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thechosen1

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Hey all,

something has been on my mind a lot and that is the idea of multiple businesses.

You always hear about these investors and companies with portfolios of profitable companies just throwing off all this cash and making their owners rich.

My question is, how much of that is fact and how much is fiction?

If we think about owning shares of stock, obviously you can have the money system that does that to the tune of a few percent per year - maybe even 10% or so.

But I’m talking about outright business ownership with complete and total fulfillment of the Time commandment in CENTS.

Who has done it, who has seen it?

And is that exclusively reserved for the “investor” who already has millions?

Most of the time I have seen this done, it was through someone who already had a ton of wealth or liquidity from past hands-on activities or ventures. But I know there are people who do this with multiple operations somehow!

(edit: an example I know is of a 70 year old man who has owned a business most of his life and now has let it be run by his son in law. The man still collects a salary and still owns either 100% or the majority of the company but is no longer present, lives at his thousand acre ranch out of state.)

Any anecdotes or stories are welcome.
 

BizyDad

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I'm far from wealthy, but I have a client who is retiring. I currently am negotiating with his son to jointly buy the business. We've worked together for 3 years as it is, so there is an existing comfort level. In fact, he doesn't want to buy the business if I'm not involved. He'd run day to day, as normal, and my team of marketers would continue to provide marketing support. Our goal would be to grow it faster than his father felt comfortable doing, and once revenue has doubled, sell the business.

Not quite passive, but essentially nothing changes time wise vs what is happening now, from my standpoint. Whether he's a partner or a client, my time invested is roughly the same. My side is just deciding whether I want to tie up funds in this venture in exchange for a greater share of profits vs hold funds for other opportunities.

I have another client who told me when he retires, I'll be his first call for sale, since his team already knows, likes, and trusts me to keep the ship going the way it needs to.

Once I amass sufficient wealth, I will continue to look for opportunities such as these.
 

eramart

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I’ve seen this, several times actually. It involves finding and buying underappreciated, but already perfoming businesses, and growing them with a help of a partner or good hired executive. It sure does involve some wealth, because it is investing, after all, but not necessarily an extraordinary amount (and multiple parties can pool their resources, of course).
 
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thechosen1

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I'm far from wealthy, but I have a client who is retiring. I currently am negotiating with his son to jointly buy the business. We've worked together for 3 years as it is, so there is an existing comfort level. In fact, he doesn't want to buy the business if I'm not involved. He'd run day to day, as normal, and my team of marketers would continue to provide marketing support. Our goal would be to grow it faster than his father felt comfortable doing, and once revenue has doubled, sell the business.

Not quite passive, but essentially nothing changes time wise vs what is happening now, from my standpoint. Whether he's a partner or a client, my time invested is roughly the same. My side is just deciding whether I want to tie up funds in this venture in exchange for a greater share of profits vs hold funds for other opportunities.

I have another client who told me when he retires, I'll be his first call for sale, since his team already knows, likes, and trusts me to keep the ship going the way it needs to.

Once I amass sufficient wealth, I will continue to look for opportunities such as these.
That’s pretty cool. So it’s still an investment, but nothing crazy?

Still has potential to take you from 1 to 100 as opposed to 1 to 1.1?
 

thechosen1

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I’ve seen this, several times actually. It involves finding and buying underappreciated, but already perfoming businesses, and growing them with a help of a partner or good hired executive. It sure does involve some wealth, because it is investing, after all, but not necessarily an extraordinary amount (and multiple parties can pool their resources, of course).
Have you seen anyone do this *not* as a financial investment but rather with their own biz?

My gripe is that investing for 10% returns won’t make you wealthy, even if you’re doing it with extra risk.

Biz ownership is the thing that’s supposed to make you go from 0 to 100. So this should be different than say, putting in $1 million and getting an 8% return.

---
The question is, are you getting financial market returns or are you getting business owner returns?
 
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eramart

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Have you seen anyone do this *not* as a financial investment but rather with their own biz?

My gripe is that investing for 10% returns won’t make you wealthy, even if you’re doing it with extra risk.

Biz ownership is the thing that’s supposed to make you go from 0 to 100. So this should be different than say, putting in $1 million and getting an 8% return.
It is not like investing for fixed returns, you legitimately buy businesses and grow them.

For example, you can find and buy small facility that makes frozen half-finished meat products and struggles with sales and grow it ten times with your partner, who excels in sales, and simultaneously do the same with organic flour milling shop, and with local bakery, and who knows what else. Or you can be the one to grow businesses, spending time and skill, and your partners will provide financing. After some time, you sell businesses that don’t grow, invest more into those that do.

With luck, eventually you end up with several profitable business that are managed by hired personnel and continue to grow, and you and your partners handle only high-level decisions.

Edit: business owner returns, of course. And risks, you can lose everything.
 
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