26 Feb Profit from Your Passion – How successful people profit from Small Business Investing
Profit from Your Passion – How successful people profit from Small Business Investing
Even in one of the gloomier books about how life is not fair or meaningful, the author of Ecclesiastes repeats one essential key to successful (or meaningful) life – “eat, drink and find satisfaction in the work that you do”. Over the last several years Legacy Venture Group (www.BuyBizUSA.com) has had the honor of helping people find businesses that fit them well. Millions of Americans continue to search for jobs, while many others continue to leave the workforce to find the right opportunity to apply their interests and talents in an environment they can make a living.
Over the last few years, people have chosen to buy existing businesses in industries that are differ greatly from their work or education backgrounds. One of our clients has a PHD in bioscience and delights in running his group of convenience stores and gas stations.
One corporate refugee with advanced degrees and expertise in finance and tax enjoys running a really fun burger restaurant along the Florida coast.
Another corporate manager left the workforce to run a great plumbing company – and he has no plumbing experience but is growing business.
Howard Shultz left his great sales job and eventually purchased the original Star Bucks to later create the amazing legacy. Many people who have been very successful after buying an existing company have had very diverse backgrounds; most took time to explore different possibilities, but all found businesses they could be passionate about running and building.
Industry Passion – When someone chooses to own a business in an industry that they are very excited about, they are applying Industry Passion. Many people start out with something they know, like auto repair or baking, and build or buy a business based on that knowledge. Michael Gerber talks at great length about how people often start off as the “technician” in their own business and how they can build a real, sustainable business around their expertise. In his book, The E-Myth Revisited, Gerber shares the typical challenge people typically face when they try to grow their businesses around Industry Passion. I highly recommend all present and future business owners read E-Myth Revisited now.
Before choosing a business to own chiefly based on the Industry, make sure you fully understand why you want that industry. Consider how running a business in an industry, like making pies (to steal from E-Myth), can be very different from actually performing the function of making pies. It is also important to not limit yourself to industries you already know. Everyone should learn the industry that they plan to operate a business in, but your past industry experience does not have to dictate what you do next. The few examples of business owners cited above are just a small sample of people who chose to follow their hearts and passions to do something different in life. They have applied their transferable skills from past experiences, but they have also applied themselves to work in businesses that they are excited and passionate about.
Process Passion – Some people choose a particular business because they are excited about fixing it or improving it. They know that many businesses have room for improvement – some more than others. Great businesses are born from great ideas. Many such businesses become moderately successful while others never became very profitable or viable because they needed some key improvements. Ray Kroc envisioned the McDonalds concept as being a much more dynamic company when he bought it. Many Process Passion investors buy businesses that were started by Industry Passion people who had the vision to create a great idea or concepts. Process Passion investors then build upon the established vision. One of our favorite private business growers started in the 1960s with buying a hardware store but in later years owned a large bank, radio station and logistics and trucking company. He resold companies that netted tens of millions in profit to him and each business was in a different industry. He was passionate about making companies better and he applied past knowledge to new industries all the time.
If you choose to buy an existing company, don’t shy away from it just because it is not performing well, if, only if, you really have the capability and desire to make it viable. Know your interests and abilities and carefully assess your transferable skills. Craft a business plan and consult with your trusted advisors. Remember to find a business you can be passionate about leading. Ask yourself if you can still be excited about running a particular business even when handling the most mundane task or whether you can find the fortitude push through the most difficult times with a good attitude. When looking to buy any existing business, profitable or not, remember the Legacy Rule of Investment – “Buy based on potential (the potential You can draw out of it), Pay based on performance (how the business has done recently, not some far off time when things were different.”.
Remember to follow you passion and your heart. Use your head to make sure you are well prepared. Visit www.BuyBizFL.com to get an idea of what is available. Retain us for superior council, insight and help finding the right business (even if it is not on the market we can help with our buy a business advocacy system).