my business FAILED and I lost over $100,000

And so at the time, I was proposing about an $80,000 build out of a space that was about 16, 1700 square feet.

Now, I have a relatively small audience when it comes to social media, but I think sometimes the perception is if someone makes videos online or has any sort of following, that they therefore don't make any mistakes. And especially when it comes to business or stock market trading or finances, somehow if you get behind a camera and talk about it, that you never make mistakes, well, that's not the case. And whether or not a influencer or creat decides to share those stories of how they were wrong, what they messed up on, is really up to them. But today I'm going to be sharing with you how I lost over $100,000 building a business that never actually even opened up, and what I learned from that whole process. The story starts a year ago, and that was in our area, Washington State. The pandemic really was still very prevalent. We literally just had our mask mandate removed a couple days ago here in March of 2022. So it's been two years since the pandemic started, but a year ago, we were still right in the middle of it. Everyone was still wearing ma. Fear was very high. And I had this idea that, hey, look, there's. People have gone through this pandemic for years. There's been very little social interaction. There's a lot of mental illness and people struggling with depression and anxiety. And I felt like, hey, look, I think I can do something about that or at least help some people by offering a place where people can come and meditate. They can reset their mind, reset their body using things like chirotherapy, red light therapy, ice baths, yoga. We would have saunas and salt baths and all these sort of things. And it would be a very relaxing, relaxed atmosphere. A place where people could come 247 and they would be able to take part in all these different types of therapies and just be able to relax. And the name of the business was Reset Mind and Body. It was basically like, look, you go to the gym to work out your body, but for many of us, we live in a concrete jungle. We live in apartment places. We don't have an area where we can actually have silence, have darkness, have an ice bath, like, that's cold enough, or have a sauna. And so that was really the gist behind it. Like, look, you can go here 24 7. So if you need to go here in the middle of the night just to cry, we would literally have small Rooms that were soundproof, that you could go and just let off the stress. And so that was the idea behind it. And the intention was to help other people and potentially make a good business out of this. And so at the time, I was proposing about an $80,000 build out of a space that was about 16, 1700 square feet. It was in a prime real estate location right next to Fred Meyer and Whole Foods. It was prime real estate. And in my mind, I was like, look, I understand that the rent is high, but that the location was going to be the most important part of this entire business. So how did I lose $100,000 without even opening this business up? Well, it came down to the lease. The bottom line is I signed a five year lease and our monthly rent was about $4,000 plus triple net. Triple net stands for NNN, is basically all the maintenance that goes into a commercial property that the tenants split up and pay for. So we were responsible for a piece of that. So at the end of the day, it costs about $5,000 per month just to be there for rent. Now, I was able to negotiate six months of free rent on this five year lease because at the time it was actually pretty difficult to find commercial tenants due to the fact that at that time, Covid was still a real threat to landlords in the commercial leasing space. I'm going to go into detail as to why I backed out of this deal in just a moment. But at the end of the day, what cost $100,000 is the fact that I had to get out of this lease early. I had to break the lease, and it ended up actually being rented out to Pizza Hut. So you can tell it's a great location. But in doing so, in breaking, at least I had to pay $50,000 just to break the lease, plus I had to pay about six months worth of rent. Plus there was legal fees, accounting fees, and just more design fees when it came to the architect that proposed all the plans for us to the city. So why did I back out of the deal? The bottom line is that when I came into this deal, I thought I was going to spend $80,000. However, the cost of materials literally tripled. And by the time everything was done and said it was going to cost me well over $280,000 to build out the space, because it was what's called a cold shell, or there was absolutely nothing up. There was no electric, there was no plywood. A lot of times what happens in these commercial real estate transactions is the first tenant, the person who gets the property first will a lot of times get a chunk of money or stipend from the landlord in order to build out the space. Kind of put the initial sheetrock up, put up some walls, bring in the electricity and the water. In reality, even though it's going to cost 80 to $90,000 to build up the space, I was going to get about 40 to $50,000 of that back to me from the landlord and get that refunded. So in my mind, I was like, this is fantastic. I'm going to spend 30 to $40,000 on building out the space, buying the equipment, and I'll be up and running in business. And I anticipate by the time I would have my six months of free rent, I would have built out the space and been profitable in terms of having enough members to cover the cost of. Of the facility. But then Last year, in 2021, the cost of materials went so far up, and the cost to build out was going to be so absorbent that we went from $80,000 budget to literally over $250,000 just to build out the space. Also, I underestimated just how much time it was going to take to go through the permitting process for the city of Bellingham, which is the city that we were doing business in. And they needed, they wanted every single thing so dialed in, because it was going to be a 24. 7 facility open all the time. And there's going to be certain parts of it that we wanted to make where it was self use. They didn't need a staff member in order to use things like a sauna or use things like red light therapy. And some of those things weren't really what they wanted, because they wanted there to be staff oversight and not a 24. 7 facility. But I knew from operating anytime fitness that, like, look, if people are allowed to come in and lift 400lb deadlifts in the middle of the night by themselves, surely I can convince the city of Bellingham to be able to do ice baths in the middle of the night. But that was a big, big deal, and it was going to be a lot more difficult than I anticipated. So ultimately, I backed out because the massive inflation that was happening in terms of the build out cost, as well as the fact that it was going to take months, not just a few weeks, but months and months to actually get through the permitting process. And by the time I ran my numbers, we would have burned through our six months of free rent literally before we'd even be able to start building because of the permitting process. Now I think that's kind of stupid and dumb, especially for something that was going to help, in my opinion, the community so much. Now, obviously there should be oversight, there should safety protocols, but I just thought it was way overblown. The amount of time, money and permitting that was going to go into this was just over engineered in my mind. Now at the end of the day, this all comes back to me making a mistake. And there's the fact that I should have never lost $100,000 because I should have never even got involved with this business. I got involved in this business because, hey, I wanted to help other people. I thought it was a good business opportunity. But at the end of the day, I did several key things wrong. Number one, I did not read my lease thoroughly enough to be able to know that if I was going to use it for just that type of facility, I wouldn't be able to use it for anything else. Because when we realized that we were not going to create reset mind and body, I was like, no worries, I'll take this lease and I'll turn into an office space because we need office space. But I couldn't. I was not allowed to because of the way that the lease was written. It had to be used for the exact use that I had anticipated. Now, I could not have anticipated the fact that it'd take months for permanent, that the cost of building would quadruple. However, the lease didn't care. And so when we decided that we were not going to do reset mind and body, it wasn't like I could just reuse the lease for something else. I had to break the lease or pay on that lease for the next five years, around $5,000 every month. So I should have read the lease, I should have understood the lease a lot more before signing it. And furthermore, I should have tried to get the permit somehow, like the business permit and the licensing and the plans permitted by the city before even signing the lease. The problem was, is that this space probably would have gotten bid out and someone else would have leased it prior to me getting these permitting things in place. So I literally would have done all this work for engineering and architecture, getting a permit. And then if the space would have been leased out to someone else, I very well might have lost it. And so yes, I should have done more planning prior. And there was absolutely no excuse to get into a business without ever fully knowing exactly what the permits are going to cost, exactly what they're going to entail, and the timeline for those. I Should have talked to the city of Bellingham. And, yes, I could blame the fact that they were super slow because of, you know, COVID protocols and everything like that. And that's all annoying, but at the end of the day, it's my fault. And I'm the one who lost $100,000. Now, what is the thing that I learned through this process that I will never do again and I hope you learn from? It's what I talk about a lot, and I've talked about it a lot in the past year because I literally fell into this, and that is the shiny object syndrome. And when I talk about things on this channel, and I have very strong beliefs in the systems that we create in our businesses. A lot of times, it's because it's stuff I went through, and I had to learn the hard way. I had to figure things out and make mistakes and lose a bunch of money. So when someone's like, well, why would you join Augusta Lawn Care? Join any franchise. You're giving away control. The reason you do that is to avoid all the mistakes that that franchisor has figured out. And that's what I was doing here. Reset Mind and Body. I was trying to do it independently, and I had no idea what I was doing. And going after the next shiny thing. And the next shiny thing is a relevant issue for all of us. As business owners, we're entrepreneurial. We see ideas. We see opportunities to make money. And those ideas might be plausible. They might be really good ideas. I really believe Reset Mind and Body would have done really well financially. I believe that. I believe we could have made a chain. It could have helped a lot of people. We could have made good money. But at the end of the day, the shiny object syndrome is what leads many business entrepreneurs to failure. Because it's like, well, I'm going to get into real estate, and then you start doing real estate, and you're doing well in real estate. But then you're, oh, I'm going to sell cars. Okay, well, now I'm going to get into cryptocurrency. Now I'm going to do stocks. And, oh, I got. I heard that plumbing is a great business. And they're all over the place. Business owners are all over the place, and they go after the next shiny thing. And for me, last year, Reset Mind and body was the next shiny thing. And it just spanked me because it brought me back to my senses that I need to focus. It's going after that next thing instead of just realizing that what I have Now I need to focus my time, energy and effort on and be patient. 5, 10 years is what it takes for a business to become successful. And I've had Augusta Lawn Care now for almost nine years, and the first location is doing extremely successful. But the franchise has only been around for, like, two, two and a half years. It's not time to get distracted by other things. And I could very well say, well, I was going to have a manager and I did a great manager that from day one would have done a great job. I would not have to spend hardly any time there. It would have been relatively passive, but it was still another thing that would have been added to my plate. And right now, my sole focus for the next five to 10 years has to be Augusta Lawn Care in order to actually maximize the opportunity and make it the highest return for our franchisees and for the business at large. At the end of the day, there's always gonna be lots of opportunities, things that you could do to make money, businesses that you could start and that are great opportunities, but doesn't mean that you need to do them all. You need to focus on one and make it successful. And that means five, 10 years of patience, building that thing, getting distracted in years 1, 2, 3, 4, and 5 in other businesses, different sectors, different industries, different ways to make money, different investment opportunities is absolutely crazy. And I had to learn the hard way. And that's why I'm so passionate about things I talk on this channel because I learned them the hard way. I lost $100,000. I don't want you to as well. So please learn from my mistakes, stay focused and plan better for your businesses. So I hope that the mistakes that I've made, like reset mind and body, you don't have to repeat, you have to duplicate. Not looking at a lease and understanding that you can only use it for one thing. These are the things that we as business owners have to slow down, stay focused, and put blinders on. As we're racing like they do a racehorse, they put blinders on so can only see the finish line, can't see the rowdy crowd and people over here and all the other horses and everyone, their competitors, like, stay focused on the finish line. What you're doing now, do the boring work of building a solid business. My name is Mike Andes. I'm the founder of Augusta Lawn Care. We have over 85 locations around North America. And if you want to see the most underrated business, the most underrated industry, check out this video right here where I talk about not the fun, exciting, flashy, best thing since sliced bread type of business industry. But it's absolutely the most underrated way to become a millionaire. This year. Here it is.