[Brent Deines]

I agree with Jay. It's not about how much you pay or don't pay to get started, it's about how much you put in your pocket at the end of the day. Some people are very good at developing a business from scratch, and others are better at managing an existing business, but lack the patience for laying the foundation.

I would gladly pay $100/day for existing accounts that produce $200/day, or $1000/day for existing accounts that produce $2000/day. Some people get so blinded by the cost of doing business that they fail to see the benefit of experience.

The problem is that most people know how much time and effort went into developing a business, and feel they should be compensated for that. Unfortunately for the seller, but fortunately for the buyer, that is not the way it usually works. Blue sky has very little value, so you can often pick up someones existing accounts for pennies on the dollar if they are truly ready to get out of the business.

Just be sure you do your homework. Talk to the accounts to make sure that they are willing to stay with you, or at least give you a fair shot, after the sale and have the seller sign a non-compete contract. Most importantly, have the seller pay for an independent appraisal of the business. Most of the time the appraiser will estimate the value far lower, and much more realistically than the seller. The business may be worth more or less than the appraisal, but at least it gives you a good place to start negotiating.

I'm not saying it's the right move for everyone, but in some cases buying an existing business can help jump start your venture.