Entrepreneur and author Adam Coffey, founding partner of CEO Advisory Guru, LLC and best-selling author of The Private Equity Playbook, believes that every entrepreneur dreams of achieving freedom through their business. However, the reality is that many businesses fail within the first year, and even those that survive face challenges in reaching the million-dollar revenue mark. Coffey, who has acquired 58 companies and achieved billions in exits over his 21-year career, suggests that buying an existing business rather than starting one from scratch can increase the odds of success.
According to Coffey, buying a business that has been operating successfully for some time can reduce risk by providing a proven track record of performance, customer attraction, and profitability. To find the right business, he recommends starting by identifying industries that match your skills and passions and have stable, recurring revenue streams. Using tools like DealStats, Hoover, and Grata can help verify industry choices and create a list of potential acquisition targets. Building a profile of the perfect company based on criteria like CEO age, desired level of involvement, revenue size, and customer base can further refine the search.
Coffey emphasizes the importance of reducing risk when acquiring a business, highlighting the benefits of buying a company with existing revenue, customers, and earnings. While past performance is not a guarantee of future success, conducting thorough research and ensuring the business aligns with your expertise and interests can increase the likelihood of a successful acquisition. By following a strategic approach to identifying, evaluating, and acquiring businesses, entrepreneurs can improve their chances of achieving the freedom they desire. Forbes Business Council is a networking organization for business owners and leaders, providing opportunities for growth and collaboration.
