Three Currencies For Buying A Business
Cash is only one of three ways to buy a business — expertise and sweat equity buy the same asset when you have no money.
- Difficulty
- Moderate
- Time to result
- ~months to results
- Steps
- 5
- Confidence
- 93%
The objection Sanchez hears constantly is that you have to be rich first. Her counter is that there are three ways to buy a business: cash, expertise, or time — what she calls sweat equity. She inverts the position to prove it: she has plenty of cash and a shortage of operators, so a young, hungry person who can actually run a business is the scarce side of the trade, and she would happily pay one $100,000 to operate a business she was going to buy anyway. So the person with no capital does not buy the business outright; they arrive with relentlessness and ask to be paired with someone who knows how to run the thing. The realistic first counterparty is not a Codie Sanchez or a Steven Bartlett — it is somebody's dad. The financing mechanic that makes it work is seller financing, which she notes is how roughly 60% of small businesses actually get sold: the seller takes a percentage of future profits over several years instead of a lump sum, so the buyer needs almost no capital and the seller needs only to believe the buyer will not wreck the business.
Origin
Bartlett put himself back at 18 with $700 a month from a call-centre job and said he would have assumed he had to wait until he was rich. Sanchez agreed you cannot buy it with $700 of extra cash — but you can buy it with your sweat and your time. She then told the story of Adam, a 19-year-old in her community who acquired a graphic-design vendor through his employer on seller financing.
Core principles
- 01There are three purchase currencies: cash, expertise, and time.
- 02Capital-rich buyers are operator-poor — that scarcity is your leverage.
- 03Your first counterparty is somebody's dad, not a famous investor.
- 04Seller financing is how roughly 60% of small businesses actually change hands.
- 05Selling anything is a trust trade; seller financing is a return to bartering.
How to run it
- 1
Identify which currency you actually hold
If you have no cash, you have time and relentlessness. Sanchez's framing: 'I'm working 12 hours in a call centre right now, I am relentless.' That is a real bid, stated as one.
Pro tip Name the currency explicitly in the pitch so the counterparty knows what trade you are proposing.
Watch out Pretending you have capital you do not have kills the deal on diligence.
- 2
Find the capital-rich, operator-poor counterparty
Ask a business owner what their actual constraint is. Sanchez walks Bartlett through his own: not money, not attention, not ideas — people. Hungry ankle-biters willing to do whatever it takes.
Pro tip Realistically start with someone's dad who owns something, not a public figure.
Watch out The counterparty must genuinely lack operators, or you have nothing to trade.
- 3
Bring a specific acquisition, not a general offer
Adam did not ask for a job upgrade. He identified a specific vendor — the graphic-design firm his employer already used, whose owner was done running it — and proposed the acquisition.
Pro tip Sourcing the deal is itself the contribution that earns equity.
Watch out A general 'give me a shot' offer has nothing to price.
- 4
Structure it as seller financing
The seller takes a percentage of future profits over a period instead of cash up front. Sanchez's worked numbers: a business making $100,000 profit a year sells for $300,000 paid over five years out of that profit.
Pro tip Frame it to the buyer's side as a near risk-free trade — the payment comes from profits the business already generates.
Watch out The seller has to believe you can grow the business, or at minimum not royally mess it up. That belief is the whole underwriting.
- 5
Negotiate your equity for bringing it in
Adam explicitly asked whether he could have part of the company for bringing the deal over. Because his employer put in almost no capital and Adam would run it, the answer was yes.
Pro tip Ask at the moment you have proven you can close, not before.
Watch out If you do not ask, you have simply done free M&A for your employer.
In the wild
Adam worked inside a marketing company with no cash and no operating experience. He noticed a vendor doing their graphic design whose owner was done running it, went to the senior partner, and proposed buying it via a percentage of future profits and integrating it — with himself running it.
→ The marketing head agreed if Adam could get the deal done. Adam asked for and received part of the company for bringing it over. He is now about to sell that business.
Sanchez walks Bartlett's own employees through the same play: a sign outside says the studio space is for sale; an employee proposes negotiating a seller-financed real-estate deal, renting it out and converting a cost centre into a profit centre, offering to run it.
→ Sanchez concedes the first deal might get a no — but says you will look permanently different as an employee afterwards.
Common mistakes
Assuming you must be rich first
Sanchez calls this the central misconception. You cannot buy a business with $700 of cash, but cash is only one of three currencies, and the operator shortage means sweat is genuinely purchasing power.
Approaching famous, capital-rich buyers first
She says a young person is not going to be able to partner with a Steven or a Codie at first. Somebody's dad who owns a plumbing company is the realistic and less-competed counterparty.
Not understanding seller financing before negotiating
Because 60% of small-business sales use it, a buyer who cannot explain the structure is negotiating in a language they do not speak and will accept bad terms.
Is it for you?
Best for
People with no capital who want ownership, and employees sitting near acquirable vendors or suppliers.
Not ideal for
Buyers with enough cash to acquire outright who are not constrained on capital at all.
From the transcript
“there's three ways to buy a business you can either use cash you can use expertise or you can use time or what I call…”
“I have a ton of cash you know what I don't have a lot of operators”
“seller financing is how 60% of all businesses get sold when they're small businesses”
From the episode
Codie Sanchez: They're Lying To You About How To Get Rich! How To Turn $1,000 Into $1M! Hard Work Doesn't Build Wealth!
Codie Sanchez