0053 - The Real Reason You Haven't Bought a Business Yet

You've been looking at listings for months, maybe longer. Your spouse is on board. You have the finances, you've talked to a couple of brokers, but you still haven't done a deal. It's not a deal flow problem. It's not a financing problem. It's not even a timing problem. The real reason most buyers never close is that they haven't made a decision yet. And I'm not talking about the specific deal. I'm talking about themselves. Today, I want to walk you through exactly what's going on: The three reasons buyers tend to stall, and the three things that you can do to break that pattern. If this sounds familiar, stick around as we jump into it. Welcome to Business Buying for Financial Independence. I'm Tim Delaney, and I help young professionals buy small businesses so they can escape the 9 to 5 and take control of their time, income, and future. If that sounds like you, hit the subscribe button and let's get into it. If you ask a stuck buyer, somebody that's trying to buy a business, what's holding them back? I can almost guarantee you're going to hear something like, there's just no deals out there. The timing isn't quite right, or I'm still saving up a little bit more money. Things like this. I need to do some more - some more research on the industry, just haven't found the right deal yet. Those are pretty common things that I hear when I talk to people that say that they want to buy a business, but haven't done a deal yet. There's always some version of that. And it's not a lie. It is the truth. Those are valid reasons for not buying a business. But very often there's something deeper going on. None of those are really the actual problem. It's an excuse. It's a way to verbalize what's going on, verbalize a reason for not actually pulling the trigger yet. Very often it's the internal decision, the internal struggle and the the feeling of readiness that is holding people back. I've had conversations with numerous people, and it always kind of boils down to those same things of when I ask why they haven't done a deal yet or what's holding them back, it's always one of those versions, one of those those statements. But the reality is, deep down, it's just that they're not ready to pull the trigger yet. And at the end of the day, it doesn't matter how many more listings you look at, how many more brokers you talk to, how much more money you save. If you haven't made that decision internally, you're never going to be ready. From what I've experienced, I think it comes down to three kind of major reasons that people are doing the deal or don't feel ready yet. The first one is just kind of that that feeling of waiting to be ready. Early on, when I was first starting to look for a business 15 years ago, I actually found one that I thought would be a good fit. It's a bar restaurant. It came with real estate. It was a good deal. The numbers looked right and we actually came to an agreement. We put it under contract. I was moving forward in due diligence and then decided to walk away. Thinking back about that deal, thinking deeper about it - It wasn't really the due diligence part of it. It was more of me not being ready for that lifestyle, thinking more and more about that bar restaurant. Where I live, Bars are open till four in the morning. That particular place is open till four in the morning, seven days a week. Not that I had to be there every day. There was a staff in place, but it's still that - that thing in the back of my mind that goes on all night. And I wasn't ready for that lifestyle. I wasn't ready for that business. it wasn't necessarily the due diligence piece. It wasn't picking apart the numbers and the spreadsheets. It was just an internal thing of me not being ready for that type of business. It wasn't the deal problem. It was an identity problem with me and what I wanted, and I hadn't come to terms with that yet. Readiness isn't really a feeling. It's just kind of built through repetition. I couldn't necessarily have known that I wasn't going to be ready to do that deal because I hadn't looked at enough deals yet. I hadn't looked at enough bars and restaurants to have come to that conclusion. Unfortunately, I did go to the contract level, which in retrospect, I shouldn't have done - it tied up the business and held that seller tied to me for longer than he should have been. At the end of the day, he didn't end up selling it at all, and one of his sons has taken over since then and it's worked out well for him. So I guess it worked out. But me being ready was the the holdup on that particular deal. was the the holdup on that particular deal. Had I looked at more deals, had I already looked at a bar - And I guess thinking about that from that point forward, I didn't look at any more bars and restaurants. I still don't. I have no desire, no interest in bars or restaurants whatsoever. And that's because I looked at enough deals. So getting those reps in, looking at more deals, looking at the opportunities out there is one way that can help you kind of scale back and figure out what's not right for you, so that you can create a vision of what is right for you. Figuring out what you want through the repetitions, getting those reps in will help you feel more ready. getting those reps in will help you feel more ready. Waiting to feel ready - It is a common theme. I have had it. I still continue to have it in some areas of my life. So just being aware that that's out there, and that's a reason that a lot of people stall, can help you get past that. Like I said, it's getting those reps in. Looking at deals, talking to brokers, building out that confidence through looking building out that confidence through looking and talking to a number of business owners that will help you. And it doesn't always have to be through brokers. It can just be going and talking to other business owners that aren't even looking to sell right now, learning about their businesses, learning about the industries that can help give you the confidence and help you figure out what it is you want so that you can be ready. The second reason that I think a lot of people don't do deals is that they're trying to optimize for a certainty that just doesn't exist. When you're looking at businesses, it's very easy to spot flaws, and it's very easy to see the risks and to see the things that could go wrong. And a lot of people don't really look at the regular 9 to 5 job in the same way, because they can't see the risks. They don't know that that risk is there until they're handed the notice of termination, or until their new boss is just an awful human being and treats them terribly. Those risks don't exist until they're already in your face. When you're analyzing a business, it's very easy to spot those risks and you're seeing them. And so you're trying to optimize for a certain future that just isn't going to be there. There is no certainty - whether it's in your day job or whether it's in a business that you're buying. It doesn't exist. And if you can prove me wrong, please do. But just there is no certain things in life. So when you see those risks in the business, it's easy to just point them out and say, oh yeah, there's a risk there, there's a risk there. When in reality, if you really took a deep, deep look at your regular job, you'd probably see a lot more risks to your future, to your livelihood getting laid off in, you know, in this environment currently can be a very tough thing. I personally know a lot of people that have been looking for jobs for quite a long time and or have taken pretty significant pay cuts to get a new job. An example of this is one of the another business that I looked at before I bought the wine and liquor store was a pet store, and we were in contract negotiations. and liquor store was a pet store, and we were in contract negotiations. I liked the deal quite a bit. However, I ended up walking away over a few thousand dollars. I couldn't get the seller down. Significant money, But at the end of the day, when I look back at that, I think it really was just I was pointing out all of the risks in my head, and I wasn't able to come to terms with that, because in retrospect, that couple thousand dollars over the life of a loan wouldn't have really made a huge impact. It wouldn't have made a big difference in my life. However, I think the reality of it was that I just I saw too many flaws and I wasn't comparing those to the the uncertainties of my current life and my current job and what I was currently doing. So that trying to optimize for certainty, trying to eliminate all risk is something that holds people back as well. Third reason, which is kind of the deepest reason, is that people haven't made that internal identity shift yet. If you've read any self-help books or listened to any mindset type people, a lot of the things that they talk about is creating your identity before you even do it. So as somebody that's looking for a business to buy, So as somebody that's looking for a business to buy, I hear a lot of people say something to the effect of, yeah, I'm looking. It'd be nice, it'd be interesting, definitely interested. But they don't use the words - I am a business owner. I am a business buyer. I am going to buy a business with that certainty and that identity of I am a business buyer. I am somebody that is going to buy a business. And that identity shift is what can really help people move forward in the process. When you start telling people that you are a business buyer, it's a lot different than when you tell somebody that you're looking into buying a business. Those are two different mindsets, two frames of mind, and the former is Those are two different mindsets, two frames of mind, and the former is the one that actually gets your mental capacity ready to pull the trigger when the right deal comes up. It's that exploring versus doing. When I found the right deal, after looking at dozens and dozens, the wine and liquor store was there. There was still risks. There were still uncertainties. I wasn't completely ready, but I was ready to be ready. It was time to pull the trigger. I had kind of shifted mindset, although I didn't really used that terminology at the time. Something had flipped in my brain and I was ready to be ready. I knew that this deal had to get done. I knew that I needed to take the step in this direction for my future, for my family. We were in a rented apartment. We had a one year old daughter. It was time to make that decision and move forward - empty my bank accounts and did it. That's the identity of a buyer versus somebody exploring the opportunity. If you wait to feel like an owner If you wait to feel like an owner until you've actually taken action, you've waited too long. You need to start acting like an owner, acting like a buyer before you even do the deal. Walk into that first conversation with the broker or with the seller Walk into that first conversation with the broker or with the seller in the mindset of you are an owner, you are a buyer, and that will help you in the mindset of you are a buyer, and that will help you mentally prepare yourself and mentally make that decision much easier. It's not always about the spreadsheets and the numbers and all of the due diligence that you're going to do. Not that that's not important, but flipping the script and telling yourself you're an owner before you even actually buy the business will help you get there much faster. So what breaks the pattern on these three things that are holding people back? One is a strong forcing function. Sometimes this can be external. You get laid off, you have a birthday, you have a family emergency that requires you to take a lot of time off from work, and they don't want you to take the time off. An accident, a number of different things, something that forces your hand. Something that kind of pushes you out of the comfort zone. Something that kind of pushes you out of the comfort zone. Something that makes the cost of waiting visible. So when we first moved back to Buffalo, we had been able to save up a decent amount of money while I was living and working overseas. I don't know the exact numbers anymore, but it was somewhere roughly around $50,000. By the time we bought the wine and liquor store a few years later, we had whittled down some of that money. We were down to 35,000, roughly in savings, in stocks, which wasn't a great position. It was that kind of forcing function of, the way we're living and what we're doing isn't going to work forever. I spent some money on trying to start another business, and I knew that my current role working remotely for my past employer wasn't going to last forever. I knew that I needed to to take a step and do something different. And so finding those forcing functions in your life, the risk of a layoff, the risk of getting fired, the prospect of having children if you haven't had kids yet, and the expenses that are going to come with that, the desire to move closer to family and friends - if you live somewhere different right now. all those different kinds of things can be forcing factors, and you can help manufacture some of those through looking around and you can help manufacture some of those through looking around and taking a careful look at your life and what you want it to be like. A lot of times buyers are looking at deals and looking at what they stand to lose by doing a deal. What are the biggest risks of that deal? In reality, they never look at, “What are the risks of not doing that deal?” What are the risks of staying in that W2 job forever? Layoffs, don't get enough raises, don't get enough perks. Those things are rarely calculated by people. Is your salary going to keep up with your increasing lifestyle over time, especially right now? Like, I hear a lot of people complaining that they're finding it harder and harder to make ends meet with their current job because their salaries are not going up as fast as the price of everything else. But that's a risk that very few people calculate. They're quick to calculate the risks of buying a business, but very rarely calculate the risks of not buying the business. The other aspect of that is also the time aspect. Calculating the time that you haven't bought the business is time that you're not building equity. Time that you're not developing a systems and processes that can give you freedom in your life much faster. When you're working in your job, it doesn't matter how hard you're working, you're not building anything for the future. When you stop working, you're done. Every year, every month, every day that you spend not working on yourself and on your own business is time lost. And that's a risk as well. So think about those factors as to help reframe your mindset and give you that forcing function to go out and take more decisive, quicker action. The second thing that can help break this mindset and help get you ready to be ready, and to help shift you to an owner's mentality is deal flow. Looking at enough deals, getting the reps in. The more deals you look at, the more comfortable you're going to get and the more likely it is when that right deal comes along, you are going to feel confident and ready to do it because you've looked at enough in the past. You know what a good one looks like. You know what a bad one looks like. Or more likely, you've seen enough ones that don't work - that when that right one comes along, you're going to know that it's the right one when it first presents itself. I've talked to people in my mastermind and elsewhere that regret not pulling the trigger on the first deal that they ever saw. Because in retrospect, after they've looked at dozens and dozens more, they realized how good that one was. It’s going to just kind of pop out at you because you've seen enough not right ones. The third thing that can help change your mindset and help you get ready, or help you feel ready to be ready is the right room - being around the right people. Not another course. Not another podcast, not another book. Being in a room with other like minded people that are actually doing the thing that you want to do, will help you shift your mindset to that owner buyer mentality. If you're surrounded by people that are also analyzing deals, that are talking about the reasons to do a deal, the good and the bad of different deals, you're going to feel more like a buyer. You're going to feel like an owner. You're going to feel ready because you've talked to enough people. And I realize most people don't have others in their lives that have bought a business or even owned a business - whether they started it or bought it. So getting around other people that are doing this actively that are also buyers like you, it's a great way to help make your mindset ready to pull the trigger on that business when it comes along. If you don't have that group, it can be exhausting when you're looking for a business. Maybe you feel timid to tell people because you're worried about their judgment. You're constantly defending yourself to family members that think you're crazy for looking at businesses to buy, or you're trying to educate other people constantly. When you're in the right room with other people that are also buyers, you don't have to waste your time and energy on explaining yourself or defending yourself. You're supported and supporting other people that are doing the same thing. In that right room, you help cultivate better questions to ask. You have better accountability. You see other people's situations and how they're making it work, and how they're getting themselves ready to be ready. It's not just a random room or it's not just an additional education. It's the right room with the right group of people. That's what I created the Buyers’ Table for. It is that room where we get together and you can feel comfortable analyzing deals, talking through your situations, talking through your mindset to help get you ready. And so when that right deal comes along, you can pull the trigger. There's plenty of deals out there. There's plenty of financing options out there. There's a ton of tools out there. None of that is really what's stopping you. When I had that bar under contract, it wasn't really the due diligence that stopped me. It was that I wasn't ready for that lifestyle. I wasn't ready for that business. I wasn't ready to be an owner. The pet store - it wasn't just about the negotiation. It wasn't just about those couple thousand dollars. It was that avoidance. I used that price tag as an excuse because I wasn't ready. With the wine store - It stuck. It closed because I was ready. I was ready to be ready. I made that decision and I stuck with it. We needed something different. I had that forcing function. I had looked at enough deals at that point. I had gone deep into negotiations with a couple at that point, I knew that this one was the right deal, and I had also found somebody to talk to a little bit more by that time about the deal that had bought businesses in the past, and that was a game changer for me to get that extra set of eyes and to get that that extra opinion. And that's what I want for other people. I want you to have those people around you that can also help you. Again, we weren't specifically ready, but we were ready to be ready. And that shift can happen for you as well. If this resonated with you at all, and you are somebody out there If this resonated with you at all, and you are somebody out there that has been looking or exploring, but hasn't felt confident enough to make that take that next step and actually close a deal, reach out, jump on my website, take a look at the Mastermind and the Buyer's Table and see if it's the right fit for you. Put an application in, schedule a call, Put an application in, schedule a call, and we can talk it through and figure out if it's the right fit for you, if you’re at the right stage, and if it is a mindset issue. Just know that there is a business out there that can change your life. If you need help with the mindset piece, there is a seat for you at The Buyer's Table. We'd be happy to work together and find that right situation for you - that makes the most sense. There's a link in the show notes below. Hop on there and get on my calendar so we can have a conversation about it. I'll see you again soon. Cheers. Thanks for listening to Business Buying for Financial Independence. If you're serious about owning your time and building long-term wealth, make sure to subscribe so you don't miss the next episode.