Tuesday, September 30, 2014

[VIDEO] Mastermind Groups Encore-Questions answered

I answer Rick's questions about mastermind groups and discuss why mine is so successful.  It's because of business systems.  How can you join or make your own mastermind group?


The original Mastermind Group post is here [click]

Monday, September 29, 2014

[VIDEO] Dead Capital in a business and buying a job.

In this video, I discuss the idea of 'killing' capital by putting it into a business and getting no return on the money.

I also address the topic of 'buying' a job through small business acquisition and how this compares to 'investing' in education.


Friday, September 26, 2014

Updates from David about the Blog and a new set of tools coming soon

A brief update about:

  • Blog readership numbers
  • Upcoming webinar
  • New tool set that I'm developing for those that want to do local deals from the book.

Touching reader review of Invest Local on Amazon

I was really touched when I read this review of Invest Local that appeared from a reader on Amazon. 
My intent in writing the book was to create a no-nonsense, easy to understand book
that would shed light on things that many people just don't understand.

I think I've achieved my goal with this reader.

By Andrea Smith on September 25, 2014
Format: Kindle Edition Verified Purchase
I thought I would be confused about how investment works but this book showed me how. 
There was a lot of useful information. I liked that he said to invest outside the banking system. 
I didn't know you could do such a thing. I always thought that they rip you off . 
Maybe that is too harsh a term, but I find it funny that you can only withdraw a certain 
amount of your money from an ATM daily. I mean what if it is an emergency? 
As for the stock market, I know a bit more now about how it is run thanks to this book.
I see how the Wolf of Wall Street made his millions. I have so much more to learn. 
Invest Local covered a lot of topics that I didn't realize i would come across. 
I always receive car loan applications in the mail . I am glad I ignore them anyway. 
I know I am probably going to do the certified pre owned lease when i car shop. 
I am not yet an investor but in the future when I do, I will be smart about it. 
This is a simple, straight forward guide.

Wednesday, September 24, 2014

[VIDEO] One Buyer, One Seller, Multiple Simultaneous Offers

I have often used the strategy of making multiple simultaneous offers when buying houses, businesses, or large capital items.  It can be a way to frame the discussion with the seller and show that you're open to various scenarios.  I talk about one such example in helping a friend who is negotiating to buy a company.

Tuesday, September 23, 2014

FSN Interview about crony capitalism that turns to local opportunities

This is a great interview with economist Gordon Long about the evolution of crony capitalism and how large companies resort to 'regulatory capture' to ensure profits.

When the conversation turns toward investing, the discussion gets local.  (about min 18:00)


Great book review on Goodreads.com

Another great review of Invest Local. Have you bought your copy yet??

This one was posted on Goodreads.com, a very comprehensive book review site.

I read Invest Local and I learned a lot. It was a re-education about savvy investing. I didn't realize it but I have always sort of been under the influence of the financial system. I really didn't think about other ways I could invest my money outside of RRSP's, mutual funds, TFSA etc... And your book really opened my mind to think about better ways to invest that would actually give me more control over where and how my money is invested. Some of the suggestions in the book seemed very traditional even old fashioned ideas about investing. I love it! In my view investing in a local business is great! We all know how getting money from the banks can be an uphill battle and in a lot of cases simply because of the prohibitive policies and regulations they have in place.

Monday, September 22, 2014

Great article on the number of people living paycheque to paycheque and what they can do about it.

I came across this great MoneyWise Blog article about the number of Canadians living paycheque to paycheque and what can be done to find some savings in a budget.

Saving is important because you need your rainy day fund intact before you can save to invest.


How to Stop Living Pay Cheque to Pay Cheque

How to stop the paycheque-to-paycheque cycle.
By Andrew Seale
With files from Melanie Epp
Try as they might, many Canadians are working hard for little gain, according to a new survey by the Canadian Payroll Association.
Around half of those polled say it would be a challenge to meet their financial obligations if their paycheque was delayed by a week and even more – 63 per cent – of young adults aged 18 to 29 are living paycheque to paycheque.
It’s a tough space to be in, says Christine Canning, head of everyday banking at BMO: “It can be overwhelming and very scary,” she says.
BMO’s Rainy Day Survey found similar results, with a quarter of Canadians only having $2,051 in emergency funds – not nearly enough to cover an unexpected health incident or weather a job loss for more than a month.
How can you break the vicious paycheque-to-paycheque cycle? Check out our top tips:

It’s the Little Things

Turns out, breaking the cycle is all about frame of mind – and taking some baby steps. “A lot of us know instinctively what the right things to do are, but knowing what they are doesn’t make it easy to actually do them,” Canning says.
The key is taking a less overwhelming perspective. “Change it from ‘oh my god, I’m supposed to have three to six months of savings stored away, I could never do that,’ to ‘I wonder if I could find 10 dollars a week.’”
As with any financial decision, whether it be tackling debt, contributing to an RRSP or saving, you need to realize that each little decision will add up to a greater whole.
“You don’t have to have a huge amount of money in order to, over time, make a huge amount of difference,” Canning says.

Step 1: Know What You Owe

Taking some time to get to know what you owe can help you decide where to draw a line between your wants and needs. “If you’re someone who finds budgeting intimidating, don’t choose a whole bunch of numbers chose one,” says Canning. For instance, add up all your expenses from debt to rent and groceries and figure out what’s left after you’ve used your paycheque on those bills. Allot a portion of that for non-essential spending and a portion for saving. [CLICK TO CONTINUE TO ARTICLE PAGE, THERE ARE 7 STEPS IN TOTAL]

Saturday, September 20, 2014

New appraisal site rocks

I want to put up this post to personally thank Aaron Doucette for his fine work in rehabilitating my appraisal website.  It was a silly looking template site for too long.

Advantage Liquidity Partners

See the fine work that he did for me here: www.BusinessAndAssetValues.com

Aaron's site and samples of his work can be see at www.aarondoucette.com 

Aaron does really good work at affordable prices for clients around the world.

Friday, September 19, 2014

Disappointing WSJ article

I often do searches for news on local investing.  Usually so I can post comments to promote my book ;)

I came across this Wall St. Journal article about local investing.

The Payoffs of Investing Locally It can be worth it both financially and personally, but there are risks.

To paraphrase the article:

  1. Local investing is done to make you feel good.
  2. Local investing is risky.
  3. Local investing gives poor returns.
  4. Local investing is akin to supporting local charity.

The article sucks.

I invest locally to:

  1. Reduce my systemic risk.
  2. Invest in things I can actually keep my eye on.
  3. Invest in companies in which I can meet the main stakeholders and evaluate them.
  4. Make lots of $$$$ and High %%%% !!!!!

Then I realized that this article comes from the 'belly of the beast' so to speak, Wall St.

Their interest is that you keep shoveling money into the mutual funds that advertise in their pages.

Critical thinking should always be top of mind when considering anything you read.  Even this post.

Enjoy and have a great weekend.


Thursday, September 18, 2014

[VIDEO STORY] Sell a partial interest in a note to reduce risk

In this video I explain how I used one of the leverage techniques from Invest Local to reduce my risk in a small loan to a startup company.

Sometimes partial sales can attract capital gains tax issues.  In this case it doesn't.  Watch to understand.

Read Invest Local to learn how you can do these types of deals yourself.

Wednesday, September 17, 2014

I'm flattered, someone is trying to use my book to scam people...

Wow, online pirates must think that I've got a pretty big following since they're trying to use my book to scam people into downloading their viruses!

Check out what I recently found online...

I hope nobody tries to get the book free this way.  I did and my virus protection software went crazy with warnings.  You'll get lots of malware if you click the link.

The best way to get Invest Local is to buy it from Amazon or this site https://gum.co/quoB

Gumroad is a reputable online retailer of digital content.  When you buy my book from Gumroad, you'll be notified if there is ever a revision and you can get the updated copy free.



Tuesday, September 16, 2014

[VIDEO] Mastermind groups

I've been in a mastermind group for over 3 years and I think that it's critical to my success in business and investing.  Here are some of my thoughts.

Be sure to buy a copy of Invest Local.  You'll certainly get more out of my posts and videos once you've read it.


Monday, September 15, 2014

Legal Crowdfunding for Startups wanting to sell shares? Several provinces may be approving this soon..

I love this article.  It gives me real hope that there will soon be even more ways for small businesses to raise money.

Through my lending efforts I help a few local businesses.  This is the topic of my book, Invest Local.

By opening up crowdfunding for equity issues, there is the real possibility for companies that do less than a million dollars in sales to develop a distributed group of shareholders. I see small company share issues being used as marketing tools.  Much like when Sam Adams brewery made a share sale offering in its cases of beer so that fans could become owners.

This could make it feasible to raise as little as a few hundred dollars from each shareholder and put together an impressive sum of capital.

If it gets approved in New Brunswick, maybe I'll use it to set up a venture capital fund!

Fingers crossed.


Canadian entrepreneurs eager to use “crowdfunding” to raise capital may soon get the chance, as most of the country’s securities regulators unveiled proposed rules Thursday for selling equity over the Internet.
But investor-rights advocates warn the new rules could expose even more investors to fraud. And crowdfunding enthusiasts, while welcoming the proposals, said some of the new rules were too restrictive, and could hamper the growth of what they see as the future of raising startup capital.
The Ontario Securities Commission, for example, would allow companies to raise a maximum of $1.5-million in equity in any 12-month period through crowdfunding. Individuals would be able to invest no more than $2,500 in a single project, to a maximum of $10,000 a year.On Thursday, securities commissions in Ontario, British Columbia, Quebec, Manitoba, Saskatchewan, New Brunswick and Nova Scotia announced proposed rules to regulate the raising of limited amounts of capital, and the selling of shares, through crowdfunding websites. While many of the proposals are similar, some provinces have proposed different limits.
But the British Columbia Securities Commission says it would allow companies to raise just $150,000 per offering, twice a year. Investors would be limited to a maximum of $1,500 in a single offering.
To address widespread concern about fraud, regulators have proposed a lengthy set of restrictions. Crowdfunding websites, or portals, will have to be registered with securities commissions as “restricted dealers,” and comply with minimum capital and insurance requirements as well as various reporting rules.
They would be required to do background checks on companies and their directors or officers who are raising equity on their sites. The OSC says it will be the responsibility of a portal to shut out issuers it believes are fraudulent.
But some feel these safeguards may not be enough.
Neil Gross, executive director of the shareholder advocacy group FAIR Canada, said that with so much stock fraud already targeting unsophisticated investors in Canada, regulators have not weighed the costs and benefits of crowdfunding.
“The question is how much loss and financial ruin are these provisions going to cause, and how does that compare to the benefit in terms of funding of new companies that this is likely to generate?” he asked.
Canada’s nascent crowdfunding industry largely welcomed the proposals, but said they may need fine-tuning.
Sandi Gilbert, founder of Calgary-based crowdfunding portal SeedUps Canada, said one issue is a provision that would not allow those currently registered under existing securities rules, like her company, to also take advantage of the new registration for crowdfunding portals. This could make raising capital more expensive, she said, as many companies would need to pay fees for both.
“If this looks like it is still going to cost an issuer $50,000 of out-of-pocket money before he can go raise his $250,000, it is not going to work,” she said in an interview.
Crowdfunding has exploded in recent years as a way to raise small donations for projects ranging from films to video games to gadgets. The producers of the Veronica Mars movie earned huge publicity last year when they raised $5.7-million (U.S.) on the crowdfunding platform Kickstarter to fund their feature film.
With a growing number of small firms seeking financing through the Internet, securities regulators worldwide are facing pressure to allow companies to issue shares in exchange for funds they receive.
Meanwhile, the OSC announced another landmark proposed rule change on Thursday, which proponents say could allow new ventures to raise billions of dollars.
Under the proposal, Ontario would adopt rules similar to those in other provinces, that would allow investors to invest a maximum of $10,000 in a business that produces an “offering memorandum,” a disclosure document that falls short of a full prospectus. Investors who meet certain net asset thresholds could invest up to $30,000. Industry groups that lobbied for the changes praised the move in general but said the proposed limits were too low. [full article page here]

Sunday, September 14, 2014

Thursday's inverview now on YouTube

My interview last Thursday on FSN is now available on YouTube.

I talk about some recent deals and some current events with Kerry Lutz.

My first FSN interview is here: April 9

Also, my FTM Daily interview is here: June 30

Thursday's Interview...

Friday, September 12, 2014

New radio appearance talking about Invest Local

I was lucky enough to be invited to give an interview on Financial Survival Network this week.

Check out the interview on www.FinancialSurvivalNetwork.com (direct link)

See what kind words Kerry had to say about the book and why he feels that local investing is so crucial for the future of local communities.


Thursday, September 11, 2014

Entrepreneurs in need of capital have limited options

I spent some time this morning poking around the small business finance articles on about.com.

What struck me was the fact that many of them simply repeat the same information over and over...


Basically they say that entrepreneurs can get money from:
1. Themselves
2. Friends and Families
3. Banks/leasing companies
4. Investors

We all know that banks are highly unlikely to lend money to many small business entrepreneurs.  When they do, they insist on lending to the entrepreneur themselves, who in turn put the money into their business.

I would argue that this is really money from item 1 above instead of 3 since the bank considers the individual to be their client.

When it comes to true outside sources of capital for small businesses, the small business entrepreneur is often limited to items 2 and 4.

These are the roles that you can fill and Invest Local shows you how.  Earn superior returns without taking on big risk.

Wednesday, September 10, 2014

[VIDEO] What I've learned about inventory in successful small businesses...

I discuss some of the things I've learned about the inventory levels in successful small businesses over the years that are particularly important if you're going to buy one.


Tuesday, September 9, 2014

Interesting Bloomberg article on small business loan 'market makers'

Bloomberg Businessweek reports that new entrepreneurial firms are entering the under-served small business lending market and earning returns up to 50%!.  That's what I've been trying to tell everyone in my book, Invest Local.  

You can make these types of investments yourself and pocket big returns if you open your eyes to the opportunities around you.

The article poses the question, "should small business lenders be regulated?"  It doesn't matter if they should or shouldn't.  Regulation could kill these intermediary 'market makers' but I don't believe they'll never be able to intervene in one-to-one relationships between a local lender and a local small business.  Interesting article....

Expensive Small Business Lenders Are Unregulated. Should They Be?

Former Small Business Administration Administrator Karen Mills
Photograph by Brendan Smialowski/AFP via Getty Images
Former Small Business Administration Administrator Karen Mills
The Main Street credit gap has become such a well-accepted fact that whole waves of startups have launched, often armed with impressive-sounding technology, to improve small business owners’ access to capital. Many of those new firms, including OnDeck, which has loaned small businesses more than $1 billion since 2007, and Kabbage, which loaned more than $200 million last year, are largely unregulated.
Critics calling for regulation of alternative lenders have pointed to high borrowing costs, which often top 50 percent on an annualized basis, and lack of transparency, especially among the brokers many lenders rely on to bring in business. On the other hand, “there are some who say the marketplace is solving the problem,” said Karen Mills, former head of the Small Business Administration, in a recent interview. “You have innovators and entrepreneurs coming in, and you don’t want to get in the way of this too soon.”
Mills wouldn’t take a firm stand on whether the new lenders should be regulated. But she knows Main Street’s borrowing woes well. Her tenure as head of the Small Business Administration began in the dark months following the financial crisis and roughly coincided with a 20 percent decrease in small business loans. This week she published a detailed account (PDF) of the current state of bank lending to small business, hinting at the role the government might play in helping Main Street companies access credit.
Other obstacles are more likely to last: Main Street is made up of diverse businesses, including long-haul truckers, nightclubs, and Etsy retailers, to name a few, making it hard to create uniform underwriting standards. Meanwhile, the pool of community banks—a traditional source of small business financing—has diminished to fewer than 7,000 from more than 14,000 in the 1980s.
As alternative lenders seek to fill that gap, the debate over regulation is likely to heat up. Among the federal agencies that might take a more active role in regulating online small business lending, Mills says the Consumer Financial Protection Bureau is the most likely candidate. That’s because Dodd-Frank charged the CFPB with collecting data on small business loans to “facilitate enforcement of fair lending laws.” As Mills points out, the agency has a full plate writing and implementing rules to govern the consumer credit market.

Monday, September 8, 2014

[VIDEO STORY] The only unsecured business loan I've ever done

I tell the story of an unsecured business loan I made to a pizzeria and the steps I took to ensure that I would get paid.

Not for the novice local investor.

Learn more by reading my book.  Buy a copy here: https://gum.co/quoB

Friday, September 5, 2014

[VIDEO STORY] Muffin Lady Goes Bust (a franchise tale of woe!)

I'll put up this great little story for the weekend.

I tell the story about a woman who ran her business poorly and how the franchise company took advantage of the situation in a big way to get a new operator and profit in a big way at the expense of the woman and the bank.


I reference an earlier post about head leases that you can find here: [VIDEO] Leases, head leases, master leases (franchises)

Wednesday, September 3, 2014

[VIDEO] Buying equipment with a loan vs. leasing for small businesses (not a tax discussion)

I discuss why I prefer equipment leasing over borrowing to buy equipment for a small business.

Also a great example of when terms are more important than price.

Tuesday, September 2, 2014

[VIDEO] What can happen to commercial real estate when the economy changes

I ran into a real 'eye-opener' which demonstrates clearly what I had expressed in an earlier blog post about what can happen when a business owns real estate and why its not always the best option for many businesses.

Check out what has happened to commercial real estate in this seaside town when their pulp mill was removed.

To see my original post about businesses owning real estate, click here: [VIDEO] Should businesses own real estate?

Monday, September 1, 2014

The Advice That I'd Give New Entrepreneurs

I was asked by my friend and business coach Marc Mawhinney to provide a guest post for www.marcmawhinney.com. Marc works with entrepreneurs and those who are starting their entrepreneurial journey.  Here is what I put together it appeared last week:

The Advice That I’d Give New Entrepreneurs

I’ve owned 5 businesses. I regularly work with business owners to improve their systems and processes. I’ve also had a career as someone who helped people buy and sell businesses and I can tell you that I’ve learned a lot from all the successful (and not so) entrepreneurs that I’ve met over the years. When asked to come and do a guest blog post for Marc about what to remember when starting a business, here’s what comes to mind:
Cash Flow: The purpose of a business is to make money. It should do this every month, right from the start. Do not encumber your young enterprise with obligations it can’t meet like costly overhead at the beginning. Use outsourcing and rent/borrow as much as you can to keep monthly commitments to a minimum. ‘Burn rates’ are for Internet businesses that have been capitalized with millions of dollars from venture capitalists.
Vendor trade credit: Most people think about making the sale and not how they’re going to be paid. The awful truth is that when you’re new, you may find customers that your competitors don’t want because they are terrible at paying on time. What are the normal payment terms in your industry? Should you be extending trade credit to your customers? What is reasonable and how will you enforce the credit terms? A bad debt can kill a new business. Accepting credit cards to eliminate receivables can be a smart move for new companies.
Over-estimating sales penetration: Did you hear the joke about the entrepreneur who said he was being conservative about estimating that he could capture 1% of a billion-dollar industry? I see this all the time. That’s not how you estimate sales. Your sales projections should be based on these questions: how many calls are going to be made each day? How many sales appointments will this result in? How many of these appointments will lead to a sale? How long will it take to deliver the service/product? How long will it take to get paid? As you can see, sales are a function of how many clients you can touch and sell to, not how big a market is.