Mike Andes sold five Augusta locations to one of his general managers to clear his plate for bigger projects like his Command Center and Copilot software. He calls it leaving money on the table, but frames it as the right move to focus on what matters most.
Questions this episode answers
January 10, 2024.
Five locations.
An Anytime Fitness acquisition for $550,000.
10% down payment for an SBA 7(a) loan.
Built for Business.
Hey everyone. I hope you're having a fantastic day. Welcome back to the podcast. I was out of town last week, did a turnaround in Ontario, did a turnaround in Idaho and back in the saddle. It was a really rough week last week. It was the first week of the year 2024. So my goal is to not let the first week define the next 98% of the year ahead of us in 2024.
It was a rough week to say the least. Not necessarily from a career perspective as much as just somewhat emotional. Had to make some in the business and let go of team members. And there's always so many different facets of stories when it comes to having to let someone go that is close to you they care about. That's done a lot for you and especially when you know that it is going to impact your team, impact your bottom line, and take a lot of time to actually execute on the decision. This is a very difficult week, but we look forward and we move forward. And so I am right now selling five of my locations that I own at Augusta to one of my general managers and he's gonna crush it. Really looking forward to seeing him scale those locations up. And last year I started four of them in addition to the one that was already currently there nearby Mooresville. I decided to sell it to him and when I go back into starting corporate locations myself, I'll do it in a much bigger way and in much more, probably 20 plus locations with multip regional managers, etc. But right now, given where we are currently at, I had to leave some money on the table. The locations were, I would say the valuation at which I sold them would probably have doubled, if not tripled in the next 12 months. But it's a matter of sometimes you gotta leave money on the table. And kind of what today's episode is about is walking away from a good opportunity in order to pursue a great opportunity. And so right now, the reason I did this, given everything that happened last week and the switch in management, etc. I needed to make sure, although I knew that the general manager that's now buying the locations would have crushed it as a regional manager for that area and he would have done well. I know that for a fact. I cannot have anything distract me right now. I think I mentioned in previous podcasts I closed down Built for Business. We cut back on several different areas of the business that were just very small that would take my attention here and there. And we are focusing exclusively on Augustination and Copilot. There are other Little side quests that must be done. Things like the P4P software, I'm still involved in that. The media side, obviously I travel, but it is a matter of focusing and you've got to practice what you preach. And so when this all happened last week and all of a sudden I did not have a regional manager, Yes, I could have instituted this general manager. He was already trained up their systems in place within six hours. He was actually serv as the regional manager. But I made the decision that over the next three months, it is in the best interest of Augusta Nation and the members of Copilot that I focus on those two things. And it is a greater. It achieves more by me spending my time on that than me trying to double or triple the valuation of those locations. And it kills me because it stinks. When you start locations up, usually your first year or two, it is a grind. You're just trying to put the money back in, you're reinvesting it, you're growing the customer base, you're getting the right general managers. And I felt really strong about going into this spring rush. There's an awesome group of gm' that were all came up from the field, were trained up, ready to roll, and.
You got to walk away from that and just realize that, yes, that is a good opportunity. Yes, it stinks to put effort into something and then not get a huge return on that. The return I'm gonna get from it now is going to be seeing someone else succeed massively and achieve their dreams. I know that the GM that is now gonna is now the owner of those five locations is going to absolutely crush it. And it probably.
Him forward four to five years in his kind of business career and planning, which is also a huge win. The same thing was done for me and this is what I keep going back to my mind is my very first big acquisition was Anytime Fitness and it was $550,000. But I couldn't afford the down payment. And so the previous owner, Anthony Hamilton, who used to be my boss when I was a personal trainer there, then I left for a few years as I started August.
He gave me the down payment, the 10% down required for the loan from the SBA for a 7A loan. And really I was able to get the business started and then cash flow from day one because he paid that down payment for me. And that's really the similar structure that I'm doing for my. For the locations that have now been purchased and the benefit and what I am going to get out of this is a lot of satisfaction of seeing someone just crush it, succeed and serve those general managers better. This I could have with all that's gone on in the past week. It's better that someone is closer to them, make sure they succeed, and has vested interest and equity in making sure that they crush it. And so I'm looking forward to it. It stinks to walk away from something that is a good deal. That was a good deal for me in the next 12 months, 24 months. It would have been a great win financially. But you've got to focus on the thing that's actually the most important and bringing the most value to the people that you love. And so for sometimes that is which one's gonna make the most money. Especially if you're providing for your family. You're gonna have to cut certain things out that you might be passionate about. You like, but you like, you gotta pay the bills. There's other times. And this is the case for now. And that is like, I have to look at what the aggregate positive benefit is brought by me focusing my attention on certain things. And right now, the greatest benefit to augustination is me focusing on Command Center. And we have this new thing called Crush the Rush. We have banners everywhere, mugs, mouse pads. It's a big deal. We have giving bonus checks, crushing the spring rush, and that's the big focus. And then copilot making sure that the software is. The bugs are ironed out, making sure that the features are in place before spring rush for chemicals and wait list, et cetera. So we got a lot of work ahead of us, and I need to be focused on those things. The greater opportunity has to take precedence over the good opportunity that is drowning. And I think it was Jeff Bezos. I don't remember. He said something along the lines of, you can measure someone's success by how many good opportunities they turn down. And in this case, this is a good opportunity for me. It's a great opportunity for the new owner of the locations. He's going to crush it and take his business career and hit to the next level. And something we preach at Augusta is taking your career to the next level. And I'm doing that. He is doing that, and it makes me very happy. So I hope you all have a fantastic day. I hope that this week is better than last week. I believe it will be. And if it wasn't for you, we have 98% of 2024 ahead of us. So I love you all and hope you have a fantastic day.
