How can you become good at doing deals, so you can do more of them?

Created by Vee brad, Modified on Tue, 5 Nov, 2024 at 10:59 PM by Vee brad
To become good at doing deals and turning one business into multiple income streams, you need to focus on creating strategic leverage, developing expertise, and maximizing efficiency. Here's a roadmap to guide you through that process:
1. MASTER THE ART OF DEAL-MAKING
Build Relationships: Your network is your net worth. Deals often come from relationships, so invest in nurturing partnerships and connections within your industry. Whether you’re starting a business or expanding, the people you know can open doors to opportunities.
Understand the Numbers: To successfully make deals, you must understand the financials. Dive deep into profit margins, expenses, tax implications, and overall business valuation. Know what makes a deal profitable or not before you commit.
Leverage Resources: Use your existing resources to multiply opportunities. If you already have one business, think about how you can expand it without starting from scratch every time. For example, if you have a successful product or service, explore ways to scale it through franchising, licensing, or white-labeling.
Be a Problem Solver: The best deals solve significant problems. Identify what inefficiencies exist in your market or industry and position your business as the solution.
2. CREATE MULTI-INCOME STREAMS WITHIN ONE BUSINESS
Vertical Integration: One way to stack up income streams is by controlling different stages of your industry’s supply chain. For example, if you own a construction company, you could add real estate development or a material supply business to reduce costs and increase revenue.
Add Complementary Services or Products: Find out what your customers are already paying for elsewhere and offer those services under your umbrella. For example, if you run a health business, you could offer wellness products or digital content like courses or memberships.
Offer Subscriptions or Retainers: Adding subscription models or retainers for ongoing services creates steady, passive revenue streams. Think about what value you can provide on a recurring basis, whether it’s software, advisory services, or product deliveries.
Invest in Passive Income Streams: Invest in passive opportunities like real estate or licensing products. While your primary business is generating active income, passive streams like rental income or intellectual property royalties build wealth with less active effort.
3. LEVERAGE REAL ESTATE AND THE STOCK MARKET FOR WEALTH PRESERVATION
Real Estate for Tax Benefits and Long-Term Wealth: Real estate is key for preserving wealth, not necessarily for accumulating it quickly. By investing in real estate, you can take advantage of tax benefits like depreciation and 1031 exchanges to reduce your taxable income. Over time, it helps you build a portfolio of assets that generate passive income and appreciate in value.
Stock Market for Inflation Protection: The stock market is a tool to hedge against inflation, not a shortcut to wealth. A solid strategy is to aim for long-term growth with an expected return of around 8-10% annually. The focus here is on preservation and slow accumulation of wealth over time.
4. START OR BUY BUSINESSES FOR WEALTH CREATION
High Risk, High Reward: As you pointed out, starting or buying businesses is the real way to make money. But it comes with high risks, especially considering that 90% of startups fail. If you’re going to create serious wealth, it requires scaling businesses to the point where they’re generating consistent revenue and profitability.
Acquisitions: Sometimes buying a business is more profitable than starting one. Find underperforming businesses with potential and inject capital or strategic improvements. Many successful entrepreneurs expand by acquiring complementary businesses, which can instantly create more revenue streams.
5. OUTSOURCE, AUTOMATE, AND DELEGATE
The key to making your revenue streams passive is outsourcing the day-to-day operations. Build a competent team, use automation tools, and delegate responsibilities so the business can run without you. This allows you to create time freedom while stacking income streams.
6. TAX EFFICIENCY AND LONG-TERM STRATEGIES
Tax Optimization: Use structures like LLCs, S-corps, or trusts to minimize tax exposure. Wealthy individuals know how to “cheat the IRS” legally by using deductions, write-offs, and tax credits. Building a business that strategically leverages real estate, R&D tax credits, or employee benefits can significantly reduce your taxable income.
Safe Asset Allocation: Once you've built a business and generated wealth, the next step is allocating your profits into safer assets like real estate, stock market index funds, or even municipal bonds. This preserves wealth while you focus on making more through active ventures.
FINAL THOUGHT: FOCUS ON ACTIVE INCOME, THEN DIVERSIFY
Real wealth comes from growing businesses that generate active income first. As you build that income, diversify into real estate, stocks, and other passive investments.