November 1, 2024 • By Dennis Beaver
If you enjoy going online late at night, chances are that seemingly out of nowhere, flooding your screen, ads appear that discuss ways of buying a business with little or no money down.
“Most of the people behind these ads are cons, passing themselves off as gifted business coaches who want to share their insight — for a hefty price,” says Josh Tolley, nationally syndicated talk show host and author of Acquisitional Wealth.
My interview with him and article earlier this year yielded a bumper crop of emails and phone calls from the very crooks Tolley is referring to, all wanting me to interview them for a story.
“These people claim to be experts, but not from expertise in running an actual business.
“Their entire purpose is to up-sell you on more and more expensive coaching/seminars that are generally worthless, but intended to lead you to believe that making millions owning your own business is easy — if you follow their formula.”
How these scams suck you in
“They appeal to that segment of the American population who realize they are not keeping up with inflation, their retirement account isn’t going to work like they thought it was, so people are desperate for something. And these hucksters are giving them a little razzle dazzle and milking them for tens of thousands of dollars.
“The initial come-on is a podcast with free content offer, such as ‘Sign up now for my free newsletter on how to buy a business.’ Or, ‘Sign up now for my free video on how to buy a business.’”
As Tolley describes, “If this makes sense, and you want to know more, then you are encouraged to sign up for their Mastermind Program, that costs $5, $10, $15 thousand for a weekend. And then;
– If you want the elite level skills, this will cost $30, $40, $50, $100 thousand more.
– Reality is that you attend these programs, and as these coaches are not business professionals, they are not going to represent you as a broker, realtor, lawyer or an accountant would. And virtually all of them have never owned a business.
“Dennis, I have met so many people who have fallen for these learn all the secrets of buying a business scams and paid as much as what they could have used as a down payment on a business and learned virtually nothing of practical value!”
Red Flags to Watch For
Now, you are probably thinking, “What are the signs that I am about to get sucked into something I should avoid?”
Tolley provides these answers:
“If one course leads to more courses. If the person teaching the course does not offer the services of whatever it is they are teaching. If the person teaching the course has a track record of offering or teaching other courses and topics that are not related at all to the one they are currently teaching, If their social media posts are ‘Look at me! I have mansions, fast cars, a private jet and yachts!’
“Notice how legitimate investment houses do not advertise that way.”
How does someone become a coach?
They read a book or attend a seminar and decide to do it!
Or, as happened with one of Tolley’s former, short term employees, he hired a firm to have a book ghost-written for $15,000, which he did not contribute to at all, but had his name on it. A third-party company created the content and a production company made videos, workbooks and off he went, selling.
“The tragedy is that some of these ‘experts’ have become multi-millionaires. We have followed their programs at hotels where they charge over $10,000 per person, 300 people walk in! And what they teach is often just useless.”
Advice for Anyone Thinking of Buying a Business
– If you are serious about buying a business, do not go to anyone selling these courses.
– Do not buy a business without the assistance of a qualified and experienced M&A brokerage.
– Do not buy a business because you’ve heard that it is a great way to get wealthy even though it is. You want to be sure this is something you truly want as you will be responsible for it.
– You must understand both personal and business finances. If you do not understand the importance of deadlines, payroll, taxes, workers compensation insurance you can expose yourself and your family to lifelong financial and legal ruin.
– It is wise to have had some experience in the business world. Some of the best entrepreneurs are in businesses they don’t have experience in, however, they know marketing, branding, advertising, sales, payroll, HR, leadership — they have the set of skills for what it takes to run a business, but not the specifics of running this business.
For a fascinating video about a “business coach” I recommend:
Finally, ask yourself, “If CEOs with MBAs preside over companies that fail, how can I possibly succeed with my limited or lack of experience in the business world, just because I’ve attended these coaching seminars?”
Dennis Beaver Practices law in Bakersfield and welcomes comments and questions from readers,
which may be faxed to (661) 323-7993,
or e-mailed to Lagombeaver1 – at – Gmail.com.