The Insider’s Guide to Buying Businesses with No Money Down with Jonathan Jay [The Opportunity Ep.129]

May 16, 2023

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Buying a business is a great way to skip the queue and jump straight into generating revenue. That said, purchasing a profitable business isn’t cheap.

But what if there was a way to buy a business by leveraging the business’s assets and cash flow to fund the acquisition?

This clever approach is how Jonathan Jay buys businesses with no money down. Jonathan is a serial business buyer and the founder of Dealmakers.co.uk where he teaches people to buy businesses without risking their own capital.

In this episode, Jonathan joins us to explain his approach to no-money-down financing, diving into the types of businesses that are ideal for this strategy and how to structure the acquisition using the business’ cash flow. He reveals the common mistakes buyers make and explains which characteristics first-time buyers should look for in a business. According to Jonathan,

“I encourage everyone to make your first acquisition a multimillion revenue acquisition. Go for the bigger businesses because you'll make more money. They're easier to finance, they're easier to buy. They run themselves better. They don't need you because bigger businesses have management in place already.”

Jonathan also shares behind-the-scenes details of his pandemic buying spree, where he purchased 48 nursery school businesses in 37 months. He shares the challenges that he encountered along the way as well as the important lessons he learned, including:

“Buying a business is not about the business that you will own, but the person that you become in the process. You become a far more confident person. You become a better business person. You become a better negotiator. You become a more creative thinker when you buy a business. So don't just think about the business, think about the person you’ll become in the process.”

If you’d like to learn an alternative way of buying a profitable business that doesn't require millions of dollars, then look no further. This episode is packed full of useful no-money-down acquisition knowledge and tips from a seasoned business buyer!

Topics Discussed in This Episode:

Jonathan gives us a brief look into his entrepreneurial background (02:30)
The mistakes Jonathan made buying 48 businesses during the pandemic (04:56)
The characteristics Jonathan looks for in a business (07:13)
The types of businesses that are ideal for no-money-down financing (09:55)
Buying a business with a positive cash flow is key for no-money-down financing (12:48)
How Jonathan structured his acquisitions using the business’ cash flow (17:23)
Why Jonathan uses direct mail to source his acquisitions (26:54)
The common mistakes business buyers make (30:42)
The types of businesses that are difficult to finance (34:03)
The best piece of professional advice Jonathan has ever been given or heard (36:41)

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Sit back, grab a coffee, and learn how to buy a business without spending a large lump sum of money!