My Life as a Business Broker: The Truth Behind the Curtain

 I was on the phone with a gentleman who’s exploring the idea of becoming a business broker. He found my blogsite and some of my videos and wanted firsthand feedback about my experience when I was a broker from 2008 to 2011.

That conversation brought back a lot of memories—and I realized it was time to share another autobiographical installment. https://youtu.be/LsieCGOiS9I 

Why I Became a Business Broker

After the financial crisis of 2008–2009, my finance brokerage business collapsed. More than half of the companies I sourced capital from disappeared. These firms had been packaging deals and selling them to Wall Street, and when that market froze, they vanished.

At the same time, I kept meeting people trying to buy and sell businesses often with brokers who had no idea what they were doing, especially when it came to financing. I wasn’t an expert in buying and selling businesses back then, but I did understand financial statements, deal structure, and money.

That’s when I met Richard, who owned a Sunbelt Business Brokers franchise.

Sunbelt appealed to me because it was a large international organization with structured training manuals, workbooks, online programs and a path toward IBBA certification. I joined, trained, and eventually earned my Certified Business Intermediary (CBI) designation.

Early Success and the Hook

In late 2008, I began working with clients. One of my first listings was a husband-and-wife building materials business. Five or six months later, the deal closed, and in February I received a five-figure commission check.

At the time, it felt fantastic.

I committed fully to business brokerage: more training, more reading, deeper immersion.

In 2009, I purchased the Moncton, New Brunswick Sunbelt office. We expanded into a new office with:

• Myself
  
  

• Three associate brokers
  
  

• One administrative staff member
  
  

On the surface, things looked great.

The Two Sales Cycles No One Talks About

Here’s the reality most people don’t understand about business brokerage:

There are two completely separate sales cycles.

1. Convincing a business owner to list
   
   

2. Actually selling the business
   
   

I spoke with some owners for over two years before they finally listed.

Then, after listing, some deals took three to four years to close.

One of my earliest listings of a fried chicken franchise was one of the last deals I closed in December 2011. That file sat on my desk for almost three and a half years, producing zero income during that time.

The Fatal Flaw: Contingency Income

Business brokerage is largely a contingency-based revenue model.

Yes, I charged engagement fees but those only helped a little. There were stretches where I went nine or ten months without a single closing.

When a deal did close, the commissions could be substantial $30,000, $50,000, even $110,000—but those checks just went to paying off accumulated debt. Then I’d freeze again, afraid to spend, because I had no idea when the next deal would close.

There was:

• No predictable income
  
  

• No stable household budgeting
  
  

• Constant financial stress
  
  

The Breaking Point

In the summer of 2011, I had six deals lined up to close in the winter. I felt confident enough to take my family on a two-week vacation to Florida.

When I returned, three deals collapsed within eight weeks:

• One failed due to government licensing
  
  

• One failed when a bank rescinded financing
  
  

• One failed because the franchisor treated the buyer so badly he walked away
  
  

None of those failures were caused by buyer or seller behavior—third parties blew them up.

The remaining three deals closed, but instead of ending the year with surplus cash, I ended 2011 with my debts paid and very little left over.

At the same time, my wife informed me our marriage was ending.

That combination—personal upheaval and uncontrollable business income—made the decision clear.

Walking Away

I exited the brokerage by transferring ownership to one of my associates and negotiated a small share of future commissions from existing files. There was no big payout—just closure.

With two kids to support and major life changes underway, I needed predictable income and financial stability.

Final Thoughts

Being a business broker was one of the most exciting periods of my life.

I love solving problems. I love structuring deals. I love helping buyers and sellers reach the finish line.

But excitement doesn’t pay the bills if the cash flow is erratic.

For me, business brokerage—at least as it’s traditionally structured—wasn’t sustainable long-term.

I hope this behind-the-scenes look was helpful, especially if you’re considering the industry yourself.

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Should You Buy Into an Existing Business as a Minority Partner?

Key Risks, Financing Realities, and How to Structure a Partnership the Smart Way

This week I would like to talk about a question I received few years ago, Kurt sent in a great question:

“I’ve recently approached a local business owner about partnering—me buying into the business. He might actually be considering it. How do I evaluate this opportunity and what financing options exist?”

If you’re thinking about becoming a minority partner in an existing business, there are unique risks, structural challenges, and financing limits you need to understand before moving forward.

Let’s break it down. https://youtu.be/UNZavOxgg74 

1. Buying Into an Existing Business Usually Means Buying Equity Only

If a business is already operating and has financing in place, you aren’t buying the whole business. You’re buying shares representing the equity, not the debt.

Example:

• Business value: $400,000
  
  

• Existing debt: $300,000
  
  

• Equity: $100,000
  
  

If you buy 50% of the business, you aren’t responsible for half the debt—the financing is already baked in. You’re simply buying $50,000 worth of shares.

2. You Probably Won’t Get Outside Financing

Here’s a reality many buyers don’t like hearing:

No bank lends money to buy shares in a small business.

The only exceptions:

• Personal loans based on your income
  
  

• A personal line of credit
  
  

• Loans from family or friends
  
  

• Rare cases where the seller finances the buy-in
  
  

If you’re planning to quit your job to join the business, remember:

Arrange any personal financing BEFORE you leave your job.

Banks lend based on your personal income—not projected future business earnings.

3. The Big Danger: Becoming a Minority Shareholder

This is the part most people underestimate.

Being a minority shareholder is a lot like getting married—but without the romance.

Why?

Because the majority owner can still outvote you on every major decision unless you create a detailed partnership agreement outlining:

• Voting rights
  
  

• Reserved matters requiring unanimous consent
  
  

• Profit distribution
  
  

• Decision-making authority
  
  

• Buy-sell clauses
  
  

• Dispute resolution processes
  
  

If your relationship relies on the contract regularly, it means conflict already exists.

And conflict usually stems from one critical issue…

4. Partnerships Fail When Roles Aren’t Clearly Defined

I’ve seen many partnerships explode simply because both partners believed they should control the same areas of the business.

Successful partnerships have:

Clear job descriptions

Each partner knows exactly what they are responsible for.

Formal organizational structure

Just like a larger company, the business has a defined hierarchy and workflow.

Boundaries

Partners don’t meddle in each other’s domains.

I recently worked with a partnership where:

• One partner was CFO and President
  
  

• The other was Head of Operations
  
  

They rarely stepped into each other’s lanes. That structure is what made the partnership last.

5. Buying Into Someone Else’s Existing Business Is Especially Risky

Unlike starting a partnership from scratch, you’re joining a business that is:

• Already established
  
  

• Already operating under one person’s control
  
  

• Already influenced by one owner’s habits, assumptions, and decision-making style
  
  

Here’s the key question:

Is the current owner emotionally mature and business-savvy enough to share control?

If they’ve been the sole decision-maker for years, shifting to shared ownership may be harder than you think.

6. Multi-Year Transitions Require Even More Structure

Some people structure buy-ins over several years. For example:

• Year 1: Buyer purchases 20%
  
  

• Year 2: Company pays a dividend
  
  

• Buyer uses dividend to buy another 20%
  
  

• Over several years, ownership flips
  
  

This only works when partners have:

• Policies & procedures
  
  

• Job descriptions
  
  

• An organizational chart
  
  

• Defined responsibilities
  
  

• A clear shareholder agreement
  
  

Without that structure, the partnership turns into chaos—and somebody eventually wants out.

7. My Final Advice

If you want the full argument, I lay it out in detail in my book Invest Local:

• Being a minority shareholder is rarely a good idea
  
  

• The only exception is when all shareholders are active operators, which applies in your case
  
  

But proceed carefully.
Evaluate the owner, the business, the structure, and—most importantly—the relationship.

And remember:

Partnerships are easier to get into than to get out of.

If you want to learn more about creative private investments, check out my book Invest Local — available on Amazon or as a PDF from DCBBooklist.com .

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The Business Buyer Who Put $55K on His Credit Card

 I was at a local business luncheon recently, and someone cracked a joke about buying a business using credit cards.

It reminded me of a real story from my time owning a Sunbelt Business Brokers office. https://youtu.be/LE_Lyx9eOI0 

The Deal

There was a small retail store for sale with an asking price of about $150,000.
After some back-and-forth, the buyer and seller agreed on $130,000.

The terms were simple:

• $100,000 due on closing day
  
  

• $30,000 to be paid over time through vendor financing (a seller note)
  
  

The Buyer’s Clever Move

A week before closing, the buyer asked the seller about her accounts payable.
She had about $55,000 in unpaid supplier bills.

The buyer made an interesting request:

“Don’t pay your suppliers this week — bring the payables to closing.”

On closing day, before signing the papers, they sat down together.
The seller had a big stack of bills. The buyer pulled out his credit card and called each supplier, paying off all $55,000 directly.

Then, when it came time to close the deal, he only needed to pay the remaining $45,000 in cash.

 Why It Worked

From the seller’s point of view, this was an asset sale.
She kept the bank account, cash, and receivables — and she was supposed to pay her suppliers out of that cash anyway.

So, the buyer covering those payables had zero impact on her proceeds.
But for the buyer? He effectively put $55,000 of the purchase on his credit card — and earned enough airline points for a business-class trip to California.

Pretty sharp move.

 The Takeaway

Creative deal-making isn’t about trickery — it’s about understanding the flow of money in a transaction and finding win-win solutions.

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