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I Bought a Business for $0

280 pointsby catchmeifyoucanabout 4 years ago

23 comments

sidllsabout 4 years ago
This is as misleading as those real estate shows that promise "no money down" or "other people's money" style financing. They bought 80% of a business at 0% APR for a set of 20 installment payments. They are funding the payments with the business' revenue--meaning they are not able to pocket that cash themselves, i.e., they're using their (business) income to pay the cost of the loan.
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rvnxabout 4 years ago
The other side of the story is interesting as well: <a href="https:&#x2F;&#x2F;medium.com&#x2F;swlh&#x2F;saas-7th-time-lucky-b971dae7d36" rel="nofollow">https:&#x2F;&#x2F;medium.com&#x2F;swlh&#x2F;saas-7th-time-lucky-b971dae7d36</a><p>Essentially, the former owner had no interest into maintaining the business (serial entrepreneur) and just likes to launch new ideas
aeturnumabout 4 years ago
This seems like a great deal for everyone involved!<p>I think the real takeaway here is that many entrepreneurs are not interested in running successful business. They&#x27;d rather be starting new things! So if you are good at running businesses there&#x27;s a decent chance you can take over their business in return for letting them keep a lot of the profit. Everyone wins - the creator gets an income stream to support their future work and you get a business that&#x27;s already working.
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IkmoIkmoabout 4 years ago
Same energy as all someone saying he bought a home for $0 by buying it with a mortgage and renting it out such that the mortgage is paid by the tenant.<p>It&#x27;s completely fine saying you bought a business with $0 downpayment. But saying you bought it for $0 is just silly, you didn&#x27;t. If you did, you could close down the business the same day and walk away from it. But you can&#x27;t, because in fact you signed a contract for half a million in instalments. The article is nice but there was no need for the clickbait title.
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gandalfianabout 4 years ago
He paid for the business in instalments. The monthly instalments were less than the monthly profits. I think that is what he is saying.
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vidarhabout 4 years ago
One area I have wanted to play in, and started looking at before I ended up in my current job, was to seek out businesses where the owner wanted to sell because they struggled with the costs of scaling.<p>When I was running my consulting business, I can across several where the path to fixing this was obvious for me, and I offered people to fix their scaling challenge for a percentage of savings or a percentage of the business, but I was starting to look for businesses like this to outright purchase, as there were a number of owners who when faced with this just saw it as too complicated for them to want to deal with.<p>If I find myself back doing consulting again at some point, I&#x27;ll likely revisit that, as so many people don&#x27;t understand how to cut their hosting costs.
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surroundabout 4 years ago
&gt; we stumbled across Notify: a simple Shopify plugin that would pop up at the bottom of a website, displaying a purchase another customer had recently made.<p>Not only are these kind of pop ups incredibly annoying and an invasion of the purchaser’s privacy, they are also considered to be dark pattern.<p><a href="https:&#x2F;&#x2F;webtransparency.cs.princeton.edu&#x2F;dark-patterns&#x2F;" rel="nofollow">https:&#x2F;&#x2F;webtransparency.cs.princeton.edu&#x2F;dark-patterns&#x2F;</a> (See: Social Proof)
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iujjkfjdkkdkfabout 4 years ago
I don&#x27;t know if this qualifies as a &quot;dark pattern&quot;, but this kind of &quot;social proof&quot; feature that the article is about buying really is hostile to consumers and is nothing to be proud about buying.
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nickelproabout 4 years ago
Am I the only one who finds the initial email very unprofessional? Everything from the subject line, all lower case, even the closing words. I wouldn&#x27;t have taken an email like that seriously or would have assumed it was a scam.
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mikikianabout 4 years ago
This sounds a lot like a seller financed deal. Hopefully the seller had a secured loan against those installment payments because in the event of default, at least the seller gets his&#x2F;her company back.
alex_gabout 4 years ago
&gt; &quot;Buying up small apps in the Google Chrome or Mac app store.&quot;<p>This is a focus of mine. I&#x27;ve recently acquired a Mac app and I have a hunch that there are a lot of small Mac apps producing small but reliable income.
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totoglazerabout 4 years ago
Seems odd the previous owner accepted such a low monthly payment. I guess it required a lot of work? Or perhaps the owner felt the downside risk was substantially higher than it appears?
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dr_kiszonkaabout 4 years ago
Reviews Meta is looking for a buyer [0,1].<p>I am not affiliated at all with them, but I use the website frequently and would hate to see it discontinued or purchased by someone malicious like The Great Suspender was.<p>0. <a href="https:&#x2F;&#x2F;reviewmeta.com" rel="nofollow">https:&#x2F;&#x2F;reviewmeta.com</a><p>1. <a href="https:&#x2F;&#x2F;reviewmeta.com&#x2F;blog&#x2F;successor-to-reviewmeta&#x2F;" rel="nofollow">https:&#x2F;&#x2F;reviewmeta.com&#x2F;blog&#x2F;successor-to-reviewmeta&#x2F;</a>
Havocabout 4 years ago
How does a notification pop up move a million in yearly revenue though? I get that it’s recommending a product but still seems pretty wild
purple_ferretabout 4 years ago
From one of his other articles he linked:<p>&gt;Similar arbitrages exist everywhere. My old roommate for a while was buying Toyota Prius’ and paying people minimum wage to drive them around taking Uber rides. He&#x27;d then take the difference between what Uber paid him and what he paid his drivers… often 5-10k a month.<p>Is this legal?
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projektfuabout 4 years ago
Most veterinarians who buy practices buy their businesses &quot;for free&quot;. There is usually a large bank loan and a small seller loan. The deal is structured to pay a decent salary and cover the debt in 10-15 years.<p>Sure doesn&#x27;t feel free, though, to have a personal guarantee on a gigantic loan.
eb0laabout 4 years ago
A friend did something similar: he bought a hosting business and paid with cash the business made.<p>Totally licit.<p>It was a similar case: the founders just wanted to pivot and do something else after &gt;5 years in the business.
kitcarabout 4 years ago
&quot;I bought a business using time instead of money&quot;
barbegalabout 4 years ago
Whats the legal purpose of a letter of intent? If the letter isn&#x27;t binding then surely it has no real legal power.
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supert56about 4 years ago
Interesting article. I didn’t know about this as a method so it was useful to me. Thanks for sharing!
smoldesuabout 4 years ago
TL:DR - person spent money on company, company revenue paid off bill before it was due
taytusabout 4 years ago
TL;DR<p>Marketing bullshit for some startup.
binbagabout 4 years ago
He bought a business for $400k.