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Building Wealth Through Boring Businesses and Other Contrarian Ways To Live and Invest with Codie Sanchez
All the Hacks with Chris Hutchins
How Seller Financing Works in Buying Businesses
Many sellers are trapped in their businesses and cannot exit because they don't have enough cash for retirement and lack a transition plan. Seller financing, where a buyer pays back the seller from the profits of the business, is a common solution to this problem. This method is used in more than 60% of all businesses deals. In buying businesses, you don't actually need to have $100,000 or more to buy a $100,000 business, thanks to the future profits of the seller. Over 70% of these sellers do not have a transition plan for the next generation to take over or bring in somebody else. With 10-12 billion small businesses for sale, there are not enough buyers. A buyer is constantly in charge when there is a lot of supply and not a lot of demand. This is a great solution for sellers and buyers who want to exit or invest in businesses with limited cash.
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