We LOVE entrepreneurs.
As a society, we celebrate startup entrepreneurs like…
We praise them for taking insurmountable risks, creating new technology, and changing the world in the process.
The story of successful startup entrepreneurs like these serves as an inspiration to us to take action now and build our business empire from scratch.
If they did it, why not us?
So we take action…
Frustrated, tired, and done working 9-5 making our employers and bosses rich – we quit.
We take a chance and go out on our own to start our own business in pursuit of making ourselves rich.
We read business books to keep us motivated…
The Millionaire FastLane (MJ Demarco)
The Millionaire Mind (Thomas Stanley)
Think and Grow Rich (Napoleon Hill)
Unlimited Power (Tony Robbins)
We write our goals, business plan, and dream boards to help us reach our dream.
We listen to Gary Vee, Grant Cardone, and other podcasts to keep us PUMPED.
We cold call, and email friends, family, and strangers to get customers and clients into our newly formed business so we can start making revenue.
We file our own LLC paperwork ourselves to save money, do our own taxes, and read NOLO legal books to do our own legal contracts.
We accept that in order to reap a BIG reward we need to take BIG risks.
If we push just hard enough, we’ll make it.
“Forget the odds of failure, those are for other people,” we say to ourselves.
And then reality sets in months or years later…
We don’t have any product-market fit, barely any customers, don’t know how to market effectively online, sales is a constant struggle, our accounting is out of control, and we’re spread so thin with 10 different job roles, and with little cash-flow, we can’t afford to hire employees to help us out.
With enough time passing, and no traction – we finally quit.
Back to being a 9-5 employee making other people rich. We don’t take risks anymore because the fear of failure is great. We stop venturing anymore.
Our dream of being free, and wealthy by starting our own business?
By its very nature, startup entrepreneurship is hard.
According to the Bureau of Labor and Statistics, only 70% of startups make it past year 10. Michael Gerber, Grant Cardone and Tony Robbins put the failure rate at 96%.
Think about it…
Only 4% to 30% of businesses are winners. Statistically the odds are stacked against you when you start a business from scratch – too many unknown variables.
So how do you win the game of entrepreneurship if the odds are stacked against you?
You stack the odds in your favor by doing what most people never think of.
This is the dirty secret to startup entrepreneurship most people don’t tell you.
What if you could BUY the 4% to 30% of businesses that are profitable and have weathered economic recession after economic recession using other people’s money as leverage?
At this point, I’m sure you think you can’t do it…
That only the rich and mega corporations can do it.
Then why have 54+ of my students done this already and why can’t you?
It’s not your fault though…
Acquisition entrepreneurship is new, and rarely spoken about.
Few universities teach it, the media doesn’t talk about it, and few books show you how to do it.
It reminds me of the question Peter Thiel poses in his book “Zero to One”:
“What important truth do very few people agree with you on?”
Here’s my answer:
The acquisition of businesses founded by someone else who has solved all the unknown variables in a business for a 5-10 year period and then innovating within that business and scaling it beyond the original founder is faster at building personal wealth and impact than startup entrepreneurship.
There are two types of entrepreneurs:
- Startup Entrepreneurs
- Acquisition Entrepreneurs
A first-time startup entrepreneur with no previous track record of success starts from scratch looking for product-market fit and is stuck learning how to market, and sell their product until the funding runs out (if they have any). For most first-time business owners, funding is done by themselves, without venture capital, and most of the time they are stuck doing everything because they can’t hire out first.
In contrast, an acquisition entrepreneur buys a business using other people’s money as leverage in a deal. They become the CEO of an already established, and profitable business that has weather economic recessions – pandemics too. A business with product-market fit for YEARS, customers, marketing, sales, employees, and most importantly profits already in place.
At first, most people from my experience choose to become startup entrepreneurs, until they learn that acquisition entrepreneurship is an option too.
Although buying a business takes more time, and it’s more of a process. It can take anywhere from 6 – 12 months to buy your first business, but after you buy the business and become CEO then scaling the business is infinitely easier than starting a business from scratch. The unknown variables are less, and consequently, the risk is virtually eliminated.
Successful entrepreneurs choose to buy businesses when they can instead of starting them because they know the dirty truth – it’s easier to scale a profitable business than start from scratch.
Remember the list of successful entrepreneurs from earlier?
Elon Musk didn’t start Tesla, he bought it and scaled it.
Steve Jobs didn’t start Pixar, he bought it, and scaled it.
Jeff Bezos didn’t start Zappos, he bought it, and scaled it.
Startup entrepreneurship is too risky and with a low success rate, and yet we teach people this is what they need to do in order to be free of an employer, and make money.
It’s time to expose the charade of startup entrepreneurship for what it is – a dead end for most.