Building and selling companies

[fanocks2003]

My "One Trick Pony" is building companies and then selling them. Invest 50% of the proceeds in passive cashflow investments. Then invest the other half in another company (if all of the cash is needed that is otherwise the extra cash is put into a capital secured and tax free bond to avoid inflation errosion).

Then I will build the the next and the next company after that and sell them all and repeat the process. For me, building companies is the best way for me. It comes naturally to me and is something I do well. I have been doing it for 6-7 years now. Day in and day out.

 

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[imirza]

Nice


What steps do you take to build a company ?

Are these traditional businesses or internet ones ? Same industry or different ones ?

How long does it take from starting to selling the company ?

 

[andviv]

Yes, definitively, please do add more details if you can. This is a very interesting topic. And welcome to the forum

 

[MJ DeMarco]

My "One Trick Pony" is building companies and then selling them. Invest 50% of the proceeds in passive cashflow investments. Then invest the other half in another company (if all of the cash is needed that is otherwise the extra cash is put into a capital secured and tax free bond to avoid inflation errosion).

Then I will build the the next and the next company after that and sell them all and repeat the process. For me, building companies is the best way for me. It comes naturally to me and is something I do well. I have been doing it for 6-7 years now. Day in and day out.

I can't think of a better Fastlane definition other than to build/create assets (add value, reposition, remarket) and then sell. When I think "assets", I think business. For others, it might be real estate. This is pure Fastlane thinking and congrats to you for that.

Welcome to the board ... speed+

 

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[fanocks2003]

Nice


What steps do you take to build a company ?

Are these traditional businesses or internet ones ? Same industry or different ones ?

How long does it take from starting to selling the company ?

Imirza, I will answer your questions step by step:

What steps do you take to build a company ?
I believe there is 8 specific stages in a company cycle. You usually start out at stage 1 which is all about testing your business idea (see if people would buy your specific service/product for the price you want for it). The second stage is all about retaining exisitng customers (all about back-end sales). The third stage is all about finding a COO to run the day-to-day activities (and also find the other managers you will need such as a Head of Finance, Head of Communications and also Head of Products. The legal part I usually outsource entirely). At stage four you try to expand through JV's and other strategic partnerships. At stage five you are usually ready to sell part of your business in a private sell-off. At stage six you are usually ready to mortgage your business (at this stage your business is what is called "bankable"). At stage seven your business is ready to pay out dividents year in and year out. At stage eight you are ready to sell exclusive licenses in foreign countries (this is a very lucrative thing. You can charge millions per country in fixed fees and also ask for royalties per sold unit of service or product).

That is how I approach things when I setup a company. Never deviating. As someone on this forum said, getting rich is about following a system. This is my system.

Are these traditional businesses or internet ones ? Same industry or different ones ?

I build both internet based and offline based businesses. The process is the same whichever you choose. I know my place in business so it doesn't matter which industry I choose to create a company in. As long as there is a demand (a weakness I can help fill with my strenght) I will be there and create a company. There, of course, always need to be a demand where someone is willing to pay handsomely for your help. The rules to this game is get the best win margins possible, because great win margins means more cash when you sell.

How long does it take from starting to selling the company ?
This question is not possible to answer with one simple answer. Every industry is very different. Some industries are very, very slow when it comes to doing decision-making. Others are really quick in assessing things. The fastest company I've built took 1 year to build and 6 months, or something like that, to sell. But that was a internet based company also. You may visit the place at www.smspoker.se. A poker website where you pay with sms instead of credit card. Doesn't seem like much perhaps but it brought in some cash in the pocket and that is what matters most (because that means money to buy passive income with).

 

[fanocks2003]

I can't think of a better Fastlane definition other than to build/create assets (add value, reposition, remarket) and then sell. When I think "assets", I think business. For others, it might be real estate. This is pure Fastlane thinking and congrats to you for that.

Welcome to the board ... speed+

Thank you very much .

 

[czach41]

Very impressive. At what age did you build your first company? What do you think prepared you to succeed at building various companies? Basically, in your opinion, do you feel you were born with a "knack" for this sort of thing, or was this a subject you studied for many years before partaking in your first endeavor?

Sorry to be "putting you on the spot," but I am very, very impressed and intrigued! Speed +

 

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[fanocks2003]

Very impressive. At what age did you build your first company? What do you think prepared you to succeed at building various companies? Basically, in your opinion, do you feel you were born with a "knack" for this sort of thing, or was this a subject you studied for many years before partaking in your first endeavor?

Sorry to be "putting you on the spot," but I am very, very impressed and intrigued! Speed +

I don't mind :smxF:. I will answer your question step by step as I did before:

At what age did you build your first company?
I started my first company at the age of 16. But that was based on the Herbalife system (I became an indpendent distributor for Herbalife). But my very first business venture began already at the age of 13, when I and a close friend of mine went out and collected trash (really) and made the trash (often lamps etc) nice looking again and functionable and then we went door to door and sold the items. In one night we made something like $20-$30 (which we split evenly). Everything went to candy, of course (that was the whole idea behind selling in the first place...hehe).

What do you think prepared you to succeed at building various companies?
I started early. The thing you need to coop with is nasty people. People can really take you down to earth if they have a bad hair day :nonod:. And if you meet enough amounts of these people you will get really good at ignoring the fact that someone just called you a "naive bastard". Seriously. It becomes natural behaviour. The brain has a great way of adapting. Also I want to include Socrates Method in cooping with nasty people: Socrates method is all about (as I have interpreted it) asking the one who is nasty a question. Say they call you a "naive bastard". Then you ask the one who thinks that something like: "In what way am I naive?". That makes even the most hard boiled bully lost for word. The bully is now forced to explain in what way you are naive. In an intellectual way. When he/she has answered you just ask another question to get more clarity. In the end the same man/woman will not want to say a word to you, because they now the routine that will follow. And this method also makes people think you are stupid, a great way of getting of the hook in a word confrontation.

Basically, in your opinion, do you feel you were born with a "knack" for this sort of thing, or was this a subject you studied for many years before partaking in your first endeavor?
I belive in people having natural tendencies. Some people are naturally good at leading people. Some people are naturally good at numbers. Some people are naturally good at creating stuff etc.

I absolutly think I have a "knack" for creating new companies. Coming up with new business ideas. I don't need to force myself to do this. It is not like I schedule 5 hour a day to invent new companies. The best ideas I get is when I am trying to sleep and also when I am sipping on some hot coffee (don't ask me why this is. I don't know). When I ain't working that is.

I am naturally "intuitive" as they say (see "Myers-Briggs system"). Intuitive people find it very easy to just come up with multiple ideas and then start them up. But they are usually very, very bad at completing stuff. So that is why I am trying to, as quickly as possible, get a project going and take it to step number 3 (where I find a COO to take over the reigns of the day-to-day business). This is a paramount step for me, because I have so many business ideas that I will not even get them all up and going in my lifetime. All of them are unique in a grand way.

Some people create a new company, but they focus only on either having the best price or having created a new "schweizer knife". They are not really creating something truly innovative that changes the lifes of the entire world. Something universally functionable. That is what I am doing (I wouldn't say smspoker.se is one of those things though..hehe), something that has not been done before. Just look at Prince Alwaleed and his new monster building. Talk about innovative. Creating a new building that is more than 1 kilometres tall. Double the size of the one in Dubai which is something like 740 metres tall if I have the number right. That is innovative. Because it takes a whole new way of thinking to have that building standing erect even under enormous pressure. Such things makes me tick as nothing else. Creating something that is faster, smaller, bigger, taller, harder, softer etc. You get it.

 

[Russ H]

bump for those who have never read it.

This is NOT for the fanocks bashers.

It's for those who have not done any dd on him, and have written him off.

Read a bit.

-Russ H.

 

[littlekingaz]

That is such a great idea, and I have similar goals I would like to do, but not quite!

sounds likes a very profitable business. How exactly do you decide if it is profitable enough to sell?? I would imagine some people would be extremely dissapointed if they bought the business and realized it is not profitable.

 

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[Rawr]

This is a great thread and I love having fanocks here. I would love to hear more- for example how do you go from the "ok, this might be a good idea" to testing it, doing DD, to setting up,coming up with initial $, getting clients, advertising.. etc


Thanks for the bump Russ - loved your college post btw, very spot on

 

[ITA]

What amount of revenue do you build the company to before you sell it?

One problem I believe is that small companies, even profitable ones, often have a hard time finding buyers.