How To Buy A $2.1M Small Business While Working A Full Time Job (Took 221 Cold Calls)

**Brian Luebben** (0:00)
What's up, ladies and gentlemen? Welcome back to the Action Academy Podcast, Corporate America's Least Favorite Podcast. Hey guys, riddle me this. How much real estate do you need to buy for $500,000 of cash flow?
I don't know the answer to that, but what I do know the answer to is one business, and that is the business that we are discussing today. $500,000 of profit, $500,000 of SCE, $2 million purchase price for one of our Action Academy members, first business deals ever. Today is the closing table, today is closing day, and we are getting our Action Academy member Drew on the show to walk you through the deal. Now, the first half of this episode is talking about how he found the deal and negotiated the deal, what attracted him to the deal, how he talked to brokers, pay attention for how he interacted with the brokers, and in the back half of the episode, we're talking about how the deal almost died three to five different ways. We had three different banks that he had to go through that backed out on him on the very last second and he was able to pull through. So you guys are going to learn every single bit of this process through today's episode. Now, guys, if you want to be hanging out with guys like Drew, that is in the Action Academy community. If you want to be on the podcast, talk about how you bought a $2 million business, that is the Action Academy community. You can find us at actionacademy.com or you can more easily go in the show description, the show notes of this episode. Click the link, book a call, and we will happily talk to you for 15 to 30 minutes and see if it's a mutual fit. Let's get to today's show. All right, Drew, we signed some documents today.
Walk us through it. How are you feeling? Walk us through your day. You woke up this morning. What did you make happen?

**Drew** (1:43)
Yeah, I woke up this morning and coming off the high of actually signing and closing on a new business. Short term rental property management business. It's been a long time coming, man. So I've been ready for a long time and just waiting for this day, honestly.

**Brian Luebben** (1:57)
Dude, it's a lot of hurry up and wait. It's a lot of hurry up and wait.

**Drew** (2:00)
That's what nobody tells you is you're super gung-ho and you're cranking out broker contacts and cold outreach, and you're talking to everybody and underwriting businesses, then you get one and it's always that balance of, do I keep underwriting more? Do I have faith that this deal is going to close? Do I want to have more of the pipe?
You do a lot of negotiating and then it's waiting for lawyers, it's waiting for bankers, and I will say you start to psych yourself out a little bit. At least for me, I underwrote this deal a million times, front, back, side to side, every which way I could, and then you're just sitting there twiddling your thumbs, and you start thinking about all the worst, you have to remind yourself, I've thought about all this already, don't panic, we're good. All the worst case scenarios are worked out, we're ready to go. So that call before the storm is surprisingly loud.

**Brian Luebben** (2:45)
Dude, I've heard the same on the sell side. People that are, I'm about to get a life changing sum of money, and I'm just going to sit here and just hopefully they don't back out the very last second. So walk us through this man. We just closed, I believe, 1.7 million for the business. Walk us through some of the deal details and then let's walk it backwards to how this journey came to be.

**Drew** (3:08)
Yeah, let's do it.

**Brian Luebben** (3:09)
Yeah.

**Drew** (3:09)
So overall deal, some of it I can't share yet, but most of the meat I can. It's about 1.725 mil for the business itself. There's some working cap and some funds for expanding there in the future. So all in, we're talking just over 2 million. So it's like 2 million, 20,000 all said and done. Of the deal, there's basically 750,000 is seller carry, 0% interest, 3-year standby.
So the company itself is short-term rental property management. One of the big things for me is, obviously, new business, right? That's where most of the risk is taking it on, especially there's the seasonality aspect. So I really wanted to push to minimize debt service early on. That's how we came to the 3-year standby was mostly, let me get stabilized there, feel confident, and then we'll start bringing in a little bit more of the debt, which they were good partners about and we're certainly happy to make it work.