Ryan Begelman, Summit Series // Holistic Entrepreneurship, Philosophy + Buying A Mountain
Creator Lab - interviews with entrepreneurs and startup founders
*Joint Venture Model: Buying Existing Small Businesses *
Buying existing small businesses can be a lucrative venture as it offers better returns compared to real estate. By purchasing a small business with the help of the Small Business Administration loans, you can achieve significant returns with as little as 10% equity down, which can be raised from friends and family. Even without significant growth, buying the right business at the right price can lead to substantial profits. When considering equity splits in joint ventures for buying a business, factors such as the amount invested, work done, and risks taken play a crucial role. The joint venture waterfall method can be utilized to structure the equity split, ensuring fair share for all parties involved. In such scenarios, the operator who is actively involved in the business operations and taking risks may end up owning a larger portion of the business. Despite putting in a smaller amount like 50 grand for buying a million-dollar business, one can potentially make substantial profits depending on the business's profitability and growth potential.
