Why acquire businesses BEFORE the recession?

I had someone send this to me the other day, that’s inside of my Capital Network…

I thought it was important to actually dive into this.

In creating a group and portfolio, one of the most important things, more than anything else is that you can have the infrastructure needed.

For example, yesterday, I hired a full-time paid ads person, which sole job is to help those inside of my portfolio and group.

The power of build a “group” of companies is that you can utilize economies of scale across the different areas of business.

Instead of each company having it’s own lawyer— there’s one.

Instead of each company needing to have a book keeper— there’s just one or two.

I agree, that we’re in a recession at the current moment and that the next number of years we’ll see a major difference, than we’ve likely ever seen.

I’ve been building and expecting this to happen for years and in many ways, I thought It was going to happen far sooner than it has (mostly to due with governments printing more money than has ever exisited.

In this time, for those who have capital and resources, your ability to acquire companies will be much easier.

When the “sky” is falling down around, people are willing to let go of emotional and ego attachments to their business, much more quickly.

Thing is…

If you don’t have infrastructure to support acquisitions and mergers, what are you going to do…

Just buy a bunch of companies and let them sit, why you spend the next 12-24 months trying to “figure it out”?

I’d hope not.

Right now, may not be the best time to acquire businesses… we’re not at the “top”, but we’re not at the bottom.

Thus, while I’m acquiring businesses, at the moment, it is motivated by three key beliefs…

#1. Businesses that will, without a doubt work throughout a recession

and

#2. Businesses that allow me to get the infrastructure in place to be able to acquire more businesses down the road.

and

#3. Businesses that have the ability to be cashflow (profit) positive within 3-6 months of acquisition to fund future acquisitions.

I know, that most businesses are going to sell later, for less.

However, if I don’t have the infrastructure, I’m not going to be able to do much with it, because I don’t have unlimited capital.

Even if I raise money (we’ll talk about this in a minute), an investor also doesn’t just want to park their cash in something that isn’t going to return.

Speaking of which…

By understanding and figuring out the model, it’s going to make it really easy to do something important later.

Once you have a proven model for growth, a recession will make investors flock to you.

Why?

Because when all traditional investments don’t work, inflation is high, investors are thinking…

“I need to do something with money”.

So, to clue up, this thought. Sometimes, you have to do things, not because it’s the perfect time, but rather, it will create the ability for you to have the perfect time.

Plus, I’m having a lot of fun!

-Scott