- What advice do you have for someone wanting to be an entrepreneur?
- How do you know if a business idea is worth pursuing?
- How do you prepare yourself mentally to be an entrepreneur?
- How to handle naysayers when starting a business?
- What to think about when taking over an existing business?
- Advice from young entrepreneurs
Sal answers the question "What to think about when taking over an existing business?" as part of its partnership with Bank of America on career and personal finance education (Better Money Habits).
- Every now and then I get a friend or a family member saying that they're interested in buying some type of a business. So this wouldn't be about starting a business, but there might be an existing business. Maybe it's a convenience store or maybe it's some type of health care practice or whatever it might be, and they say, hey, I'm going to buy this from the existing owner and I think it's going to be a great business. And they'll often say it generates this much money and I only have to put this much in and it feels risk free. And what I tend to tell them, and I don't wanna be one of these naysayer people, I say, possibly. But what you always have to think about is why are they selling it? And sometimes there's a good reason why they're selling it. Maybe they're retiring and they don't have someone to pass the business onto and they see in you kind of the person that they would love to see running that business going forward. That could be a very legitimate thing. But oftentimes, there might be situations where they might be pumping up some of the numbers, they might be showing you business in the busy season or on the busy day. And so I wouldn't take, especially if it's a small business that doesn't have auditing, that doesn't have really strict accounting practices. I would observe the business for a very long period of time and I would take your own data as to whether the numbers you're hearing about are real. And I also wouldn't discount how much effort and work the existing owner is putting into it and what happens to the business if they're no longer there. If all of that works out and if it really does make sense, then, yeah, you might be onto something.