Moran Pober is an investor. He’s looking to buy and invest in good businesses and people. He’s now on his path to own more businesses than Richard Branson.
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3 Value Bombs
1) You don’t need a lot of capital to buy a million-dollar business.
2) Acquisitions are the quickest way for a company to grow.
3) It is better to be a shareholder in multiple businesses than the owner of a single business.
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(click the time stamp to jump directly to that point in the episode.)
[0:37] – Moran looks to invest in both businesses and people
[0:53] – Tracing Moran’s career path
- Moran started his entrepreneurial journey nearly 10 years ago
- He resides in Israel but constantly travels around the world for business
[01:44] – He attempts to offer attractive retirement opportunities to his clientele
[02:05] – You don’t have to have a lot of capital to buy a business. The richest people in the world build wealth by using other people’s money
- Moran tries to use business assets to finance the acquisition cost. This reduces the requirement of capital
[03:33] – Moran’s expertise lies in cherry picking the best deal
[03:50] – What is the one key thing that you did that allowed you to get the network and relationships that you have now? – Provide value
- Moran has cultivated some great mentors by providing value
- Worked for free at a major marketing firm so that he could learn the ropes of the business
[05:27] – “Entitlement is one of the worst attitudes you can have as an entrepreneur”.
[07:02] – Buying a million-dollar business without your own capital
- You can approach financial institutions or asset-based lenders to get a loan against assets for a profit-making business
- Business assets can be used as a collateral. No need to provide a personal guarantee
- Structure milestones to make payments in a staggered fashion
[09:13] – Worst Entrepreneurial Moment: Moran built an app, which provided tips for using the iPhone. The App was wildly popular until one day Apple came out with a similar App, and informed Moran that he could no longer have his App on the Apple Store. He lost his million dollar business in a single day
[10:44] – Selling a business is a great way to make money
[11:50] – You can be a shareholder in multiple businesses instead of owning and operating one business day-to-day.
[12:20] – Entrepreneurial AH-HA Moment: Moran points out that 9 out of 10 startups tend to fail. Thus, he prefers to invest in multiple businesses and so he can concentrate on building up his income rather than concentrating on managing a single business and running the risk of failure
[14:24] – Moran reads books and cultivates mentors to educate himself
[15:08] – Becoming familiar with corporate financing is a smart move for anyone who wants to be wealthy
- The only way for companies to grow at high speed is through acquisitions
- Learn from the big players and apply their lessons to your own business
- Facebook bought Instagram and introduced Instagram Stories after being snubbed by Snapchat
- A lot of people have completely abandoned Snapchat because Instagram Stories is a much better platform
- Snapchat would have grown by leaps and bounds had they accepted Facebook’s offer
[17:36] – The Lightning Round
- What was holding you back from becoming an entrepreneur? – “Nothing. I just hated having a boss”
- What’s the best piece of advice you’ve ever received? – “Hell on earth would be to meet the person you could have been” and “99% of your life is not spent in the achievement of your goal, but in the path to that goal. So, make sure you enjoy that path”
- What’s a personal habit that contributes to your success? – “Releasing negative beliefs that I have in my subconscious mind” and “Pick a goal. Pick a mentor. Find out whatever action you need to take, and do that continuously everyday, no matter how you feel”
- Share an internet resource, like Evernote, with Fire Nation – Reminders on my MAC
- If you could recommend one book to our listeners, what would it be and why? – Rich Dad, Poor Dad, The Power of Now: A Guide to Spiritual Enlightenment and The Compound Effect: Jumpstart Your Income, Your Life, Your Success
[20:33] – “Find a way to enjoy today and at the same time don’t forget to become the best person you can. So you can give as much as you can”.
Moran Pober: Yes, I am. John, I’m excited.
John: Yes! Moran is an investor. He’s looking to buy, and invest in good businesses, and people. He’s now on his path to own more businesses than Richard Branson. Moran, take a minute, fill in some gaps from intro, and give us just a little glimpse of your personal life.
Moran Pober: Dude, yeah. So, I started a few businesses from scratch, more than 10 years ago now. And at the end of the day, I just didn’t like to do the day to day work in a business. I realized that I’d rather own businesses than be a shareholder in businesses versus running, managing, and just do – in my opinion – boring and repeatable stuff. And yeah, I just decided that, hey, I want to be like the guys on shark tank. And that’s my world right now, just buying and investing in businesses. And it’s the most fun I’ve had in business ever.
John: So, let’s get a little more personal. Where you at? What’s going on in your life?
Moran Pober: I’m in Tel Aviv in Israel, very sunny here. But I’m constantly all around the world just traveling, looking at different businesses, different deals. This is literally the perfect business, in my opinion, for people who are ADD who just want to be involved in many things at the same time because I have the opportunity to just be involved in different sectors, many different people, and amazing, amazing people. Some of the people I talk to are people who have been business owners for 10 or 20 years. And I try to give them a great retirement opportunity. So, I love it.
John: Now where did you get the initial capital to invest in these businesses?
Moran Pober: That’s something people don’t understand. You don’t have to have a lot of capital to buy a business. The richest people in the world – I don’t care how much money you have in your bank account – the richest people in the world, the way they build wealth is by using other people’s money. At the end of the day, your personal net worth or cash is going to end up – so obviously, it’s awesome if you have capital to play with, but it’s not a must.
It’s similar to real estate deals. You can do real estate deals without your own personal capital. And you can start a business without the personal capital as well if you are resourceful and you have the right strategy. And that’s what I’m trying to do. I’m trying to basically, the ideal deal for me is to buy businesses using the business assets to finance the acquisition cost. And obviously, if there’s a missing link and we need to bring in capital from home, then we obviously consider that and due our due diligence if it makes sense.
John: Fascinating. Well, I’m excited to learn more about this because I think this is a topic that is very, very misunderstood by the vast majority of entrepreneurs, myself included. And I think it’s a great opportunity, Fire Nation, for you to think about alternative ways to create wealth in this world. It’s not always by being that person with the nose to grindstone making that thing. It can be helping other people make their things your area of expertise. And what would you say today, Moran, your specific area of expertise? If you could just narrow it down to one thing, what are you great at?
Moran Pober: I would say I’m great at building myself guileful of great deals. I just have great network with great people who always send me great deals. So, I have the opportunity to just look any many, many deals and just pick the best ones.
John: How do you get to build that type of network? What is one key thing that you did that allowed you to get to the type of network and the relationships that you have now?
Moran Pober: I think to summarize it in one word, in a nutshell is value. I really do my best to add value to people. I’m very fortunate and grateful to have amazing, amazing mentors and some of those mentors are people who I literally just added value either in a business way or sometimes just in offering to buy them lunch. Like literally, that’s sometimes all you need to start the relationship.
John: Okay, so buy lunch is pretty basic and that’s cool and I’m glad that is a great way to add value. But give us a specific that you added value to somebody that’s kind of outside of the box. Think of a specific time that you added value where you really think it turned out well that you think that we would find unique and cool.
Moran Pober: I had a marketing agency and one of my mentors is someone I told them, “Hey, I’ll do the marketing for you. I’ll work for you for free basically.”
John: Well –
Moran Pober: “Something that’s close to thousands of dollars for someone else, I’ll do all that for free. I’ll do whatever you want for free. All I want is your time whenever you can. Either bring me to your meetings, have calls with me.” And I was really fortunate to fit with that person and I still am. He’s a partner in a very large business firm and I just sit with him in his meetings, with his partners, with people who want to pitch him ideas. And that’s how I learned. And obviously, I spent fortunes – a small fortune on the same mentors. And of course, it’s things like that. So, it’s all combined in me today.
John: Fire Nation, entitlement is one of the worst attitudes that you can have as an entrepreneur. You need to go to people, just with a genuine open heart and say, “Hey, I’m looking to add real value. Here’s the ways I can do it. Let me do it now for free to prove myself.” Do you know how I got my CPA, Moran? Do you know how I got my lawyer? Do you know how I got my designer and my web developer? They came to me and they said, “John, we love what you’re doing. Let us prove that we deserve to be part of your team. We’ll just do work for free.” And they did and they were amazing. And they’ve been part of my team for years now. And I’ve been –
Moran Pober: I love it.
John: Saying the same for other people and other things. And now, I have these relationships and partnerships. When Tim Ferriss, when I heard that he was first going to launch his podcast, I reached out and said, “Tim, if there’s anything I can do, anytime, just let me know. I’ll jump on a cellphone call; I’ll make it happen for you.” And he took me up on that and we wrote a good relationship through that which has been a huge benefit for me. So, think about that Fire Nation. It is absolutely huge. So –
Moran Pober: Totally.
John: Besides other people’s money, Moran, which is how you just kind of dropped a great value bomb, and how you can acquire a business, and build wealth. What’s something else that we don’t know about acquiring good businesses that as entrepreneur you think would be really helpful for us to know?
Moran Pober: I wish I knew that. First of all, it’s even possible to buy a million dollar business even if you don’t have capital to work with. And like I mentioned before, you can use the business asset to find its acquisition cost.
John: Well, kind of walk us through that, a specific example –
Moran Pober: Yeah.
John: What does it look like to acquire a one million dollar business with their assets?
Moran Pober: Yeah. So obviously, it depends on the deal, right? First of all, let’s assume that the best case scenario, the business is profitable making money. Let’s say it’s making one million in sales on $200,000 in that profit. Each business, again depends on the industry, they got their balance sheet, they’ve got assets on the balance sheet. Things like receivables, inventory, sometimes real estate, obviously cash. I can go to financial institutions and literally just Google financial institutions for your industry or just Google asset based lenders for niches that you’re looking for.
And there are hundreds, or thousands, or literally [inaudible] of people you can go to. Tell them, “Hey, I’m looking to buy that business. Here are the assets that I have, how much can you loan me for those assets?” And there’s no personal risk, that’s another misconception. People are just afraid to do those loans because they think they’re going to sign personal guarantees and things like that. You don’t have to do that if you don’t want. You can use the business assets as collateral as your loan which will allow you to go and start negotiation with the business owner.
And that’s just the beginning; I mean that’s before even considering things like structuring milestones for the business. So, for example, you can pay a certain amount on day one when you buy the business versus you can structure the deal where most or some of the payment is going to be structured over a few years either based on the business profitable, or revenues, or about milestones that you agree on. And that’s called – there are different things that you consider, but you can structure a deal with deferred payments or [inaudible] notes. I can go – as deep as you want with me on this.
John: Yeah, no. it’s really fascinating and maybe what we can really do is you can send me some articles or some case studies that you’ve done or maybe that you’ve just read that you think would be valuable for our listeners that want to do a deeper dive can maybe learn and read. Maybe a couple of blogs to follow, etc. So, we’ll have some great content for you Fire Nation on the show notes page because we’re actually going to shift to your story, Moran, because you are always on this path to own more businesses than Richard Branson. And you’ve had the ups, you’ve had the downs. Take us to what you consider your worst entrepreneurial moment to date. What’s that story?
Moran Pober: Oh, man. I have tons of those. I just forgot to mention that – and I’ll just say that the people who are ahead of me in life, what I figured out is – one of the main things is they failed more than me. And it’s a huge, huge lesson that I tried to work on, just go and fail. But for me, the biggest thing I think, and just because it was so [inaudible], you can say. I had a business that I bought, one of my first deals before I even knew about this world of deals too much. I bought an app company, I turned it around. And the app got to be in the top 100 app in the app stores. I’m talking more than 100 countries.
In the Apple App Store, we used to rank next to really, really high companies, and huge companies, and apps like Kindle. And one day, basically, Apple told me that I can’t have that app on the store anymore just because they came with their own version of that app. And my app was just – it’s a very simple app which is used to give people tips on how to use the iPhone proactively. And now, if anyone who got an iPhone, they have their own version of that. And yeah, that’s basically a million dollar business that was gone in one day. And I definitely learned a lot from that. So, that’s, I think, at least the most [inaudible] story I can give.
John: In looking back, now knowing what you know, Moran, what would you have done differently and what’s the biggest lesson that you want to pass along to our listeners?
Moran Pober: I’d say two things. One of them is – and that’s something I learned a few years later from one of my mentors is that the best time to sell a business is now. And I don’t care what happens in your business. If your business is going up, that’s the exact reason you need to sell to your potential buyer of why you should be selling the business. And I learned that you only make real, good money when you sell a business.
But then I think, looking back, I’m just thinking, I could have kept the startup phase and I could be like the guys on Shark Tank. Obviously, in a smaller way, but today. I didn’t need to wait two months to build too much experience or to have too much of a capital to start becoming an investor, and someone who owns businesses, and can own multiple businesses versus just running and operating one specific business day to day.
John: Great stuff, Moran. And I kind of want to shift now to another story in your journey. And this one’s going to be one of the great ideas that you’ve had. One of those, “Ah ha,” moments. So, you’ve had a lot, but take us to one. Tell us that story.
Moran Pober: For me, it all comes back to this because I spent so much time trying to build businesses from scratch. And again, I looked at TV shows like Shark Tank, like the Profit, and I love those TV shows, and Dragon Den for the UK, and the Canadian version. And then, I loved it. I just wanted to be like those guys and I wish I knew I could be like them earlier. And all the books out there, all the courses out there are talking only about starting a business. At least the ones that I came across and what most people don’t tell you is that most startups will fail.
I don’t know the exact stat, but it’s like 90 plus percent will fail in the first five years, then those who make it in the first five years. Most of them fail in the first 10 years. And I wish I just had the opportunity to go and know that it’s even possible to buy a business. And for me, I just think it really came up to me realizing that my goal was building a lifestyle and great income versus building the next Facebook or Instagram. Obviously, that’s an amazing thing to do, right? If you have a great idea like that, then you can do that. By all means, do that. But I’ll just give you a small example.
Moran Pober: So, I have many friends who are – and I’m starting myself as well – who are investing in startups, or angel investors, or even in the business world, in the adventure capital ward. But when you’re doing those kind of investments, my friends, the angel investors and even me when I’m getting into the sport now, I know in advance, that nine out of 10 will fail.
So, it’s like going to the casino and just knowing in advance that nine out of 10 bets you’re going to lose that and you’re still going to do that, right? I’m just saying, it’s not a must to be that one who’s fighting to be that one out 10. And again, it’s really up to the individual. Just for me, I think becoming an investor, being involved in many, many things at the same time. For me, I just found much more fun.
John: Where do you go to educate yourself in this industry on identifying and owning different businesses?
Moran Pober: I tried all over the place. I literally paid multiple six figures over the last two years, I think, only. And I bet as much as I can. I read as many books as possible, like I said, I tried to do my best to find mentors who are doing this day to day because most of the people who are doing this day to day, they don’t teach that. They’re worried and focused on actually doing deals, on investing in businesses, or basically their only day to day job is to find more deals and find more capital. That’s the deal maker world.
Moran Pober: And I just did everything I can to just go out there and be next to them.
John: Do you have a book or two or a website or two that you could point our listeners to that might want to learn a little bit more?
Moran Pober: I would just check everything related to corporate financing. I think that’s great. Literally, everything in that world. If you could bring those ideas to the small business world, that would be a great, great start. Everything in that world is really what we’re doing. Everything you see in the corporate world, in the big business world, in the public company’s world. It’s the same thing that I’m doing day to day right now. If you even look at the biggest businesses in the world right now, like Facebook, they wait for them to grow by – growing by acquisition to meet their shareholder demands, you have to grow by acquisitions by going and buying out their companies.
And that’s why they’re doing acquisitions like Instagram, and WhatsApp, and all those things because otherwise, you just can’t grow as fast as you want or organically, or just internally by bringing in more product, or marketing and sales. You can just go and buy a business and literally grow by decade’s worth of sales in one day just by buying companies that have synergies with you and cross selling opportunities. So, I say go and learn those – the big guys and just try to implement the best that you can in the small business world.
John: And you have to look at real world examples of businesses who have decided not to sell and are paying for. And some not brutally, but it’s happening. For instance, Snapchat was offered a huge price tag from Facebook and they said no and they had their reasons. And they’re still doing fine. I mean they’re doing some really cool things, but guess what? Facebook said, “Okay. We’re going to turn Instagram into Instagram Stories, and we’re going to essentially copy everything that you’re doing, and have a much bigger fan base.”
And I know a lot of my friends and other peers have made the leap and completely abandoned Snapchat because Instagram Stories is just a better place for their audience, etc. And you have to think and know that Snapchat is definitely not experiencing the kind of growth they would had that not happened. Or if they had accepted Facebook’s offer and Facebook hadn’t turned Instagram Stories on, then Snapchat would just be growing by leaps and bounds because they’d essentially be the only game in town with infinite amount of money just growing them and making them bigger and better.
But you know, that’s the decision of the founder and the owner. And you just have to weigh those decisions carefully and these are the type of value bombs, Fire Nation, that Moran is going to be dropping in the lightning round, so don’t you go anywhere. We’ll be right back after thanking our sponsors. Moran, are you ready to rock the lightning rounds?
Moran Pober: I am, let’s do it.
John: What was holding you back from becoming an entrepreneur?
Moran Pober: Nothing, man. I just hated too much having a boss.
John: What’s the best advice you’ve ever received?
Moran Pober: I want to go with two quotes I try to live by. So, one of them – the first one is, “Hell on earth would be to meet the person you could have been.” I wish I knew where I heard it the first time, but it really changed my life. So, just do something with your life, don’t waste it. And the second one is, “99 percent of your life isn’t spent in the achievement of a goal, but in the path to that goal.” So, make sure you enjoy that path. Try to just enjoy your day and try to enjoy every moment; otherwise you’re just wasting your life as well.
John: What’s a personal habit that contributes to your success?
Moran Pober: I have two here as well. I’ll do this quick. One of them and it helped me tremendously. I wish it was more out there, but releasing negative beliefs that I have in my subconscious mind. And I use different spiritual mentors that I worked with. And number two is pick a goal, pick a mentor, find whatever action is taken, and do that consistently every day no matter how you feel.
John: If you could recommend one internet resource, what would it be and why?
Moran Pober: For me, it would be Reminders on Mac. I’m sure there’s something for windows, but I just like to set reminders that will motivate me, make me more focused, grateful, and sometimes just asking myself these questions throughout the day helps me along.
John: Recommend one book and why.
Moran Pober: One book. I’ll throw a quick – two ones. I think it’s a must, must for everyone. So, reach for The Power of Now and The Compound Effect. Those two books changed my paradigm like nothing else. And I wish I had the option to find more books like that will –
Moran Pober: Change my – the way I look at life so much.
John: Have you read the Slight Edge by Jeff Wilson?
Moran Pober: Yeah, very similar to the Compound, I tried.
John: Yeah. He was actually the mentor of Darren Hardy. So, Darren Hardy’s kind of inspired by Jeff Wilson’s Slight Edge.
Moran Pober: Really?
Moran Pober: Wow, I didn’t know that.
Moran Pober: Awesome, amazing.
John: And I’ve been the hearing The Power of Now so much recently with my past guests and honestly, not before recently. And this book’s been around for a long time, so it’s very interesting that this book seems to be having a big resurge in the entrepreneurial community. So, definitely check it out Fire Nation. And Moran, let’s end today on fire, brother, with a parting piece of guidance, the best we can connect with you, and then we’ll say goodbye.
Moran Pober: If someone was listening got an existing business who potentially wants to sell or if you want to get into this world of buying businesses, I’m personally happy to give someone equity if he’s willing to help me. And I’m happy for him to watch my back, so feel free to email me. I’m not out there too much, just email my personal email is Moran, M-O-R-A-N at my company name is A-B-D assets.com.
John: And a parting piece of guidance.
Moran Pober: For me, it really comes back to the two quotes I said before. It’s about finding a way to enjoy today and at the same time; don’t forget to do your best to grow to become the best person you can, so you can give as much as you can. I think that’s something you need to focus on.
John: Fire Nation, you’re the average of the five people you spend the most time with and you’ve been hanging out with MP and JLD today. So, keep up the heat and head over to EOfire.com. Type Moran, that’s M-O-R-A-N in the search bar, his show notes page will pop up with everything we’ve been talking about today. Best show notes in the biz. Timestamps, links galore. And Moran, thank you for sharing your journey with Fire Nation today. For that, we salute you and we’ll catch you on the flip side.
Moran Pober: Thanks, man. I had a great time.
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