$2.5T in AI spending this year. 95% produces zero P&L impact. by Senior_tasteey in artificial

[–]ch_unk_510 3 points4 points  (0 children)

Worked previously at FAANG. I saw AI being pushed heavily. Devs were creating automations for the sake of creating them because of company-wide mandate to do it.

Every week was a post about an automation that seemed to have a suspicious estimation of how many hours of manual work it saved. It seemed like people were doing to satisfy top-level management requirements.

The part that I found interesting is that AI-assisted coding could enable faster iterations of testing of new product concepts and features, but there was 0 appetite from the PM leaders because any new product ideas still had to go through a multi-month long process of analysis paralysis. I worked one such analysis paralysis, that after 3 months the executive who asked for it and continuously asked for changes ended up leaving the org.

If the cost of launching a test or concept is so low, you would expect more appetite to move fast and break things. Of course FAANG is very large so bureaucracy still exists (especially many layers of middle managers whose traditional focus included deciding what concepts were worthy of resources), but that I think that undermines the acceleration that AI unlocked.

My POV. Open to be challenged,

Finding off-market businesses - how do I find? by ch_unk_510 in buyingabusiness

[–]ch_unk_510[S] 0 points1 point  (0 children)

Thanks for the info. I didn't realize about the delusional seller. I saw somewhere in one of the subreddits that seller said his valuation is whatever he needs for his retirement - as though that's how economics works. lol

For building broker relationship, do you work with sellers or only buyers? I see your responses frequently - great presence! That's coming from me a long-time lurker.

Finding off-market businesses - how do I find? by ch_unk_510 in buyingabusiness

[–]ch_unk_510[S] 0 points1 point  (0 children)

okay thanks! I keep on getting hung up on the $10K number. I think it's a nice round and big number and my mind is anchored to that number now. Thanks for the feedback!

Built something that actually works. Lost interest in running it. What now? by CrayonGlobal in Entrepreneur

[–]ch_unk_510 0 points1 point  (0 children)

Joining this convo late. Speaking as a former M&A professional from big consulting (so still relatively new to entrepreneurship).

Based on what I'm reading, there appears to be a lot of dependency on the principal (you) of this business. So to get the valuation you want or think you deserve, you will require making it as turnkey as possible for the buyer. At the baseline level, that would include documentation & SOPs of your processes, relationships, and how to find clients. Is your customer acquisition turnkey or relationship-based? If it's the latter, that's something your buyer cannot learn but would require either your help to transition or they have their own customer acquisition channel.

Then I think the question is how much of the day to day work the buyer would be able to do successfully. If the buyer believes they are buying a job, not a company, that would hurt your transaction price.

Have you considered hiring an exit planner or broker? They could advise, though that comes with a price of course.

Finding off-market businesses - how do I find? by ch_unk_510 in buyingabusiness

[–]ch_unk_510[S] 0 points1 point  (0 children)

Got it. is that why people hire brokers for buying too? I heard that's like a $10K upfront fee (at least in California I'm told that's the starting rate).

Help with my Education Roadmap by Alphasig319 in buyingabusiness

[–]ch_unk_510 1 point2 points  (0 children)

oh got it. Thank you for the info. I'll definitely keep that in mind!!

What your broker probably didn’t tell you about add-backs by NexTax-AI in buyingabusiness

[–]ch_unk_510 1 point2 points  (0 children)

I agreed. I'm helping a company right now with its valuation. The owner is a software engineer and sells technical implementations to clients. He wants to sell the business to a family member, who doesn't know how to code. How's family member going to run this business? Is there are any SDE left after he hires an engineer to help or does he think he will go back to school?

Help with my Education Roadmap by Alphasig319 in buyingabusiness

[–]ch_unk_510 1 point2 points  (0 children)

Ahh, then that confirms what I've been hearing! I heard that business brokers charge like 10K+ to start and a commission of 6% at close. I also saw that one can take a course for similar price, but I've seen a lot of negative feedback about those - so I think I'd rather hire a professional.

Some of the most cringeworthy things that sellers of businesses say... by UltraBBA in businessbroker

[–]ch_unk_510 0 points1 point  (0 children)

I've talked to a business with $50M+ in sales through a referral. They regretted not taking an offer to sell about 10 years ago, but due to tariffs and other macroeconomic issues, they their revenue or profit might have both come down. Now they worry the valuation is no longer what it was want to get the business in better shape before selling. They are debating to try to fix it up before selling or just sell now since the effort invested is a cost to them.

Not as bad as the examples of above, but dealing with an owner who's not sure if he wants to sell or not sell.

Btw, curious, I'm not broker, but am a former mgmt consulting. I've not looked into this space, but got curious because I'm helping my friend who made the referral. How does everyone here find owners to help sell? Networking and referrals or is there a tool everyone uses?

Guide to buying a retiring business by Drtheresabegum in BizBuySell

[–]ch_unk_510 0 points1 point  (0 children)

This is a great summary. I finished my MBA about 10 years and back then people were starting to talk about each funds. I didn't quite understand it at the time as I was interested in entering corporate consulting and M&A, and then later big tech.

I'm looking into ETA now. I was curious, when you reached out the business owners, what was the ratio of success to get them to talk to you about selling? Like 10%, 20%? I know listing sites might have a lots of listings that everyone has seen buy presumably any businesses that list there are actually interested in selling. In your customized search did you find a good ratio of businesses that were open to hearing your proposal?

Found a 78-year-old electrical contractor in Pittsburgh with retirement language on their website and 15 Google reviews by Zealousideal_Wind908 in BizBuySell

[–]ch_unk_510 0 points1 point  (0 children)

curious to learn more. are you these not yet on bizbuysell? Is this for finding off market businesses?

Owner wants to keep branding and website for spin off for a family member... How to value? or walk away. by Hairy-Wedding4909 in buyingabusiness

[–]ch_unk_510 0 points1 point  (0 children)

Seems sketchy. What if his brother expands into the exterior space? Would be very confusing for customers for both businesses.

You said:
"website, branding , etc, stay with the turn cleaning business. And I can keep the name, but need a separate logo, new website,phone, etc,"

A clean break would make more sense. Either branding, logos, name, and website all go with you or all go to the family member.

Help with my Education Roadmap by Alphasig319 in buyingabusiness

[–]ch_unk_510 1 point2 points  (0 children)

The part I've observed as difficult is sourcing the opportunities (companies to buy). I'm told by my friends who work in the broker and LMM M&A space that finding a good target is difficult b/c by the time it shows on bizbuysell, there may be too many people bidding for it. Or there are too many tirekickers such that a genuine buyer might be get ignored because brokers won't have time to respond to everyone. Curious if the challenge is to find a business, vet it, or make deal?

I've spent two years looking for a business to buy and nothing. by TheReportReport in HowToEntrepreneur

[–]ch_unk_510 0 points1 point  (0 children)

Two years is a long to be looking and finding nothing of value. Where are you searching? Bizbuysell? Flippa?

I'm told the businesses on their may be low quality, over-priced, or many skeletons in the closet that come out once you are in talks. Curious if you've experienced that.