This is the philosophy behind everything I tell buyers.
1. Pay for the Past, Buy for the Future
Historical financials establish the foundation for value.
But you are buying the future cash flow.
2. Buy Good and Make It Great
Don’t buy a disaster because it’s cheap.
Turnarounds are harder than Instagram makes them look.
3. Ingredients Mean Nothing Without a Recipe
Customers, equipment, employees and inventory don’t automatically make a business.
Systems matter.
4. Fall in Love With the Profit, Not the Product
You don’t have to love what the company sells.
You have to understand how it makes money.
5. Do What You Do Best
Your skills should improve the business.
That’s where acquisition arbitrage comes from.
6. Look for Automation
The less dependent the company is on the owner, the better.
7. Find the Gold
Every business has assets that may not be fully exploited.
Look for them.
8. Know What You’re Buying
You should be able to explain the business simply.
If you can’t, you probably don’t understand it yet.
9. Find What’s Not Perfect
Imperfection creates opportunity—but only if you know how to fix it.
10. Determine What It’s Worth to You
Market value and strategic value aren’t always identical.
Your skills may make a business worth more to you than to another buyer.
These principles are also the foundation of my original [10 Commandments of Buying a Business]. Read the 10 Commandments
Michael Shea represents the Tampa Florida Transworld office. In business since 2005, he has established a reputation as a trusted business broker across Florida’s key markets- from Tampa to Orlando, Melbourne, and more. Over the past two decades, Michael and his team have closed over $1 Billion in sold business volume and presided over more than 476 transactions. His credentials include the IBBA Certified Business Intermediary®, and most recently, the prestigious Certified Exit Planning Advisor® (CEPA) credential. He is also a Florida Licensed Real Estate Broker and Business Brokers of Florida Board Certified Intermediary . Shea is a member of the VRMA and a recognized expert in property management and vacation rental management business sales