View Most Recent Newsletter >
Many of you with regular jobs may have daydreamed about one day becoming your own boss by starting the next Google or Amazon in your garage- but the best path to entrepreneurship isn’t the start-up, it’s buying a business that already exists.
Why? Startups are incredibly risky. You are starting with an unproven concept in an unproven location in an unproven market. Many, many startups fail.
“In fact, in the BizBuySell Guide to Buying A Small Business, author Ed Pendarvis notes that various studies by the SBA and Department of Commerce have shown that between 65 percent and 90 percent of startup businesses are no longer operating after 5 years. In fact, most startups fail in the first two years because they run out of money before they can generate a positive cash flow.”
http://www.inc.com/bob-house/want-to-reduce-risk-buy-a-business-don-t-start-one.html
It is a far safer bet to buy a business that has a proven track record – a concept, location and market that have worked for this particular business long enough for it to turn a positive cash flow.
Another major issue with a startup business is the issues that can kill a fledgling business haven’t found their way to the surface, like too many partners or zero written agreements.
“Every day, entrepreneurs who are too focused on the big idea or on near-term needs neglect what it takes to sustain long-term success. In prioritizing the short term, they unwittingly sabotage their futures.”
http://www.inc.com/eric-v-holtzclaw/5-common-startup-mistakes-that-will-sink-you-later.html
If you really want entrepreneurship to be in your future, then the far safer and cost-effective method is to buy an existing business and make it your own.
“Would you invest your money in an unproven business, or would you invest in a company who’s proven their staying power? Think about entrepreneurship in the same way. It is a far better bet to buy a business that already works instead of starting from the ground and building up.”
https://infinitybusinessbrokers.com/costs-starting-scratch-buy-an-existing-business-instead/
“What if the reason I want to own my own business is because I want to create something that is uniquely mine? You can accomplish this easily by buying an existing business. Here’s how:
Let’s say you have a really great restaurant concept. Instead of building an entire restaurant infrastructure from scratch, you can buy an already proven location that is fully equipped, furnished, licensed, staffed and stocked. When you take over the restaurant you can begin to implement your own concept over time. You will save yourself the money and the headaches of starting from scratch.”
If entrepreneurship is in your future, consider the costs and risks of a startup before discounting the opportunities available by buying an existing business. You can have a successful career as a business owner without the added risk of an unproven business.
Have you considered buying a business, but couldn’t find one that fits your goals? Do you have a great idea for a startup, but aren’t ready to take the financial risk? Please feel free to share your experiences or questions below.
Michael Monnot
941.518.7138
Mike@infinitybusinessbrokers.com
12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907
Leave a Reply