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    4 Replies Latest reply on Aug 21, 2016 6:21 PM by moderator_lisa

    Hi everyone I need some advice

    intrepid Newbie

      I own my own business in souther California.  But lately I have been looking for  a change. I am a consulting geologist and on a whim was looking at other firms in the northern California  area,  I mean extreme north, to southern Oregon . I happened upon a company whose owner wants to retire he is several years older than I.

       

      Here is the gist of my questions.  We are both  well known in our industry in our areas. I am thinking of perhaps moving up north  and taking over his business as he retires.  In this business  the consulting is technical  but the relationships can me more personal.  Your dealing with the stability of someones home. Have been doing this for 40 years and he about the same .

       

      Unfortunately  due to an ex partner have no cash reserves, no retirement savings and nothing to fall back on. I just rent here in so cal but he rent has gone through the roof, and is more expensive than when I was fortunate enough town a home.

       

      Is the risk moving up there  to big to take? His business is successful.  Also  how can I buy the  the business with out any money? Can iWork as a w-2 employee  at a lesser pay and have the excess directed into an escrow account  to be used in the purchase.

       

      What  risks do you see? what benefits? 

      Am I missing any big points? 

      I open to all thoughts, points of view, positive or negative,. 

      At heart I am  a scientist.

        • Re: Hi everyone I need some advice
          Moderator Rebecca Guide

          Hi intrepid!  Welcome to our community.  The first idea i have is to try to convince the current owners to do a seller carry back, kind of like a rent to own, where they act as the bank and you pay them back - eventually buying them out over a specified period of time. If your initial start up shows a profit, you may find securing a loan or finding an investor that is willing to back you.

           

          Since you mentioned you are both well known in your industry, do you think this is something that he/she might be interested in considering? 

           

          We have an amazing community here and I'm sure that you will get a lot more great advice.  Please be sure to stay in touch and let us know how your journey goes!  Best of luck!

           

          Cheers,

          -Rebecca

            • Re: Hi everyone I need some advice
              intrepid Newbie

              Yes to say the least our business is interesting. Since we are consultants there is an awful lot of name recognition and even more  influence on locations of practice. I am in san Diego  and he is in southern Oregon.   One method I have seen used down here is  when  the owners  start to get  ready to retire. They often  set up a  system that works like this.  The new buyers instead of taking a bonus and/or a raise  allow that money to be into an account to fund a buy out of the owner down the line.

              The other issue is how to value  a service company.

                Often times in my area the consulting company is tied to a  specific person. "so n so has a great reputation call Him" so when that person leaves the industry the new  owner is   facing the challenge to rebuild the  business using the new name.  That  suggests to me that in a specialized service company  the value is in the person doing the consulting who has the reputation.   so  how do you value  that?

              The other issue if the owner is  going to retire I suppose I could just  go up there open a business and compete with him and eventually where him down,  But I don't really want to things that way . i would like to start of  with some good relationships.

               

              So  what do you all  thing?  this consulting area is  engineering  geology.