From $1m to $25m in 6 Years

And he happened to own one. I live in Scottsdale. He had, there's only one of these locations in Arizona.

And he happened to own it. He had had it as part of a bigger acquisition he'd done, and it wasn't doing well. It was losing money.

Oh, by the way, if you've been doing this in the history, we're going to go back the last five years and charge you employers all this money. And so he had a big financial liability at this point, so he wanted to get out of this business. So he calls me up and said, jeff, hey, I got a great deal for you.

Why don't you buy my locations in San Diego and Southern California as part of this? There's like five or six of them. And my twin brother lived in San Diego at the time.

I'm like, great, let me take a look at this. And the franchisor wasn't too happy because they want to build new locations. Right. But this is when I learned a valuable lesson.

And that is when you go through the due diligence process with a franchise or they're legally obligated, there's certain things they can't tell you. Profitability, some other stuff. But if you go and buy an existing franchise and you talk to them and you get your due diligence, you get significantly more data than you would if you just build a new franchise.

So anybody that's ever considering going the franchise world, even if you don't eventually buy an existing location, if you can like talk to them and go do the due diligence, you can get a significant more amount of data than you can from the franchisor because of all the laws and everything.

This is so. This is such a good tip. And so when you're talking about the information that will be provided to you by the franchisor, if you're, if you're considering standing up a new unit or whatever, doing a de novo approach, the classic approach, that's the FTD FDD, sorry, FTD French franchise disclosure document, sorry, item.

19 is what you want to focus on item 19. Though they may or may not disclose the revenues of the system.

Exactly. FTD item 19. We've heard that a lot on this podcast for anybody who's done franchise. And so you think a newbie would think, oh, man, look at all this great transparency. This is regulated. And so we can, you can really learn a lot about the franchise system by looking at this regulated transparency, this document.

You can go access the document on various websites and as it turns out, first of all, there's a lot, there's a lot of ways that that can be maybe manipulated is a bit strong, but massaged that number.