Entrepreneurs have a problem: startups. Almost all startups either fail or never truly reach a sustainable size. Despite the popularity of entrepreneurship, we haven't engineered a better way to start...until now. What if you could skip the startup phase and generate profitable revenue on day one? In BUY THEN BUILD , acquisition entrepreneur Walker Deibel shows you how to begin with a sustainable, profitable company and grow from there. You'll learn how to:
BUY THEN BUILD is your guide to outsmart the startup game, live the entrepreneurial lifestyle, and reap the financial rewards of ownership now.
This book grossly oversells the opportunity of entrepreneurship through acquisition and irresponsibly excludes numbers that go against the book's pitch. As a book that's supposed to give you an in-depth understanding of this investment type, the author is actively misleading the reader. A few quick notes to make my point:
* SDE should not be included in its entirety in your return because a part of it (or all of it) is the salary for the 8-12 hour days you are putting in to run the business. It's salary that pays for living costs that you'd be making as an employee working somewhere else. That should not be included in ROI. * Business taxes are for some reason completely excluded from ROI calculations and because loan repayment is not tax deductible, the tax burden can be meaningful * The author fails to mention that small businesses are notoriously more volatile and you need to have significant cash cushion * SBA loans as mentioned in the book require you to personally guarantee all loans which hold your personal assets and credit score as collateral, greatly increasing the overall risk/reward
One of the most interesting investment opportunities I’ve seen in the last few years is acquiring and growing a small business.
There are two macro trends driving this opportunity. One is a huge wave of baby boomers that are retiring and looking to sell their small businesses. The other is the proliferation of niche businesses on the internet which expands the number of small businesses that can operate profitably.
As Deibel points out in Buy then Build, these opportunities are largely overlooked because of the widespread belief that “real entrepreneurs” must start their own business.
20 years from now, I think “acquisition entrepreneurship” will be as common as going to a MBA program is today. In the meantime, it’s a huge opportunity to hop on the train early and Buy Then Build lays out who is a good fit for acquisition entrepreneurship and how the process works, from finding to evaluating to buying a company.
Buying and improving small companies is indeed a fantastic opportunity.
It seems to me that this book could had been shorter. Typos distract readers and make us think that you haven’t thought much about what you are communicating. There are also mathematical misconceptions, you can’t just calculate investment returns without considering when you recieve the money (it’s very different to recieve say $60 after 5 years than $12 a year during 5 years, the latter case being way more profitable). A way more appropriate metric is internal rate of return.
Also, buying businesses by borrowing 90% of the money and using your own assets as collateral is absurdly reckless. That’s playing Russian roulette. This book is supposed to be for beginners. You can’t sensibly suggest that to a beginner (nor to anyone who isn’t your enemy).
It’s too US-centric. Nowadays investors from almost anywhere can buy a business from almost anywhere. And this trend will keep growing, as companies are less location dependant.
Yes, it is a good book. Good all-round information from why buying to actually concluding a deal. I must admit I was more after information for buying companies with LBO type financial engineering. After reading more about acquisition entrepreneurship lately and not just in this book, I have come to realise that you can read a lot, but you can't learn the soft skills or on the ground skills that are required unless you actually do a deal (handheld or not). Where the author has had a tremendous advantage is that he bought his first company off his parents.
Incredibly helpful. Lots of specific advice, little fluff. The frameworks and formulas were especially helpful. One of the 2 best books I’ve read regarding acquisition entrepreneurship. Check out the authors website for more helpful blog posts and spreadsheets. Considering paying for his advisory service (it’s between them and Acquira, but the latter focuses more on home service businesses and I’m looking more at health, analytics, and others)
Most products that we use on a daily basis were companies that were bought by others. McDonalds, Google Docs, Tesla, I’d argue the second time that Steve Jobs came back to Apple. None of these were the founders. They were the people who took a product market fit business and turned them into large scale businesses.
This book I’d argue is one of the best end to end books on how to be private equity/acquisition buyer of one. It goes through vetting different companies to but and how to actually execute the purchase the company. Highly recommend if you want to get into the private equity game as an individual.
Better than start up, the buy then build approach is a great option for the entrepreneur minded who want to reduce risk and get a head start with building a business. You’ll get a good overview of the process and the key steps and pitfalls. A must read to get started before you decide to start from scratch.
Walker Deibel has written the most valuable book about the challenges and rewards of owning your own highly successful business. When read in conjunction with the available Audio Narration Walter's message is clear and easily understood...it is far better to Buy Then Build a business than to startup a new one.
This is an excellent book for all "would be" new business owners. The strategy outlined is spot on and is the type of advice I personally have given dozens of people over the years. The author, Walker Deibel, delivers on his promise to help "outsmart the startup game"!
Inspirador y una buena guia sobre el proceso específico de como adquirir un negocio pequeño. Muchos conceptos y experiencias valiosas (SDE, multiplos, mentalidad comprador, contruir memo con lo que se busca, etc) y también conceptos mas basicos pero que siempre vale la pena repasar.
* p32. Riesgo asimétrico de posibilidad de exito entre entre startups (10%), VC backed startup (25%) y adquisición de emprendimientos (98% segun tasa de default de SBA) * P46. Para emprender, antes de encontrar la compañia. Es importante tener claro los 3 atributos necesarios para manejar la empresa. Attitude, Aptitude and Action. * P66. 4 cuadrantes de tipos de negocio que existen que es necesario identificar, enternable profitable, turnaround, high growt and platfom. * P86. La razon por la que solo el 10% tiene exito. Es porque saben lo que quieren. Tipo de industria (producto, distribución o servicio), tipo de crecimiento, el tamaño de SDE y limitantes. * P105. 2 alternativas para hacer el approach para la busqueda de comprar una empresa. Hablar directamente con la persona y decirle que utilice el servicio de un broker dado para trabajar la valorización, el que luego me dará preferencia. Ir a traves de un itermediario (broker) con un mandato específico para dar mas peofesionalismo. * P121. Quiet light brokerage article on buythenbuild.com * P136. Listado temas offering memoramdum. Asking price, name, lugar, producto o servicio ofrecido, numero empleados, rol de cada uno y sueldo, analisis clientes y concentración, razon de venta, plan de crecimiento mirando para adelante. A parte de info financiera. * P180. Actitud correcta de humildad y de “venderse” frente al vendedor. Generar vinculo, credibilidad, meta en comun. Importancia de identificar las fortaliezas del vendedor para evaluar lo transferible del negocio * P188. Importancia de reflexiones luego de primera reunion con el vendedor. Importante actuar, y orientarse al proceso para realmente entender que es lo que está buscando. Entender las tres As, evaluar las habilidades, saber el nivel de involucramiento y dia a dia que quieren, tamaño de SDE, etc. * P192. Usar 5 fuerzas de porter para entender las particularidades del negocio y generar un business plan. * P204. Para generar la estrategia usar el concepto del hedhegog. Intersección entre Pasion, aptitud y rentabilidad. * P206. Business plan version resumida de Guy Kawasaki. “The only 10 slides you need in a pitch” * P212. Libros sobre unicorn toolbox. Exponential organizations. Como apalancar tech modernas en industrias tradicionales. Libro sobre product subscription. Built to sell y automatic customer. * P220. Compra de activos vs compra de acciones. Mejor para comenzar fresco en una nueva entidad
No recuerdo quién me recomendó el libro, solamente por la idea general que transmite la portada me interesó el tema y lo compré. No fue una muy buena compra.
Para opinar sobre si las consideraciones ideales hechas por el autor están cerca de la realidad necesitaría realizar mi propia investigación en temas prestatarios en México porque en el argumento del libro no solamente se parte de idealizar un entorno económico específico si no además en Estados Unidos donde como todos sabemos se cuenta con una mejor regulación que en México; pero claro está que la postura que tenga el gobierno en poder sobre el papel del ciudadano promedio en la economía nacional tiene un impacto en las variables a considerar por la Pyme.
A partir de conocimientos obtenidos en otros libros ahora entiendo que existen amplios catálogos de libros de negocios que simplifican las circunstancias económicas de las empresas estudiadas y proveen de información al lector que puede ser mal interpretada o no comparada con otras variables. Es difícil saber lo que no sabemos (y empieza a ser peligroso económicamente si nuestro medio o filtro de información tiene incentivos para mostrar un panorama muy positivo y nos incita a "tomar acción"). Sin duda no me dio buena espina cuando en el segundo capítulo mencionan a Elon Musk como un ejemplo positivo de empresario sin analizarlo al menos con un poco más de profundidad. Debido a que ya había empezado el libro tuve que al menos hojear el resto de capítulos.
Walker does a very good job in the first half of the book laying out the arguments that being an entrepreneur and especially when buying a company rather than starting from scratch is the more profitable and bears a higher likelihood of success.
The second half of the book drills down to details what one needs to be mindful of throughout the acquisition process, from negotiation to looking at the balance sheet and checking cash flow. The accounting line items like accounts payable and accounting receivable and inventory.
What I liked about the book is more like the practical examples of how one applies for the SBA loan (like you need personal guarantee and you wouldn’t be able to get home line of credit afterwards) but the downside is that it is scarce in the real world examples of people who have conducted successful small business acquisitions and a profile of those buyers/sellers as well the businesses themselves. Walker made his first step into acquisition entrepreneurship through buying his own parents’ business, thereby peeking into the buyers and sellers’ sides simultaneously. This is probably not typical of others who are starting out. What I would have liked to see would have been more examples of people who have done search funds and what those are.
This was an all-encompassing "how-to" tutorial on acquiring a business. The author did a good job of articulating his over-arching premise/hypothesis: the statistics show it is generally more lucrative to buy an existing business than to start your own. Many traditional entrepreneurs fail, and with the baby-boomer population nearing retirement (many without a true succession plan), there is great opportunity to acquire durable/successful business at fair prices, be your own CEO, add value through your skillset, and grow/exit the business at attractive returns.
The author does cover all the basis from internalizing your skillset/interests, sourcing deals, raising capital, understanding financials, negotiations, the transaction process, and transitioning into the CEO and integrating your new team.
I would have rated it higher if there were fewer typos, and if it didn't read as much as a checklist (though that is likely appropriate). I do find the subject quite intriguing (which is why I read the book), and having gone through an acquisition and multiple tuck-ins, it was nice to take a step back and truly codify the process. Again, this was a great how-to on the process and roadmap for the acquisition entrepreneur, which I believe will be quite relevant given the current state of our economy.
Walker makes a compelling case to go off and buy a small business, especially compared to starting one from scratch. 7000+ baby boomers are retiring daily, and many of them have small businesses that need a new owner, and have growth potential. Buy at a low multiple, use debt, and grow.
After making the case, he then walks through how to go ahead and do it. He hits the major steps, from getting debt, thinking about due diligence, closing and transitioning, while avoiding gory detail.
I am growing quite interested in this path and really liked this guide. It suffered from some poor editing/grammar, and could have used a few detailed cases from his experience (rather than just saying he did it 6 times).
Reads more like a chronological guide of how-to so only fit for someone seriously considering the strategy or deeply curious about small business acquisition.
As someone that has started several businesses, the concepts in this book opened my eyes to how getting into new businesses can be so much easier by skipping all the startup steps and reducing overall risk. I can add capabilities to my existing businesses or leverage my skill set and complement it using other peoples in the business that I would acquire. After reading this, I can never go back to the idea of starting a business from scratch unless absolutely necessary. This book goes hand-in-hand with the Who Not How concept by Dan Sullivan. I listened to this book through my local library on hoopla.
Disclaimer: don’t read it if you aren’t ready to buy a business, it’ll get you looking. I had to stop reading it halfway through because I was starting to seriously think about buying another business and then build it. I can envision myself doing this one day, either to grow my current company through acquisition of another company, or to start fresh and run a different company once I retired from my day-job. Very good read. Will be picking it up again and reading it when I’m ready to make the jump.
Great overview on the business acquisition process. Deibel goes into details on how the process work, mostly focusing on due diligence and deals. This is everything you need to know if you're considering acquiring a business. Some of these techniques are only applicable to US-based business (like SBA loans). However, the basic idea should translate to other markets as well.
The only thing that could be more written on is the "Built" part of the "Buy then Built". Only a small section towards the end focuses on how to grow the business you just bought.
An entrepreneur is some who assumes all risk for an asset as an entity. If the goal for entrepreneurship is to mitigate all risk associated with a venture, then the fastest and least riskiest path is to acquire resources that generate sustainable revenue by injecting the least amount of personal capital, not to build from scratch. It applies a lot of PE methodologies to startup entrepreneurship. That is the thesis of this book in a nutshell.
A very interesting perspective indeed. I will have to delisted to this book.
Great book - incredibly comprehensive guide on acquisition entrepreneurship from why it can be much more lucrative than doing a startup to a full soup to nuts guide on how to find, acquire and run an acquisition. The author’s overview on business strategy and key principles like Porter’s Five Forces and disruption is one of the clearest, most useful business summaries I have ever read. This book is worth reading for that section alone.
Great book on understanding how to acquire a business. if you are looking to buy a business and have zero experience or don't know where to start, this book will break it down for you and give you the confidence needed to go through the process. The only reason I am not giving it a 5 star is because I have not yet implemented what I read, I just happened to have the opportunity to be a partner in a business so I am implementing what i read in the following book: "Traction" by Gino Wickman.
A readable and concise introduction to self-funded ETA by an entrepreneur with significant success in the field. While highly readable, the book is intended as a cursory introduction and does not delve into the minutiae of the process. Recommended to those who want to learn more about ETA and use this book as an entry point, but if you've read Rick & Royce or Jan Simon, you no longer need to read this book.
It’s a really specific book for a very specific type of person and a very specific type of acquisitions.
This book explains how you go about buying any CASHFLOW POSITIVE business for little (own) money (using the bank for the rest). It doesn’t really go enough in detail about how to run/pivot after the acquisition, just focusses a lot/predominantly on the search for what you want to buy. It’s about the buying, not the building.
El libro insta al lector a crear su propio proyecto de emprendimiento a través de la adquisición de una empresa en funcionamiento y evitar así los riesgos derivados del emprendimiento desde cero. El libro guía al lector a través de todo el proceso de identificación, negociación y compra de la nueva empresa. Es bastante básico pero puede ser interesante para el neófito.
This is a very numbers oriented book. As an audiobook it's a little dry, but the content is strong and after listening to about 70% of the book, I've decided that this is a book that I need to continue in print. Most audio books that I listen to I finish and move on. This is one of the few "reading" books rather than resources that I will have to buy and revisit.
Good foundational learning for people looking to embark on the acquisition path of entrepreneurship. It will leave you equipped with a good basic understanding of the business acquisition process and an abundance of jumping off points for additional, deeper learning. But more than anything, this book will leave you inspired to take the reigns in your life and pursue business leadership.
Most of the MBA programs focus on entrepreneurs. This book gave insights into buying a business that aligned with my MBA but also built upon and reinforced. If looking at purchasing a business, I definitely would recommend this book.