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4 Books Every Entrepreneur Should Read Before Buying a Business

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Acquisition entrepreneurship has picked up interest, both economically and here at the forum. To best honest, if I was a newbie entrepreneur and just getting started, I'd probably be more interested in acquiring a small online business, versus trying to start something new. Our most popular thread on the subject, with someone actually succeeding at it, is here:


That said, if this is a space that intrigues you, here are 4 books you should read before buying a business. The first book is currently a giveaway raffle for INSIDERS.

Buy then Build, by Walker Deibel
https://www.amazon.com/dp/1544501137/?tag=tff-amazonparser-20

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Entrepreneurs have a problem: startups. Almost all startups either fail or never truly reach a sustainable size. Despite the popularity of entrepreneurship, we haven't engineered a better way to start...until now. What if you could skip the startup phase and generate profitable revenue on day one? In Buy Then Build, acquisition entrepreneur Walker Deibel shows you how to begin with a sustainable, profitable company and grow from there.

You'll learn how to: buy an existing company rather than starting from scratch; use ownership as a path to financial independence; spend a fraction of the time raising capital; find great brokers, generate your own "deal flow", and see new listings early; uncover the best opportunities and biggest risks of any company; navigate the acquisition process; become a successful acquisition entrepreneur; and more.

Buy Then Build is your guide to outsmart the startup game, live the entrepreneurial lifestyle, and reap the financial rewards of ownership now.

Here's the Deal, by Joel Ankney
https://www.amazon.com/gp/product/1539850811/?tag=tff-amazonparser-20

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A seasoned deal lawyer demystifies the process of buying a small business. Learn about what happens before, during and after the closing of the deal. Learn what typical purchase agreement provisions mean. Educating yourself about the process, what to expect, and how to resolve common issues can help reduce stress, save time, and save on legal fees.

How to Buy a Business without Being Had, by Jack Gibson
https://www.amazon.com/dp/1426936184/?tag=tff-amazonparser-20

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Before you start wading through the buying process, it's imperative to learn about common pitfalls that often trip up unwary buyers and how to determine a fair value for a business that attracts your interest, even businesses that at first glance appear to have little or no reported earnings. Mr. Gibson, who has been helping buyers and sellers for more than thirty years, helps you do your due diligence. Make it a point to gain all the knowledge you can as you think about one of the most important financial decisions of your life. Learn what constitute the elements of value, why adjustments to financial statements are important and how to determine the accuracy of financial statements. Gibson also describes how to prepare a purchase contract that will protect your interests and ensure a smooth closing. You'll read case studies that help you discover if profits are overstated or, maybe, understated as in the case of "hidden" assets. And you'll read comments from experienced business owners who wish they had known more about how to avoid the common mistakes many buyers make. The book also contains a useful study and discussion guide.


A Practical Guide to Buying a Business, by Robert Chalfin
https://www.amazon.com/dp/B08NF32FBY/?tag=tff-amazonparser-20

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A Practical Guide to Buying a Business provides a comprehensive overview of the acquisition process—from locating a business to the final contract. The information is presented sequentially with sample forms, checklists, and agreements. Some of the topics that are covered in the book include:•Why businesses are acquired and sold•Locating a target business •Sources to consulting when searching for a business•Creating the selling memo •Using professionals to assist with the process•Due diligence- items to request along with a sample due diligence checklist•Discussion topics and questions for a productive meeting with the seller•The letter of intent, indication of interest, and term sheet— what should be included and when to use these documents.•Financial analysis and metrics—items to review when evaluating a business•Valuation, including some key factors to consider•Raising funds- sources, alternatives, and strategies.•The contract, including a brief discussion of the key components•Post-closing, including brief suggestions on operating the business following closing This book is invaluable to anyone who is interested in buying—or selling—a business along with their attorneys, CPAs, and advisors. The book includes advice and information useful for entrepreneurs seeking to build their businesses. It helps buyers and sellers to understand the process, know what to look for, avoid common pitfalls, and consummate a deal with benefits to both parties.

Any resources you'd like to share that helped you in your process? I'm currently reading Buy then Build.
 

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monfii

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It's an interesting option.

There are online businesses that make about 50 USD per month or so for sale for 1000 USD on Flippa. It could be fun to buy one and try to grow it.

However, I don't think I would take the risk to do so as a person who has never done business before. I wouldn't want to run the business into the ground due to incompetence.

But for people who already have experience in sales, marketing, and "taking initiatives to do business", why not?
 

JunkBoxJoey_JBJ

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So funny ...the buy a business from a Baby Boomer thread and “what’s coming with the Silver Tsunami” mindset has caught my attention too. Also half way through Buy Then Build.

*Literally picked this up yesterday after reading it on Kindle wanted the hands on, recommended it.
B921975C-ECFC-406D-BE94-CED83023238A.jpeg

“Other Peoples Money” with Danny Devito... not from a greed factor ....from looking at the big picture of several things within it. Recommend.
 
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JAJT

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Just finished reading "Buy Then Build", funny enough.

Not the most exciting or engaging book I've ever read but it was truly excellent at explaining exactly the concepts the author was trying to get across in a way that made perfect sense and the math was explained well.

I'd highly recommend it to anyone considering purchasing a business, for sure.
 
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MJ DeMarco

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Never mind this thread, or reading any of these books, apparently reading books is a waste of time, and you'd be better off binge watching Game of Thrones on HBO.

:rofl:

Not the most exciting or engaging book I've ever read but it was truly excellent at explaining exactly the concepts the author was trying to get across in a way that made perfect sense and the math was explained well.

Agreed.
 

krich1512

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So funny ...the buy a business from a Baby Boomer thread and “what’s coming with the Silver Tsunami” mindset has caught my attention too. Also half way through Buy Then Build.

*Literally picked this up yesterday after reading it on Kindle wanted the hands on, recommended it.
View attachment 36953

“Other Peoples Money” with Danny Devito... not from a greed factor ....from looking at the big picture of several things within it. Recommend.
Buy then Build is a great book.. Only issue if the financing.. he's calculations are based off 10% down payments on SBA loans.. which require collateral to qualify... However.. can still be a good option if you can get financing somehow
 

AusTex

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Purchasing an existing business is a good way to get a jump-start into entrepreneurship. You're not just buying the machinery or assets, but buying a running history of cash flows, customers, and branding. I agree that you shouldn't do it unless you have some decent technical, sales, or general business experience.

My experience was with buying a party bus company. I had an undergrad in business from a good school and still felt in over my head at times. I also wrote this here:
Article: How to Purchase a Small Business
 

Fritz.dvl

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Acquisition entrepreneurship has picked up interest, both economically and here at the forum. To best honest, if I was a newbie entrepreneur and just getting started, I'd probably be more interested in acquiring a small online business, versus trying to start something new. Our most popular thread on the subject, with someone actually succeeding at it, is here:


That said, if this is a space that intrigues you, here are 4 books you should read before buying a business. The first book is currently a giveaway raffle for INSIDERS.

Buy then Build, by Walker Deibel
Amazon.com: Buy Then Build: How Acquisition Entrepreneurs Outsmart the Startup Game (9781544501130): Deibel, Walker: Books

View attachment 36939



Here's the Deal, by Joel Ankney
Here's The Deal: Everything You Wish a Lawyer Would Tell You About Buying a Small Business: Ankney, Joel: 9781539850816: Amazon.com: Books

View attachment 36938



How to Buy a Business without Being Had, by Jack Gibson
How to Buy a Business without Being Had: Successfully Negotiating the Purchase of a Small Business: Gibson, Jack: 9781426936180: Amazon.com: Books

View attachment 36941




A Practical Guide to Buying a Business, by Robert Chalfin
A Practical Guide to Buying a Business: Locating a Business, Performing Due Diligence, Valuing the Enterprise, Raising Funds, and Closing the Deal: Chalfin, Robert J.: 9798563434431: Amazon.com: Books

View attachment 36942


Any resources you'd like to share that helped you in your process? I'm currently reading Buy then Build.
In many occasions I watched my mentor talking to his mentor about this book, "Mergers and Acquisitions from A-Z". Both of them read that book because they do Turnarounds.

Just hearing them talk about the deals they have done is incredible. Leveraged Buyouts (LBO), synthetic equity, Discovery's. Buying and selling businesses is a world in itself.

But what have though me is that, the best way to buy a business, or at least get part of the end tail, is not to be looking for a business that is out for sell. But rather, entering it from the back door as a consultant, so you can evaluate the business from the inside and gauge it's potential.

THEN, and only then, see if the stakeholders have any plans of selling. If not, well, you're gonna be wasting your time.
Because if someone is trying to sell a business that is "doing good", is because the business is probably NOT doing good. That's why he's trying to exit that business!

Greetings from Llama Land!
 

Parks

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I have never purchased a business as of yet, but I think Built To Sell by John Warillow & The E-Myth Revisited by Michael Gerber are also must reads when purchasing. You need to understand the concepts of how the business was built that you are buying as well.

Given I haven't read the 4 books suggested yet but I have two in queue to my read list so it may share similar concepts.
 

JunkBoxJoey_JBJ

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...finishing up Buy Then Build and signed up for Six Month to CEO by Walker. Won’t put the link here, people can find it easily enough.

So far the course takes his book (Buy Then Build) and outlines it with additional information, checklists and "homework" so to speak for people to hone-in from "Tire Kicker” to actual buyer. Personally finding it a nice addition to the book.
 
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