Paul Burri: Converting a Good Job Into a Failing Business
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By Paul Burri, Noozhawk Columnist
It's easy to do if you take all the wrong steps
Converting a good job into a failing business and a huge second mortgage is not as difficult as it sounds if you go about it the right way.
Let’s make a few assumptions first:
» You have a reasonably good job and you have a good work history.
» You have reasonable expectations of continuing employment.
» You are good at what you do.
» You own your home.
» You don’t especially like your boss and his or her decisions.
» You are sure you could run the company better if you had the chance.
OK, you’re ready to convert that good job into a failing business.
» Step 1. Start finding fault with every decision that management makes and grumble about them to your fellow employees.
» Step 2. Complain to your wife about your boss and the company every chance you get.
» Step 3. Continue to convince yourself that you could run the place better if you had the chance. (You don’t really need much convincing, do you?)
» Step 4. Don’t read any books about business or take any business-related courses at the local adult education campus. (This is a very important step.)
» Step 5. Start thinking that you should own your own company so you could “do things the right way and make a lot of easy money doing it.”
» Step 6. Start looking around for a small company that someone is trying to sell. (The less you know about the business, the better. For example, if you are an auto mechanic, start looking for restaurants that may be for sale.)
» Step 7. Talk to your wife and family about the idea of buying that restaurant. (Your mother is an especially important person to discuss this with because she will always be on your side.) Important: Do not talk to professional advisers or people who know the restaurant business, or if you do, ignore whatever they tell you.
» Step 8. Open negotiations with the former owner. Listen to everything he tells you about how easy it is to run a restaurant and believe him when he tells you that he is selling the restaurant “to go on to bigger opportunities.” Do not inspect the books or records because, as he points out, they don’t show the true profits so as to minimize taxes. Wink, wink.
» Step 9. Go to your bank and ask for a loan for $250,000 because you have a pretty good idea that’s what you’ll need. Besides, it’s a nice round number.
» Step 10. Go to another bank when the first one turns down your loan request on the grounds that you have no restaurant experience.
» Step 11. Go to five or six more banks to confirm what the first two told you.
» Step 12. Find an angel investor to lend you the money that no bank would.
» Step 13. Take out a second mortgage on your house for $100,000 (at 12 percent interest). If this is still not enough money, borrow the rest from friends and family.
» Step 14. Buy the restaurant. Be careful not to have the former owner stay around for the first few months. After all, if he knew how to run the place, would he be selling it in the first place?
» Step 15. Repeat Step 7 about talking to business advisers or restaurant experts.
That’s all there is to it. Good luck.
My sincerest thanks to Ben Stein for his book How to Ruin Your Financial Life for the idea behind this column.
— Paul Burri is an entrepreneur, inventor, columnist, engineer and iconoclast. He is not in the advertising business, but he is a small-business counselor with the Santa Barbara chapter of Counselors to America’s Small Business-SCORE. The opinions and comments in this column are his alone and do not represent the opinions or policies of any outside organization. He can be reached at .(JavaScript must be enabled to view this email address).
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