Mike Minutes Mastermind 12/04/2023

Destination.

Let's go and get started. Turn this up a bit.

All right.

Great weekend. Happy Monday.

I had one bad thing happen on the weekend. Very, very sad.

And it is. Sorry.

A couple weeks ago, I thought I.

Was able to finally get Augusta Lawncare.com after years of trying to get it. And so I paid the money after many negotiations. And they have 30 days where the broker holds it and basically back out if they want. So guess what they did. They backed out on the weekend. So back to the drawing board on that one.

I think they probably just sleuthed around a little bit, saw what. What we're doing, and figure if they sit on it longer than unicorn money and they're not even, they closed negotiation down too. So ridiculous. Very disappointing because I thought I had it in the bag. So anyways, all I want for Christmas is augustalonger.com that's literally all I want for Christmas. So we will continue to work on that. But that was a bit of a disappointment because I thought I had it in the bag. Make sure my audio.

Oh, sorry.

Audio is not good.

Go. Now we're talking.

All right, let's jump into questions.

Where's the questions?

Minutes.

Pull it up, see what we got. We got six questions for marathon Monday. Oh. Oh, no. I don't have to do this anymore.

Good. Very good.

Very good. Pull that right here. Oh, beautiful. We are living the good life now. Present Share screen.

Oh, baby. Let's go.

Oh, yeah, man. We are in business. All right, first question comes from Kyle Tarvin Moore, Oklahoma. We've talked a little bit of. We have talked a little bit about Cody Sanchez and how she promotes buying a business with little or no money down and using seller finance. I've also heard how you think acquisitions mostly don't make sense as a lot of the customer may leave after the transition.

Just depends on the industry. Yeah, most of the time, acquisitions don't work as well as originally planned. If you were to get a business with little or no money down, what would you. What would that change your view on? Would that change your view on acquisitions? Maybe it would be worth approaching local landscaping companies during the winter about a buyout and trying to create a conglomerate and plug them into the Augusta systems.

Yeah. Here's the thing. Okay? So.

The people that are most vocal about this, like Cody, have a massive social media following, which brings in tons of leads of companies that are willing to give the keys away for little to no matter. It's way harder than everyone makes it sound out to be, especially if you have no Massive following. You don't have a legal team behind you and this is a rounding error on your taxes.

And if it falls apart, doesn't matter because it's a write off. So.

If you can't build a business by yourself from scratch and make it successful, a of lot, a lot of times you lack the skills for acquisitions.

Someone could say, well, why would you ever want to build? Just buy a, skip all the steps, right? I just believe that those skills are required to actually take it to the next level, make it better, optimize for profitability, hire better management, et cetera. And you know, if you look at the background, like Cody, she worked at Goldman Sachs, she has a whole bunch of experience with mergers and acquisitions and finance and all. So like people are like, oh, like I'm just going to jump right into buying businesses for no money down.

I just don't see it work out a lot. And so I'm not against it though it definitely can be done 100%. Like technically I bought the gym for no money down because I got an SBA loan and then on my very first payment, monthly payment, he just held the eight, the drop, the, the draw for me. So I basically the $50,000, 10% down I needed on the loan I got in the first week. So I basically need to fund it. I needed to fund it for like three days. So it was basically no money down. So am I a fan of it? Yes, I am. But I had been running Augusta for six years, since five years before that. And I knew when I to go in, like what pricing need to change and who to hire and the culture was all messed up and stuff like that. So I'm not against it. I just think that your time spent on quote.

Buying out and trying to create a conglomerate would be better spent spending that time, money and energy growing your business.

Like it's the, the. Was it. I think it was Jeff Bezos that said you can determine the success of an individual by how many profitable and successful opportunities they turn down. And so, yes. Could you make money? Yes, you could. But will that make your first business more successful? Likely not. It'll actually divert your attention and split it. There's a really good video coming out tomorrow for the turnaround show. I want everyone to watch it. It's extremely important. You're going to see someone that has two different businesses, one in the hunting industry and one in lawn care and landscaping, and you're going to see what happens when they try to do both. And you're going to see it like I think at first they should close it and they kind of convinced me otherwise. And then by the end I'm like, you should definitely close this business down and just focus on the hunting one because that's what you're passionate about. That's where you spend most of your time in trying to do both of these things. Neither of them are going to be successful. So you will see that video come out tomorrow on the turnaround show. Highly recommend. Watching.

Would be very good because like especially this time of year when things are slow, holidays, you're scrolling on social media. It is easy to start getting into this thing of like all these other ideas. Like literally I, I'm not doing any of that right now. It's like literally the only thing I care about is we are focusing on scaling up command center and growing copilot. Like there's the only two things. Anything outside of that is a complete distraction. Right? It's easy right now. So for example, there's this really, really good law that's getting passed by Fannie Fannie Mae and Freddie Mac. Not a law like a, it's a loan product where for fourplexes you can now put 5% down. That was unheard of. Typically you have to pay 20 to 30% down on a fourplex. So theoretically I should go buy five or six four plexes. Makes perfect sense. Yeah, you're right. But that money, that time and the energy deployed against my higher value opportunities is going to lead up to a far higher outcome in the future. And so is it a bad opportunity? No. Is it the best use of time, money and energy? That is what should be debated. I think most time we divert our attention to too many different things and therefore the none of them have really, really hit a home run because we just got keep hitting all these bunts and bunts and bunts and bunts. It's like the thing about business, you guys got to hit one home run and you are far more ahead. It's not a linear game. It's very exponential.

Devin from Red Deer when you gross 220,000 with your business, can you take out a real estate loan for 500,000 to rent out a 4 plex? Oh wow. This is hilarious. I did not read these questions before. I promise. Or the better scale up and buy more trucks. I would just really encourage you. The fact that the 20 by the time you have closing costs, you know 50 grand that you're gonna spend on that fourplex if it was deployed against your business, you could double the business. And so let's say that that value of that home goes up 20% in the next 10 years or five years even. That's a hundred thousand dollars in increased equity.

It's going to divert your attention away in terms of management, property management, all the rest of it's not passive like everyone talks about. It's not, it's just not. And so you make $100,000 over the next five years in equity. Assuming that you sold it, let's say 10% of that gets fleshed out because of closing costs. So $90,000 you're going to make in the next five years on this real estate deal. And we're assuming that there's no cost of your time on management, which is not true. So let's just assume half of that is like actual your time involved. So let's say 50 grand you actually make in real capital gains on this property. My, my, I would venture to believe that you spent 30 to 50 grand right now in your business the next five years, you would gain a whole lot more than 50 grand. Like you could do that next year. So we underestimate the power of small business. When you're dealing with smaller numbers in massive numbers, you can't deploy millions of dollars against your small business. So yes, buying assets is a great way to keep it safe from the, the government in the form of tax havens. That's why it's in stage seven, stage seven of wealth at Augusta at 220,000. You have not yet accomplished step one. And it's not a diss or throw you under the bus. It is stay focused on that stage of growth and that step of wealth. Kyle Tyron from Moore, Oklahoma. I'm working on GM compensation for next year. Would it be a bad idea to have a low base pay like 2 to 3k per month, but have high monthly bonuses? Plus they also get profit sharing. For example, if a GM does 30 to 40k, give them $1,000 bonus, 40, 50k, et cetera, et cetera. I'd much rather align my GMs on profit and growth versus them sitting back and getting a higher base pay. Plus it would force them to actually get out there and hustle for their bonuses. Yeah, the thing, the problem is if you start incentivizing too much on.

Bonuses with a gm, there's nothing keeping them from going doing it themselves. Right. There's a sense of security that comes with a paycheck and that's why they get started with you. What I would recommend doing is giving them a big chunk of profit. Sharings to incentivize staying with you. So like my GMs might only make $60,000 in year one, in year four or five. I'm very confident someone that is a GM can easily make six figures.

If they stick to the profit sharing of 35% that they get if they start one new and existing locations. Like I tend to move those numbers up as they stick with the company more in terms of profit sharing.

So I really try to incentivize sticking around. And typically profit sharing is the thing that aligns the most with that. Most people are not going to get out of bed for two and a half thousand dollars a month and manage an entire team. And on a bad month that you like, it'd be so demoralizing for them and like, well that's just part of the business. Well then they should just go start their own, right? So if you're not going to give them at least four grand a month, like as just base pay, like the downside is so much, they might as well just go become their own business owner, right? So the person that wants that would be like, would want that is so high risk that they would probably go start their own business and take zero pay for a year and a half or two years like it typically does when you're starting a new location. Kim from Michigan. Satire. Okay, thank you for clarifying. I have an idea for the name of the equipment listing. Idea.

Equipment list.

Oh, Mike's List, Lee's List, Chuck's Trucks. Oh, that's actually pretty funny. Then you could open it to the Lawn care Millionaire page. That's hilarious. Yeah, I found out with all this stuff like with posting like so for example, when we did lawn care business for sale, we ended up taking the site down because you get too much spam and then you get blamed for legal stuff. So like if someone buys a business, for example, like happened with us and then they said it was our fault because we posted, we allowed them to post their financials and that was incorrect and therefore like it was our fault. Same thing could go here. Like same thing with Craig. Like there's all like sort of like bad stuff that has happened and they get blamed for it, which is fine. They have a whole business around it. I just don't want to create a business around Mike's List, Craigslist, Lee's List or trucks. Trucks. Oh, I have another one. Lee's Lawn Care Listing. Wow, we got alliteration. It's almost the four L's Lee's Lawn Care Listing. We got three L's in there. All right, guys, let's see here is any other questions. I think that's it for today. All right, Have a fantastic rest of your day, guys. We will see you tomorrow and Tuesday.

And it's officially December, so let's rock and roll. See you guys.