How to Buy Your Company with Someone Else’s Money & Create Multiple Liquidation Events
Capability Amplifier
Is It Easier to Buy Businesses That Are Bigger Than Yours?
i thinka again, the way i like to frame it is, imagine you had a business, and you know how hard it is to grow organically. So here you can grow use some one else's money and grow with someone else's revenue. And one of the things that you've shared is it's also possible to buy businesses that are bigger than yours. Cause that is another mind expandingex absolutely. I guess most otrapnes and i've been guilty of this myself, probably still am, to be completely honest!
You know how hard it is to grow, build and scale your business.
Most of your net worth is tied up in your business and at risk.
Welcome to the entrepreneurial roller coaster!
What if you could
“buy money at a discount” (with no risk)
10x your revenue,
and buy your company so you can “take money off the table” and get liquid and still keep and remain in control of your business?
If that sounds completely impossible and counter-intuitive, welcome to the most interesting growth and exit strategy Mike has seen—and meet the guy who came up with this model.
Mike is going to repeat that last big idea: What if you could get a stack of cash by buying your business from yourself with someone else's money?
Mike's guest on today’s episode, Coran Woodmass, has a unique combination of skills allowing him to create growth and exit strategies that Mike has never seen before, in a system he calls Billion Dollar Exits.
It’s a unique way of pairing business owners with money and finding ways to multiply the value of a business with a series of strategies that he calls “Value Multipliers.”
Something Mike loves about his strategies is he creates a situation for you as a business owner to have multiple exits. One by buying your company with debt. Then one or two more with one or two subsequent buyers. Genius.
According to Coran, “I’ve always been fascinated with billionaires. What it took to become one, how big businesses were built and sold… even as a kid. It might sound strange, but it’s true.”
Nine years ago, Coran and his wife, Leanne, decided they wanted to travel the world, so they left their corporate jobs behind and started buying, building and selling online businesses. Online businesses are location independent, allowing them to travel full-time.
Coran approaches life challenges with a broad perspective. Like a chess master, he sees patterns that others do not, and he is able to partner and negotiate on behalf of his clients. He’s always thinking “How else can we do this while reducing risk and getting multiples?”
It hasn't been all sunshine and rainbows. Coran and Leanne have been through the pain he calls “An eight figure debacle.” They found a great business to sell and the right-fit buyer. Everything was set. Three days before closing, the buyer called and said, “We need to renegotiate the deal.” There was nothing wrong with the business. The buyer had an issue and it was completely out of their control.
This is very typical. Mike knows because it’s happened to him multiple times. Buyers frequently push sellers to jump through all kinds of hoops before a deal closes. The business owner takes their eyes off sales, growth and scaling during due diligence. Revenues drop. Then the buyer stalls and renegotiates. By then, the owner has already “spent the money” in their minds and winds up selling out of frustration or kills the deal.
The first time it happened to Mike, it cost $500,000. The second time cost him more than $2,000,000. The second time, Mike was better prepared, but it stings like hell.
For Coran, it was a horrific experience and something they never wanted to go through again. When the deal didn't close, Coran took it very personally and it led him on a quest. Four years and over half a million dollars later, he’s figured out EXACTLY what causes big dollar deals to close. (And how they can model billion dollar exits for small businesses as well.)
A few years ago Coran had a client that was thinking about preparing for an eventual sale of their business and how to get the maximum value out of the deal. They were already really good at what they did operationally so they thought, “what if we start acquiring smaller brands and growing for an eventual acquisition?”
Knowing what a big undertaking this was going to be, Coran made sure that they were prepared for the challenge. They jumped in with both feet. Coran raised $55 million dollars in debt to acquire several smaller brands and 3 months later they’re well on their way to $100 million in revenue.
Read this closely: they grew from $10,000,000 to almost $100,000,000 in 3.5 months…with someone else's money buying several companies.
It gets even better than that. With the remainder of the money, they bought their own company without giving up equity or control. Call that “exit #1” - putting a few million in the bank. Now they will repeat the process until they’re ready to be acquired.
Obviously there’s lots of nuance to how the deal is put together, but the bottom line is that Coran has figured out a process and a system to make BIG things happen for their clients quickly (allowing them to live the lifestyle of their dreams) using OTHER people’s money.
Mike wishes he would have met Coran a decade or two ago when he was growing his businesses. Mike could have 10x what he had built and put some cash in the bank instead of bearing the stress and anxiety of having his entire net worth tied up in his business for a decade.
Bottom line is if you have a real business, the right mindset and are coachable… Coran can help you grow and exit your business.
Listen to Mike's entire conversation with Coran and find out how to work with him and leverage the Billion Dollar Exits methodology at www.BillionDollarExits.com or email him at GIFT@BillionDollarExits.com. Coran is giving away a detailed training that walks you step by step through the mindsets and the value multipliers.
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