Ep 357: 5 BIG Reasons People Fail At Buying A Business with Jaryd Krause

Are you setting yourself up for success or failure, and why most people don't realize they're setting themselves up for failure, and it's not your fault? Hi, I'm Jaryd Krause.

I'm the host of the Buying Online Businesses podcast, and today I'm doing another solo podcast episode so you're listening to me, myself, and I. And today is going to be a little bit of me getting a bunch of stuff off my chest, I'm gonna share with you five reasons why people fail to acquire online businesses and even just make money online in general.

Or why people just, a lot of these philosophies that I like to teach and I am gonna share today are not just about acquisitions, online business, making money online, but about life, really. Most of what I do is mindset stuff and philosophies,s and it's just hidden behind business acquisitions, marketing, e-commerce, software businesses, content sites, all that sort of stuff.

Most of it is life philosophies, personal development, and mindset stuff. And I'm just sick of people thinking they want or being sold to the idea that they should be making money online or starting a business, even sometimes acquiring a business. It might be for you, it might not be for you, but some hurdles are absolutely in the way. Also, I have another thing that I wanna share as well.

Couple of times I've spoken to Aussies recently on the podcast, which has been super fun, and the reason I say it's super fun to speak to Aussies is because I never usually get to speak to Australians that are in the online business space, and I also didn't want to create some unease with you guys as my audience because 90% of you guys are American and then a bunch from the rest of the world. And I just want to say why I love working with Americans.

I used to just work with Australians. And the reason I love working with Americans is that there are two different cultures. It's very, we are similar in Australia. I live in Bali, Indonesia, but there's also differences between America hugely and Australia in the sense that in Australia, we are a lot more skeptical and we're slower to move and we typically don't get the results as fast or as many results and this is very general statement as say Americans do and there's a big reason why and as for myself as well, I had to overcome this myself is that in Australia we are, I feel I'm lazy, I'm gonna put my hand up and definitely say I'm lazy.

We tend to have a bit more of a lazy culture and a bit more of a lifestyle culture. And we can do that because our government is set up in a way that if you lose your job and you lose your health, even if you are to lose all your family and friends, what the government is gonna do is they're gonna help you and support you with money until you can find a job.

They do help you find a job. They can also shelter you. We do have our own housing crisis and things going on in Australia. The homeless are rising as it is in so many parts of the world. So we've got our issues and things that we need to solve there for sure.

We're not a perfect country, but in Australia, we do get the benefit of the government helping us if you lose all your job, all your money, all your friends, your family, and your health.

You're getting given money from the government to survive, live, and buy food and groceries. And then you're also going to get help with shelter,r and they're also gonna help you get work. And if you're sick, we have free healthcare, which is wild, especially for most Americans.

And a lot of people wanna move to Australia for this or migrate to Australia for this. And they say tough times create strong people, strong times create easy times, which create weak people, and then a cycle. And I'm butchering that philosophy and that quote there, but you get the point here.

It does make us a little bit weaker in terms of our work ethic in Australia, because we don't have to fight as hard a,s sa,y in America. If you lose your job, your money, and your health, it's very, very tough. You're either out on the streets, and there are not really a lot of resources to help and support you.

So this is why Americans are such go-getters and achieve amazing things. It's quite, I guess, correct me if I'm wrong, I'd love to hear you guys' comments, email me, comment on YouTube and wherever this is posted that you're listening to is let me know what you think, but it's quite capitalistic in America.

And the way that's set up is you guys in America just have, you're just so ambitious, and I love, love, love working with ambitious people. I love working with Australians, and I love working with people all over the world. And just because you're not from America does not mean you're not ambitious.

I'll put my hand up here and say, I'm crazy ambitious, and I'm not from America. But I just wanted to share that with you guys is like the difference between our cultures and our work ethic and how we go about things. And it's also relevant to why a lot of people might fail in the online space.

I know a lot of people in Australia who want to try and achieve things, but the pain isn't big enough for them to go forward, and it's not necessary for them to make big life changes. This is America.

It's like, it's this or what else? Like it's like you go for it, or the alternative can be more severe. So I want to share that, but a lot of people trying to make money online do struggle. The majority do struggle. And I think it's mostly because they're not setting themselves up for success. They're unconsciously setting themselves up for failure. And it's a shame.

Whereas I want to help you guys set yourself up for success, especially in the acquisitions, especially in life. So the first reason that people fail out of these five is, and I'm not gonna say number five is the least strong and number one is the strongest, but I am kind of, yeah.

So number five is, now I'm gonna start with five and work my way down or up towards one, being the strongest, but they all, everybody has their own thing. Like I've got my downfall, and the biggest thing that gets in the way of me achieving things is myself, right?

My own emotions, my own mental blocks, or unconscious blocks that I don't know about. And it's up to us to work out what they are as we go along our life and our journey in acquisitions and everything that we try to achieve. So hopefully this episode is valuable for you so you can start to realize, like, maybe that is an unconscious thing that I'm doing or suffering from, and it's making it harder for me to win.

Now, let's start with number five. Number five is you don't need to know how to do it before you even do it. So in acquisitions, you don't need to know how to run a business or even buy one before you do it. And that's the misconception that most people have is like, I want to buy a business, but why would I do that when I don't know how to run the business? Okay.

They think they should know how to run the business first. And this is absolutely false in my experience. My experience is that I'm a plumber, and I try to start businesses, like a couple of online businesses, two of them, and I failed. I made a little bit of money, but this is a massive failure in my book. And I would say most people's books as well. And then I came to the idea of like, oh, or maybe because 90% of subs fail, I'm gonna know you've heard my story so many times probably, why don't I buy one that's passed that 90% failure rate?

And so I thought, where can I buy an online business that allows me this lifestyle? It's already set up and making money. So I went and found them, and I bought my first business. And had I ever run a business before? No, no idea how to run a business. Have I ever bought a business before?

No, no idea how to buy a business either. But I bought on,e and it went quite well. And I bought three businesses in three years, and then I was able to replace my income. Now that's my experience in buying businesses,s not knowing how to buy a business, and not knowing how to run a business.

Also, most of a large percentage, and I'm talking probably 70%, maybe even up to 80% of the people that buy and acquire businesses have never run a business before, online or offline. And they buy a business, and they do very well. So this is why it's a massive false thing:t you need to know how to do something before you do it. Business is actually like life.

You don't need to know how to do things. You just work things out as you go. And the more help and support you get from the right people at the right time in your journey, your business life, and your regular life, the more you can become far more successful. You don't need to know how to do things before you even do them.

Otherwise, you never would have started walking in the first place. Do you think you just came out as a baby and thought, hmm, I need to learn how to walk? No, you just started experimenting and trying things and learning along the way. Eventually, until you're successful, right?

You pick these things up as you go. So please, please, please don't have the ideology of like, I need to know how to do something before I do it. I need to know how to run a business before I buy a business. I need to know how to acquire a business before I buy a business. It's not true.

We pick these things up as we go. If that were true, you never would have applied for any job. You would have been too scared to apply for your first job because you've never done those jobs or you've never done those tasks in that job. So you would have never applied, and you would have never gotten the job. You would have never made money.

So if you think about this all the way back through your life, most of the time that you achieved anything, you didn't know how to do it before you even did it. So think about that.

The next big failure that people suffer from, or the next big reason that white people fail, is because of just bad advice. Now, it's unfortunate, but it's a pro and a con that we have this online world today where we can learn anything that we want, theoretically, online at the drop of a typically mostly for free, right?

It's a con, it's a pro, and a con. The pro is that the access to this stuff is just there,e and it's amazing, it's phenomenal. All of us content creators out there are competing for engagement, eyeballs, viewers, and we've got to provide the best value for free to get that.

So it's a massive win for us as consumers as well. But this is where things get murky and muddy is that you have people, even like myself, giving general advice out here on a podcast just like this and YouTube videos and maybe even like it will it is it's most content creators is putting out general advice and assume a lot of people assume that because someone else has done it this way Or achieve something in a certain way they can do it the same way for themselves now I'll give you an example when you listen to a podcast of one of my clients that has bought a business, you might go, okay, cool.

This person bought this business for let's say a hundred grand, and you go, okay, cool. I've got a hundred grand. I'm going to buy this business. And it took them, my clients say, three or four months to do it. And then you go away.

And you go, okay, cool, I've got 100 grand. I'm gonna set the bar here, and I'm gonna try to buy this business for 100 grand with my cash in three to four months. The reality is that they might not have, you might not have the time resource that my client had.

For example, they have a single male or a single woman who doesn't have a partner, and they've just either retired or quit their job, or maybe they work five, maybe they work 10 hours a week, or 15 hours a week. And they don't have, they don't spend too much time on their hobbies. They just do a little bit. Now, for you, you might be in a totally different life situation where you've got three kids or two kids, even one child, and it can be challenging.

I don't have children, but I know my nieces and nephews and all my friends and family who have them, there are challenges with, know, they're very time intensive, and you didn't have children not to want to spend time with them, right?

You love them, you want to spend time with them, you enjoy that. So it's difficult when you want to spend time with them, but you also want to set yourself up in the future. You've got time that needs to be dedicated to your child and love.

And then you also might have a 40-hour work week. And then you also have a partner where you need to maintain the relationship, especially through the tricky time of when you've just had children. Because you're so busy and you might not have time to work on the relationship, you need to spend time on that as well.

So there are so many things demanding your time in this situation. And then you go away and you set yourself up for failure because you think you're gonna do this in a four month period when you're comparing yourself to somebody that has all the time or a lot more time than you at least.

So don't be assuming that you can go away and achieve the same result as somebody else when you don't know their full backstory or their full life story. That's setting yourself up for failure, not setting yourself up for success. Give yourself space and time. Another thing is that when I share an example on how to say buy a business with financing, through SBA?

Well, just because I say the general advice is that, okay, if you've got $100,000, you should be able to get a million dollar loan if you pay 10 % down, but then you go to do it and you realize that you've got really bad credit and you can't get a loan for a million dollars.

Maybe you can get a loan for 500K and it's not really what you thought you were gonna get. These, a lot of the things that I share, and a lot of things that a lot of content creators share is general advice and it's never typically specific to you. But that good thing makes us a little bit lazier than Americans.

So it's not so much that it's bad advice. It's that it's general advice. And sometimes a lot of the time I would say people take what I say and what some other content say as gospel. And that's the way it's going to work.

Another example is that a lot of people hear about how you can buy a boring business and you can buy a boring business for no dollars down. Now theoretically that can be done and a lot of people sign up for some of these courses. I know a bunch of people that have come to me for my help after realizing how tough this journey is. They've nearly failed and given up.

They failed at the first part of the journey, which is them believing they could buy a business with no money down and it's a boring business. It's going to be easy. The reality is that's not true.

These boring, mean, yes, boring businesses that I would say great. Like they, they're systems that make money and they're boring and great. But if it's a business that you can pay almost no money down or like a couple of percent down to the business, and then you're relying a huge portion on self financing and then maybe some funding somewhere else.

What's realistic about this is that that business is likely depreciating and it's a crappy asset. And then you have this idea that you can go find something great and you spend a year doing that and realize this method doesn't really work. And you take that as gospel that somebody has shared that with you and you just like, this, this, this sucks.

Like, and then you run away and realize like, okay, it's just too hard to buy a business. Now in general, yeah, it's typical to buy a business, but the strategy that you took on board was not setting yourself up for success or setting yourself up for failure because you didn't understand the market, and you just didn't know yet.

Take what a lot of people say as general advice, and also take it with a grain of salt because you don't want to allow these things to set you up for failure. A lot of the time, these glory stories that you hear are stories where people have succeeded, and they've set themselves up for success, and it's taken them time to get to the point where they can set themselves up for success in their life journey alone.

So that's the fourth reason that a lot of people fail: they take so much advice as specific advice for themselves when it might be general advice, and aren't realistic about where they're starting in their own life and where they want to get to. And they might put a massive timeframe on it or put up or try to achieve something with a certain age bracket, or whatever it is, I've been there as well.

And what I've found is that when I think, all right, I'm gonna try and make X amount of money and X amount of time and I don't do it, what ends up happening is that when I don't do it, that's a notch on my belt, a negative notch on my belt of I'm not good enough, I'm a failure, I didn't achieve this result.

And when you do that multiple times, say for example, if you want to exercise an hour every single day, and you go, I'm going to exercise an hour every single day for a year. Reality is that if you've got a normal life and you want to go on holiday, or you have children, or you do it every single day, the issue is that you're setting yourself up to fail here because it's going to be very, very tough to do it every single day.

And then when you get to the end of the year, you feel like just a piece of crap because you haven't achieved that thing. And you do that multiple times over, which even small things that might be like, I'm gonna consume, I'm gonna spend less time on Instagram, and you cut it down to like, I only wanna spend like five minutes a day on social media or whatever it is.

The consumption's insane out there in the world these days, but you wanna get it down to five minutes, and you're doing two hours a day. That's a big gap. Be kind to yourself. Let's set ourselves up to win here. And what's the most negative thing is that when you do set the bar too high, you're opening yourself up to failure.

Like the higher the bar, the higher the failure rate, I would say, in general terms. And then the higher the failure rate, typically, the worse you end up feeling about yourself when you don't achieve those things.

Because all those things that you don't achieve, small little things throughout your day, it compounds to a point where you feel like useless and you feel like a failure versus just setting yourself at the win and keeping the bar low until you can then guarantee or almost guarantee within 90% of accuracy of achieving that result and then it boosts your confidence, even though the bar is small and then you just build it up and you slowly lift the bap. You don't just jump into the gym and wanna bench press 400 pounds straight away. You're not doing that. Like, unless you are Arnold Schwarzenegger and you've been doing it your whole life, but I mean, that's not relevant because he's not just jumping in the gym and trying for the first time. So let's not set the bar too high, okay? I'm talking about, still talking about bad advice and taking on general advice from a lot of content creators and people that are out there sharing value and information. There are pros and cons to it. The third big reason that people fail, and I may have already alluded to this through my just sharing already, is that people just aren't prepared. That's one big reason. The third big reason people fail is that they're just not prepared for the mental challenge. Now they look at, okay, I'm gonna acquire an online business, and it's a shortcut instead of buying a business. Well, the reality is, yeah, just because it's a shortcut doesn't mean it's gonna be easy. It's not. It's not easy to buy a business. It takes a lot of commitment. It takes a lot of time. It takes looking at 40 due diligence reports. Typically, if you're doing it yourself, you're not even find one that's worth buying. Yes, if you're buying a larger business, say a seven-figure business, then you have the resources to pay for somebody to do that for you, who's done it multiple times, and the success rate is going to be far higher, and the stress level is gonna be far lower. You're paying for that, that's what money's for. Money is typically used for us to spend on things that make our lives less stressful. That's why it's such a beautiful source of money. Many people starting are not prepared for how tough it is, especially in the lower range, under $100,000 for acquiring a business, or even under $ 500,000. You're going to have some challenges. And like I said before, the best way to prevent yourself from getting stuck and winning in life and business is hiring the right people at the right time of your journey that can help you win and they can come in, like for me, a lot of the times people will come in and there's like, Jaryd, I want some coaching with you or some acquisition consulting calls. And I'm like, great. They had this money, and they went to buy a business in this amount of time. And I want it to be this business. And what I do is I just bring the bar down. I just set their level of expectation, and typically change their expectation based on where they're at and where the market's at, which is reality, versus where they are at and where they think they can get without any idea of the landscape that's ahead of them. And that's what I help people do, is I help people navigate the landscape, typically it's their mental landscape, where you have this idea that one, it's going to be easy, I can achieve it in this amount of time, and don't realize these are the challenges you gotta find, to do due diligence on 40 businesses, you gotta look at maybe one to 200 businesses and speak to a bunch of people. And the amount of effort that goes into this is significant. And so it's not for everybody. Yes, it might take you a year to do or two years to do. And you might be thinking, that's not really a shortcut. But it is if you're looking at starting a business, because typically when you start a business, you're not making money for the first or second year and you're just stressing the whole time and not knowing how it's gonna work versus in year one when you buy a business or after one year you might buy a business and it's already making money and it might be making five grand a month, two grand a month. A larger business might be making 50 to 100K a month, but you're getting that straight away, and you've got the asset that you own. So yeah, it's a shortcut but it doesn't mean there's not mental barriers and challenges to get there. So that is number four. I think that's number three maybe actually. Yeah, number three is that people just aren't prepared. Now let's get to number four. This is a big one, is patience. Now I've spoken about this a lot already, so I won't go through it elaborately again and again and again and again, but patience is like, people underestimate the time it takes and they give up because they think I can buy this type of business. Their thought is they might have 100K and they're like, I'm gonna buy this software business, which is a unicorn business that has, it might be making 50 grand a year in recurring revenue. I'm gonna buy it for 100K and it's gonna be a software business and the retention is gonna be awesome. The marketing's gonna be great. They have this ideology that they can go away and do that because they've heard somebody's done it before or they've just built this fantasy in their own head. And I've put my hand up and say, look, I've been there definitely built fantasies in my head, my own head of like, can achieve a hundred grand a month in X amount of time. And the reality is like, I'm where I'm starting from is like, it's so far from me when I, when I was starting, it was so far for me to get to that level. And it wasn't the path wasn't clear. I didn't know anybody had followed that path yet. If I went and hired a mentor at that time and said, I want to get to a hundred grand a month and I'm making three grand a month. Yeah, they're be like, look, you're not doing it in a year or two years time. They're gonna help you along the journey with the mental hurdles and understand the landscape because they've already done it. So patience is very, very valuable. Another thing that I wanna mention with patience is that when you have this ideology of trying to achieve something in a certain amount of time, you're setting yourself up failure.

Why are you setting yourself up failure? Because you shouldn't be counting time. Time is not the best unit of measurement or not the most accurate unit of measurement to measure success. Why? Because what you could do in one year might be vastly different to what I could do in one year.

Or what you could do in one year might be vastly different to what somebody else can do in one year, based on how many people you have in your life, kids, partner, family, parents, friends, work, 40 hours a week, hobbies versus somebody that might have less family, less friends. They work 10 hours, 20 hours a week, and they have a lot more resources and time. So don't count time, count inputs. For example, if I say you need to get to, most people buy a business after, or typically around the 40 due diligence range, how fast can you do due diligence on 40 businesses in six months?

Maybe you can, maybe it might take you one year. Maybe it might take you two years. But somebody else might be able to do it in six months, and it might take you a year. So don't count time, count inputs. And when you're on any goal or wanting to achieve anything, you should be counting inputs, not time.

Same with a health goal. For example, I wanna lose X amount of pounds in three months. Well, let's say you wanna lose 20 pounds in three months. Maybe you can do it in one month.

But let's say you've got 20 pounds that you need to lose in three months, and how you do it is that you go to the gym twice a week. What if you just cut that in half, and you go, I'm gonna go to the gym four times a week, and do it in 45 days, not 90 days?

And you could achieve that result far faster time-wise, but with the same inputs. So it's mostly about the inputs; it's not about the time. So patience, a big one. Be patient, be fair, set yourself up for success, not for failure. Now, the last one is big, and it's a scary one. I don't think people are gonna, I think people need to be very, process this and digest how I deliver this, and be real with yourself on, is this for you or not, okay?

The biggest reason I think people don't buy a business, or fail to acquire a business, or fail to achieve anything, is making money online, placing their income, whatever it is, like the most amazing partner in the world, like whatever it is, right? It's because they want it, but it's not necessary. So think about acquiring a business.

The pain of some, and let's think about the reason why you wanna buy a business. Most people don't wanna buy a business. Most people wanna buy a business only because it allows them to lifestyle so they can have location independence, earn income online, and be anywhere and work online.

But if the pain of living the same life you have right now is not strong enough to make a change, then, and it may never be, you're not gonna change. For example, I've got friends who have talked about starting a business for years, decades, sorry, decades, and they want it, but they don't need it. They get a job promotion, they make a bit more money, their lifestyle changed and they're semi-comfortable, but they have these things that they want.

They're not so uncomfortable that it's like, I effing need this. Like, there's no other way, right? For example, with myself, when I was plumbing, I hated working 70 hours a week. To such an extent that I would drink alcohol on the weekends so badly that I would get blackout drunk and just try to sweep all of this pain of hating what I was doing with my life under the rug.

So it created this self-fulfilling prophecy of just like my life getting worse and worse and worse and more painful and more painful and painful because I was unhealthy, I was working too much, I was stressed because I was doing a job that, I mean, I was an apprentice, but I was running job sites. I was the site foreman, I was the guy. I was 20 years old witha 40-year-old, having to tell 40-year-olds how to do their job and run the job site and sign things off.

It was just a nightmare situation. So I was frustrated, and the reality is that if you're not frustrated enough with your life, then you're not gonna have the ambition and the energy to commit to a change. And that's okay, right? The question you need to ask yourself, i.e., do you just want to change your life?

Do you just want to change it, right? Or, what if you just want to change your life, but you shouldn't just want to change your life. What I'm saying is that you need to change your life, then you'll go away, and you'll do whatever it takes. Nothing's getting in the way.

No mental barriers, no hurdles, all these other four things that I've mentioned before you, they're just speed bumps along the way. They're just brick walls that you need to bash through and get through, right? And you will get through them. But the big domino is this: do you want it, or is it necessary?

And if you just want it, that's okay. Then spend, understand, be more present in your life, and enjoy the things that you already have and appreciatetheme. But if it's a need and it's necessary for you, then nothing's getting in the way, nothing. And I would say as much focus as you can on achieving the result.

And really, you don't need the focus because the focus comes from that feeling and that drive, and the ambition comes from discomfort. That's where ambition comes from, is you not being comfortable enough, and you also being in pain, and pain is a massive, massive driver, and so is fear. And so that's why anybody achieves anything is because they're just either scared or they're in pain, and that's what drives ambition.

And it's wild to think about it this way, but it's people, even billionaires, have this, this is where their drive comes from. It's like, because they're scared of either fear of judgment from others that they're not good enough, or because they don't have enough money or enough success or whatever it is, and or they're just, they're in pain for some reason. And that pain might come from the fear as well.

So this is what ambition is, and you can manufacture ambition. You can manufacture things that, and this is what I do in my life, as I look at things like I'm not happy with that. Want this. And I might think, do I really want it? How bad do I want it? And if it's not just a want, I'm like, I need it.

I'm like, why, why do I need it? And understand like, okay, this is the part that's frustrating me. Focus on that part that's frustrating m,e and go, that's where the drive comes from. That builds the energy for me to have the gusto, the willpower, and the ambition to achieve the results.

That's the biggest one. Be okay with wanting things as well. You don't need to be this crazy, elaborate, billionaire, super successful. Nobody needs to be that. But with small things, you can manufacturwhat youat want, what you need, what you desire, and that ambition. So guys, I'm gonna go through those again. All right, a quick little recap.

Number five is that you don't need to know how to run a business or even buy one. You don't need to know how to do it before you do it. Bad advice, be very careful with the advice that you take. Thirdly, people aren't prepared, just not prepared for the mental challenge. It's simple in theory to do, go buy a business, but it is a challenge, it's not easy. Patience, you need patience, you need to set yourself up for success. Don't be counting time, be counting inputs.

Don't be comparing yourself to others. And the last one is, is your goal a want? Like do you just want to have that goal or is it absolutely necessary? And understand the difference. So guys, this was just a totally unfiltered, unscripted solo podcast. I would love, love, love, love some feedback from you.

Please let me know what questions you have. If there's something further that touched on a pain point for you or touched on some level of frustration or something you feel that I should talk about and share with you. As you can tell, I love talking about this sort of stuff. I've been through a bunch of experiences in my life and I wanna share more of some of the personal things that have happened for me.

Because the personal things have allowed me to achieve the things in business and the personal things are the platform that I've built. Everything that I've achieved, not that I'm like super successful, but like everything that I've achieved in my life.

I'm sorry, I do feel like I'm pretty successful. I do love my life. That's the number one thing if success is like if you love your life, then that's the win, right? But yeah, I'm just saying here to share with you, please let me know what else you want me to share that I've learned along the journey and let me know your questions.

If you did like this sort of format, me just sharing, having a bit of a yarn and chat with you guys, I'd love that feedback as well. Thanks so much for listening and I look forward to coming to you more with more stuff.