be the main focus here. If the system is already set up and has marketing, distribution, location and a good model in place, you do have the option to buy it, build it, and sell it with a remaining percentage belonging to you of course. THAT is how you build cash flow. The richest people do this as a hobby, and in the end become MMs that people talk about.

Business structure has been covered here but not so much in depth of a self started "business". Kiyosaki talks in depth about business structures and tax benefits of different structures i.e a corporation vs. a GP. When you are a business owner hotshot, it could be extremely profitable to structure your business(es) under an entity, especially a public one that people buy shares of. When your business starts buying your assets with pre-tax dollars (equity, real estate etc.) instead of yourself as a person, there are numerous ways you can benefit. Housing your assets as well as your team of financial advisors, accountants, and lawyers under your "business" has the most tax benefits and opportunities.

Money is not "real". Money is just an idea. A corporation is a piece of paper. A corporation is a clone of you.

 

there's always money in the banana stand

If your dreams don't scare you, then they are not big enough. "There are two types of people in this world: People who say they pee in the shower, and dirty fucking liars."-Louis C.K.
 

Soooo much incorrect info about McDonald's... one guy on page one got kinda close, but still missed the mark. And unlike anyone else I have heard here, this is my family's business, so I would consider myself a subject matter expert. No, I am not going to spend 30 minutes typing out a detailed response quoting incorrect people or explaining the business model. After reading this thread I am even more skeptical of the things I read on here, seeing as people purported their thoughts as facts when they could not be more incorrect. SHEESH.

 

There's many options for financing a small biz, most of which center around commercial loans. SBA has great options too that can save you on the down payment and get you the final push if the bank is on the fence.

Main thing to remember is that, in most cases, any credit you seek for your business will be based on your personal credit. So get rid of bullshit debt as it eats up your debt capacity. Think two main points....your credit score (try to get above 750) and your debt-to-income ratio (maybe 30-40%). So if you got a bunch of bullshit debt, or an overly expensive car or house, you diminish your chances of getting that 200k business loan.

 

I've always thought about opening a pizza place in a college town. I went to school in upstate NY, and literally every local place was dirty with terrible food. Anywhere else these places would go out of business, but hungry stoned college kids always managed to keep them afloat.

Property there is dirt cheap, and if you get a nice looking place that sells real NYC style pizza, I can't imagine how well you would do. Maybe there's something I'm missing but to me it seems like a real easy way to make $.

 
Banker14:

Anyone have any thoughts on an auto service / maintenance/ oil change center? I see a lot of them for sale and started thinking about them after reading in article about drivers holding on to cars longer and large interest in the used car market in general...

The independent mechanic my family knows is looking to get out of the business pretty soon. He says that most people are getting cars that have longer warranties and thus would go to dealerships for their work to be done instead. Granted this is in a more affluent area.

As for quick oil change places like Midas etc. I cant comment on.

 

I'll be the contrarian in the thread. Joined a retail flavour "startup" (after how many dozen/hundred million USD financing does it become a mid-cap?) after leaving the commodities world. It's a lot of painful, hard work, dealing with regulations, payments, fraud, inventory, warehouses, etc.

The reason so many people try and start web stuff is because the investment in time and effort is so low, vs. a low probability high payout/high probability average payout scenario. You don't need to be a geek. There are loads of firms in India who can do the job really well for very little. We got our entire BI for 8 countries built for $30,000, so an app... just make sure you have somebody technical for proof reading to make sure you don't get ripped off. Because the outlay is so low you can start many and get a decent return on the 1-2 that might take off.

Surprised nobody brought it up. I also used to think it strange that all these talented kids from Ivies were stuck on that banking/tech entrepreneurship stuff; now I get it.

 

Agreed. Most web stuff requires way less effort and investment than brick and mortar businesses. I don't think people are shying away from brick and mortar stores because its unsexy, people are doing it because they don't have the cash

 

I live in Irvine, California also known as "The Bubble" or "The Safest City in America." (according the FBI statistics) ....Anyway much of the Irvine residents tend to be fairly well off. If I'm correct the according Census Bureau we're in the top 10 for median household income, please correct me if I'm wrong, but to to cut it short mostly everyone was money in Irvine. We also have a large Asian community which account for about 40% of the population.

That being said one... of the public driving ranges in the area (at Rancho San Joaquin Golf Course) nets around $1.4mm-$1.6mm/year in profit. It's open 7am-10pm 7 days of the week. I also think it's open on most holidays. They've got the best rates in town. It's $10 for a large bucket (105 ball) and $7 for a regular (72). In know the nicer public golf clubs in town have buckets for upwards of $15 bucks for a large. On a summer night you'd be damned if you can find one of the 65 mats/hitting stalls free of occupancy. On any given summer night there's a few weekend warriors out, people taking lessons, regulars, and TONS AND TONS of Asians. Especially Koreans. I'm not really sure why Koreans love golf so much (not limited to but particularly affluents Koreans).

I don't know much about this particular business or anything of this nature but I thought it was cool and it made wonder if I could get something like this going later in life because all I do is golf excessively if I'm not at school or working. Anyway share some thoughts I'd be curious to know if anyone knows where one might need to start if he wanted to go about establishing such a facility in an upscale city/town. What would be the biggest obstacles? Startup Capital? Zoning restrictions? etc?

I had a flair for languages. But I soon discovered that what talks best is dollars, dinars, drachmas, rubles, rupees and pounds fucking sterling.
 
Udechukwu:
Anyway share some thoughts I'd be curious to know if anyone knows where one might need to start if he wanted to go about establishing such a facility in an upscale city/town. What would be the biggest obstacles? Startup Capital? Zoning restrictions? etc?
Think about how much land those things consume. Think about how much land costs in an "upscale city/town."
 

In Dallas, there's a thing called "Top Golf", that's a bit more compact than your typical driving range - and appeals to a wider range of people (non-avid golfers). Might be worth looking into - I don't know if they franchise or anything...

 
NiceWork:

In Dallas, there's a thing called "Top Golf", that's a bit more compact than your typical driving range - and appeals to a wider range of people (non-avid golfers). Might be worth looking into - I don't know if they franchise or anything...

Yeah, Top Golf is essentially a mix between a driving range and a lounge/bar. They opened one in Houston recently and that place is always PACKED. Looks like a lot of upfront capital investment (balls with sensors in them, etc.) but that place is minting money now.

 

I've worked in the gas station industry for a little over 5 years, and the margins on gas are small but the money is made from the inside sales. The gross margins on the inside sales get as 60%. You just need to provide a quick, clean service to the customers and they will come back. Also, one thing I noticed that wasn't mentioned was branding the stations. BP, Shell, and the others pay the owners of the stations to put their logos on the station, uniforms, marketing advertisements, etc. This strategy has worked extremely well for the owner I work for, he started with one station when he was 20 and 30 years later he has 200 sites in 5 states, and is looking to add a lot more in the near future.

 
zee4:

What do you guys think of a pawn shop business? It seems to me very capital intensive. Any thoughts?

From what I have seen of the business, it seems like it is very capital intensive (unless you are doing stuff like Gold, silver etc.) The more "exotic" stuff (like what you see on Pawn Stars) is basically investing in illiquid assets where the market is not very well defined. That is why they offer such low prices vs. the collector estimates on the show.
 

What interesting timing... I was just thinking about buying a small business in the suburbs of Chicago where I live. I picked up a few shirts from my drycleaner's and got to thinking... this guy always has an endless rack of clothing in his rotation, so he must have business. He's in an upper-middle-class suburban neighborhood where there's plenty of demand. It takes him a few days to clean my shirt, which I imagine takes like 30 minutes, so he must be busy. And this guy goes home at 5pm. I have no idea what running a drycleaner's entails, but I'd be surprised if I couldn't do it at least as well as this guy.

I mentioned this to my brother-in-law and he said that he wonders why all of these little Asian-operated drycleaners don't somehow consolidate and push costs down. That's something to think about. I assume you can buy hangers and chemicals cheaper in bulk.

I think that I have a better chance of running small business successfully than I do of cold-calling my way into IB out of a non-target... Maybe I'll work as a credit analyst or something when I finish undergrad next year, save up a bit, and buy into one of these.Maybe I'll be able to quit my job after I own two...

I assume you can get some great deals because there is probably gross mispricing in a lot of these.

It would be awesome if by like 30 I could have a life of driving around a few businesses and checking-in, trading ForEx, and doing whatever else I want... The American Dream...

 
Little Engine Would:

What interesting timing... I was just thinking about buying a small business in the suburbs of Chicago where I live. I picked up a few shirts from my drycleaner's and got to thinking... this guy always has an endless rack of clothing in his rotation, so he must have business. He's in an upper-middle-class suburban neighborhood where there's plenty of demand. It takes him a few days to clean my shirt, which I imagine takes like 30 minutes, so he must be busy. And this guy goes home at 5pm. I have no idea what running a drycleaner's entails, but I'd be surprised if I couldn't do it at least as well as this guy.

I mentioned this to my brother-in-law and he said that he wonders why all of these little Asian-operated drycleaners don't somehow consolidate and push costs down. That's something to think about. I assume you can buy hangers and chemicals cheaper in bulk.

I think that I have a better chance of running small business successfully than I do of cold-calling my way into IB out of a non-target...
Maybe I'll work as a credit analyst or something when I finish undergrad next year, save up a bit, and buy into one of these.Maybe I'll be able to quit my job after I own two...

I assume you can get some great deals because there is probably gross mispricing in a lot of these.

It would be awesome if by like 30 I could have a life of driving around a few businesses and checking-in, trading ForEx, and doing whatever else I want... The American Dream...

For Dry Cleaners it's not the hangars or chemicals, it's the Plant (Capital Equipment). You either a) put up a decent amount of capital and deal with regulations to build your own Plant or b) pay someone a LOT per garment to actually do the cleaning for you.

Having your own Plant is typically the way to go, but you need to have very high volume (unless you can somehow get a huge price premium. Since you're in the Chicago 'burbs you've probably heard of CD One Price Cleaners - they're killing it as a Plant on site, low cost cleaners.

In a previous job I actually did a lot of work with a guy who was going to compete with CD One Price before they got as big as they are now (this was 6-7 years ago). His goal was to become the "McDonalds of Dry Cleaning". He actually had some good plans (possibly better than CD One), but once push came to shove he wasnt willing to put up enough $ to execute the idea.

twitter: @CorpFin_Guy
 

Look at this:

http://www.bizbuysell.com/Business-Opportunity/Awesome-Ice-Cream-and-Ho…

How awesome does that opportunity look? I know that plaza. There are always families walking around and spending money every day. There's a movie theater nearby and minor league sports stuff.

The description seems to be written by someone who isn't retarded and he says he's selling because he's moving and not because the business sucks. This could be verified, obviously.

I'm confused as to how the price is so low? I'm still in school and have never bought a business and don't really know what I'm talking about, but I've valued real estate for various finance classes. A sales price of 5-10x cash flow is pretty standard in residential and commercial real estate from what little I've seen.

How the hell is this guy selling what looks like a sound business in a great area for 0.86x CF? And he's willing to train you, negotiate financing, and it comes with a working staff.

What's the catch?

And is there a way to verify the financial statements of private companies? How do I know that his CF is really $70k? And do I need to bring in an appraiser to value inventory and FF&E?

 

There are a lot of fragmented industries out there that one could start a company in and then build up a larger company over time. These don't just have to be mom-and-pop outfits like gas stations, dry cleaners, etc...but also things like manufacturing and service companies. For example, LKQ Corporation which was started to consolidate the used auto parts industry, now a multibillion-dollar publicly-traded company. Also Quanta Services, a consolidation of electrical infrastructure contractor companies. In private equity, they call them "buy-and-build" strategies, where you get a good platform company, then "bolt-on" acquisitions to create economies of scale. You also can acquire say three or four decent smaller companies and "bolt" them together to create a larger, more efficient platform company, then begin bolting on acquisitions to it. There is also what's called the "roll-up" strategy, where you take a lot of companies and "roll" them up together at once, however this can fail if the roll-up isn't executed well. Roll-ups were big in the 1990s like the Dot Coms, then fell out of favor when the bubble burst.

An epic example of the buy-and-build strategy I think is Bernard Arnault, CEO of LVMH, the largest luxury goods conglomerate in the world. He built it by adding all sorts of smaller luxury goods companies together (everything from watches to wines and spirits to handbags and clothing) under an umbrella company where they have economies of scale. This model can be replicated on a smaller scale in other industries as well I believe.

One could also look into creating their own franchises (as franchisors). I've seen some umbrella companies with multiple franchises under them (YUM! Brands is one example). There is also what is known as "multiconcept restaurant companies," which is where a company owns multiple restaurant concepts.

Regarding app creation, app creation is cool, but the chance that you will really strike it big (as in hundreds of millions or billionaire big) is exceedingly tiny. For most of us, if we want to make that kind of wealth, we have to look at it from a more pragmatic standpoint. The main problem for the other companies though is as someone mentioned, getting the initial cash to start up.

 

Anyone know anything about owning factories in undeveloped countries or U.S. "territories"? How much regulation is there really? What's the financial risk? What kind of capital would it require to start up of these? I'd imagine you could stretch a dollar pretty far in a place like Saipan or Bangladesh. I have no knowledge in this whatsoever so if anyone knows please chime in.

I had a flair for languages. But I soon discovered that what talks best is dollars, dinars, drachmas, rubles, rupees and pounds fucking sterling.
 
Udechukwu:

Anyone know anything about owning factories in undeveloped countries or U.S. "territories"? How much regulation is there really? What's the financial risk? What kind of capital would it require to start up of these? I'd imagine you could stretch a dollar pretty far in a place like Saipan or Bangladesh. I have no knowledge in this whatsoever so if anyone knows please chime in.

I tried for ten minutes to figure out how to embed a picture, but I failed.

So here's a link: http://origin.tvfanatic.com/gallery/frank-reynolds-picture/

The effect is not the same.

 
Udechukwu:

Anyone know anything about owning factories in undeveloped countries or U.S. "territories"? How much regulation is there really? What's the financial risk? What kind of capital would it require to start up of these? I'd imagine you could stretch a dollar pretty far in a place like Saipan or Bangladesh. I have no knowledge in this whatsoever so if anyone knows please chime in.

The main issue is usually that the rule of law is not entirely respected. Much as Silvio Berlusconi in Italy used "deregulation" to give his chain of businesses monopolies in almost every industry, and controls the parliament to such an extent as to force amnesty on all corruption prisonners to free his brother of legal trouble, the worse it gets, the more these local oligopolies apply. The hard thing is not getting your business confiscated for some stupid, trivial reason used as an excuse to put a legal front on your property being seized by gangsters.

If you really intend to start something over there, go live there for a while first.

 

Another random one.... my boss owns an online RE brokerage that pays out 100% commission. Agents/Brokers just have to pay a monthly fee and also a transaction fee. Not sure how well these types of businesses do though. Anyone know anything about this?

I had a flair for languages. But I soon discovered that what talks best is dollars, dinars, drachmas, rubles, rupees and pounds fucking sterling.
 
Udechukwu:

Another random one.... my boss owns an online RE brokerage that pays out 100% commission. Agents/Brokers just have to pay a monthly fee and also a transaction fee. Not sure how well these types of businesses do though. Anyone know anything about this?

I think real estate has long been poised for disruption. The 6% commission model chaps a lot of asses out there. My only question about your boss's business is how does he account for the liability if he's not being compensated on the deals he signs off on? Ultimately the broker is responsible for anything that goes wrong, not the agent.

Yacht brokerage (my old business) is due for something along these lines as well. The standard commission in that business is a staggering 10%. When a guy sells his boat for $800,000 and has to cough up $80,000 in commission at the end, things can get pretty heated.

 

Years back, some friends and I were able to establish a very lucrative import/export business due to some significant changes in government policy. We were eventually able to use the strong CF to diversify into several other profitable industries. Casinos, for example, can be excellent investments, particularly if you can operate with the help of a friendly government.

"This is the business we've chosen"!
 

I've been skimming this site for a while, but I haven't had the opportunity to contribute until now. I want to add a few things I've learned about this:

In one of the my business classes we had a guy who started a regional pizza chain (Garlic Jims) as a guest speaker. Basically what he said was the majority of the time you are better off starting your own business and then (hopefully) franchising it out vs. buying into a franchise (i.e. opening your open pizza shop vs. opening a pizza hut). If you think about it what does a pizza hut do differently than the local pizza shop down the street? They both make pizza and they both make it in relatively the same way. The only difference is maybe the marketing/brand recognition. SO why would you pay pizza hut a ridiculous amount of fees each month AND upfront capital to do something that you could do on your own? Is the brand/marketing really worth it over the long run? In essence this can be applied to almost every other franchise model out there. Lastly it's good to remember a franchisee may become wealthy, but it is only the franchisor that will truly become rich.

Another thing is, there are literally tons of other opportunities in businesses that people seem to gloss over every day. There was this family friend I met a while back who's businesses were textile importing and used car export. Literally one day at the hospital he saw all the doctors/nurses/patient's hospital attire and he asked himself, I wonder where they buy all their textiles (hospital garments)? and Why can't I be the one selling it to them? So he found out where the textiles were manufactured, bought them wholesale and slowly started selling them to hospitals and growing his business to success. Same thing with exporting used cars. He traveled to a lot of developing countries where he noticed new car prices were extremely high thus there seemed to be a strong demand for quality used cars (especially luxury), but not enough supply. SO voila he started buying used cars at auctions for wholesale prices and exporting them to dealers oversees (i.e. Dubai).

 

One thing to consider when own a Gas station or a convenience store with a gas station.... Quick story, the university iAttend had a gas station next to it/near by....long story short the Uni is expanding, buying land, business, and other gentrification techniques. It got to the point they wanted to buy/take the previously mentioned gas station...the owners were VERY old, no kids and no1 to inherit the business...so they decided to GIVE IT AWAY to the University, so we could put either homes or class buildings on the land. One problem, due to the laws, my Uni was not allowed to accept the land...something about the gas tanks underneath could/or may have contaminated the land. End result, they had to give the land and the business away to the City since the City isn't held to the same Regs as my college. This was an example use in my Economics class, a lesson of getting out of business, exit strategies, and "free entry and exit". Sorry for the shitty writing format and horrible grammar ....I'm smacked right now, but the lesson is still a valuable one, hope this helps!

Wise Men Listen & Laugh While Fools Talk
 

This is a fucking awesome post. Ironically, I made a thread asking about the QSR industry and ways to value stores not too long ago.

Anyway, this is something I've been looking into on and off for the past 3 years (got involved in finance and got sidetracked) and I'd like to contribute what I can. I'm no expert on this but I'd like to help anyone out there who's looking into this as I've found small business ownership/franchise businesses to be something hard to get good information on. I hope this helps!

7-Eleven

One franchise I looked into was 7-Eleven. I talked to several franchisees and heard mixed stories. One thing I got from all that I talked to was that 7-Eleven didn't seem to be keen on having you open more than 4-5 units. Then again, maybe this is because I was asking franchisees in the Long Island and metro NYC area. 7-Eleven has also restructured the way they get paid; as your sales go up, so does their cut. Typically, they get 50% of gross profit. The important thing is to see what percentage of sales are cigarettes, beer, and lotto (these 3 can be the bulk of sales in the store but I've been told they shouldn't exceed 30% or more), and also what is the Gross Profit %. 7-Eleven will give you all this info after you sign their FDD (Franchise Disclosure Document) and go through the assessment. One cool thing is you don't pay the rent, which is awesome since the leases and rent rates here in NYC for commercial space are ridiculous. Here's the cool part: 7-Eleven builds the stores out and gets them going and then tries to sell them to franchisees. So buying a store is buying one that's already going and you can see what revenue/profits they've had. You can also completely build out your own store if 7-Eleven approves, but I don't believe most stores are done this way; typically they're either corporately-owned or owned by an existing franchisee looking to sell (called "Goodwill" stores). I've also been told that in the city, a 7-eleven is not necessarily any more profitable than a good bodega, which are everywhere here (NYC) and directly compete with 7-Eleven stores. I like 7-Eleven and am continuing to look into it but am not so sure because I'm worried about how scalable it is (with them not wanting you to own a large number of units). Another thing is that I have heard stories of a couple which closed and from what I heard, it didn't seem to be from poor management but rather that the store met competition from another business or the location soured, etc.

The investment range is very low for the stores in NYC, we're talking 70-500k with open doors and running, depending on the store and location.

Pros: - Franchise gives you good training - You don't pay the rent! - Constantly one of the highest-rated franchises

Cons: - Long hours - Low margins - Possibility of getting robbed - Franchisor doesn't seem to want high # multi-unit owners

One other point is they do not allow absentee owners; you have to be there running it. This can change after you've had one for a bit, but to begin you have to be there working at the store.

Subway

I looked into Subway as well but don't have as much dirt on it as 7-Eleven. I spoke with 4-5 franchisees in Manhattan and none of them seemed to be very happy. One franchisee I spoke with had 3 partners and said the store was a lot of work for not a lot of reward. I asked if he would continue if he had full ownership of the store and he said "maybe". Another owner has barred credit-card purchases under a certain amount (which I think is against the franchise rules) and is an absentee owner.
An owner I spoke with back home has over 40 units and has done EXTREMELY well for himself, however, he got into the business decades ago before it was a big name and constantly built/bought out units in the region as Subway kept getting bigger. He said it's a good thing, to just be willing to put in the hard work. One thing I found interesting in what he told me was that he never worked in a store prior to owning one (which isn't something I'd be comfortable doing).

The investment can be pretty low for Subway, going from 60k to up in the six figures. I'd have to do more research to really settle down on Subway more.

Pros: - Low investment - Constantly one of the highest-rated franchises

Cons: - I've heard several bad stories on failed stores (maybe I missed more bad stories on others and this is biased)

Auto repair

A good friend of mine's father owned a small auto repair shop in a very small town. He was already winding down the business by the time I met him, but he told me that years ago (when he was younger and more physically able to work) he was pumping out mid six-figures of profit but working many 12+ hour days and nights (and weekends). He only had this one unit and was there every day. The profits mainly came from labor (duh) and some on parts. The reason his business was successful came from word-of-mouth. Everyone knew he did a very good job on cars and pushed stuff out quickly; he knew his shit. Let me also say that this guy never finished college and dropped out of high school but became very successful in life. He also owned several others assets that he poured money into and another side business that was very lucrative; the auto shop wasn't his only source of income.

Gas Stations

The things I've heard about gas stations are the same things that others posted in this thread. The 2 people I talked to said they were making almost nothing on the gas and pretty much dependent on the inside sales. Lotto, cigarretes, and beer were the biggest things the inside sales came from according to the owners (same as 7-Eleven). The investment is pretty steep from what I understand (high six-figures to low millions), but I'd have to do a lot more research on gas stations to know more.

Cell phone retail

A good friend of mine is a manager for the stores owned by an authorized retailer. The owner is not much older than me (late 20's) and is absolutely motherfucking killing it with what he's built in just a few years. He now has almost 30 units and is expanding into another state. This is getting harder to get into as some carriers (or at least one I know) are stopping new retailers/franchisees from coming in; now you have to purchase the rights through a licensee franchisor (may be using the wrong term) like Wireless Zone.
One thing I would be a tad worried about with the cell phone retail business is how technology could possibly remove the current service carrier monopoly. I don't think it's crazy to say that technology may advance enough to the point where we no longer use carriers but rather WiMax or something (I know WiMax coverage hasn't done too well but just giving an example) to make calls instead of the carriers' networks.

Other points

A random point I've been told by several owners (and maybe this is just a given and I shouldn't even mention it) is to open business where the costs are low and the competition is little. I've heard more good stories from business owners in small towns back home than good stories here in NYC. I've thought about even moving overseas (like Southeast Asia), getting a small menial job, getting to know the area, and seeing if I can find a good business opportunity in something from the US that isn't offered there. One big problem with overseas businesses in SE Asia specifically, for instance, is corrupt government. In Thailand, police come and grab vendors' goods and shop materials and demand payment of fines to retrieve them - it's the fucking wild west out there. One cool thing could be low cost in some of these emerging countries but really I don't know too much about this, just kind of throwing it out there.

I just thought I'd throw all this out there as this is something I'm very passionate about. I've been working in trading for almost 2 years now but originally came to the city to open a business. I actually wound up in trading when I tried to get a small job to settle into the city - go fucking figure. I love trading and may stay, idk yet, but business is the thing I have been wanting to do for some time now and the longer I work in trading, the suckier my job feels even though the subject intrigues me and I spend a lot of my time on it and enjoy it.

I still think starting a business is a better route than trying to climb a corporate ladder. Most of the prestige and crazy paychecks that graduates think about when getting a job in any industry are usually enjoyed by only a very small percentage of the company, and many have gotten there not only through work but because of political reasons. I've met plenty of very smart and capable people who've put years of work and energy into their job and aren't board members - it seems like there's a hell of a lot more factors that come into play than just getting a seat and doing a good job. What's your real edge?

On the other hand, I've seen people and heard of people who've done very well for themselves in business and the best part I love about the people I've met who own businesses is that they're people you'd never think would have achieved the things they have. They tend to be very down to earth and simple people who are humble and hard-working.

With all the talk about millennials not wanting to go corporate, I think a better route could be business. The majority of successful people I've met are not those who work for other people, but rather business owners in all sorts of industries including small brick-and-mortar storefronts. Unfortunately, some of the capital required for some things (like some I've mentioned) may be out of reach for some people...but I think through saving and maybe getting investors, it can be done. There are other businesses that also cost less (mobile businesses of goods/services like food trucks, mobile computer repair, etc).

For whatever it's worth, I hope whoever actually takes time to read the stack of shit I've spewed out will find some benefit from it. Unless I really have a change of heart by the end of this year or find some other opportunity, I'll probably be leaving my job to pursue a business. I'm trying to get a job part-time at night and on weekends to get some experience now. As far as being "unsexy businesses", to me there's nothing more unsexy than having some title at a company, being chained to a desk, and being someone else's property. The real prestige goes to the owners and high-level management. So in that case, owning several small businesses is not only more prestigious IMHO, but can also be more profitable.

Hope all this helps, just trying to offer up what I have learned and give my opinion

 

nice post. I left finance and started my own business. First thing I realized is how hard it is to make in PROFIT (not revenue) what you make at a corp gig and once you include the benefits you were getting....it gets really hard. I pay $330 bucks a month for health insurance...I get to write it off...but there isn't enough income for the write off to matter much! Definitely took for granted how much money $70k salary + benefits is. From my side, the nice thing about corp gigs is that you have a clear path. You have a clear path to advancement and raises, and you have a clear tasks to do each day, so you can be very productive. It can be tough to be as productive as an owner because it isn't clear what needs to be done and where things are going, so there is a lot of unproductive time (which isn't generating present revenue). There is a lot of BS as an owner that you have to deal with, that doesn't go away just because you don't work in an office. I've also learned everything costs twice as much as you planned or were told and takes twice as long...EVERYTHING, it can be depressing.

Lifestyle wise there are some great benefits to being an owner, at the same time, you have to accept the fact that your business may only make a very small amount of money and then you have to figure out what to do if that is the case. It's called the slow death, you aren't losing money, but you are making very little for your time...and not enough to support a family how you want. People say they can handle the risk...but I believe many who think they can, can't. Not that they can't be successful with their own business, but that they won't be able to or won't want to handle making

 
MoneyTalksMonkeysWalk:

nice post. I left finance and started my own business. First thing I realized is how hard it is to make in PROFIT (not revenue) what you make at a corp gig and once you include the benefits you were getting....it gets really hard. I pay $330 bucks a month for health insurance...I get to write it off...but there isn't enough income for the write off to matter much! Definitely took for granted how much money $70k salary + benefits is. From my side, the nice thing about corp gigs is that you have a clear path. You have a clear path to advancement and raises, and you have a clear tasks to do each day, so you can be very productive. It can be tough to be as productive as an owner because it isn't clear what needs to be done and where things are going, so there is a lot of unproductive time (which isn't generating present revenue). There is a lot of BS as an owner that you have to deal with, that doesn't go away just because you don't work in an office. I've also learned everything costs twice as much as you planned or were told and takes twice as long...EVERYTHING, it can be depressing.

Lifestyle wise there are some great benefits to being an owner, at the same time, you have to accept the fact that your business may only make a very small amount of money and then you have to figure out what to do if that is the case. It's called the slow death, you aren't losing money, but you are making very little for your time...and not enough to support a family how you want. People say they can handle the risk...but I believe many who think they can, can't. Not that they can't be successful with their own business, but that they won't be able to or won't want to handle making <50k for the next ten years. I see with my business, it's going to take a long time before I make what I was making as an analyst, I will get there (I believe) and I will surpass it greatly (hopefully) but I realize now that it may take 5-15 years with lots of risk. It's going to be a good ride, but I am envious of my old career path sometimes. We will see

What kind of business did you start/what industry? Could you elaborate on your full story? Thank you for the insight, btw.

 

A good friend of mine makes roughly 350k/yr crushing rocks for a living. Mostly state contracts and obviously an over simplification. A modern day Mr. Flinstone, not bad since he only has a high school education... and it wasn't a 'target' lol

 

Fast food franchise. I was an analyst at a bank. Another analyst and I put our money together got a bank loan and opened up shop. We both had worked at our respective banks for just over a year. It took a year from deciding on this franchise to signing paperwork, to signing lease, to construction, to opening day. This franchise is regional - 95% of locations are in one state. Margins are really tight in this industry, food prices have skyrocketed in the past 1-2 years and hopefully don't continue to do so, but it's not looking good, and min wage is increasing in my state. My store has been open

 
MoneyTalksMonkeysWalk:

Fast food franchise. I was an analyst at a bank. Another analyst and I put our money together got a bank loan and opened up shop. We both had worked at our respective banks for just over a year. It took a year from deciding on this franchise to signing paperwork, to signing lease, to construction, to opening day. This franchise is regional - 95% of locations are in one state. Margins are really tight in this industry, food prices have skyrocketed in the past 1-2 years and hopefully don't continue to do so, but it's not looking good, and min wage is increasing in my state. My store has been open <3 months and we are about breaking even, there are a lot of fixed costs, so it's tough to make it on revenue <500k. 500k isn't easy to get either. I need my rev to increase 25% before I call this store somewhat successful, I think I'll get there as business seems to be gaining momentum as people in the area discover us. The main thing I've learned, is that these places don't really make a lot of money in absolute terms, OK in terms of ROI as this was a ~350k investment, but we both need to live. The only way for us to make decent money is to open more stores, organically isn't going to happen, so we are going to seek out some money and open a couple more stores. We are in the early planning stages of this. To anyone who thinks they want to open up a franchise fast food on the side....ain't gonna happen. It's a full time job with hundreds of thousands of dollars on the line. "hiring a manager" or "paying more for a better manager" won't cut it.

Thank you for the insight.

 

I think about this all the time as well. My uncle is a cop and frequented Dunkin Donuts, as all cops are supposed to do. He ended up getting friendly with the Dunkin Donuts manager and has now been dating her for like 7 years. She from Brazil and started as a cashier. She lived in a tiny studio in a shitty city as she moved up to Manager. She continued to live in a shitty place and eventually saved enough to open her own DD franchise. Still living in a shitty place, she opened another, and another, etc.

She now owns over 10 Dunkin Donuts franchises, but now specializes in purchasing the land of closed gas stations and converting them to gas station/DD stops at busy intersections. Some of her lots even have space to lease out dry cleaners and other small business. She's a baller multi-millionaire now.

In summary, there is a lot of opportunity in franchising, but you need to be prepared to live on very simple means for a number of years with a strong vision for the future. It would be very difficult to leave a six figure job and expect to maintain the same lifestyle, or even anything similar, for many years.

Also, wanted to share a less successful story. My dad's friend that I haven't seen in years decided to quit his job when me and his kids were in high school to open a Subway franchise. He now owns two franchise stores, but he has low margins and pulls in the same amount of money as he did when he worked a corporate job. I don't know if he's happy BC I haven't seen him, but just wanted to give a non-as-successful scenario in the franchising business. In this case, I'd rather have a corporate job with a defined track rather than take on the stress of 7 day work weeks and answering to the Subway franchise to make the same amount of money.

 
trippycannon:

anyone know what the margins are on liquor? as in liquor sold at liquor stores?

I have a buddy whose dad owns several. he seems to do very well and whenever I see him he's just hanging out at home.

usually liquor stores are at an average of 20%. Some are higher from wine sales. They are a profitable business, but def. not easy. Location & rent is what makes or breaks you. Inventory also adds up. a small store can easily fill $100k in inventory

 

I have two businesses currently. I own a international trading house (Basically, I do import from china, export to Bangladesh, contract manufacturing, etc). I also own a tattoo/piercing parlor/gift shop on St. Marks in manhattan (LES). I also use to own a verizon wireless franchise & a mobil gas station (I HATE them btw) in florida. Both of my current businesses are very profitable. But it IS NOT EASY.

First the negatives Trust me when I say this. For 90% of people, even most bankers, It is best not to get into a unsexy or non-finance business. Why? well b.c just like i can't go and become an associate at a IBank tomorrow with no experience. It is also very different from getting a steady paycheck to worrying about where your next paycheck is going to come from. Also Intellect has nothing to do with being successful. It is all Handwork, networking (very important), capital, & a lot of LUCK.

I tell my friends when they ask me sometimes what I do, sometimes I'm the CEO, COO, CFO, Secretary, & Janitor all in the same day. Thats what it takes to be successful. Nothing is "below" you. If you don't understand the cash register at your gas station you will never be able to stop the reason most gas stations fail (theft). For anyone wanting to go into an unsexy biz or franchise, i urge you either to work at one or partner with someone with experience. I have personally seen tons of people come into my areas of business and fail while losing lots of $$$$. A lot of these people actually came from respected other careers. Doctors, lawyers, accountants; etc.

2 things about buying business & franchises. Remember, always think that someone is trying to screw you. 1. When buying a business, DO YOUR DD. Pay someone if your not an expert in that field. B.c most likely they are lying or exaggerating. Just b.c on their tax return they put X amount, that means shit to me. Everyone says their selling their business b.c their retiring or have another investment opportunity. But usually that means their not making enough money.

  1. When buying a franchise, talk to every current and former franchise owner you can. You will learn more here than anywhere else. The franchisees that own DD, 7-11, subway; etc and started even 10 years ago are in a different category as you. This franchisees are given better opportunities/stores. Find newer franchisees. See how they are treated, how profitable, & MOST IMPORTANTLY are they being allowed to expand. Many franchises want to reel you in with the potential of owning many stores, but than since your not hitting their BS targets you aren't allowed to expand; etc.

I have personally looked over most of the "best" franchises & businesses available in NY. If you guys want my input just send me a msg.

Now that the negative part is over, here are the benefits.

If you are successful, you can make amazing money with great tax benefits. Also being a business owner is like being a successful FA. You eat what you kill. & honestly when you are successful there is no better feeling in the world than putting $100k in your pocket b.c you closed a deal. Its nice to see getting rewarded for your hard work. Something many people don't see in normal careers where you are at the whim of office politics and your bosses.

Your time is flexible (for the most part). Yes you still have a boss. Your boss is your customers, manufacturers, lawyers; etc. But if you need to go to a doctors appointment or a massage on a Wednesday morning, no one is going to tell you no. This is one of the main things about being self-employed that is AMAZING.

Also one benefit that is a double edged sword, is that sometimes if you are very successful, you might actually have too much free time. You would think that is amazing, but it sucks sometimes as well. Your friends aren't going to chill with you tuesday @ 2 pm. (you might be working Sunday all day though). Sometimes it does get boring. But hey thats why I'm looking for a day job. In your 20s WORK hard.

The experience you get in a short amount of time is unparalleled imo (if you are successful). Your not just a spreadsheet money, your not just a intern, not just a resident; etc. You will be able to do every job involved in your business within the first year. You will be the leader. Sometimes theres things that you can't just teach. Working full time and owning my own businesses since 19 has honestly changed how I am as a person, for the better.

any questions or advice, I'm happy to share.

 
YoungBiz:

I have two businesses currently. I own a international trading house (Basically, I do import from china, export to Bangladesh, contract manufacturing, etc). I also own a tattoo/piercing parlor/gift shop on St. Marks in manhattan (LES). I also use to own a verizon wireless franchise & a mobil gas station (I HATE them btw) in florida. Both of my current businesses are very profitable. But it IS NOT EASY.

First the negatives
Trust me when I say this. For 90% of people, even most bankers, It is best not to get into a unsexy or non-finance business. Why? well b.c just like i can't go and become an associate at a IBank tomorrow with no experience. It is also very different from getting a steady paycheck to worrying about where your next paycheck is going to come from. Also Intellect has nothing to do with being successful. It is all Handwork, networking (very important), capital, & a lot of LUCK.

I tell my friends when they ask me sometimes what I do, sometimes I'm the CEO, COO, CFO, Secretary, & Janitor all in the same day. Thats what it takes to be successful. Nothing is "below" you. If you don't understand the cash register at your gas station you will never be able to stop the reason most gas stations fail (theft).
For anyone wanting to go into an unsexy biz or franchise, i urge you either to work at one or partner with someone with experience. I have personally seen tons of people come into my areas of business and fail while losing lots of $$$$. A lot of these people actually came from respected other careers. Doctors, lawyers, accountants; etc.

2 things about buying business & franchises. Remember, always think that someone is trying to screw you.
1. When buying a business, DO YOUR DD. Pay someone if your not an expert in that field. B.c most likely they are lying or exaggerating. Just b.c on their tax return they put X amount, that means shit to me. Everyone says their selling their business b.c their retiring or have another investment opportunity. But usually that means their not making enough money.

2. When buying a franchise, talk to every current and former franchise owner you can. You will learn more here than anywhere else. The franchisees that own DD, 7-11, subway; etc and started even 10 years ago are in a different category as you. This franchisees are given better opportunities/stores. Find newer franchisees. See how they are treated, how profitable, & MOST IMPORTANTLY are they being allowed to expand. Many franchises want to reel you in with the potential of owning many stores, but than since your not hitting their BS targets you aren't allowed to expand; etc.

I have personally looked over most of the "best" franchises & businesses available in NY. If you guys want my input just send me a msg.

Now that the negative part is over, here are the benefits.

If you are successful, you can make amazing money with great tax benefits. Also being a business owner is like being a successful FA. You eat what you kill. & honestly when you are successful there is no better feeling in the world than putting $100k in your pocket b.c you closed a deal. Its nice to see getting rewarded for your hard work. Something many people don't see in normal careers where you are at the whim of office politics and your bosses.

Your time is flexible (for the most part). Yes you still have a boss. Your boss is your customers, manufacturers, lawyers; etc. But if you need to go to a doctors appointment or a massage on a Wednesday morning, no one is going to tell you no. This is one of the main things about being self-employed that is AMAZING.

Also one benefit that is a double edged sword, is that sometimes if you are very successful, you might actually have too much free time. You would think that is amazing, but it sucks sometimes as well. Your friends aren't going to chill with you tuesday @ 2 pm. (you might be working Sunday all day though). Sometimes it does get boring. But hey thats why I'm looking for a day job. In your 20s WORK hard.

The experience you get in a short amount of time is unparalleled imo (if you are successful). Your not just a spreadsheet money, your not just a intern, not just a resident; etc. You will be able to do every job involved in your business within the first year. You will be the leader. Sometimes theres things that you can't just teach. Working full time and owning my own businesses since 19 has honestly changed how I am as a person, for the better.

any questions or advice, I'm happy to share.

Definitely would like questions/advice, particularly re: the import/export. Do you have feet on the ground in both countries? Guessing yes but wondering are these hired locals, family members? Will PM you as well.
He who is not contented with what he has, would not be contented with what he would like to have. Socrates
 
castondavis:

Definitely would like questions/advice, particularly re: the import/export. Do you have feet on the ground in both countries? Guessing yes but wondering are these hired locals, family members? Will PM you as well.

Yes i do. I have a business associate in China. I made sure he invested with me though so that keeps him honest. I also have 2 close partners in Bangladesh. One who is my father's childhood best friend. & another who is my dad's ex business partner. I also have clients in other countries that I've cultivated just through networking.

Just like getting into & succeeding in banking. Most businesses are about networking. Use your personal and professional avenues to increase your income (in w.e career path you take). Too many people these days concentrate on more education & other nonsense. Remember the generation before us, the boomers, all worked off networking. Their old school and appreciate a "kid" who knows how to network & sell. IMO the most important thing a person can learn is sales. No matter what you do, sales are the most important.

 

Anybody given thought to or have knowledge of used car dealerships? Even to higher risk/bad credit customers, seems like they are pretty lucrative.

He who is not contented with what he has, would not be contented with what he would like to have. Socrates
 
castondavis:

Anybody given thought to or have knowledge of used car dealerships? Even to higher risk/bad credit customers, seems like they are pretty lucrative.

i use to own one. Ill post up about it when i get some time

 
YoungBiz:
castondavis:

Anybody given thought to or have knowledge of used car dealerships? Even to higher risk/bad credit customers, seems like they are pretty lucrative.

i use to own one. Ill post up about it when i get some time

Sweet. Thanks!
He who is not contented with what he has, would not be contented with what he would like to have. Socrates
 

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Greed is Good!
 

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Career Advancement Opportunities

March 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. (++) 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

March 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

March 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

March 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (86) $261
  • 3rd+ Year Analyst (13) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (202) $159
  • Intern/Summer Analyst (144) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

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