Would you rather have $1,000,000 or $50,000 per year cashflow?

[danoodle]

Just thought I'd pose the question on which would you rather have. I am personally taking the "safe" route by working my way up to $50,000 per year in cashflow from rental real estate. I see it as being mostly passive and very predictable. I would probably rather have a million because of the versatility and opportunities it opens up, but I feel if I can get to this point, I will be "retired" in a sense and very happy not having to work a 9-5. Plus I can experiment with other businesses and maybe one of them would eventually take off and achieve fastlane success. Post your thoughts and opinions!

 

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[Rickson9]

I would take $1m because with the current state of US RE, $1m properly deployed in a city like Phoenix, AZ can comfortably cash flow more than $50k a year.

 

[MNentre]

I would definitely take the 1M. I feel confident that I can invest it and make more than 5% per year.

 

[The-J]

I think my answer's been said here already... Gimme the $1 million

 

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[DTS Ltd]

$1,000,000


You can acquire a $100 million company with $1,000,000.

I'd go with the $1,000,000. There are so many ways to leverage it...

 

[Kak]

1 million...

 

[socaldude]

The 1 mil bro.

Time Value of Money is the crux of passive income.

95% of people would have absolutely no freaking clue as to how to properly and competently invest 1 million. Which brings me to a need; the market needs a really good financial literacy book.

 

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[The-J]

The 1 mil bro.

Time Value of Money is the crux of passive income.

95% of people would have absolutely no freaking clue as to how to properly and competently invest 1 million. Which brings me to a need; the market needs a really good financial literacy book.

No. The market is in need of a really good financial literacy class. Everyone should be required to be financially literate upon graduation from high school. So many problems would be solved.

 

[DTS Ltd]

No. The market is in need of a really good financial literacy class. Everyone should be required to be financially literate upon graduation from high school. So many problems would be solved.

Do you think that there's a market for a 3d video game that teaches financial literacy? Someone suggested that this would be a good idea for me to implement.

 

[The-J]

Do you think that there's a market for a 3d video game that teaches financial literacy? Someone suggested that this would be a good idea for me to implement.

I have no idea. Try it and find out.

 

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[JEdwards]

$1,000,000


You can acquire a $100 million company with $1,000,000.

I am game. I have a million bucks. Please pm me some info.

 

[DennisD]

Do you think that there's a market for a 3d video game that teaches financial literacy? Someone suggested that this would be a good idea for me to implement.

There's absolutely a market for it if it was implemented in a way that gamers would understand/relate to. I've been thinking about this concept for around a year now. If you'd like to brainstorm PM me.

 

[SlimTycoon]

I am game. I have a million bucks. Please pm me some info.

Can you run a hundred million dollar company?

 

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[DennisD]

I think no matter which way you throw the dice when presented with 50k/year or 1m most people would choose 1m. I'm actually interested in a related hypothetical situation:

You own a business making 50K/year in PROFIT. You built this from the ground up. You have future vision for it and think it can go big places.

You're offered $1m today for 100% of the company. Would you stand by your 50k/year company or take the 1m and reinvest it?

 

[healthstatus]

Can you run a hundred million dollar company?

My money is on Jack to run it more than your ability to come up with a viable plan to leverage 1 million into buying a 100 million company.

 

[SlimTycoon]

Lots of people lose their shirts based on potential and the future.

Pay for profits not potential. So on that note, just based on what you've provided, yes, I would sell it and buy a much bigger company. Roll several into the first company you bought and cash out after 3 years. Believe me, after this process, you will not be thinking about your $50k/year business.


Buy a small business doing about $10million a year with about 20% margins. Over the next 3 years buy 2 companies a year to roll into the platform company. Over a period of 3 years you would have bought 6 additional companies plus the 1,=7 companies rolled into 1.

Lets say each business that you bought, all are doing the same numbers($10mill/20% margins)

Now you have a $70 million dollar company doing 20% margins. or $14 mill in profits. You'll have about $5 million worth of debt payments so that leaves $9 million on the books. You pay yourself out of the "9". You discuss your "draw" with your CPA but remember you need to leave some cash on the books for working capital and the IRS only allows you to draw a comparable amount as it relates to your daily duties. If you're the chairman and you only oversee operations while someone else runs the company, your draw will be different. Consult your CPA.

Other option.

Sell it to a Private Equity firm after 3 years or a Fortune 500. Don't worry about the debt. A large F500 company can write a check for the business and wipe out the debt with their SMALL petty cash account. :0)

On the very low end, you could expect about $25million after all is said and done. BTW, I am assuming this is a manufacturing related business. That's why my numbers are what they are.


You might be wondering, how are you going to get the money to buy the other 6 companies? You're going to use a fraction of your profits and leverage them, in addition to other financial instruments.......believe me, there are HUNDREDS of ways to finance a business.

I think no matter which way you throw the dice when presented with 50k/year or 1m most people would choose 1m. I'm actually interested in a related hypothetical situation:

You own a business making 50K/year in PROFIT. You built this from the ground up. You have future vision for it and think it can go big places.

You're offered $1m today for 100% of the company. Would you stand by your 50k/year company or take the 1m and reinvest it?

 

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[SlimTycoon]

My money is on Jack to run it more than your ability to come up with a viable plan to leverage 1 million into buying a 100 million company.

Just so you know, I've been a investment banker for 15 years and I have spent my entire career doing Mergers and Acquisitions as well as raising capital and doing leveraged buyouts. Now, I do my own deals.

website removed. is my firm. Feel free to call me anytime........ during business hours. I spend 95% of my day: Raising capital or sourcing deal flow.


What I say is coming from experience not theory. So before you pick sides, let's not jump the gun. I'd prefer to create joint venture partners not Me -vs- Jack threads

I thought that's what we are here for? Correct me If I am out of line.

 

[JEdwards]

Can you run a hundred million dollar company?

Did you wake up this morning?

 

[SlimTycoon]

Did you wake up this morning?

Ok Jack. Have fun.

 

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[JEdwards]

Just so you know, I've been a investment banker for 15 years and I have spent my entire career doing Mergers and Acquisitions as well as raising capital and doing leveraged buyouts. Now, I do my own deals.

(He removed his website name, so I will remove it here also. ) is my firm. Feel free to call me anytime........ during business hours. I spend 95% of my day: Raising capital or sourcing deal flow.


What I say is coming from experience not theory. So before you pick sides, let's not jump the gun. I'd prefer to create JV partners not Me -vs- Jack threads

I thought that's what were hear for?

You are asking if I can run a 100 million dollar company when your website doesn't even have a correct header or favicon, and your youtube video has been seen 37 times?

You want people to sell you their businesses and give you private info, when the principles are not even listed on your site. I could have your exact site up and done correctly in under 24 hours.

Can you please tell us what business you are "rolling up"right now?

And again, I am game, please pm me how I can take a million dollar investment and control a 100 million dollar company?

I would call you but i figure you are not at the office at this time, and I am not going to ask for Slim tycoon.

 

[SlimTycoon]

Are you kidding me?

This is not the kind of business in which people find you online. This is a business of connections and referrals. No one in the deal community cares about websites. That's how small business works my friend.

Business Growth Strategies by C.L. Webb, this guy here has done some AWESOME things in business. Look at his website.......it's worse than mine.


You've been online too long if you think deals are done based on a website.

You are asking if I can run a 100 million dollar company when your website doesn't even have a correct header or favicon, and your youtube video has been seen 37 times?

You want me to sell you my business and give you private info, when the principles are not even listed on your site. I could have your exact site up and done correctly in under 24 hours.

Can you please tell us what business you are "rolling up"right now?

 

[The-J]

Why is it that people come onto the forum and fight with Jack, thinking they are some Internet tough guy? I've seen this a million times and every single time, Jack has won. So, Slim, you might want to quit while you're behind only a little.

 

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[JEdwards]

Are you kidding me?

This is not the kind of business in which people find you online. This is a business of connections and referrals. No one in the deal community cares about websites. That's how small business works my friend.

Business Growth Strategies by C.L. Webb, this guy here has done some AWESOME things in business. Look at his website.......it's worse than mine.


You've been online too long if you think deals are done based on a website.

I agree, a lot of big businesses sites are crap. So you got me there.

You are legit, sorry for doubting you. Seriously. So you asked, can I run a 100 million dollar company, Even though that was not one of your requirements when you posted earlier. I believe I can. I am pretty sure I can.

So what is the next step?

 

[SlimTycoon]

The next step is to find a company to buy. The issue you will run into is, competing with investment bankers and large Private Equity Firms. They have deep pockets and can write a check, when you're going to use a vast array of financial instruments to acquire the business.

So the goal is to create a STRONG bond with the current owner over time. You want the owner to feel as if YOU ARE THE GUY to take over "his baby" not some corporate machine that could slaughter his business and outsource his employees.

That's the part that MOST buyers miss. They go straight for the kill and the scare the cat away.


For him, it's emotional, not financial. He knows he'll ge his money, he just wants it from the "right guy".

I agree, a lot of big businesses sites are crap. So you got me there.

You are legit, sorry for doubting you. Seriously. So you asked, can I run a 100 million dollar company, Even though that was not one of your requirements when you posted earlier. I believe I can. I am pretty sure I can.

So what is the next step?

 

[SlimTycoon]

I agree, a lot of big businesses sites are crap.

Yeah, look at this guys website: click here It looks very outdated. :0) He must be "fake" too.....call him, he's probably not at his desk neither.

 

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[Kak]

This is entertaining!

 

[SlimTycoon]

View attachment 3495

This is entertaining!

It is.....

 

[InMotion]

Why is it that people come onto the forum and fight with Jack, thinking they are some Internet tough guy? I've seen this a million times and every single time, Jack has won.

Not sure why but that was funny...Hey maybe I cant beat Jack "here"(whatever that means).... but damnit im looking forward to that golf game some day

 

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[Kak]

Not sure why but that was funny...Hey maybe I cant beat Jack "here"(whatever that means).... but damnit im looking forward to that golf game some day

Jack... You golf at all?

 

[JEdwards]

The next step is to find a company to buy. The issue you will run into is, competing with investment bankers and large Private Equity Firms. They have deep pockets and can write a check, when you're going to use a vast array of financial instruments to acquire the business.

So the goal is to create a STRONG bond with the current owner over time. You want the owner to feel as if YOU ARE THE GUY to take over "his baby" not some corporate machine that could slaughter his business and outsource his employees.

That's the part that MOST buyers miss. They go straight for the kill and the scare the cat away.


For him, it's emotional, not financial. He knows he'll ge his money, he just wants it from the "right guy".

Ok, that was pretty well covered in the book how to buy a good business, which I read probably 20 years ago.

Have any other insights?

Btw: I never said you were fake. I would just think that a company in the business of buying million dollar businesses would have a nicer site without a link to a hosting company and might of listed the principles, I guess I was wrong in thinking that. I have been wrong before.

Yeah, look at this guys website: click here It looks very outdated. :0) He must be "fake" too.....call him, he's probably not at his desk neither.

1. Warren buffets name is right there at the top. 2. Your name was not listed on your site. 3. You are not Berkshire. 4. Ole Warren can do whatever the hell he wants.