How to Build Wealth — with Codie Sanchez

Financing

Financing small businesses can be more accessible than many realize. Codie Sanchez explains that the business itself often serves as collateral, allowing for loans based on its earnings rather than personal income. She highlights three primary financing methods: SBA loans, which can cover up to 90% of the purchase price; creative financing, where future profits are leveraged; and apprenticeship models, where ownership transitions gradually 1 2.

The interesting part about the business landscape is the credit is not your own.

--- Codie Sanchez

These strategies open doors for aspiring entrepreneurs to acquire businesses without substantial upfront capital.

   

Main Street

Investing in traditional "Main Street" businesses like plumbing and cleaning services offers reliable wealth-building opportunities. Codie Sanchez argues that these businesses are often overlooked despite their stability and community impact. She notes that many small businesses are poised for sale due to retiring owners, creating a ripe market for acquisition 3 4.

Ownership leads to wealth most often if that ownership is sustainable.

--- Codie Sanchez

This approach contrasts with the volatile tech startup scene, emphasizing consistent income over speculative growth.

   

Profitability

Focusing on profitable business strategies can mitigate risks associated with startups. Codie Sanchez suggests acquiring existing businesses to leverage their established operations and customer base. She emphasizes the importance of scalability and recession resistance, noting that many small businesses are underutilized and ripe for growth 5 6.

What if we just focused on profitable businesses instead?

--- Codie Sanchez

This strategy allows entrepreneurs to bypass the high failure rates of startups while building a portfolio of income-generating assets.

   

MBA Value

Codie Sanchez challenges the traditional value of an MBA, advocating for investing in small businesses instead. She reflects on her own experience, suggesting that practical business ownership offers more tangible benefits than formal education. Sanchez argues that the best business school is real-world experience, which not only teaches but also pays 7.

If I could go back right now and instead take those two years back from my MBA and that $100,000 and instead buy a couple of these businesses, I would.

--- Codie Sanchez

This perspective encourages aspiring entrepreneurs to consider direct investment in businesses as a viable path to success.