Knowing how to buy a business is a lot like knowing how to buy a rental property. First, you’ll need to know the price of the asset, then the cash flow, followed by expenses, and finally the structure. Because buying real estate is perceived as “simpler” than buying a business, most investors decide to go the real estate route—but they could be missing out. Codie Sanchez saw this opportunity when she was working in venture capital and decided to try out the business buying route herself, just on a smaller scale.
Codie can be perceived as your classic “value-add” investor, which much of the real estate investing community can relate to. She finds a business that has a strong foundation but lacks the tech or marketing to grow faster or increase its profits. When a business has a strong underlying value, just like a rental property, it’s easier than most people think to “renovate” it into something that will sell for far higher.
Codie stresses that buying businesses isn’t so different from buying real estate. She also categorizes which businesses real estate investors should buy if they’re looking to maximize their cash flow and minimize their expenses. With some help from Codie, you could be relying on much more than just rent checks soon!
In This Episode We Cover
What a “value-add business” looks like and how to find undervalued businesses
Evaluating and analyzing a business purchase and which key metrics to calculate before making an offer
Buying off-market businesses and why most business owners never consider selling (until you ask)
The three questions every investor MUST ask before buying a business
Buying instead of building and how trying to build a business can cost you much more than just money
Becoming the business owner, not the operator, and outsourcing everything you can
And So Much More!
Links from the Show
BiggerPockets Youtube Channel
BiggerPockets Forums
BiggerPockets Pro Membership
BiggerPockets Bookstore
BiggerPockets Bootcamps
BiggerPockets Podcast
David’s YouTube Channel
Hear Codie’s Interview on The BiggerPockets Business Podcast
How to Use the DISC Profile to Communicate Effectively in Business
“Contrarian Thinking” Newsletter
Quiet Light
BizBuySell
Empire Flippers
Connect with David:
David’s Instagram
David’s BiggerPockets Profile
Connect with Rob:
Rob's Youtube
Rob's Instagram
Rob's TikTok
Rob's Twitter
Rob's BiggerPockets Profile
Connect with Codie:
Codie's Twitter
Codie's Instagram
Codie's TikTok
Click here to check the full show notes: https://www.biggerpockets.com/blog/real-estate-614
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