🔑 #1

Marinas are a great business.

You naturally have a location monopoly, and these businesses are priced like real estate (high multiple on earnings).

So if you can increase the profits of your business, you can re-sell the property and capture a lot of value. But unlike real estate, you have more levers you can pull to increase profit.

Some simple ideas on how you can increase profit at a Marina:

• install vending machines, or a store to cater to customer needs
• remodel the marina, and increase prices
• increase your gas prices (as Michael says)
• start a marketing campaign to decrease your vacancy
• offer incremental services (cleaning, servicing, repair)

How do you buy it? I recommend you look at SBA(7a) as an opportunity.

Question for the audience: If I find a Marina business for sale. Do you want to hear about it?

🔑 #2

I believe that “fear” is the greatest limiting factor between us and our goals.

Humans naturally create fears in their own head. It’s what has helped us survive for thousands of years, but it also hinders our forward progress.

I’m human too. Many times I have been:

• too scared to ask a customer for the price I deserve (missed opportunity to get paid what I’m worth!)
• too scared to approach a girl that I think is attractive (missed opportunity to meet a life partner! Fortunately, I did eventually)
• too scared to reach-out cold to a person I admire (missed opportunity to make a lifelong friend)

Overcoming these types of fears helps us grow.

I’ve found two ways in my life to overcome fear.

1. Turn it into a game
2. Invert and use the regret minimization framework

1 - How to turn an activity into a game?

My favorite example of this is “rejection therapy”.

We’re all naturally conditioned to avoid rejection. But the truth is life is full of rejection. If you get comfortable with it early, you are more likely to ask for what you want, and thus more likely to get what you want.

In simple terms, here’s how it works:

Ask a friend or two to do this activity with you. You can keep each other accountable.

For 30 days, your goal is to get rejected by someone 10 times a day. By the end of this period, you’ve been turned down 300 times, so you will be less fearful of asking for things and getting rejected.

Here’s the full explanation of rejection therapy (sorry I’m liking you to WikiHow)

2- Regret minization as a framework.

Above, Jack Altman is describing a concept called “Regret Minimization”.

Instead of backing down from your fear…Invert.

Think of what the worst-case scenario will be if you DON’T do this action. Really extrapolate it out, and imagine the worst outcome.

The way I do this is I think of myself as an 80-year-old. As an 80-year-old I look back on my life and picture whether I would regret not taking this step.

Special Tip - talk to old people, and ask them what they regret about their life. You’ll start picking up on some themes.

🔑 #3

I LOVE service businesses.

Don’t believe in the hype around venture capital and startups.

We hear about cool startups all the time in the news, and it’s really exciting to see (for example) a company like Uber grow fast, serve millions of people and make their investors and founder a lot of money.

The reality of the world is that most startups make their founders no money. This includes situations where you think a company is very successful because they raise a large amount of money. I’ve been on the inside, and close to a lot of these founders. I’ve seen companies sell for hundreds of millions of dollars, but the founder walks away with very little.

So if it’s your first time starting a business, avoid technology companies. Finding product market fit is super hard in technology companies. And, competing with other VC-backed companies can be painful.

Instead, start a service company that you know everyone needs. A service company has product market fit on day 1!

Service companies are easy to start, and require little investment.

You will own most of the business yourself, and be the master of your destiny.

It’s a great training ground for learning business.

Example service industries I like (in descending order):

• Electrician (you’ll eventually need a trade degree)
• Plumbing / HVAC (you’ll eventually need a trade degree)
• Pool Service
• Moving Business (everyone needs it!)
• Landscaping
• Painting houses or commercial
• Roof repair (you may need a degree)

In a business like this, you can start as an apprentice for a company in the space, and get paid to learn the craft.

Within 3-5 years you can set out to run your own business.

The market has unlimited demand for these services which means if you do a good job, you can be a millionaire one day.

By the way, you have a much higher probability of being a millionaire in these fields than if you start a tech company.

🔑 BONUS - My Due Diligence Checklist

One of the most important parts of buying a business is doing the proper “Due Diligence” (DD). This step happens after you sign a letter of intent (LOI) and before you sign a purchase agreement and wire them money. DD allows you to get comfortable with the business culture, and its financials.

If you identify a red flag you don’t like during DD, ask more questions and be prepared to back out.

Buying the wrong business will set you back years. So don’t fall in love with the business! Try to remain objective and be ready to “pass” if something doesn’t feel right. There are plenty of fish in the sea, and it’s always better to wait to find the right business.

If you’re thinking of buying a business make sure you download the spreadsheet below and use it as a checklist.

Step 1: Read the Tweet thread on diligence I shared a few weeks ago.

Step 2: Download my due diligence template here. Let me know if any issues accessing it and I can whitelist you.

Would you add anything to this list?

Reply to let me know if you liked Tweet 1, 2 or 3 most. Also, you can check out last week’s newsletter here.

Have a glorious week,

~ Sieva

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