Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (11) | Ignore Thread Prev | Next
Author: ToddTruby Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 15349  
Subject: Re: Buying a business as an investment Date: 6/23/2012 7:17 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 1
I already commented on this: first, I find that this appears to be standard pricing for buying a small business, second I understand and trust my friend's reasons. If you have additional input in reply to my thoughts in this regard, please do respond, but repeating yourself isn't helpful (with due respect).

I challenge the "standard pricing" assumption. I would get the CPA opinion on the value of the business.

I also would challenge the 30% passive income expectation. Especially with an online retail business. Online changes constantly, so straight line assumptions 5 years out are very risky.

Other risks include what if you have to invest more or lose everything. Not an uncommon scenario in a small business.

Sometimes you just have to do a reality check, even before spending a bunch on due diligence. What kind of investment provides the kind of return you are expecting from this venture and what kind of risk in involved. If it is truly as simply as you are being told, there it would not be a big secret and others would be all over it.
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (11) | Ignore Thread Prev | Next

Announcements

TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement