Love What You Do! Buy a Business that Aligns with Your Goals

Can you make money and follow your dreams? Yes!

A recent article at Entrepreneur posits a framework for deciding if you might be able to turn your hobby into a business. The piece (very reasonably) revolves around the potential for monetization. “Even if you’re pursuing this mostly because of your passion,” writes CRO Timothy Carter, “you’ll still need a stream of income to offset your costs and keep the business running.” Uncontroversial!

Carter suggests the following points to use as a fulcrum between “for fun” and “business model:”

Production. One of the most straightforward options for hobbies that involve physical production is selling the physical goods you create. You can sell your art, your crafts and your structures for a price that exceeds your costs. Thanks to the prevalence of online platforms, this is a highly popular option: There are 2.1 million sellers on Etsy alone.

Viewership/readership. You can also make money just by attracting a sufficient readership or viewership. Producing blog content or regular video streams about your hobby can be your route to a steady audience; from there, you can monetize your practice with sponsorships, affiliate links and advertising.

Education. Even if the other paths don’t pan out, there may be a path to monetization by educating people on how to engage with your hobby. You can charge for lessons, private coaching sessions or group seminars; the only prerequisite is a sufficient skill level.

“The bottom line,” he concludes, “is that you’ll need to find some reliable way to generate revenue. This is possible for nearly all hobbies but is more promising for some hobbies than others.”

Production, however, can be hard to scale without sufficient systems in place. And viewership and education depend on standing out in a very crowded content consumption market.

We’d like to suggest another way: find an existing business that aligns with your passion and goals that’s for sale. Purchasing a vetted business allows you to avoid many pitfalls of creating one from scratch. “Your chances of success are far greater buying an existing business than starting your own,” says Michael Greene, President of Sam Goldenberg and Associates.  “A good broker can help you find an established business that already has a proven success model, history of revenue generation, and immediate cash flow. It can also come with much more: inventory, trained employees, a customer base, operating systems, equipment, vendors, transitional support—the list goes on. It is a more manageable risk than other options.”

“Finding an existing local business for sale can often be less risky and more satisfying and rewarding than starting completely from scratch,” says Simon Brackley, former President and CEO of the Santa Fe Chamber of Commerce. “Aspiring entrepreneurs can enjoy improvements in operations, marketing and strategy rather than starting from the ground up.”

The realm of small business is vast. If you’re concerned you can’t find a business that fits your goals, you might be surprised. Our current listings alone include art galleries, publications full of character, design studios, restaurants, a dog daycare, spas, and more. Furthermore, Baby Boomers are entering retirement age and facing choices about prioritizing health and energy post-pandemic. As they make shifts in their lives, the market for businesses is likely to become even larger and more diverse.

This has been a weird year, but the bright side is that many of us have used this time to reflect on the changes we’d like to make in our lives. Consider buying a business that helps you live your values, master your own time, and pursue your own dreams–all while mitigating risk and uncertainty. Contact us to learn more and embark on a path of business ownership and work that you love.

Tips for Buying an Essential Business

“With the idea that essential businesses can be recession-proof and even boom during a public crisis, buying one is becoming a more attractive prospect,” says franchise expert Chris Buitron in a recent Milwaukee Community Journal article.

The thought piece, “4 Factors To Consider Before Buying An Essential Business In COVID Times,” discusses a rising interest among buyers in essential businesses. The COVID-19 pandemic has many buyers rethinking what type of business they might want to own, often turning to those deemed essential such as grocery, delivery, cleaning, and home services.

When looking into buying an essential business, Buitron recommends you consider the following:

  • Focus on successful types of essential businesses, those that are more likely to succeed even when economic conditions are poor.
  • Consider franchise opportunities which offer training and support.
  • Be able to decipher between a bargain and a bad investment.
  • Make sure that owning a business is right for you and that you are right for the business.

Focus on successful types of essential businesses. Among the essential businesses  that have the potential to succeed even during difficult economic times are: delivery services, grocery stores, convenience stores, e-commerce, gas stations, cleaning services, liquor stores, auto repair, lawn care, pest control, mailing/shipping services, and contracting. “The pandemic may be with us for a while,” Buitron says. “People will be home more often, and businesses that can service their needs while home will gain customers.”

Consider franchises as ownership opportunities. While some franchises are struggling during the pandemic, others are in a better position, Buitron says. “For franchises in general, much of the industry will be entering a buyer’s market, and those with the means will find some good opportunities,” he says. “People need jobs, and franchises annually employ 9 million people in the U.S. One benefit of buying a franchise is having an organizational and management team already in place to train you and help guide you. Reach out to other franchise owners to get a sense of the company’s commitment and support.”

Know a bargain vs. a bad investment. A relatively low sale price tempts some people into making a poor buying decision on a business. Buitron says it’s important to pore over the business’ financial numbers that it recorded before the pandemic and do all the research possible – especially of the market where the business is located – to determine if it was on a growth track and what the competition is like. “Two questions you need to ask yourself as a potential buyer of an essential business are: What can you bring new to the business to make it more successful, and why was or wasn’t it profitable?” he says.

Be sure you’re up to owning a business. “There are no guarantees with owning an essential business,” Buitron says. “The pandemic has put a spotlight on their importance, but they take lots of work and organizational skills to run. If you are someone who can’t deal well with uncertainty, buying a business any time, let alone during the most uncertain time in our history, isn’t the right choice. Buying a business and committing to it requires thorough research, a passion for the business, a solid financial foundation and a leap of faith.”

If you’re looking for the right business to buy, we can help navigate the complexities of this year’s unusual market and business environment. Check out our listings here and contact us for more information!

Changing Careers and Forging Ahead

A popular article on LinkedIn this week addresses career change.  Personal growth sometimes requires new challenges. “There often comes a point in your career where it’s time to re-evaluate. Things change. You change,” writes  business podcaster Jessi Hempel.  “How do you screw up the courage to leave the safety and security of the subject you’ve mastered and start something new?” To examine this question, Hempel interviews Robin Arzon. Arzon left a secure career as a lawyer to affirm and cultivate a new version of herself: an athlete, who is now the head of fitness programming for Peleton.

Your path may take different turns, but Hempel is right–we change! Maybe you’re ready to be your own boss and embark on a career as an entrepreneur. We can help you find a business that resonates with your passions and values. Maybe you’ve been at the helm of a business for a long time and you’re ready for something new. We can help sell your business to the right buyer and set you up for your next adventure.

Here are some highlights from the interview, featuring some great insights and advice from Arzon.

On figuring out what you want to do: Intellectual folks often find that it’s simple to just dig in. But that doesn’t mean that [the work is] actually aligning with our values, with our goals, and with the happiness quotient.”

On beginning to think of herself as an athlete: ” I had to really recreate myself and start to write a different story once I realized that I was curious about what this running thing was.”

On leaving a predictable career path: “I bet on myself, and I still believe that I’m my greatest investment.”

On figuring out how to turn her fitness love into a career: “I wanted to somehow marry the business acumen that I had acquired as a lawyer with something that was forward-thinking and modern, marrying technology and entertainment. And I wanted to insert myself in that story, not telling other people’s stories, but telling my own.”

On how to tell if you’re on the right career path: “it’s just a quarterly, seasonal gut check: what am I doing? Where am I going? Have I been uncomfortable enough recently? And if the answer is no, I’m not on the right path.”

On moving forward: “In every area of our lives, we’re doing this delicate dance between tension and resistance that often creates momentum, and release from that tension so we can actually get things done.”

On building resiliency: “Willpower is a muscle. I believe that resiliency is like a muscle. The more that we visit those opportunities, the greater prepared we are for the next one.”

If any of this is sparking inspiration for you, contact us for experienced support as you take your next steps!

New Mexico Makes Top 10(s) in Site Selection State Rankings Report

New Mexico made multiple Top 10 lists in site selector Business Facilities‘ 16th Annual State Rankings Report. The Land of Enchantment is also the Land of Fantastic:

  • Workforce Development – Talent Attraction (Number 9)
  • Film Production Leaders (Number 2)
  • Unmanned Aerial Systems (Number 9)
  • Electricity Generation (Number 8)

New Mexico’s Job Training Incentive Program (JTIP) is one of the most generous in the country. NM JTIP funds classroom and on-the-job training, supporting newly-created jobs in expanding and relocating businesses.  And it reimburses 50-75% of employee wages. The program recently awarded nearly $1 million to support a total of 120 new and existing workers.

“New Mexico has a robust pipeline of businesses looking to expand in the state and relocate here,” says Economic Development Secretary Alicia J. Keyes. “We know JTIP and other assistance helps businesses bring new and higher paying employees on board, sooner and with more confidence.”

The New Mexico film industry is a state favorite, according to the recent Garrity Group survey. “It definitely contributes to a ‘cool factor’ we have here,” says Annemarie Henton, Vice President of Business and Development Marketing for Albuquerque Economic Development.

This year’s disruptions presented methodological challenges to the study. Business Facilities explains:

The process of evaluating the information we use to calculate our annual rankings usually begins in the spring. In the spring of 2020, as the unfolding calamity of the coronavirus pandemic turned all of our lives upside down, we had to decide what, if any, impact the disruptions of COVID-19 would have on the results in our 16th Annual Rankings Report.

We always try to configure our rankings as forward indicators that give you a clear picture not just of which locations are atop our leaderboard, but also who’s got the Big Mo—the assets, strategies and track record that spell growth potential.

In our 16th annual rankings, we’ve acknowledged the unique circumstances of what we all hope is a temporary disruption. We’ve dropped our overall state and metro Economic Growth Potential rankings for this year’s report; we won’t speculate on which regional economies are going to recover the fastest from this unprecedented crisis. We also reset our rankings data clock, setting it early enough to make sure that the wind-shear level turbulence the pandemic has inflicted on economies, markets and employment statistics did not skew our results. You might say we’ve quarantined COVID-19 and locked it out of our Rankings Report.

If you’re thinking of expanding or making a new move, New Mexico is a great place to buy a business! Learn more about opportunities to own a business here and contact us for more info.

Seller Financing: It Makes Dollars and Sense

When contemplating the sale of a business, an important option to consider is seller financing.  Many potential buyers don’t have the necessary capital or lender resources to pay cash.  Even if they do, they are often reluctant to put such a hefty sum of cash into what, for them, is a new and untried venture.

Why the hesitation?  The typical buyer feels that, if the business is really all that it’s “advertised” to be, it should pay for itself.  Buyers often interpret the seller’s insistence on all cash as a lack of confidence – in the business, in the buyer’s chances to succeed, or both.

The buyer’s interpretation has some basis in fact.  The primary reason sellers shy away from offering terms is their fear that the buyer will be unsuccessful.  If the buyer should cease payments – for any reason – the seller would be forced either to take back the business or forfeit the balance of the note.

The seller who operates under the influence of this fear should take a hard look at the upside of seller financing.  Statistics show that sellers receive a significantly higher purchase price if they decide to accept terms.  On average, a seller who sells for all cash receives approximately 70 percent of the asking price.  This adds up to approximately 16 percent difference on a business listed for $150,000, meaning that the seller who is willing to accept terms will receive approximately $24,000 more than the seller who is asking for all cash.

Even with these compelling reasons to accept terms, sellers may still be reluctant.  Selling a business can be perceived as a once-in-a-lifetime opportunity to hit the cash jackpot.  Therefore, it is important to note that seller financing has advantages that, in many instances, far outweigh the immediate satisfaction of cash-in-hand.

  •  Seller financing greatly increases the chances that the business will sell.
  • The seller offering terms will command a much higher price.
  • The interest on a seller-financed deal will add significantly to the actual selling price. (For example, a seller carry-back note at eight percent carried over nine years will double the amount carried.  Over a nine-year period, $100,000 at eight percent will result in the seller receiving $200,000.)
  • With interest rates currently the lowest in years, sellers can get a much higher rate from a buyer than they can get from any financial institution.
  • The tax consequences of accepting terms can be much more advantageous than those of an all-cash sale.
  • Financing the sale helps assure the success of both the sale and the business, since the buyer will perceive the offer of terms as a vote of confidence.

There are no guarantees that the buyer will be successful in operating the business.  However, it is well to note that, in most transactions, buyers are putting a substantial amount of personal cash on the line – in many cases, their entire capital.  Although this investment doesn’t insure success, it does mean that the buyer will work hard to support such a commitment.

There are many ways to structure the seller-financed sale that make sense for both buyer and seller. Creative financing is an area where your business broker professional can be of help. We can recommend a variety of payment plans that, in many cases, can mean the difference between a successful transaction and one that is not. Serious sellers owe it to themselves to consider financing the sale. By lending a helping hand to buyers, they will, in most cases, be helping themselves as well.

Contact us to learn more about selling your business, or to learn about opportunities to buy a business in New Mexico.

Happiness is a Competitive Advantage

Can positivity gain you a competitive advantage? Emphatically yes, says Harvard-trained “happiness researcher” Shawn Achor. According to Achor, author of The Happiness Advantage, “If you can raise somebody’s level of positivity in the present, then their brain experiences what we now call a happiness advantage. Your brain at positive performs significantly better than at negative, neutral, or stressed. Your intelligence rises, your creativity rises, your energy levels rise.”

A positive start to your day may increase your productivity by around 30%, says Achor. And this isn’t a bad year for some self-TLC, output-based incentives aside.

This Inc. article describes a morning routine that primes you for a constructive, positive day. For an optimal morning, Achor suggests a few deliberate minutes on gratitude, meditation, exercise, and an expression of kindness. The latter serves to boost your network as well as your mood. Specifically, try emailing or texting a different person every morning with a message of support, praise, or thankfulness. “People who do this become known as positive leaders with strong social connections–the greatest predictor of long-term happiness,” writes Inc.

By the way, New Mexico is a fabulous place to integrate morning outdoor activities into your daily life! If you’re looking to buy a business, you can sustain a high quality of life while saving money in our beautiful, affordable cities. Learn more about opportunities to buy a business in New Mexico here.



What Are Buyers Looking for in a Company?

It has often been said that valuing companies is an art, not a science. When a buyer considers the purchase of a company, three main things are almost always considered when arriving at an offering price.

Quality of the Earnings

Some accountants and intermediaries are very aggressive when adding back, for example, what might be considered one-time or non-recurring expenses. A non-recurring expense could include costs like meeting some new governmental guidelines, paying for a major lawsuit, or adding a new roof on the factory.

The argument is made that a non-recurring expense is a one-time drain on the “real” earnings of the company. Unfortunately, a non-recurring expense is almost an oxymoron. Almost every business has a non-recurring expense every year. By adding back these one-time expenses, the accountant or business appraiser is not allowing for the extraordinary expense (or expenses) that come up almost every year. These add-backs can inflate the earnings, resulting in a failure to reflect the real earning power of the business.

Sustainability of Earnings

The new owner is concerned that the business will sustain the earnings after the acquisition. In other words, the acquirer doesn’t want to buy the business if it is at the height of its earning power; or if the last few years of earnings have reflected a one-time contract, etc. Will the business continue to grow at the same rate it has in the past?

Verification of Information

Is the information provided by the selling company accurate, timely, and is all of it being made available? A buyer wants to make sure that there are no skeletons in the closet. How about potential litigation, environmental issues, product returns or uncollectible receivables? The above areas, if handled professionally and communicated accurately, can greatly assist in creating a favorable impression. In addition, they may also lead to a higher price and a quicker closing.

Golden Age of Business Acquisitions?

Business acquisitions are red hot, and all kinds of businesses are being snapped up.  Some people are under the impression that only large businesses are being acquired, but this is far from the reality of the situation.  It would surprise many to learn that so much of the “action” is, in fact, small businesses buying other small businesses.

In his Forbes article, “Take Advantage of the Golden Age of Business Acquisitions,” author Christopher Hurn explores the true state of the “acquisitions game.”  His conclusions are quite interesting.  In Hurn’s opinion, there has never been a more active time in the realm of business acquisitions.

“While it might be more interesting for media outlets to watch how two multinational pharmaceutical companies, for example, jostle for position during a big-time M&A deal,” Hurn writes, “many acquisitions will be done on Main Street as one small business acquires another.”

If you own a business and are looking to grow, then you may want to consider acquiring a competitor in order to consolidate the market.  As Hurn points out, there are many reasons that you might want to consider acquiring a business in addition to consolidating the market.  These reasons include acquiring a new product or service, acquiring a competitor that has superior technology or even identifying a business that you believe is primed for substantial growth.

Yet, there are other forces at work that are combining to make this moment the “golden age of acquisitions.”  At the top of the list of why now is a good time to investigate acquiring a business is demographics.  According to a 2019 study by Guidant Financial and Lending Club, a whopping 57% of small business owners are over the age of 50.  The California Association of Business Brokers has concluded that over the next 20 years about $10 trillion worth of assets will change hands.  A mind-blowing 12 million businesses could come under new ownership in just the next two decades!  As Hurn phrased it, “The stars are aligning for the Golden Age of business acquisitions.”

This all points to the fact that now is the time to begin understanding what kind of acquisition would best help your business grow.  Hurn believes that turning to the Small Business Administration in this climate of rapid acquisition is a savvy move.

In particular, he points to the 7(a) program and a host of reasons that the SBA can benefit small businesses.  Since the SBA lowered equity injection requirements, it is now possible to finance a staggering 90% of business acquisition deals with loan terms up to 25 years and lower monthly payments.  Additionally, the SBA 7(a) program can be used for a variety of purposes ranging from expanding or purchasing an existing business to refinancing existing business debt.

Hurn truly does have an important insight.  Baby Boomers will retire by the millions, and many of them will be looking to sell their businesses.  With 12 million businesses scheduled to change hands in just the next 20 years, now is a highly unique time not only in the history of acquisitions but also in the history of business.

We understand what is involved in working with the SBA and acquisitions.  A seasoned business broker can point you towards opportunities that you may have never realized existed. Contact us to learn more!

Should You Buy a Turnkey Business?

There are plenty of benefits to purchasing an existing business, but running a successful business can become overwhelming. If you’re considering buying a small business, but don’t know if you have enough time to commit to a significant venture, then a turnkey business model might be the right fit for you. Continue reading to discover if you’re someone who should buy a turnkey service business.

3 People Who Should Consider a Turnkey Service Business

Turnkey opportunities exist in a variety of industries including painting, cleaning, financial services, and more. Even if you’re not an expert in the industry, a true turnkey business provides everything except for staff. That means you can skip the stressful startup and jump right in. If you identify with one of the following characteristics, a turnkey service business might be the right choice for you.

  1. Entrepreneurs Looking for a Side Hustle

    As an entrepreneur, you’re continually seeking ways to earn money in addition to your current commitments. Buying a turnkey business doesn’t typically require you to drop your full-time job, or any other side hustles to be successful. Once you learn how to manage the company, you’re in control of your schedule and your workload.

    Compared to a franchise opportunity, turnkey operations often cost more to purchase initially. However, long-term costs are lower because you aren’t required to pay franchise fees, royalties, and marketing fund fees. Plus, a non-franchise, turnkey business doesn’t obligate you to follow regulations and guidelines when running your new gig. Owning and running your service-based turnkey business on your terms can help you achieve financial freedom.

  2. Seasonal Business Owners

    Whether you own an ice cream shop or a window-washing business, your goal is the same. You aim to make as much as you can during your most lucrative months. Buying an established turnkey service business can supplement your income during both your busy season and off season, creating an opportunity to drastically increase cash flow every year.

    With an established turnkey business, the services provided have already been defined and proven, so your startup phase is minimal. You may even be able to find a company that compliments a business you already own. Not only is this a fantastic way to generate additional income during your off-season, but it also provides more service variety for your existing customer base.

  3. Retirees Seeking a Job with Flexible Hours and Low Commitment

    During retirement, you can appreciate your free time without having any commitments or obligations to attend to. But sometimes, you desire additional activities and responsibilities, or you may want to supplement your savings. Investing in a turnkey business opportunity allows you to create your schedule and work as little or as much as you want. The more you work, the more chances you have to earn money, but a service-based business doesn’t have to require a high level of commitment. If you need a specific day or week off, you can always schedule around your obligations.

If any of the above descriptions make you think that you’re someone who should purchase a turnkey service business,we can help. Look through our listings to find the turnkey business for you or contact us to get started!

Albuquerque “Surging” Ahead: Top 50 Cities to Start a Business in 2020

Quite the week for Albuquerque, which made the Top 50 U.S. Cities for Starting a Business in 2020, according to a study conducted by Inc. and entrepreneurship researchers Startup Genome. These “Surge Cities” leverage local assets, human capital, and development strategy to drive success, with interesting lessons to be learned in each case. Entrepreneurship through acquisition can be a savvy path to business ownership, side-stepping some of the associated risk. Learn about about businesses for sale in Albuquerque and opportunities to join the community of business owners who are enjoying the city’s advantages!

Here’s what Inc.’s write up has to say:

Startups are growing in this desert community thanks to high-density work spaces.

No. 12 Rate of Entrepreneurship; 19 Net Business Creation; 29 Wage Growth

The economic development puzzle is coming together in New Mexico’s largest city, with a shiny new innovation zone downtown called InnovateABQ. It includes a startup incubator, an 11,000-square-foot maker space, and tech transfer offices from all of the area’s research universities and national labs. It also boasts a state-run $20 million Catalyst investment fund designed to bolster local VC investment that’s already seeing results. One promising example, which has received Catalyst backing, is advanced medical lab startup BennuBio. Licensing technology from the University of New Mexico, the company develops and prototypes instruments on the InnovateABQ campus to measure the characteristics of cells. “We’re in the middle of the desert, so we’re resource constrained,” says John Freisinger, InnovateABQ’s executive director. Now with a physical space to bring together entrepreneurs and support organizations, he notes, collaboration within the startup community is getting more efficient. “It’s one stop and you can see what’s available,” he adds. Though Albuquerque’s startup ecosystem is still young, it enjoys a higher degree of founder connectedness than the global city average, according to a 2018 report from innovation policy startup and Inc.’s Surge Cities partner Startup Genome. That’s key to building a strong long-term entrepreneurship culture. –Lindsay Blakely