How to Find Businesses to Buy NO ONE ELSE Knows About (80 MINUTE Playbook)

You're told that the best way to get rich is to start a business, then why is it that there's not a single billionaire that exists that hasn't done this other thing? The best way to actually get rich with the highest degree of certainty of continuing to get rich is through acquisitions. How do I know? Because the richest people in the world have all done it. Amazon, that's done 110 acquisitions. Google, that's done 200 acquisitions. In fact, if you go to the richest people in the world and look at the Forbes 100 list, not a single person on there hasn't done an acquisition. But here's the problem. You don't have any money to go out and buy businesses. And two, where do you find businesses that you could buy if you don't have tons of money? So for the first time ever, I'm going to do a masterclass for you guys so that you can do what the richest people do in order to make massive wealth. And that's find businesses where they want to sell to you and they want to use the profits of the business to do it. By the way, this is going to be a long video. If you don't have the attention span, do you really think you have what it takes to get rich? So let's talk about first. Why is it that acquisitions make sense? This is going to be very short because today the biggest thing I want to focus on is the thing that nobody actually tells you, which is that all around you are a series of diamonds in the rough. They just look like rocks to you, and we've got to go find them. Let's talk about why acquisitions work so well. While 70% of millionaires in the US they own a business, 88% of people worth $30 million or more did an acquisition and own a business. In fact, what's fascina about acquisitions is while 90% of startups fail, 80% of acquisitions survive the first year. And in fact, acquisitions done with either seller financing or loans have one of the lowest failure rates of all businesses, about 13% from the SBA. But I think more than any of that, whether I convince you or not to buy a business is totally up to you. But the part that's interesting is what if you just started seeing them all around and then you could figure out if you want to do them or not if you want to buy a business in 2025, this will be the most comprehensive GU to finding businesses that exists on the Internet. And how do I know any of this? Well, we've Taught thousands of people exactly how to buy and find businesses. And if we've never met before, hi, I'm Cody and I own a portfolio of small businesses that look like this. Some of these businesses were small when they started, a couple hundred thousand dollars. And some of these businesses now are worth lots and lots and lots of zeros. So I'm going to let you steal my homework today because I remember the beginning for me. I remember before I had Resi, one of the largest trade franchise companies, I had fail, fail, fail in startup land before I realized that I just wasn't using the right skill set. You see, I've been in finance for a really long time and I had learned acquisitions. I had never really learned how to go from zero to $1 million in revenue. That part I think is very hard. It's called the chasm. So after this video, you're gonna steal my 15 years of finance homework. You're gonna learn some of the best places to search for deals. You're gonna learn exactly how to keep track of the deals you're tracking and to be ready by the end of this to start reaching out to businesses and know where exactly to go to to find them. As simple as if you were looking for a home or an apartment and you went to Zillow and you narrowed your search criteria and you tapped on them and you knew exactly what they were worth and they were market comps. It will be just as straightforward for you as it is if you were going to do a real estate deal. Now, there's four quadrants today that we're going to break down. And I was taught these when I worked at Goldman Sachs. When I worked at Goldman and we wanted to do an acquisition, there were four things we needed to do. First, we'd have to define our acquisition target. That is typically called your deal box. Then we have to talk about are we going to go on market, AKA to the Zillow of business buying and find the deals that are already listed, they got the sign out front, theoretically, and they're ready to go. Or are we going to go off market, which is to go search door knock, find the proverbial businesses that are for sale and then how do we target them? So once we know where the businesses lie, how do we make sure that they're the right businesses for us? And how do we narrow down what the right businesses business is? But the first question that people ask when we get to define is typically, why would a seller agree to sell their business in the first place? This is called the seven Ds so sellers on average. You guys know the age of the average small business owner in the US it's 67 years old. If you've ever run a business for five minutes, you know that it can be hard. So imagine most of these business owners have had businesses for 10 years plus they're old. So they're ready to leave from their business that's in New York and move to Florida. That's the first D called departure. Maybe have gone through a divorce or are going through a divorce and have to split up assets. They are getting older. So we've got disease happening. This happened to my uncle Eb with cancer. He got cancer, wanted to spend more time with his family, couldn't sell the business fast enough, and so ended up shutting down a business that made millions of dollars a year in revenue and over seven figures in profit. The fourth D is disagreement. So they're usually business partners in business deals. Maybe one of them doesn't get along with another. Then we've got distress. This is where a business is starting to go sideways and you can pick up businesses for pennies on the dollar. Then we've got death. We're talking about 67 on average, which means there's a lot older. What happens when that business owner dies? They go to something called probate, and those businesses just go away unless we buy them first. And then the final D is dullness. So at some point when you're running a business, you're ready for the next opportunity. One of the most recent businesses I'm going to show you today is exactly that. It is a business that does seven figures in re. And this business owner is just ready for the next thing. They think this business isn't going to be big enough for them, so they're willing to sell or finance the deal. And I think one thing I want you to remember is one of my quotes from one of my favorite mentors in business. His name is Sam Zell, a billionaire investor. And I want you to realize if you watch this video, you will learn more about doing deals than you ever have before. You'll be one of the top 1%. But at some point, you're going to start realizing by the end of this, are we getting really unfair deals? Like, are these deals that Cody's helping me set up so unfair that, like, the business owner is getting taken advantage of? And what I want you to realize is that Sam has the line where he says some see buying and creating value from others misfortunes as exploitation. But I see it as giving neglected or devalued assets in any industry, a new life. Now, if we understand why a business owner in general might want to sell a business, how could you get a business owner to allow you to buy a business using their money? Why would a business owner pay for me to buy their business? Well, this is called seller financing. And one of the reasons why is because seller financing can also make the seller more money. So, you know, right now, if you were to go buy something, you either need to have the cash in your hand, right? Or you might have a credit card, or you might need to go get a loan from a bank. That's normal. If you want to buy a house, you say, okay, I don't have a million dollars to buy a house, but I've got some money to put down. And then I go to the bank and the bank supports the rest. Seller financing is just removing the bank doesn't mean that you have to have all the money. You can put some money down. And then instead of the bank giving you money, the seller does. And the seller uses future profits of the business in order to pay you to take over their business, and you give them money over time. Now, why would a seller do something like that? Why would they? Hey, no problem. I'll be the bank instead of the bank. Well, let me show you why. The first reason is more cash. So in this real deal, the seller of a business wanted a million dollars for their business. The bank says it's not worth a million, it's worth 750. So you have to actually get a loan from the bank at an 8% interest rate, which means that you have to pay $750,000 plus the 8%. So that's probably another $80,000 per year with costs, et cetera, on it to pay for this business acquisition. So you say that's option one, Mr. Seller. But option two, what if I give you 1.15 million? You want a million? I want to give you a million plus $150,000. Now, why would I do that? Because instead you're going to beat the bank. I don't need to go through the entire banking process. I'm going to still give you a little bit of money down. But how about you give me that money at a much lower interest rate or Maybe even a 0% interest rate, I give you more money. But instead of having to pay the bank the extra couple hundred thousand doll over the course of this loan, I pay you. And instead of you getting $750,000, you get more like $1.46 million, which is your additional purchase price plus an interest rate on the loan. Does that sound like. That's interesting. Yeah, I'd rather have 750 times two than 750. Okay, cool. Mr. Seller. Now, the second reason why somebody might do seller financing for you is because they could pay less to Uncle Sam. I don't know very many people that want to pay more. So in this instance, let me show you what that looks like. You could say, Mr. Seller, if we go with that means you have to do what's called a lump sum payment. You're going to pay a big, huge amount of money to Uncle Sam right now, today, to the government for getting this big purchase price. However, if you sell or finance me, we'll put that payment out over the course of 10 years. By that time, your tax bracket will have decreased because you won't be a business owner anymore, which means that you'll save, potentially, depending on the deal size, thousands to hundreds of thousands of dollars a year in taxes. So would you like to pay less taxes and get more money for the transaction? Of course. You. Finally, there's a truth about doing deals, which is time kills all deals. The faster you move, the more money you make. And if you want to do deals and make money, you got to move fast. So you say, Mr. Seller, do you think it'll probably be better or worse for you if we move faster? Do you think the deal's more likely to close if we move faster and the seller goes, yeah, totally. Okay, well, look at the average loan time it takes to do an SBA loan, a standard loan from a bank, let's say, as opposed to if you sell or finance me. If you sell or finance me. Well, we could close in a week, two weeks, three weeks. If we go with a bank, that's anywhere from three months to six months to nine months. So do you think that a deal could go sideways inside of nine months pretty easily? Oh, yeah. You do? Okay, great. So why don't we do seller financing? Because you can make more money, you can pay less taxes, and we can close the deal faster. Awesome. Now, if all of that is true and you sell the seller on it, the seller also wants a great and trusted buyer. How do you present yourself as that? Not just somebody who's saying, please give me your business for $0 down. What's fascinating about sellers is they're not always motivated by the purchase. Meaning if I say, I'm gonna sell you this iPhone, the thing that you're most interested in is certainly that I give you more money for this iPhone than the other guy. But what do you think's even more important than that? That I actually like give you any money, that the deal actually follows through, that you're trusted. If you guys have ever sold something on Facebook Marketplace, for instance, how often do you get a lot of people throwing big offers in and you go that this is a scam, this isn't gonna follow through. It's the same with selling a business. So most of these sellers, they're burned out, maybe they're sick, maybe they're going through divorce, they wanna retire to FL, they're moving. And so these individuals, somewhere between 21% of them are motivated by burnout. 55% want to retire. 13% they have failing health, they need to sell this business. And so they want to make sure that you close. So sometimes they don't care about the purchase price. They're like, are you going to close the deal? Are you going to take care of my customers? Because I'm probably going to have to see them again. Are you going to take care of my employees? Will the business continue to exist and are you going to continue to my legacy? And that is how you sneak in. Next question becomes, when we start looking for deals, how do you find the right types of sellers who are going to help you buy a business without having tons of money? And this is what we call finding your seller. Financing avatar. There are two types of avatars for a seller. A good seller that you can find a business you want to buy without a ton of cash and a bad avatar, the good avatar. The seller wants to retire. They want more money than the bank will loan. They want an annuity or an income stream. It's a simple, boring business. They know you potentially. That's a great avatar. Let me tell you what a bad avatar is. They're young, they want to grow, they have a lot of offers on the business. They have a complex, sexy business. The business is growing like crazy fast. The business is young, it hasn't been around very long. The seller doesn't know you, is a go getter and aggressive and maybe they don't even like you. We're going to go with old, tired, slow growing businesses, not fast, young, hungry businesses. And we have an entire checklist at this. The higher the number of checks, the more likely the seller will sell to you. So what I do is I take this checklist for me and the members of my community and every time we talk to a business, the checklist is in front of you and you're checking off if this is the right type of seller or avatar for you. Let's go through a couple of these right now. Duration. So the longer the business has been around, the better for you. Number two, is it sub less than a million dollars in profit. The bigger the business, the less likely for seller financing. 3. Low competition. If there's not a lot of competition, seller financing's in play. Four, brick and mortar. If it's, if it's online as a business, seller financing slightly less normal. If it's in person, more normal the duration of the owner in charge. So it's not just how long has the business been around, but how long has that owner been around and then lack of successor. Do they have a junior, a kid or whatever that wants to take over their business? If they don't, we're in play. Older the owner, the more likely they'll sell, the less financeable the business is. Which means that the bank won't give loans. Maybe they have beat up financials. Maybe they still have their tax returns and profits and loss statements in a box with a bunch of papers in it. That's a good avatar for seller financing. 9. Price too high for its balance sheet. The seller really wants to get a bigger dollar amount. 10. Business without clean financials. So let's say this business is really beta. 11. No leadership team. 12. The business is kind of a mess. 13. We got something called an asset sale. So this is where like the business is. Maybe not even profitable, but the assets of the business might be worth something. We're sitting in a place right now, as you can see, with a bunch of furniture. You got cameras here. Well, that means that there's something in here that's valuable even if I don't make any money in this business. If you already have a relationship with the seller, the more they know you, the higher likelihood you'll get seller financing. And then are they cool with having a big lump sum or do they like the idea of a smaller amount over time and then has other sources of income outside of the business. So let's say now that you've got the perfect seller financing avatar. What type of business are we looking for? This part will be quick before we get to how to find them. Ideally, we are looking for a business below $10 million in reven and with profit to cover the costs for my income, the costs for an operator for the business, the cost for the business to grow. That's called working capital. And simultaneously the cost of debt service. So that's the price that I paid to buy the business. That's like how you get an interest rate on a loan. So if they're below $10 million in revenue, there's less competition from private equity guys and we're not ready to go head to head with those guys yet. So we don't want that. We also want a certain type of business. So blue collar, service based businesses. I like these because there's a lot of them. Highly fragmented industry. I don't want to try to go buy an AI company right now. Too sexy, too expensive. I also want one that's cash flowing and profitable. If you believe anything in this video, it should be this. Please do not buy other people's hopes and dreams. We buy realities and profits. So if it is unprofitable, if it's not a strong business today, we don't want to hope that we could fix them. You're not going to fix the guy. He's probably going to stay exactly how he is. Ladies. You're also not going to fix the business. Right? So, so the same idea. We don't want to buy the ugly house on a nice block and think that we can turn it around when we've never done construction before. We're not going to play that game. We also want to make sure the business has sufficient margin. That means if I pay a dollar to that business, if I give a dollar to the business, how much does the business keep from that dollar and then put in their pocket? I want to make sure it's at least 15 cents. So we want about at least a 15% profit margin. Then we want to have that seller financing avatar. We want that motivated seller. If it's proprietary, if it's patent pending, if it's in B technology, we're a pass. Because for this first deal we're learning deal making. We don't also need to learn a complex business. If there's a broker in the middle and you're not going to pay the broker's fee, that broker is going to get in your way. So just think about it like a real estate agent. A real estate agent's got to show every offer to the person selling their house. But if somebody says, I refuse to pay your real estate fees, I want to make sure that's not happening in this business. What's the realtor going to do? Not give you the deal. And so it's the same with brokers. That's why I like you guys to say, don't worry, we'll handle the brokers. Fee, we'll get paid. We'll get you paid. Even if we do seller financing, if the seller has a lot of competitive offers, it's not going to happen. And if you can't get the seller to trust you, it's not going to happen. More on that part later. It's super important. All right, I want you guys to meet my friend Josh. So Josh and I work together. Josh was an executive for many years. He's a super smart guy. He had been pretty successful. He had made a lot of money. But was something that was interesting is I talked to him about, you know, three years ago about buying business and he had never bought one before, even though he had been in a business for 11 years. And I said to him that, you know, why do you think that is, Josh? And he said, well, before I met you, Cody, I never even knew to look for businesses for sale. I had no idea that this was possible. About six months after learning this, he bought his first business and then his second, then his third. So now he's done three deals. What I asked him, I was like, josh, do you think before you met me no businesses were available to be bought anywhere? Do you think that somehow you got way richer so you had more money to do a deal afterwards? And he was like, no to both of those. So then what was the difference? Your amount of opportunity will always be limited by your ability to recognize it. Right now, all around you are businesses that you could buy. You just don't know what you're looking for. So you think that they're just rocks, pebbles, totally worthless, and inside you don't actually realize that there is a diamond. I want you to think about a few ways you will never find a deal. You will never find a deal if you do not get specific about what you are want. In search. We call this the spray and pray method, which basically means when an investor has no real plan, they invest a small amount of money in a bunch of different things. What kind of business are you trying to buy? Any business. Where is it located? Everywhere. How much money do you want to spend? Well, it totally depends. If you're not specific, then it turns out that it's really hard to buy a business. The next question becomes there are two paths to finding a business. The two paths are either on market deals or off market deals. Let's talk about what those are specifically before we get into them in depth. On market deals are businesses that are already for sale. The owner knows they want to sell. They're publicly listed across varying platforms. They've been prepared to sell. They probably have some version of financials. They expect you to reach out to them. These are ready to go. It's really not that dissimilar from when you have a house listed on Zillow or Redfin and it's been prepped. The owner's ready to go, they want to move on. This means that there's vis visibility into the business, there's transparency in what you're going to ask for. It's potentially a much faster process. Some of the cons to on market deals are because it's super ready, that means there's more competition. Right. If you find a house that's not listed for sale yet, maybe you could get it for cheaper. If it's listed, everybody can see it. It's also maybe more challenging to get creative deal structures like seller financing. Now, 60% of all businesses are sold with seller financing. So I do think it is possible for just about any business to have some component of the seller giving you the money to buy the business. But certainly if it's on market deals, it's just slightly less easy. The way that we search for these kind of deals, I'm going to show you, it's called Biz Scout, but think about it like you're going to go to Zillow, but make it SMB. And when you click on the listings and we'll walk through this later in the video, you can see every single business. You can see a bunch of details about them and you can reach out to the sellers. Now, the other way to find deals is called off market deals. Off market deals are businesses that are not actively advertised to the public. So these owners haven't listed their business for sale yet. They're not even sure that they want to sell yet. And these are where most deals are today. There's 11 million small businesses for sale right now in the US and those are publicly listed deals. I think there's probably more like 20 to 30 to 40 million businesses for sale in the US that don't realize they're for sale. Could be as small as jobs. These could be side hustles all the way up to really big companies that would be for sale at the right price or at the right terms. How do I know this? Well, there's 56,000 listings for sale right now on Bizkout. But what's fascinating is I travel around the world seeing hundreds of thousands of people a year. And every time I'm in a room with owners. You want to know something fascinating? I think Say, hey, who in here owns a business? Raise your hand. Now keep your hand up. And I say, okay, who in here would sell your business at the right price and the right terms? You want to know how many hands go down? Like 1%. Every single business owner at some point will take a deal. That means we have a huge untapped market of people who not only don't know that they want to sell their business, but also don't know that their business is sellable. A lot of people shut down businesses because they think their jobs. We're so trained to think that a job can't be sold. Right. That we don't realize that our business can be sold even though it feels like a job. Now, there's some cons to off market deals though. They take longer. You have to educate the seller more. You've got to go find the deals, but this might mean that you get to pay less and you get to negotiate a lot better. So I think about it and we're going to teach you all the ways to do off market deal listing. But I think about it a little bit like door knocking. You go to a neighborhood you, you like, you send a nice little letter, hey, I want to buy a house in this neighborhood. I'm having a baby. I'm not a psychopath. Would you want to sell to me? Right? That's off market deals. Now both can work. The difference between your two is on market deals take faster moves. Potentially you pay a little bit more. Off market deals a little bit slower. Potentially you pay a little less. Let me show you how you can use our contrarian deal box in order to nail exactly the right, right type of business that you want. By the way, what's really cool is after you guys fill this out, we have one of the largest marketplaces of small businesses listed. And so you can actually use the deal box and it will custom send deals to you based on your parameters. Okay, now this is called a deal box. What is a deal box? This is where you figure out exactly the things that are important to you in buying a business. And we fill out every single segment of this so that when a good deal walks past you, you, you know, sometimes I think about this like Neo in the Matrix. Remember how he was walking along and all of a sudden the girl in the red dress walks by, he turns and looks. When he looks back, he's about to get shot, Right? In life, we get distracted by the girl in the red dress everywhere. And if we don't know exactly what we're looking for we're going to get distracted again. This will narrow your focus. No girls in the red dress. All right, so what are some of the requirements? First, I like to break down how much money do you want to spend? And then you say how much do I want to make in a year? You're going to fill that out as well. You're also going to talk about how much do I want to finance. You're going to talk about where's the deal located. You're going to talk about what industry is it in? Do I want to be an owner investor, AKA just give the money. But I don't really run anything. Do I want to be an owner operator? All right, so if you are in our community, which if you're serious about business buying is definitely worth checking out, we'll include a link below. This is only for people who are really serious about business buying and we handhold you through every step of the process and help you find deals and help you analyze those deals and hook you up with a one on one deal coach. If you're in our community, you get access to this deal navigator. We're going to start with a few questions that you have to ask yourself when you're looking for your deal. Here they all are so you can see them live. What's the minimum amount of cash, your income you have to make going forward on this deal? How much do you want to pay an operator? How much financing do you think you're going to need? What's the estimated debt service cost? We'll also show you how to explicitly do that in the community. How much cash flow do you need in the business? What's the minimum purchase price then? And maximum purchase price. And then we got something called must, haves, can't haves. These are things the business has to have. Like I want it by me or I want it remote or I want it to be less than a million dollars. Can't stands would be like I don't want to own a restaurant. That's too much work. I don't like dogs. I don't want to own a dog grooming facility. And then I also want you to think about your sector, location, number of employees and numbers of years in business. Then we're going to take all of that and put that in your custom deal box. Then every time you look at a deal you will look at this and make sure that this deal is actually a good deal for you. Let's walk you through a real one line. So this is from somebody. By the time Name of Heather and Chris. They bought a sign manufacturer business in California. They needed $120,000 a year in cash flow because she wanted to replace her income. She didn't need an operator salary because she was going to operate it herself. They didn't want to use her traditional loan, they wanted to use sba. They wanted to use seller financing. So no, no financing in this business. They wanted a recession resistant business and no license. They didn't want to have to get like a contractor's license. She wanted nothing to do with anything that had to do with cars, anything that had to do with E commerce, anything that had to do with retail. And then it needed to be located in San Diego. And they'd like a smaller team because she hasn't run that many teams before and wanted an operator who was willing to transition for at least a year. Cool. Now we know what she wants. So when she looked at the business, which is this sign manufacturing business that was doing $170,000 an SDE, which is a fancy way to say seller's discretionary earnings, AKA the money that she makes herself in the business and puts in her profit and $278,000 in revenue, she thought, okay, this is close. It's not my perfect 120k but it's pretty dang close. She also liked that the business owner had a lot of work life balance, 40 hours a week. She liked the business had been around for 12 years, it was located in San Diego, there was no license that was needed for for it and they didn't really have a lot of key man risk. She knew she could run this business too and the owner was willing to do a smooth transition. They were also being pretty reasonable on the asking price, 275k and they would finance the deal for her. Plus if the business didn't make what she thought it was going to make, they could pull the price of the business down. She was like, okay, this looks like a cool business. So now it's hitting getting all parts of her deal box. She is off to the races. Now we're going to go to searching for on market deals. What does this mean? These are businesses that are listed for sale publicly like we talked about. The sellers want you to find them. They're going to include really general criteria, not everything for the business because they often don't want their employees to know that they're selling the business. Typically these businesses are broker represented. That means that they have a broker, just like you might have a real estate agent. They have a selling Their business agent or what's called an SMB broker. Now there's a couple simple steps for on market outreach. The main steps are like deal clarity. So you need to know your criteria. We went through your deal box. You're going to fill that out. You're going to search using target filters. I'll show you later in this how to set up one perfectly for you on bizcal. That's how I search for businesses. You're also going to reach out to the listing brokers. You're going to get a vibe of what that feels like to talk to them. And then we're going to rock and roll. Now one of the first things that happens once you start reaching out on site and saying like double click, I want to buy that business. Do you know that the average listing gets over 100 outreaches? So every time somebody lists their business, they have 100 people in their inbox. It's kind of like a hot chick on Tinder. Right. So the brokers have to screen through them and see who looks serious and who is actually going to close a deal. So I'm going to give you some pointers to make sure that you don't have what happened to this guy happen, which is basically brokers saying, no thanks, I'm going to pass. Be good, be brief, be gone. So here's what I mean by be good. I want you to be really professional. Hi, I buy businesses in the tax and accounting space. I'm looking for one located in the southwest. I'm looking for businesses below $3 million in revenue. I see you have a listing that matches my criteria. We're looking to move forward quickly on the deal. Typical process for me is going to be that I outreach, see a little information. I'm going to obviously sign your N. N.D.A. then I'd want to go into like maybe a two to four week due diligence and then we close. I'd be happy to chat further if you're open to it. Great. I also want you to demonstrate financial capability. I'll show you how to do that. On Biz Scout, you're basically going to check a little something that shows that you're a player even if you don't have your, your the money to do it. I want you to indicate that you want to move quickly. Like, hey, we're looking to move forward quickly. Here's my typical turnaround time and not emotional. Also in what's really important, like this first outreach is really like that first look. You only get one chance at this because you got to remember, everybody who's responding to this is a broker for a business owner, and they don't work for you. They work for the seller and they work for the deal. And so how do you become a person that doesn't send, you know, dozens of messages and not get responses and have one that gets response? You've got to know that in this instance, it's all about reps. The first time he switches a golf club, it probably looks pretty ridiculous. The first time you swing a bat, the same thing. The first time you outreach, it's the same. We're going to give you some reps. Now. This is Biz Scout's listing list. Here you're going to use these advanced filters to narrow down the options based on your deal box. And once you fill these out, if you're in our community, we're going to send the deals custom to you. You're going to refine by all the things we had you go through earlier. Then I want you to set up alerts. So this is where you're going to receive notifications on every new deal. Because the person who sees the deal fastest moves the quickest is often the one that gets the deal closed. Time kills all deals, so we're going to set them up. I like to see deals daily. In the beginning, I just kind of want to get a vibe for what a good deal looks like. You need to see kind of 100 of them before you find the right one. I also want to make sure that once you're serious about buying a business and you have your deal box narrowed, we're going to reach out to them on a consistent basis every single day. Because I think what most people don't realize, the difference between you being super rich and having bought a business, you being an acquirer, or you potentially thinking about doing a startup for the rest of your life, there's really only one difference, and that's do you move even though you're a little scared? Bizkout is not the only place to buy businesses, by the way. There's Biz by sell, Flippa, there's LoopNet, there's lots of locations. I just found most of them to be lacking, which is why we. We built our own. I wanted someplace where all the deals were curated. There was no trash or slop on there, no fake listings, no outdated listings, and people actually got back to us. Now, what I'd like you to do, in a perfect world, if you're reaching out to find a business to buy cash rewards, consistency, consistency is then contagious. And once something is contagious, it spreads. So before you do anything, I like you to have an account accountability buddy. Because I think if you want to go fast, you go alone. If you want to go far, you go together. I'm going to show you how a couple of people in the community have used an accountability buddy to execute faster. But in case you think this is crazy, pretty much in every aspect of your life, if you just consistently tell another person and you put down the activity on your calendar, you have anywhere from a 60 to 90% higher likelihood of achieving XYZ goal. The American Society of Training and Development Development found that people are 65% more likely to hit their goal if they do it with somebody else. Which is why I think community is so important. You're just more likely to win if you're around winners. So, quick caveat before we get into how to search for businesses directly, what does good accountability look like? I want you to identify an imperfect action plan for outreach. What I think that means is you fill out your deal box on biz Scout, you find your accountability partner, you join a community, then you have your deal box set up automatic notifications. Or you work with our deal coaches and they push things to you directly and you say, I'm going to buy a business inside of the next six or 12 months and I am going to spend at least two hours a week looking at it. That's your imperfect action plan. Then I want you to create an accountability statement. In the next year, I will buy a business that will replace my salary entirely. That could be a good accountability statement. Then I want you to have a challenge where you talk to your community buddy or your accountability buddy and you say, hey, once a week I want to check in 15 minutes and see are we doing the things that we say we're going to do. Then those check ins will be your deadline. You're like, well, I know I got to check in with Tom on Tuesday, so I better have reached out to those businesses by Tuesday. Then I want you to celebrate the small wins. So what? You haven't bought a business yet. Every single week, you at least reach out to the number of people you say you're going to reach out to. Go buy yourself a little something, have a drink, go out to dinner. Because, because what's also fascinating, you are 2/3 more likely to achieve your goal if you celebrate the small wins than if you only celebrate once you accomplish it. So think about that. We call it the partner, then plan, then propose periodic Updates to have a particular profit. That's your reward where you then party about it and then you pass it on. Now let me show you how a live acquisition might happen. So this is Lloyd. Before I taught Lloyd, Lloyd had bought zero businesses. Now he was a smart, hard working guy, but he had never bought a business before. He had had some startups to like varying degrees of success, but he had never actually bought something before second year. He now owns two businesses and he works with me. How did he do it? Well, step one, he's learning the things that you're learning today. He had a foundation, he joined the community, he set his deal box, he started moving forward, forward. Step two, he handled his deal clarity perfectly. That deal box got locked and loaded and he knew how much he could afford to pay for a business or not. And because he nailed his financing first, then he nailed his must haves and his can't haves, his must haves where it needed to be close to him, he didn't want to spend too much time on it. So he settled on a laundromat. Step three, origination. That's what we're learning today. This is, is how to find a business to buy. And so here you can see this is the inside of Contrarian's CRM. This is where all the deals get filtered if you're in our group and you can see how many deals you have to look at and how many fit your criteria. So he started looking. Once he had saved his deal box he realized, wait a second, I have a bunch of stuff that's on market that it's interesting. How many do I have to talk to before I can actually buy a business? And he started at 50 that he looked at hot level. That's like you scroll through Zillow, you kind of put 50 in your saves then you go to 20 and you really analyze the numbers. Do these make sense? Do I like these? Maybe you do a drive by. Then he went to five where he was like, I'm actually going to put in a letter of intent. I'm going to, I'm going to say that I'm really curious in these so I can get their financials, I can sign a non disclosure agreement, I can go deeper. Then he went into advanced due diligence. Okay, I really like these three houses. I'm going to go out there, I'm going to meet with them, I'm going to put in a real offer, I'm going to talk to the real estate brokers, I'm going to comb through all their financials. And then he finally bought one business. So 50 to 1 ratio. And then he did what I started talking to you guys about with finding a business. When he found this business, it was an on market business. And he did our outreach process where he made himself the trusted resource to both the seller and the broker. He used Bizkout to dive into this business and started tracking every single one of his steps of where he was at in the business buying process. He realized that it would take him, in this case, about three months to close a deal. And so every single day he would update his status. You can see here he was at 14%. Because I think when you follow a proven process, you get to your goal faster. So steal my homework on this. Then he evaluated the business and said, like, is this business worth too much? Do I like this business? I call evaluating a business the keep it stupid simple method, which basically means most businesses sell for 2 to 3x revenue or 2 to 3x profit if they're smaller businesses. What's often called seller discretionary earnings. So he knew that and he was like, okay, so this business that I like, after I've screened it down, I'm going to buy it for 2 to 3x. Then he gave an offer, put in his LOI, then put in his binding purchase agreement and closed on the deal. At which point, point he gets the NDA for the deal. He gets his accountability buddy locked in. He sources vendors to help him close the deal. He breaks down every single segment of the business, just like you would a house. Hey, are the hardwoods good? Is the roof leaky? Are the lights where they're supposed to be? Wait a second. Are there any other liens on the house? All of that he did for the business. That took him about four weeks, four weeks from beginning to end. And now he's moving from 14 completed to more like about 50% completed. Finally, he gets into financing. How's he gonna buy this business? Well, he, like many of you guys, didn't have a lot of cash. You know, he was an employee for a long time. He had burned a bunch of money on his startup. So he was like, I got, I got like 30k to put down. I could put about 30k down on this business. And the rest I'm going to finance with the sba. And so he did just about that. And that allowed him to buy a small business without having a ton of cash. Now, he used just one of these 21 other ways to finance a business that we teach. But that step allowed him to get to closing, at which point he finalizes the contracts, he puts in his offer and he rocks and he rolls. And this same process is the one that you're going to follow. It's the one that I followed to buy first a laundromat, then a second, third, fourth laundromat, then a wash and fold company. The fold. So my first laundromat was $67,000 a year. The second company was a $3 million a year business. And the third company, which is a software company that I just own a small part of, that's a 60 million dollar a year business. You can layer these acquisitions the same way. I think what most people don't realize in doing a deal is that when you go to eat an elephant, you do it one bite at a time. So we do tiny little steps every day to outreach different buyers. So we do tiny little steps every single day to outreach different sellers. And that's how we get the outcome that we want. Before I get into Bizkout and I want to break down for you how to use this tool live, by the end of it, you can create your own deal box. You can actually search for a business live, and we can like find you your first business here. But before we do that, I want you to think about something a lot of people talk about. A lot of people talk about, can I have a broker find me a business? You know, right now you go to buy a house, you're like, I don't need to know how to search on all this stuff. I just go, I call this real estate broker up and they go find the houses for me and they give them right to me. Why doesn't that exist in buying and selling small businesses? Because really good brokers, they do what's called, they go up market. That means they don't want to work with little guys. So they're either going to charge you 5 figures a month, like 10k a month to help you source a business because most people aren't serious business buyers. Or they're going to charge you five figures a month plus a percentage of your closing costs, like somewhere between 3 and 7%. I don't like that. I think most business brokers are incredible at working with sellers and really bad at working with buyers. The industry is just not set up for it. And so if you're asking me, I would say do not use a broker for the buy side. I do not recommend them at all. I think it is way too expensive. And instead this is what I would do. I'm going to show you how to walk through and find your own business so easily. You don't need a broker. You just need a computer. Okay, so now we're on bizkout.com, which is where I go to buy and sell businesses. And I'm going to click in here and I'm going to look at what businesses are for sale. So I come right in to the marketplace. The first thing I'm going to look at in the marketplace is all the businesses for sale. You can see that right now there's 50,300. That's too many for Cody. So in the beginning, I might just go in here and say, I want to find laundromats and I want to find them in Austin, Texas. Okay, ready? Go search. And it's going to pull up a bunch for me. But you guys are going to be pros, so we're not going to do it that way. We're going to go to a deal box, and when we click on our deal box, we're going to go in here and we're going to say, all right, I want to have. Let's call this one Austin, Texas. And I'm gonna say, I'm in the state of Texas. That's where I want to find a business, because I live here. I want to do it in Austin. I want a price range. So, you know, maybe I don't want a business below $10,000. I maximum want to pay $2 million for my business. Let's say one more zero there gross revenue. You know, I don't want anything that makes less than $10,000. Maybe maximum revenue. I don't care as much as we want. I want something that's added at any time of day. Maybe I want it to be established after 20, 21. I want a business that has a little time on market, and I want for sale businesses. And I don't care about real estate being included or not. Okay, so I'm going to save my little deal box here, and then I'm gonna go in and I'm going to have Biz Scout search for my deal box. Now look at this. Okay, it's like perfect. Look, I got a. I have 45 businesses for sale, all located in Austin. All that fit my deal box. That's great. And if I wanted to add another one, I just add a different deal box. So maybe my next deal box, I'm like, let's be more specific. I actually want to buy a beauty and personal care business. A build, building, construction and a cleaning service business, because those are all related. So I'm going to call this Austin, Texas 2. And I want to see just all of those that are located here. So let's see how many that pulls up for me. And see at the top, we've got Austin, Texas 2. Now here I've got 13 businesses. So wow. I got some kind of cool spas. If I want to buy this spa for 300k and make $76,000 a year, that's not bad, bad. You know, maybe I want to buy this $4 million H vac company. That cash flow is $1.3 million a year. That's kind of sexy. Let's look at it. All right, you can see we got $4 million. Not that many people looking at this business, by the way. And then let's look down below. What else do we see? We see the cash flow on this business. 1.28. Nice. This is a $10 million gross revenue business. So what does this mean? In these little purple boxes, you can see the sales multiple means the ratio of the business's asking price to its cash flow. So Basically, they want $4 million for this while the business is making 1.2. So 3.1 times 1.2 is about 4 mil. The profit margin on this business is 12%. Oh, how do we feel about that? We don't love businesses that fall between below 15%. Right. Then we look at the debt. So service. So how much would this business cost me to finance for this business? We assume. Well, let's say I can only put 10% down and I can only get a loan for 10 years. Then what would be the debt service on this? And then we look at, wow, what's the cash on cash return here? It would be 174% if I did it on those loan terms for this business. And then you can dig down deeper. Look, this business has been around for 30 years. Awesome old business. We like that. We can also see why the owner is selling. He wants to retire and he says he'll support us for 30 days. So I might go, okay, sounds good. But I don't love 12% margin. So what would that mean? That would mean either I want the sales price to come down or it might means I keep looking. So in here, for instance, like, look at this highly ranked handyman business with call center for sale, Austin, Texas for 124k. Now, this business doesn't have any details on on it. So let me look in and why don't we reach out to the broker so Here I would reach out to the broker, I'd put in my phone number, I'd put in my email, I would select a timeframe spoiler. I think you should say sooner rather than later. We'll look and do this in the next zero to three months. This is where I would give your pro advice. I use whisper flow, so I'm going to talk to it. Hi there. I am looking to buy handyman businesses and in the Austin area that have been in existence for at least three years that are profitable. It looks like yours could hit my parameters. I would love to discuss further. If you could please reach out to me at this number, I am happy to provide pre approval letters and also show you that I am a qualified buyer at this price. Now I'm showing them that I'm serious and I'm going to send that then, then Bizkout will go to work for me. Now let's say. There we go, message sent, we're on it. Now let's say that I want to see what's going on. I want to see the businesses that I have going on on Biz Scout. Well, now I go to my acquisition dashboard and here you can see, all right, I want to see all the businesses that I've put in offers on outstanding and wherewithal at. You can see the status of all my businesses. Like, oh look, this one, I'm under initial inquiry. This one's, I'm at due diligence. If I go into this handyman business, we'll see where I'm at today. Well, I'm at step one. I've got eight open tasks they haven't followed up to me and I can see the, the time and place that they followed up or didn't. The other thing that I want you to pay attention to is your profile. So a couple different things you can do to really stay stand out. One, I want you to verify with your id. So you're gonna scan, it's free, your ID ID here. That means that you're not a bot, you're not a fake person and you're going to increase your response rate by more than 50%. Then I want you to put in the amount of funds available you have and I want you to get Google verified super, super easy. Above and beyond that, we're also going to tell them some stuff about you, make you look like a serious buyer. We're going to tell them what kind of, of acquisition target you're looking for and we're probably gonna, we're gonna even put in Here I actually like to put in my LinkedIn, so I just want them to know, hey, I'm a player. I've been buying businesses and doing deals for 15 years. I was previously in finance. I own an asset management company. Please see my LinkedIn for further details. This way if a seller checks, they're going to see all of this information about me. All right? That makes sure your Tinder profile starts looking nice. I also highly recommend that you use the platinum plan so that you can show them that you are serious as opposed to curious. Now you guys know how to do a biz scout walkthrough for on market deals and have people actually respond to you. That is all you need to know. We're about to go to off market deals which is how you find businesses before anybody else knows they're on the market. And thus you can do deals that nobody else gets to do. But before we get to that, if you guys are serious about buying a business, I want to invite you to talk to one of our consultants at our M and A advisory firm called Contrarian Community where we teach people how to find, buy, vet, close and finance businesses. If that's something that's interesting to you, you can click the link below and have a one on one phone call with one of my M and A consultants. You can also see firsthand how the push deals to you with the Deal Navigator. And so once you fill out your deal box and they help you craft it, we'll start pushing businesses to you and making sure that you have all the tools you need to close your own business. And now let's get into those off market deals. Off market deals, how do you find deals that nobody even knows exist? I think there's a real difference between players who do private equity because they go searching as opposed to those who think they're going to to get fed. There's no baby birding in deal making. So this is about how do you find companies before they even know they want to go on sale. And I think what happens here is the more you know about doing deals, the luckier you get. It's the weirdest thing. So I remember when I was at Goldman, one of my best deal makers at the firm told me that there are only two things that matter to becoming a great deal maker. And I thought it was that you were incredible at financial modeling. You were super intelligent when to it came came to analyzing spreadsheets. You really knew how to negotiate and you knew all the terms of the deal. Those are important. But the most important is that you know how to get a ton of deals and you know how to create proprietary deal flow. Proprietary deal flow means you have your own pipeline that's not deal aggregating from a bunch of stuff that's in the market, but that is specific to you. And you can kind of think about this as a leader. Let's say that you know that a best. You know what a great leader is. A great leader is not somebody who inspires other people. A great leader is somebody who people can follow. And what's funny about most leaders is they think, well, if I get the job and I have the title, then I'm a great leader. It's like, no, no, no. Can you find people that are talented? Can you get them to believe in the mission enough to come over and do they want to stay and keep working for you and get better? If you can't do those three things, you're not really a leader. If you can't go and find proprietary deals, you can't go and get those deals to convert. You're not really a deal maker. And so how do we do this? How do we steal from Wall street here? Well, we focus on off market deals and we use the quiet seller methodology. So I want you to steal my homework. It's called the quiet seller methodology and it's how we avoid super competitive deal processes. Instead of waiting for the deals to come, we do direct outreach. So let's talk about how to do that. There's sort of five main ways to do it. The first way is strategic targeting. So that's where you have a specific type of business you want to buy and you go after it within a target area. I think about this as sniper rifle as opposed to shotgun. The next is direct outreach. This is where you are going in an area and you're actually initiating conversations. Typically you're doing it in like centers of influence areas like golf course, like going to the local chamber of commerce. The next is that you are using third party deal sourcers. Third party deal sources are really big in private equity. That's how a lot of people get their deals done. And the last two ways that we're going to focus the most on is using 21st century technology to make it feel like you've got proprietary deal flow, but really it's doing massive aggregation and then you are doing curation. So let's break this down. All right. My favorite way to do this is Biz Scout, which we're going to get into a second with our proprietary deal sourcer. But I want you to remember this quote by Peter lynch, which is the one who turns over the most rocks wins. Let's say right now you're watching and you're like, I got like 20 bucks, Cody. I'm like, I don't know how I'm going to be buying businesses. I don't have enough money to do this. Also, I'm not going to create a proprietary deal flow search engine. I want like one business because I need some income or I don't like what I'm doing. Then I would do the Venmo Challenge. Here's how this works. It's you turning your costs into profits. So what if you made money every time you spent? I want you to ask yourself the question, where are small businesses that you know and already spend on? And how would you figure that out? Well, let's look at your venmo and your PayPal history. If you pull it up right here, like I have that, what will you see? You'll see that most of the people you're paying on Venmo and PayPal are either friends and buddies and family or they're small businesses. It's like a farmer's market. Maybe it's a cleaning lady, maybe it's your landscaper. So these are businesses that you have access to the seller or the owner of the business and they take cash. It's a great way to narrow them down quickly. I take my list of Venmo and PayPal, I download all the transactions and I put them in a spreadsheet like this. In, in that spreadsheet, I want to know who is the owner. Do you have ability to get to them? How much do you spend with them? How much revenue do they have? And do you think you could add value to the business? So think about it like this. My list here, you can see I've got Griselle. She's my cleaning lady. I spend $2,000 a month on her because I'm a dirty girl. But she has a lot of stuff for me. The total revenue that she has in the business when I ask her about it is $150,000 a year. When I talk to Grizzly about her cleaning business, I'm like, you know, do you have a website? No. Do you have subscriptions? No. Do you have employees? No. Do you, have you ever increased your prices? No. Do you offer upsells? Do you have additional services? No. Mike, wait a second. I could probably add some value here. Then we've got Susanna. This is one of my property managers. I pay her about 6,500 bucks a month. Her business overall, when I ask her, is about $420,000 a year. Then I look at hers and I'm like, okay, she has a website. She has some employees. And then I ask her, when was the last time you raised your prices? She says she hasn't since she started the business three years ago. Then I ask her, hey, have you ever looked to add additional services on top of it? Like, do you take a cut if you're managing Airbnb of different vendors that you source to Airbnb attendees? No. No. So I'm like, okay, I think I could grow this business. And then the third one on there is Oscar. Oscar's my hand handyman. I kind of spend like 500 bucks a month. I don't know, random stuff for him. Turns out his business is big, though. It's a million bucks a year. He has a lot of services that he offers and employees that work for him. But I realized that his website's kind of crappy. He really has no reviews on Google. All of his business is through referrals, and he has no tech incentive inserted into his business. So I'm like, I could grow this bad boy. So how this conversation happens is after I've pulled this list of of people in order to figure out if they have a real business or not, you would be shocked what people will tell you. So I just went to Grisel and I said, hey, you know, I'm investing in and looking to own part of small businesses kind of like yours. I don't know how much revenue you do in your business, but if it's a right fit for me and you, potentially, I could invest and help you grow the business if that would be interesting to you. How much revenue do you do, Grisel? And then she tells me, you can steal my script on the that. I even showed you a text message I sent to one of my owners to see if they would have this conversation with me. So I sent that text. They said, yes. Here's how the process goes for Venmo. You pull up your Venmo spend. You list all of the people like I just showed you. Then you go through that list and you go, nah, I don't want to own a handyman company. I don't want to own a cleaning company. Property management. That's cool. I could own part of that. I want to grow that. So that's your must have have list. Then you go and you have the owner conversation. You send the text message like, I Sent you. You have that quick one line question. You ask them to figure out revenue like I did, and then once you have how much revenue they make plus, you kind of know what the margins of an industry are because you have ChatGPT. You can Google right now what type of profit or profit margin is on this type of business at this size, and it will tell you you can figure out what the business is worth. So if I go, okay, Griselle makes $200,000 a year. She has a cleaning business. I go to chat GPT, the chatGPT is going to tell me that cleaning businesses have about a 20 to 25% margin. So I go, okay, she makes 20 to 25% of $200,000. So now I take 20% of $200,000. I times it by 2 to 3x. And now I have the value of the business. I didn't even have to pull out X calculator to do it. Now I can start thinking about the offer. The reason why most people will never do this is because it's scary. You're like, can I really ask somebody how much revenue they make in their business? You go, no, they're going to murder you for doing that. What are you worried about? Like, you just do the thing that most people won't because you can literally measure your success by the number of difficult conversations you're willing to have. All right, so that's step one. The second way that I go and find businesses for sale that nobody knows about is called my personal P and L review. You ask yourself, where do I spend money that isn't Amazon? AKA where else do I spend money? Where the business is small enough where I could actually get to the owner. I want you to open up your credit card statement. Then I want you to look at what do you spend money on? You can categorize it really quickly in Excel by just filtering it. Then I want you to take out any big business. You guys know all the names of the big one. If it's Amazon, you probably can't buy it. Then I want you to list them by, okay, all of these businesses look small enough, I think I can get to the owner. Or even better, I know the owner. Now I want you to look at those businesses and think, am I interested in them and how big do I think they are? And then I want you to start working the process. So we're going to do the exact same thing in this spreadsheet. Who's the owner? What do they do? How much monthly spend do you spend with Them, what's the total revenue? And can you add value to the business? So here's some examples. These are real businesses. I did this with and taught other people how to do it too. SFP was called Straight Strike Fire Productions. They're a podcast production company. I was spending $3,000 a month with them to manage my podcast back in the day. I asked Jonathan, the owner, how much do you guys do in revenue per year? He said, $350,000. I go, wow, cool. Like, what's the hardest thing going on in your business right now? He goes, getting new customers. I literally can't. I love producing podcasts. I hate sales. I hate going after people. I was like, ding, ding, ding. That's super interesting. So, so what if I go to Jonathan like I did and say, hey, if I grow your revenue by bringing you additional customers, could I get a percentage of all the additional revenue that I bring you in equity? And he said, yes. And then we did the same thing with a company called Stateless. And then Michael B. Is my accountant. I don't own any of his business, but I went through the same process with him. Now, what are the parameters on can this work for a company or can this. This not work for a company? It can't be publicly listed or huge. You got to be able to get to the owner small enough that you can actually contribute. You know, if. If you're an intern and you have no business experience, but the business you're going after is a $5 million a year business, I don't know, probably not much you can do. If you happen to be in podcast production, you've been doing it for a while, and the business is a million dollar a year business. There might be some value you can do there. And then you want to make sure that you actually want a portion of this company or the whole company. And that's how I've bought business after business. This is my actual Excel spreadsheet from Strike Fire Productions. You can see the deal that I did. You can see every single month how much money we made here on the sheet. You can see it looks like, let's see, in month one, I. I'm C. Jonathan's J. I made $5,852 on that deal. Jonathan made 8,000 the next month. Not is good. He made five, I made four. But do you want to know how much money I spent to buy 49% of that company? $10,000. So I'm making all of my money back inside of three months plus profit. And that's because I helped him grow his business and only took a percentage of the business that was bigger than what he already have. It's also how I bought out one of my former partners. I bought him out over six months. I put down a down payment on the business, I backed out the company's assets and then all of a sudden I have 100% ownership instead of 50. 50. This is how you do your personal P and L review. Same process, download all your expenses, you're going to list them all out. You're going to ask yourself, do I want to own part of this company or not? You're going to have the uncomfortable owner conversation and then you're going to make an offer. Now the truth of the matter is in doing deals, the number one reason people won't do deals is because they say they don't have any money. You can't invest with Xero, but you can show up with $0. You can learn with $0. You can network with $0. You can bring in sales was $0. So saying that you don't have any money is just not an excuse to not do a deal. You just don't have the knowledge on how to be valuable even without cash. The next way I want you to think about finding off market deals is called the nine to fiverr strategy. I want you to think about where you work and I want you to look around and think about is the business that you work in or any of the vendor businesses that you work with a ripe candidate for a seller Financing avenue Avatar business. So do you have an older boss? Have they been running the business for a while? Does that boss not have somebody to transition the business to? Does it seem like they're ready for the next thing? If so, you might be like one of the members of our contrarian community, Jay, who bought a business that makes one and a half million dollars in revenue. And how did she do it? Well, it was actually one of her former co workers and he financed the whole deal for her. What happened? Well, this is a real conversation from Jay. You know my, she's saying my old co worker originally wanted her to run the company for him because he knew that she had some experience and she said no. But then when he said he would give her part of the equity, she changed her mind. And he was like, I'm about to retire. My wife really wants me to go skiing with her. Would you consider taking this over kind of step by step over the next three years until you own the whole business? And she said yes. And One of the keys to being a person that somebody is actually interested in transitioning their business to is that you start before you're ready and before the seller knows they're ready. One of my favorite lines from my dad is be the type of person who reaches out to others when you don't need something. And so you want to be the one to reach out to business owners and offer help when they don't need something and when you don't too. The reason that Jay nailed this is because, because she had a perfect seller financing avatar in her seller of her business, he didn't have any kids to take over the business. He thought about selling to an employee but wasn't 100% sure that the guy who had offered that to him could run the company. He didn't trust him. The business didn't have very many prospective buyers. It was a government contracting business. He was tired, burnt out, ready to exit. Now he could have sold to private equity, but he really wanted his employees to be taken care of and he didn't want to deal with a huge earn out and all the hassle and the, well, the colonoscopy that is when private equity comes in and tries to buy your business. And so he was pretty perfect. Okay. So because of all that, Jay was able to take over this business and pay the owner back over a 10 year period. And I think the number one reason that the employee to owner framework works is because you'd way rather work with the devil you know, you know than the one that you don't. If a business owner knows that you are trustworthy and they trust you in the business, they're more likely to let you take over. Okay, I next want to go into the Rolodex to ROI method which if we're not chasing deals right, like we do on market, if we're attracting them, how would we do that? And I'm going to give you some quick hits. I want you to go to places that you would never go to normally because they sound super boring. Like the local chamber commerce in these businesses are a ton of 60 plus business owners and it's very easy to strike up a very specific conversation. What do you do for a living? Oh, I buy businesses. Really? That's cool. What type of businesses? Local businesses in the southwest in professional home services. What do you do? I own a home services business. Cool. How long you been doing that for? 10 years. Wow, that's a long time. I bet sometimes you're ready to get out of that business too. Ha ha ha. Sometimes I am great. Have you ever thought about selling that business? Not saying, like to put any pressure on this, but would it be interesting to see what like a third party might evaluate your business as? And worst comes to worse, you have a price and maybe some terms from somebody. Oh, no, I guess that wouldn't be that bad. Great. Let's meet for coffee. This is the entire conversation. You are basically saying, I buy businesses. That and I gave you your deal box that are in your deal box. And I would love to discuss further with you. This beautiful business that you have, you press on the pain a little bit. I bet there are days you want to sell that business and you are in the game. Now. The other thing that I like to do is your Rolodex is not just people that you're networking with at chamber of commerce events. It's also your friends and family professionals like accountants, accountants, attorneys. These are people where everywhere they are interacting with small business owners. They just don't know it. That local coffee shop, small business. This, you know, local restaurant, small business. How about the person who does your taxes, maybe small business. And most of those people know tons of other owners. And those owners probably tell them sometimes that they're looking to sell. But nobody walks around saying, I buy. I am a buyer, business buyer. That's going to be different because you're going to do it. Now, if you're looking for people who are really going to refer business to you, I want you to remember this one line. The best predictor of future behavior is past behavior. So if you think somebody's going to change, they're likely not. What you are looking for in people who are going to refer deals to you is that they've referred deals before. It sounds weird because then you'd think, oh, they already have somebody to refer deals to. But that's not how it works. It's something called recency bias. You just want to be in touch with them more often than anybody else. So I want you to start saying to these centers of influence, hey, have you ever referred somebody like a business owner to somebody else who's selling their business? And if they say no, then you go, great, nice to meet you, bye. If they say yes, you might want to keep a conversation going. The truth that I wish that I had learned about a billion years ago is every room you're in likely has an owner ready to sell. And your network in this space actually is your net worth. So if you can just tell people that you buy businesses, you don't even have to Be good because it's not that common to buy businesses, so you can be uncommon. One of the last ways I want to talk about off market deal sourcing is social media. Now obviously you see me all over the place. Most people are just consumers of social media. Why am I on here all the time talking about business buy in? Is it because I want you guys all to buy a business? Sure. But it's because I want you to send me your deals. I want you to tell me when you have a business you want me to invest in. I want you to list your businesses for sale on Biz Scout. I've created an entire ecosystem around this. You can do the same thing. So in order to attract people, you can do something as simple as optimize your LinkedIn profile. Like we teach all of our members at Contrarian Community on it. I want you to say I bought businesses. And then you might go, but Cody, I don't buy businesses. I haven't bought one yet. And I go, but today you're declaring that you buy businesses and on a go forward basis that is going to be part of your identity. I am searching for businesses to buy and I buy this type of business. So you've got to make sure you actually share those goals and share them consistently. Once you are documenting as opposed to sharing, then more people will come to you. I also think that LinkedIn, LinkedIn, while it is a hellhole in that DM space with messaging from all sorts of nonsense vendors who just AI slop all over it, it is also a great place for connecting with business owners. And so if you can stand out like a human, just be like, hey Cheryl, this is Cody. I'd love to connect about your business. I see you run a local handyman business in Austin, Texas. I'm based here. Could we talk? That might actually work. And so I do that a lot on LinkedIn. And you know, one of the things that we've seen from our members, this is an example of Aubry doing it right here. He just goes out to family offices who own a bunch of businesses consistently and that's where he finds most of his deals. You don't have to say anything fancy or special. You have to be good, you have to be brief, you have to be gone. The other place that is so weird for me to consider buying businesses because I'm like just slightly too young for this is Facebook. Facebook groups are, are amazing for buying businesses because it's an older crowd, you know what I'm saying? So if you go in there and you search for landscaping businesses in the southwest Landscaping communities, Landscapers United, you're going to be shocked. Like look at these. In the 20 mile radius of where I was searching, there's three groups with like 50 members who are all landscaping companies. The next one's another boring one for you. But boring is often where the billions are. I want you to identify industry specific associations. So when I was in cannabis investing back in the day, I not a big user, kind of square. So like I didn't know where to go for cannabis related deals or investing. What do I do? I just go online. I search for the three or four biggest industry conferences. I went to all of them I networked like crazy. And by the next year I was keynoting one of the bigger ones. Why? Because I just went super niche into that specific industry. There are industries for everything. Coin laundry association, go to Reddit, you'll find like 400,000 handyman in one location. There are conferences like this is the H Vac conference for every industry. This H Vac conference has like 8,000 attendees at it. There are businesses all over the place place in these industry niches. When I wanted to invest in Latin America back in the day, I ran a billion dollar and assets under management business in Latin America at First Trust. I also had never been to Chile before. I was living in Dallas at the time and I went and ran our business in Chile. How did I end up doing that? Because I went to a couple industry conferences, one called Lavka and this one was the Latin American Venture Capital Association. So I go to this association, I get to know the people in charge of it. Nobody's ever reaching out to like industry association heads. They're not like getting slammed in the DMS like Gary Vee. So when you respond and say this is so cool, I love what you're doing, I'd love to meet with you. What do they say? Cool. Nobody thinks this is cool. At which point you have an entry, then the other thing I want you to think about is these online forums are incredible. Whether it's discord for younger industries, Reddit for like millennial time type industries, or Facebook groups for older industries, they have lists on lists of lists of people that you can probably go and buy businesses from. Slightly same vein industry publications. Do you know that there is a publication for every single boring business industry that I can find? This is an example of the H Vac and refrigeration industry publication which by the way is an incredible place to document if you want to buy a business. You're probably better off advertising for like 22 cents in this publication that you're buying an H Vac business than you are paying for Facebook ads. And so it's just you are narrowing your audience explicitly. One of the most powerful things you can do, though, more powerful than anything else, is go steal somebody else's 10,000 hours. I believe highly in stealing my mentor's hours. So with us, that might mean that you join the contrarian community. Because. Because I believe in collapsing timeframes. If you want to buy a business, then why don't you get on the phone with like, you know, 20 of our consultants who all they do is help people buy businesses every day and have done billions of dollars in transactions and help you get to your goal by stealing Somebody else's 10,000 hours. That to me is much better than the word that I hate more than anything, which is networking. I think networking is like what people do is when they are in corporate culture and like have forgotten that you're human, sort of. So I don't actually believe in networking organizations at all. I believe in getting in communities and getting deep in industry specific arenas because that's where the action happens, not like going to a networking event. And if you hate the idea of going and doing all of this networking and going and engaging with a ton of people and setting up your deal network, then I got you. Like, first of all, just be cool. It's not that big of a deal. You can go out and meet people or you can join the community. But if all of that makes you cringe, then let's do what we millennials and Gen Z do, which is like, apparently we don't like to talk to people in person. We just do it on the Internet. Let me show you what this looks like. If you use our off market deal scraper. So if you want to do off market deal scraping without talking to anybody, you come into Bizco, you click on off market leads. This case, I already saved a bunch for you. So what you're going to do is you're going to request a lead list. In this case, again, we're going for Austin, Texas because that's where your girl's located at. Then we go to industry and I'm saying Laundromats because I got a thing for laundromats. And then I'm going to request a lead list. It's going to pull up right here on my off market deal searches. And I'm just going to click into them. I'm like, okay, look, we've got 55 different potential businesses for me to reach out to. And look what we have here. We have the name, the address, the location, so Austin, Texas, the phone number. We also have all the social sites. For every single one of these locations, we have estimated revenue. These are going to be all over the place. We have founding years. So this one was starting in 1980. And then you can heart them one way or the other. What I love about this is now I can reach out via email, or I could reach out via Twitter or even LinkedIn and I can get right to the owner. So in this case I'm going to look through and say, huh, these look like, you know, some of these aren't exactly right, but I think we got like 30 or 40 laundromats here. Let's hammer through this list, reach out to them and see if any of these are going to be our off market leads. And then once you have one of them that you like, I'm going to save it. And when you go back to your off market lead, you can see Cody's got, you know, I've got four leads here saved. I've contacted a few of them, I've sent a follow up and I got a little CRM built in here where I don't even have to leave my house. I can just be pinging business owners direct from my computer. Isn't that cool? All right, we got one more thing for you guys to do, which is how are you going to keep your promise to yourself and make sure you actually find a business to buy. Last segment, maybe the most important. So hang with me here. If you want to do deals, you have to be consistent like we talked about before, because deal sourcing is one of the most time consuming portions of finding a business to buy. You kind of gotta kiss a lot of frogs before you find the prince in deal making. So it's up to you to be consistent with your search. Warren Buffett has a famous quote that says you can't get a baby by getting nine women pregnant in one month. I think that's true in deals too. You got to let that dude bake, you know, you got to keep that baby in that oven for nine months. And so it's the same with deal making. Then the question becomes, how do we make sure that we have a process where we get better at finding deals and sourcing them every single day? And that's when you can ask yourself, you know, do you want to just have short term fun or do you want to get rich? I would Use our goal tracker. Basically the goal tracker goes inside of your contrarian sales CRM and it looks at the number of businesses and NDAs. Non disclosure agreements you sign per week, the number of business listings reviewed. You get those auto sourced by the way for you or you can just keep your own spreadsheet. The number of deals in your deal box. So you can actually see right here, all right, I right now have 10 deals in stage one, I have four deals in stage two, I have two deals in stage three and so I can see am I really being honest about how much I am working on this or not. Then you can also follow up with how many brokers actually get back to you on time. Do you have a bunch of like basically lines out in the lake and nobody's nibbling so you're just got lines and lines and lines and it's going to keep getting tangled. So it tells you about how to get rid of those deals. Very simple. Here's what we think the stages are. Number of business listings reviewed. I want you to look at 50 or 100 of those to get your deal done. Number of NDAs signed. Usually I want that to be something like if it's 100 deals, 50, if it's 50 deals, 30. Lois submitted. These are non binding, meaning you don't have to stick with them. Letters of intent. This is you saying hey, I want to buy a business from you. I want you typically to submit somewhere between 20% of the deals for an LOI and then I want you to contact the brokers for those finally sims reviewed. This is basically have I gotten the data and information on each business? Have I looked inside of their data room? Have I seen what's on their actual transaction documents? And if I've done that then have I actually had combos with the owners? Manu a mano and finally have I submitted deals or not? This is going to be your, your deal tracker. If you want to get some examples of how long this typically takes. Emily here, who's in the group, Emily ended up buying a home services business. But you can see her journey. She passed on one stone manufacturer business. She got caught with three bankers, went through six bankers for her vocational school. She's talking to another broker right now, so she's having to talk to somewhere between five and six people for every deal that she's closing. You can ask yourself a couple questions here. You can ask yourself, are the actions I'm taking today going to lead me to a life that I want or am I just doing what I want to do as opposed to what's needed. Whenever I get stuck, I always ask myself, am I saying that won't work for me? Instead of trying to figure out how that could work for me? Only you know the answer to that. Because the truth is you got to put in the work. You're probably not where you want to be in life because you've done what you wanted and not what's necessary. So that's why accountability matters so much. Track your progress and your goals, share your goals with others and your accountability buddies and actually do the things you say you're going to. That is when you are one of the few who doesn't give up. Who's like Agnes and bought a business, who's like Tom and bought a business because they keep track of the things that they said that they were going to do. They input it into a funnel and they make sure that that funnel has enough volume to have the outcome that they want. I'm going to show you what our funnel looks like at a very high level. So you can steal my homework. So I call this the contrarian deal flow funnel. It basically keeps track of the status of each deal, when to reach out again, if you should kill the deal, and what's the reason. So here's how it works. The early stages of a deal are called initial outreach and signing NDAs and getting financials. So this is where you're getting like the name and legal structure of a business, the industry, the broker info, if there is one. You're figuring out am I doing on or off market deals. You're getting like high level financials, meaning you're only getting their revenue, profits, offer price and cash flow. That's like seller discretionary earnings. What goes in your pockets then the middle and end stages of the deal. That's where you get an initial assessment. That's your early stage due diligence. That's where you make an offer on the business and that's where you get it accepted or rejected and you close. In this level of the deal, we're getting deep finance. This is where you're like going to the house that you're going to buy, you know, and they do an evaluation of the house and you have the guy come out and go, ah, this is a mess, this is a mess. That's this stage. You're also going to get a lot of operational details, the customer base. You're going to talk to some employees, you're going to go deep. And when we do this, that is how we eat the Entire elephant. Because every single day, we're taking 10 to 20 minutes to move forward on our deals. I think a lot of times the. The reason people don't close a deal is because they weren't taking the right actions. If they looked at the actions they were taking every day in their funnel, they'd be like, oh, I haven't finished painting the house. Well, I never did buy the paint. You're like, well, how would you finish it? How are you surprised? You didn't buy the house. You didn't finish the house. You didn't buy the paint. So we want to make sure we're actually honest about what stage we're at. Because I realized something 10 or 15 years ago. I wasn't where I wanted to be in my life at point that time. I had been in finance for a while, but I was working for other people. I felt trapped. I was spending way too much money. So even though I was making a lot of money, it was going right out the door. And I remember one of my mentors told me that where he was at that day was not because of the actions that he takes day to day recently. It was because of actions he decided to take 10 years ago. And so you got to ask yourself, like, right now, where do I want to be 10 years from now? Am I doing the things today that will lead to the life I want to live in 10 years? And then I took a little graph and I plotted it. I was like, all right, if I keep doing what I'm doing right now, I can probably predict how much money I'm going to make. I can predict how much I save. I can predict what job I'll have. Why? Because I know what I did for the past five, three, one year. So just take that. Times it by 10. And when I looked at that, it scared the shit out of me, honestly. I was like, oh, my God, I'm going to be working for this long and this. This hard, and I'm still gonna kind of be caught on the hamster wheel. And I won't have actually made a material change because I have, like, flaws in my character and my execution. That means that I will get stuck here again because I'm not gonna make a material change. And then I said, okay, so what if I took the risk and did the thing I needed to do, which at that time for me was buy my first business? I was like, what if I just followed through on this? Let's say I bought business number one, and then I bought it back business every year for the next five and 10 years. And there was one trajectory where I made money. And if this is the access I, like, barely, you know, made money, right? And my savings kind of went up and down like this, and I still had to work a ton in order to do it. And then there was an inflection point where once I decided to buy a business, my life completely changed. So I have to ask yourself, do you believe that you will take the actions to get what you want out of this life? And if you do that, it's not impossible to buy a business, it's not impossible to find a business, it's not impossible to do deals. The key is you just got to start right now.