There generally are two ways to becoming a small business owner:
You could buy an existing company, with its established customer base, stable of trained employees and proven cash flow.
Or you could start a company from scratch and bootstrap it – hopefully to success.
Starting from scratch may be best for the entrepreneur with a groundbreaking idea. On the other hand, those who aspire to make their own hours or seek more immediate cash flow may be better off taking over an established business….
“Buying a successful, existing business with proven cash flow and revenue history is almost always going to have a higher chance of success than starting from scratch,” said Bob House, general manager of BizBuySell.com and BizQuest.com, which together feature 76,000 business listings for sale.
Financing a business acquisition can be easier because of the company’s documented financial history and assets, said Jay DesMarteau, head of small business banking for TD Bank, though a lender would also evaluate the buyer’s qualifications to operate the business and whether the company’s success is dependent on the seller’s involvement. Business buyers might also take advantage of seller-held financing, which may have more flexible terms.
Curated from Want to be your own boss? Do this first [CNBC]
More Posts Across the Web
US small business confidence hits new two-year low [CNBC] – U.S. small business confidence fell to a fresh two-year low in March amid persistent worries about sales and profits, the latest indication that economic growth braked sharply in the first quarter.
Episode 3: Startup Founders Share Their Stories [Chase] – During Seattle startup week, we asked four startup founders to share their stories in a video discussion and a series of articles in which they share lessons they learned along the way.