Before You Buy a Business: Don’t Buy Yourself Another Job | Louis Biron

Send us Fan MailAre you buying a valuable, self-sufficient business or paying to inherit somebody else’s job, debt and problems?An acquisition can accelerate growth, but only when the buyer understands what is really being purchased. Without a clear framework, it is easy to become emotionally attached to a deal, accept unreliable financial information or underestimate the working capital required.In this episode, Peter Boolkah speaks with One Horn Transportation co-owner and COO Louis Biron about the lessons Louis and his wife learned after buying, operating and gradually removing themselves from their first company.Having spent approximately 15 years building that business, Louis returned to the acquisition market with much stricter criteria. At the time of this conversation, he and Peter had examined around 140 businesses and found only four or five worth pursuing.You’ll discover:Why buying a small business is different from analysing a major corporate acquisitionHow to define the financial characteristics of the business you wantWhy margin, cash conversion and working-capital requirements matterHow experience changes the way buyers interpret acquisition opportunitiesWhy information supplied by business brokers cannot automatically be trustedThe difference between cash and accrual accountingWhy an owner’s years of effort do not determine the company’s market valueHow owner involvement reduces transferable business valueWhy tax minimisation can reduce both valuation and borrowing capacityHow to recognise when you are buying yourself another jobWhy does a company that depends on its owner require the buyer to replace that ownerHow long did it take Louis and his wife to create a business that ran without themWhy buyers need industry knowledge, financial criteria and contingency capitalWhy must you be willing to walk away from an attractive-looking dealHow advisers, coaches and experienced peer groups improve acquisition decisionsThe central lesson is:Never buy a business until you understand what happens when the existing owner leaves. If you must personally replace everything the seller currently does, you have not bought freedom; you have bought another job.CONNECT WITH LOUIS BIRONLinkedIn: https://www.linkedin.com/in/louisbironOne Horn Transportation: https://www.onehorn.com/CONNECT WITH PETER BOOLKAHWebsite: https://www.boolkah.comLinkedIn: https://www.linkedin.com/in/boolkahInstagram: https://www.instagram.com/pboolkah/Facebook: https://www.facebook.com/BoolkahX: https://twitter.com/boolkahABOUT PETER BOOLKAHPeter Boolkah is a business coach, author and speaker who has spent more than 20 years helping business owners build stronger, more valuable businesses that do not depend on them for everything.He is the creator of The Hamster Wheel Trap® and author of Your Business Sucks: Build a Business That Works Without Destroying Your Life.Peter works with founders and leadership teams on the issues that ultimately determine whether a business creates freedom or becomes another job: leadership, founder dependency, people, profit, execution, scaling, exit readiness and enterprise value.His approach is direct, practical and built around one simple question:Do you own the business, or does the business own you?Learn more at https://www.boolkah.com