The Entrepreneur's Compass: Forging Your Own Path with Brandon Lipman

Brandon's Origin Story

Daniel: The next episode, a very special episode of The Blueprint Podcast. We've got Brandon Lipman on, originally property investor, a financial adviser, a business entrepreneur, venture capitalist, and also a member of the, the family, not my family, but the Blueprint family as well.

Rory: But also your family.

Daniel: A hundred percent.

Rory: You guys go back quite far.

Daniel: Known each other a very long time.

Rory: Known him his whole life.

Daniel: 29 years in fact. Yep. He's my closest mentor, and he's also an investor in Blueprint. So Blueprint would not be here at the scale it is today without his help. But we're not here to talk about that.

Daniel: We're here to educate our clients, our referral partners, and just the Blueprint network with some interesting thoughts because your journey's a bit of inspiration because we can track it. We'll go through your origin story in a second, but we can track it and identify all your learnings, your growths and how you came to your current investment strategy and what you're trying to build for your life.

Daniel: So mate, thanks so much for coming on mate.

Brandon: Mate anytime. Pleasure to be here. It's always great to spend time with you guys, especially you. And, yeah, I'm really humbled to see the kind of business that you've built. Oh, because obviously work together in business before. I'm sure we're gonna touch on that as well.

Brandon: But it's amazing to see you be able to put together something like this and it makes me very proud.

Daniel: Oh, thanks mate. No, happy, happy to hear that.

Rory: We're pretty proud as well.

Daniel: Yeah, we're proud mate. Yeah, we, Rory and I bloody flog ourselves and we work pretty hard, so nah. And so the whole team as well, so no, we're really happy to have you on.

Daniel: Well mate, you're one of us, you've been there, done that in the financial services space and now you're an entrepreneur, so doing something quite different.

Rory: But take us back to when you were on the tools as a financial adviser, kind of what you created and just fill us in on that part of your journey.

Brandon: Right. Well, I guess the first, when I had a job, right. Which sounds very, it sounds wild. Yeah, it sounds really wild for me to like, think back to when I actually had a job, I was working at a bank. Can I say the bank? That was it?

Daniel: We won't have to bleep it out.

Brandon: Yeah, yeah.

Daniel: No, you can.

Rory: We'll edit it.

Brandon: Bank, right? So at...

Rory: It was a dark blue.

Brandon: One of the blue banks. But, yeah, I started to really gravitate towards wanting to understand what business was like in general and working in the bank, I was very kind of enamored about working in an environment where I could engage with different business owners to understand very much their origin stories, their business, how they run their companies, because I would find inspiration in that.

Brandon: 'Cause I knew that that's where I wanted to head in the future. And yeah, like working for the bank was great and I ran into, very early, the semantics or office politics of mid-level management or needing to do your time in certain roles before you can be promoted or move to where you want to.

Rory: We've all gone through.

Brandon: Everyone goes through that. Everyone does. And rightly or wrongly, I took to that with a very poor attitude, right? Like, there's like an element of stubbornness right, that I think I just exuded probably as a person. Where I just ran straight into a brick wall and I thought to myself, if I was gonna face that, there is just no point in living a life full of that and having other people responsible for my trajectory or whatever I wanted to do.

Daniel: You didn't want to do your time.

Brandon: That they wanted you to do your time and your time was, it was very much up. And along the way I was thinking about other things that I could do. Like I ran a small basketball league for a bit, which I think he played in. Yeah, right. So ran that for a little bit. Had like a couple side hustles going on.

Brandon: Interestingly it was one of my side hustles was actually flipping like concert tickets. So I don't know if I ever told you this. I like, no, not scalping. It's flipping.

Daniel: Right. Okay.

Brandon: Right. Like, I just...

Rory: So interesting.

Brandon: I never told you this because...

Daniel: I worked at Ticketmaster, mate. You didn't...

Brandon: No. It was never, it was...

Daniel: You didn't wanna tell me because you thought I'd...

Brandon: Conflict of interest.

Daniel: And then we're both in trouble. But this one, this one flip was really interesting. It was a Six60 ticket. And so yeah, it was when Six60 was really on the up. Like, and so, sort of 2015, 16.

Brandon: And I really wanted to go to the show out at Mount Maunganui. Myself, my girlfriend at the time, we were gonna plan a little trip and we were gonna go to see 'em at the Mount. It was gonna be fun and I looked at the tickets, they had sold out already and they doubled in price. So I didn't want to pay like 300 and something bucks for the ticket. But the Villa Maria sale was still on.

Brandon: So I bought some for Villa Maria, waited for it to sell out, and then I flipped it so that I could then have, I only have paid the $160 tickets over.

Daniel: Instant equity.

Rory: Equity. Genius. Genius. Equity, sort of. We were just trying to be as resourceful as possible. Right. And in that process, one person who actually messaged me to buy the tickets ended up becoming my future business partner.

Brandon: Right. And that was Andrew.

Daniel: Of course. Right.

Brandon: And so in the conversation, he was interested in buying them and he had seen that we had had some mutual friends. 'Cause we went to the same high school. I think he was five, six years older than me.

Daniel: So Macleans College up the castle. Right.

Brandon: Exactly. Represent. Right. And so, and that led to a conversation just saying, look, if you ever get tired of the bank, like, let me know. And I was tired months ago. Right. Like I was, I never really wanted to be there, but I played it cool and I wanted to learn more about it. And when I started to see the kind of company that they were building, I realized that I was gonna get to operate much closer to owners of a business.

Brandon: Yes. So key decision makers, people who are young and our age, and just really inspiring to be around too. Some like genuine entrepreneur geniuses as well. Right. Like if we think about that, we will touch on it later. But that company was full of great people if you see where they're all at now.

Daniel: Totally. It's like, that environment, not, sorry to interrupt, but even down to the likes of Paul Minors, a very successful productivity consultant and sort of CRM coach. Totally. And just the way he thinks about task management and how to run your day.

Brandon: Right. You don't have to be self-employed to know that time management, whether you're good at it or not, is gonna make you or break you.

Daniel: Right, exactly. And just, we were a highly effective team. Right. And we could name individual. It was really like the poor man's PayPal mafia. Right. Am I right?

Rory: So, who's Elon Musk? Are you Elon Musk?

Brandon: No way. No way. Paul.

Rory: Probably.

Daniel: Chuck Paul, Elon Musk. Yeah, yeah.

Brandon: We have, well, maybe one of the Krebs twins.

Daniel: Oh, true. Maybe. Or both of them. So yeah, so I looked at the opportunity and I realized, well, before that I was really into property and think that that was gonna be the investment strategy that I would carry through. But...

Rory: Because you would purchase your first home, I, sorry, interrupt. I need to let the viewers know. This guy, we lived together, our parents, and you was saving for his first home deposit when he was 22. And he worked full-time during the day, and then he worked night shift at Countdown night filling.

Brandon: 9:00 PM until 5:00.

Rory: There you go.

Daniel: So let's, you go. It's not any delusions that this guy is just, he's not afraid of hard work and he would work fricking hard with the hardest working guys I know. And he worked his way up at Countdown Highland Park, and he was known for his scan rate.

Brandon: He had incredibly quick scan rate. I think fastest hands in the game. That's what they knew him as.

Daniel: And is that verified that you were one of the fastest?

Brandon: I didn't win any awards, but like colloquially, like if you are in a...

Daniel: We'd know about it.

Brandon: At checkout was known.

Rory: People in a hurry would find you out.

Brandon: Yeah, exactly. Well that, that part was actually a really, I don't really see it as anything aggressively tough. 'Cause we could, it was back before AirPods, so we had like the cabled thing and like iPod touch. Right. And I found that you could download all of Hamish and Andy's podcasts. So I just went and locked all of them. We'd get like 10, 15 episodes a night, just shovel them in.

Brandon: And I'd just be listening to Hamish and Andy the whole night.

Daniel: Just like, you're not even working, eh.

Brandon: Yeah, and I, well look. So yeah, that I was really...

Property Investment to Business Acquisition

Daniel: You, and then you bought your first property, right, before this, before going to the bank.

Brandon: Right. So yeah, if we go down that rabbit hole, the environment to buy investment property back in like 2014, 2015 was completely different. Yeah. So I bought a place in Hamilton, 'cause Auckland was running hot, but you could buy with the 10% interest only mortgage, like a 10% down payment for an interest only mortgage for an investment property. That's insane. Right. And the rates were about high fours, maybe five when I had done it.

Brandon: And everyone's concerned about how we had all this crazy property inflation. What were we, people could buy 10%. And people could revalue their properties immediately. And access the equity at the main bank. Exactly.

Brandon: And so the market was about to run hot and I obviously got in, I got at a great price, bought place for $270,000, which now would've been worth, I think, upwards of six. Quite easily. Had a bit of land on it. But what screwed me up was that shortly after buying the property, the LVR rules changed. And so we went from needing a 10% down payment to 40%. So all of a sudden, any equity that I could have drawn out, no matter what I did, built like a palace or anything on the property or whatever, I'd now be subject to much harsher equity requirements to keep doing deals.

Brandon: So again, I took a look at that and thought, well, that's really, I know a lot of things are gonna be out of your control, but I felt like the rules and the fundamentals that I needed to play that game at the scale that I wanted to be able to play it was just completely changed overnight.

Brandon: And so if I was gonna base a strategy off of building wealth or building income off of a particular asset class, I'd need to be ready for that. And I just looked at it and I said, well, okay, that's just not for me. So it's just, that wasn't the game that I was gonna play, but I had this brilliant idea because I was working at Countdown at the time, that if I wanted to learn about money, I should just go where they keep the money.

Daniel: Which is at a bank.

Rory: Stands to reason.

Brandon: It's proximity. Perfect logic.

Brandon: Exactly. And so, and then that's when I started to see that at the bank, they would treat different customers differently. But you'd hear how different clients would be subject to different things like term deposit rates or interest rates, and that there were different segments of the bank that you could fit in. And it always seemed that business owners got towards these certain areas of the banks where the rules were a little more grayed out than the black and whites that you have for retail, like retail mum and dad investors.

Brandon: And so we know that those rules were different and I understood that that's where I needed to start operating within. And so to me, it just made perfect sense that business was the way forward.

Brandon: And so then fast forward after working at the bank, running into issues with mid-level management, it then made so much sense to leave the bank. And then go and work at this early stage company where we would be closer to the founders, closer to the decision makers, closer to people who are similar thinking and just surround myself with people who were always gonna go on and do great things.

Brandon: Because that's what I was gonna be able to absorb. It's very different to working in a corporate environment. And you transcend, like, you transcend your knowledge and your comprehension of business so much quicker by being, by putting yourself in an environment like that.

Daniel: Absolutely. So, we'll fast forward through that adviser journey, but the headlines are, you were very successful as an adviser. You ran a highly successful advice team exclusively doing mortgages, for many, many New Zealand homeowners, and you mentored the three directors of Blueprint through the process.

Daniel: So you gave back.

Rory: Got you into the game, didn't he?

Daniel: A hundred percent. Pulled me into it.

Rory: Invited you in.

Daniel: I was thinking of going to the bank as well. I've always followed in my brother's footsteps, but...

Rory: Did you get your work at Countdown?

Daniel: No, no, no. I did, I worked at the tickets.

Rory: Yeah, that's right.

Daniel: Best job I ever had other than this. Best job I ever, so much fun.

Brandon: At the peak of your mortgage career, what sort of volumes of lending were you doing?

Daniel: Hundred million, baby.

Brandon: Baby. Have to hit the hundred million figure at some point. Like I think that as an adviser you can make the argument that you want to be personable and that you want to give your clients a very huggy feely kind of a service, which I think you can deliver at volume and at scale as well.

Brandon: It's process. But at that point, when you do so much volume as a mortgage advisor, think about it this way. If you sat next to someone who is doing 20 million in mortgages, or if you sat next to someone who's doing a hundred million in mortgages, you are gonna run into the real nuts and bolts of the actual mortgage process that are gonna make you a phenomenal adviser.

Brandon: It'll take you five years to learn the lessons of a hundred million dollars worth of lending.

Daniel: Yeah, yeah.

Brandon: Right? And so you have to sit at volume. You just can't, 'cause you need to run into the problems. You need to run into the bottlenecks so that you can learn how to unwork all those constraints very quickly.

Brandon: Otherwise, you end up in an environment where you're learning too slow, you don't know how to operate with quirky deals. You think about an environment like Blueprint where you guys do so much lending as a group. That's where you're gonna be able to learn and actually teach people and also teach yourself more about mortgages, not just, for example, if I came into the mortgage industry today, I'd need to start, I know the basics, but the rules are different.

Brandon: So it's also about the modern lending rules and lending regulations as well. So you need volume. And we had another one of our, the owners as well, also doing a hundred million at that point too. And we were ranked, I think third and fourth in the country in terms of volume. So we were a proper factory.

Daniel: Yes. Smashing.

Rory: We were, it was good times.

Brandon: And my opinion is, volume leads to better customer outcomes because you refine the process each and every deal. You get a bit better, client gets a better experience, but you also learn all of the current potholes. So you can avoid any issues that the clients are gonna run into during their lending application process.

Daniel: But yeah, no, that was really good. And then it came to the point, obviously you're a partner of the business and you made the shift in your career where you moved away from financial adviser service. You are the product, to I'm going to be a true form entrepreneur and be a business owner. And we wanna talk about that thinking in a second.

Rory: But for the layman's, myself, I just wanna explain a bit about what you do. So you find really good businesses and you negotiate an exit with the existing owner. You take ownership and you improve that business. If we compare it to properties, our listeners would be able to, you renovate, you do the kitchen, you do the bathroom, you improve the process, you tune up where things are, and you increase the, what we refer to in accounting or financials, EBITDA of the business and make it more profitable.

Rory: Yes. So you're building equity, like when you renovate a property, you build equity, you're building equity in a business. And that allows you to keep growing the same way you do with investment property. Have I explained that?

Brandon: Yeah, totally, man. Like that's straightforward. Buy good businesses and aim to keep them for 30 years.

Daniel: A hundred percent. We're building a portfolio.

Brandon: Totally. And so the principles for buying a good business is also starting at the point where you're not trying to buy a headache in the first place. Unless if you're really experienced in dealing with headaches. But I don't think anyone who starts out in business probably is in the first instance.

Brandon: But yeah, if you find something that's good in its own right and doesn't need any changes, then anything that you add incrementally is just a bonus.

Daniel: A hundred percent.

Rory: What was, talk to me about that shift. 'Cause you talked about your first investment property and looking at that asset class as a vehicle for wealth, and then the rules changed. But then you were in this business, as you mentioned, was a juggernaut and you were doing very well.

Rory: Property investment would've been like an easy, the natural pathway for you, but you switched, you'd changed. What happened?

Brandon: So, yeah, a great question. I took a trip to the United States and just saw the scale of it.

Daniel: All comes back to the US.

Brandon: Right? Like, yeah. I remember the day that I needed to leave. It was actually a really funny day. I ordered lunch accidentally to a place that I was staying at. So I was in New York, right? I was about to leave, packed all my stuff up and, that was a side story. It was just a really funny scenario. I was packing up, ready to go and I ordered some food and, this part of the story actually just is not relevant whatsoever, but it's funny.

Daniel: Indulge yourself.

Brandon: I ordered food to an address that I stayed in, in Los Angeles accidentally.

Daniel: Oh my God.

Brandon: I just DoorDashed it. I was like, I sat there waiting. And I looked, I guess I could spin it in this way that I looked at the map of the United States and realized how big it truly was.

Rory: You think about catching a cab to go pick your food up.

Brandon: Oh, days away. What the hell?

Daniel: So far. I've never been hungry in my life. Both like internally and then also...

Brandon: I remember that entire, I remember seeing the Manhattan skyline on flight into New York when we came over from Los Angeles. And I was just enamored with the scale of opportunity that existed and it just dawned on me that on the other side of the world, quite literally, almost the opposite side of the world.

Brandon: We are here, a crew of 5 million people. We are just ranked, I was about to be ranked in the top five of mortgages in the country. At 27, 28. I just thought to myself, shit, I've got more in the tank. Right. There's more, like there's more. Like do I want to try and chase down number one, do I want to chase, do what?

Brandon: Like what do I serve? Like I could do more of the same, which don't get me wrong. That's good. And there's so much merit to doing the same thing for 30 years and being the GOAT at one.

Daniel: See that's what I'm into.

Brandon: And that is your thing. That's, and you will be a hundred percent right.

Brandon: So I looked at that and I thought, okay, bigger job. What is that? And I spent a bit of time thinking about it and in the mortgage role we talked about buying books or buying more advisory firms and growing through acquisition. So buying a book refers to buying another adviser's client base.

Daniel: Pretty much buying another advisory firm. Right. And because I had bought into this business, I'd already done a deal or a part of an acquisition in the first place. So a lot of the perspective that I had on acquisition was already broken. Right. And to me it made sense that that would be the next thing that I would do.

Brandon: Do I want to come up and start something? When I saw like all the pain and effort that it would take to build something, I thought that, well, you can actually, instead, if you try buy a business, you're actually, rather than going through the pains of starting and learning all of these lessons, you truncate that and you end up starting at year 10, 20, 30.

Brandon: So not as if you avoid lessons in general, but the whole process of gathering resources, defining a customer base, setting up systems and processes, that's all done and you start with so much wind in your sails that you can just, anything that you do from that point to improve it is exponentially more additive.

Brandon: Yeah, a hundred percent. So, yeah, so I came back from America back to New Zealand and if you ever go from looking at the Manhattan skyline to the Auckland CBD, it looks...

Daniel: Yeah, know? Hang on a minute.

Brandon: So like these ambitions of something greater than just like continuing to operate the factory line of mortgages were just, it was inside of me.

Brandon: And so, and also there's another element as well, like when you're in business and partnership with other people, especially if you are like the younger of the group or, and also I was a minority shareholder as well. Naturally, part of my progression was to want to be able to try and do it on my own, of course. To self justify the fact that I actually can too. So that was part of the process and I think like a lot of the emotional aspects to wanting to also make a move from a group, from the group that we had built. And so it just became a no-brainer. Like it was gotta move on.

Brandon: We're gonna focus on buying businesses. I'm gonna build somewhat of a very small private investment company or a private equity firm, the smallest in the planet. Right.

Rory: But quality.

Brandon: Quality, right. And quality of life as well. And just to try and match the inner ambitions that I had as well. So, yeah, that was that, it was a no brainer.

Brandon: And then the day came and yeah, there were catalysts, like moments that led up to it. And then that was time to move on and start on the new journey.

Daniel: Yeah, absolutely.

Finding Deals and Building a Portfolio

Rory: That's awesome, man. Like that fire that got lit inside of you, just seeing the magnitude of the globe and what was possible. There was obviously then steps, so obviously this is like the mindset shift that's going on now. You've like, you are kind of fizzed up about opportunities. So naturally, I assume that you now start opening your eyes a little bit back here in New Zealand. How did you, there's still a, you made the leap at some point, right? You found an opportunity. You did the deal.

Brandon: Yeah, well I would say that that gap between actually leaving to then doing the deal, that was actually the loneliest part of the journey, which was like horrifically hard to go through.

Daniel: I remember.

Brandon: Because you'd go through like a, this one, all of a sudden, one day I was no longer in the office, no longer surrounded by the team that we had built. So I was not seeing David, wasn't seeing Madhav, wasn't seeing Dan, wasn't seeing my business partners, any of the office staff and like I'd hired a lot of these people and we'd really gone into battle and like, despite it just being mortgages. I think anecdotally in business when you build such a strong comradery with a team, like your work bleeds into your personal life and friendships.

Brandon: Sure. So then to all of a sudden, just cut that and then be in like my flat in Upland Road like walking down to the Benson Road Deli to get a coffee and scratch my head and be like, okay, f***, what are...

Daniel: Bit of an identity crisis, eh? Like, where am I really?

Brandon: Yeah. And so, and I didn't know where to start.

Brandon: And the first step that I started to take was actually from a mentor of mine at the time. He would send letters to business owners. And so what we in New Zealand actually have great access to is a database in the company's office to find where directors and shareholders live in the country and other parts of the world actually don't have that kind of access to that information. It's all...

Daniel: Yeah, well it makes sense, right? Like if you have a disgruntled customer or supplier or...

Brandon: Or can come knocking on the door. Right? And so that's, the window for that is definitely gonna close 100%, sometime in the future, people will decide that it's no longer worthwhile to have director. Or they will set high standards for anyone who wants access to that information.

Brandon: Right. And they should. So I started writing these letters to business owners and I had no clue what kind of business I wanted to buy in the first instance. And you might think that being in business in a finance company, you would learn a lot about business, where you learn about the finance of business and that's actually one very segmented element of a company in the first place.

Daniel: You know how to read a balance sheet and a profit and loss. Totally. And that's pretty much it.

Brandon: Right? And that's it. That's where the line ends. So I had gone into it thinking that, okay, look, I think I know enough. And then realizing I actually know nothing. Well limited, right? I know how to hire the boys and do mortgages and sell a little bit.

Brandon: That was good, right? That was enough. And I had some kind of a track record, so I had no clue where I was gonna start looking for businesses for sale. So what I actually did was I got a copy of the Yellow Pages and I just started flicking through it, and I just started looking at different businesses that were in the Yellow Pages. Like you'd find a listing or you'd find different categories of businesses and I just look through it. Because it would at least start tuning me into deal flow. Right? Like I'd be able to start thinking about, oh, okay, well that's a business.

Brandon: How does that business actually work? What are they literally doing to make money? So you can also, when you drive through industrial areas or you're driving through areas where there are commercial buildings, you can look at these signs and actually just start to be in wonderment as to what these businesses are actually doing, how much money they might be making, if it's something that you think you can grow, if it's something that forms part of a bigger acquisition opportunity.

Brandon: And I was really trying to expose myself as fast as possible to what the opportunities were. I was also looking on Trade Me every, and actually since then, I have looked at Trade Me since 2019, 2020. I've been on Trade Me every single day without fail at least once or twice a day, seeing what pops up for business listings. And it's so habitual now.

Daniel: Also Holden Commodore.

Brandon: Aye, not just businesses. Nah. Man. And so I'm trying to, and through doing that, you see all these really unique businesses that actually exist pop up. And it just gets you thinking. And that's the first thing is being in proximity to what opportunities actually look like.

Brandon: And that's a lot of what that journey was, was actually figuring out what is the thing that I'm gonna buy.

Rory: I think this really makes me feel when I reflect on myself and the differences between a pure entrepreneur. 'Cause as a financial adviser and business owner, yes, I'm an entrepreneur, but not really. We're an agency for the bank and we provide high level, it's cut and paste. Obviously there's things our business does that's unique and the level of advice, I think is high level, but it's cut and paste.

Rory: Whereas true entrepreneurship requires not only the guts, but also some creativity. That's what I'm picking up is the creativity. To generate and create opportunities for yourself. We know what we need to do. We need to meet with as many people as possible per week and sell them on our service and provide a high level. And it's that, right? But for this, it's across different industries.

Rory: Obviously we've got some target industries that we'd speak about that you've had great success in, but it's looking at every opportunity with a unique lens and being creative and seeing how you can make a deal work while also not just trying to make anything work. Right. So that has been such a cool journey to watch you go through.

Rory: And then, I mean, if we just reflect on those opportunities and those deals you created for yourself, how many have you purchased? Like how many businesses is now under the...

Daniel: What was one? I wanna go to one. We're emailing, well, handwriting letters actually to company directors, looking through Yellow Pages, driving around and looking at businesses and just like, the cogs are turning and you eventually make a move. Like the first deal...

Brandon: Well, like, even before then, like in terms of the driving around and seeking, there's like...

Daniel: Doing drivebys.

Brandon: Not even that. Like, I remember this one time, I had a couple mates who moved to Wellington, right. And I was like, I'm gonna, just gonna, I'd actually sent a lead in a letter out to a person who had a business where they were importing commodities from Jakarta and what they were doing, it was sort of like these specific kind of coals or wood chips that were used in restaurants to create a very certain type of flavor.

Brandon: And they had relationships up and down the country with different chefs and different restaurants, and they were just importing into, was it Masterton? I can't remember. It was just some weird warehouse in the middle of nowhere. And I remember I had sent a letter out and this guy responded to me. So first thing I got on a plane, went to see the boys and stayed and crashed with Shane and Adam.

Brandon: The fellas. And so I went and saw them for the weekend, but then on that Friday, I remember catching, I went down to the city station down in Wellington, caught a train, got on a bus, got to the guy's like factory outta Masterton.

Daniel: Yeah, just to see what was going on. Nice train trip as well up there.

Brandon: Right. And...

Rory: This is just a sightseeing, don't try and mask this as an entrepreneurial sort of pursuit. You're just having a...

Brandon: Nah, just, but the beauty of New Zealand. Yeah, totally. And I guess that was, it's part of the creative or like where curiosity and creativity kind of splashed together, isn't it? Figuring out and just knowing that that's not a task or an action that can scale, but it's part of a step that you would take in order to try and figure it out.

Brandon: I remember sitting down in front of these three people who owned the business and it was like, I just had no clue what I was doing. I just wanted to meet them to try and figure out more about their business and at least have a conversation to see how that went. 'Cause up until doing the first deal, there was just so many failed attempts at even finding a business where the owner wanted to talk to me or finding a business where it was actually feasible as an acquisition opportunity in the first place.

Brandon: And so it was kind of nudging against all of these paths that would never go forwards, but along each of those attempts, I'd figure out something that would give me a lesson so I didn't make a mistake or it would help me filter better in the future. So yeah, in terms of the journey, just end up going to all these weird places.

Brandon: That's one example to just see what was going on for the sake of it, and use it as a learning experience. And then, yeah, we ended up, I ended up doing one deal. So if I think about the industries that I've been involved in, obviously finance, right? That was the first one. Then construction, which really I'll talk to you about that.

Brandon: That didn't really go out so well. And then, yeah, hire equipment and then now food production. So with the construction business, we ended up finding this guy who had tried to sell his business and he was making awnings and pergolas and it just, he had a website that was still getting traffic, but he had stopped operating it.

Brandon: He couldn't sell the business. And yeah, it was just very much on death's door. Like it had no staff. It had no one who could actually operate. And he was of retirement age. And so you didn't want it, right. So it was practically just a website that just worked and was getting traffic.

Daniel: Someone need to go and knock these pergolas together.

Brandon: And so I knew a guy who operated in construction as well and we tried to do something together where I would acquire the business and that he would be able to operate it and do the construction piece. I can focus on all front end stuff, like setting up the sales process, setting up the quoting process, then handing off all the work to be completed.

Brandon: And then real quick, I realized that some businesses are just really dead ducks, right? Like it was already, it was just really hard to resuscitate. It was practically going through the process of starting something again from scratch. And so that one really didn't...

Daniel: It was in the ICU, you couldn't, the defibrillator wasn't...

Brandon: Totally. And that was again, that was good. 'Cause that was a no money down deal. What we were gonna be doing was paying out a set number that we'd agreed on that we would give to the owner as payment for the business. And it was a, if it was successful.

Brandon: And it was done on completed work as well, so that we could maintain margin in the business and we could buy obviously the kit to be able to knock together the pergolas.

Rory: That's another great point. You created an opportunity where you actually didn't have to make a capital investment. But it made sense for the owner to take that on. Right? 'Cause there was no better alternative for that business to be sold.

Brandon: And so I guess that's a really good place to put a marker down and just say that I know that there's a huge amount of content that exists around buying businesses with no money down. There are a couple key important pieces to that.

Brandon: If you want to do something that's truly no money down whatsoever, you run the risk of it just being terrible. And like a waste of time. Because you do have to think why wouldn't someone be able to find a buyer for their business? Don't get me wrong, I've been in front of opportunities which would've been absolute stunners. And they required little to no money down, but for some reason or another they couldn't come to fruition.

Brandon: You can buy businesses using other people's money, so raising capital either as debt or equity investment and having that as the injection that you need to do an acquisition, I think that's a far more realistic and sensible way to do deals. Primarily because you can then take your pick of the good stuff rather than being subject to scraps. Because good businesses, there's a market for them. There's a market for them. It is much smaller than obviously comparatively like things like property, residential and commercial.

Brandon: But there is a market for them. So good businesses will get snapped up.

Daniel: I've seen it happen. And I've lost out in moments when it's getting competitive. There are a couple which I really did like, one that fitted well into our rental equipment space that we missed out on. And there was another one recently which is an absolute winner, but the owner really, it was just a valuation I wasn't willing to pay.

Brandon: It was a couple of trampoline parks actually.

Daniel: No way.

Brandon: And I really liked it 'cause they made good money in winter. So the actual property or just the...

Daniel: The business.

Brandon: So it was a lease, big risk in the business. 'Cause obviously if you can't extend it, then you've gotta go and fit out an entire trampoline park and you have to get consent to be able to have people coming in to park. Like a lot of people coming in to park and then so it's, yeah, that one. And that was this year. I really would've liked that one, but it was just far more than what we were willing to pay and someone else wanted to pay it.

Brandon: So all good.

Rory: Awesome. In terms of investment and capital, people are looking to float debt or put money in for a stake. What's the market like out there? Is there some deep pockets and individuals that are really pumped and ready to lay down some cash?

Brandon: Great question. Yeah, there is, and we are about, I believe that we are on the precipice of realizing that that is a genuine opportunity for a lot of people who are highly capable operators in business to be able to find people who are maybe 10 or 15 years ahead of them, who either are successful in what they do for work in the first instance, have a lot of property, but are actually realizing the limitations of cashflow from real estate investments, or successful entrepreneurs themselves, or business owners who have actually taken an exit and know what it takes to go from start to finish and don't wanna run that race ever again.

Brandon: And they'd rather find the younger version of themselves and choose that person to back over going back for another round. So I think that those people kind of get it. There's a small community, but yeah, you're right. There's money for it. And I think we're at the point now in New Zealand where, and other parts of the world, Australia, the United States, the United Kingdom, everywhere, we're at this point where there are these great businesses that do have to transition.

Brandon: What is true from having spoken to a lot of these owners and attempting to buy their businesses or being interested in it, is they have children or younger members of their family who they always intended to run the business and they're just saying, nah, I'm not keen. Like I saw you're never there for me, dad.

Brandon: Right. You kind of, I've heard all the yarns already, oh, I don't really want to go and recreate all these stories that sound boring. I'd rather keep getting the check from you and going to Bali.

Daniel: Like, totally. Like I've, they've got other agendas. Right. And they don't, they're not necessarily a product of, they're not an entrepreneur at heart or even an operator at heart. They just don't have it.

Rory: And maybe 'cause of the fruits of the older generation, aye.

Daniel: Just before you carry on, really interesting thought is that scenario about the other way around. So, not that the parents wanna hand over the business to the younger generation or the kids, but that parent, many of them who've salary sacrificed into their business. Taken less wages into their business for a payoff at a later date.

Daniel: It wouldn't make sense for 'em to pass it on to the kids because that's their nest egg. They need a sale to another private, or they need to switch over to another private that's more lucrative because that's their retirement's tied up in the business. So handing it onto the kids just doesn't make sense, 'cause obviously the kids will expect mates rates.

Brandon: Yeah, of course. Or a free ride.

Daniel: You've busted your ass for 20, 30 years to build this great business. So that's another reason why they would look to private money rather than hand the business down to the next generation.

Brandon: Right. When faced with the sale of their business, some owners look at the total sum that they get, and based on the way that you value a business, they typically would consider that to not make sense sometimes. What I mean by that is you might sell a business, let's say that it's owner operated.

Brandon: The owner works in it and they're making 250 in earnings. Right. So that's what they're taking home. Or the total benefit package that they get for themselves. If it's 250 and they're working in it, it's really despite what brokers say or how anyone else sees it, the reality is it shouldn't be really going for more than 500.

Brandon: Right. Like a two times the total earnings. It shouldn't.

Daniel: So for the folks at home, businesses are usually valued at a multiple of the earnings.

Brandon: Or earnings, there's some profit, there's some cash flow metric that is used and that you multiply that by a particular number. So it could be anywhere from one or less than one to 3, 4, 5, more. But there are different, as you go through the thresholds, there are different reasons as to why you would be valued lower or higher. So we use this example, 250,000 to a business owner is a great wicket. 250,000 to anyone is an amazing wicket to be...

Daniel: You're in the top 1%.

Brandon: Yes. Smaller portion of the 1%. It's a great earning. Exactly.

Brandon: So if you are earning 250,000 in income from a business that you run, and you can only get up to two times the value of that on exit, sure you fast forward all of your earnings into that moment, right? But no capital gains tax at the moment. No capital gains tax on the sale of a business as well. So what are you gonna do with that money? If you sell that business for $500,000 and it's giving you $250,000 a year, what are you gonna do with it?

Daniel: Buy another business.

Brandon: Or well, no, it just doesn't seem like a great exit, doesn't it? You kind of like...

Rory: So how do you engineer a great exit if you're that size?

Brandon: True. So yeah, that's, and I don't want it to leave any of the listeners being like, oh, all businesses are valued that way. So you can value a business to be worth more if it's one, got a greater size of earnings. That's one of the metrics. So when you start to get plus 300,000 to 400,000 or half a million, that two multiple can move somewhere closer to three, three and a half. And then it's on the upper end of that if there's some level of management in place where the owner isn't at the coalface doing everything, they're not wearing every single hat.

Daniel: Yes. Et cetera.

Brandon: That's gold for investors, right. Because if you're buying an asset that's income producing and is not gonna take much of your time, it's already got the, it's plug and play. Now you can actually increase the multiple.

Brandon: You have time to be able to focus on other things like business development. You're not opening the shop. You're not closing the shop, you're not serving customers, you're not also filing returns. You're not taking the bins out. You're not, you've got some sort of infrastructure that gives you separation from doing the thing to be able to think strategically about the thing that you were doing so that you can focus on growth.

Brandon: And so that sort of starts to happen from that 300 plus size.

Brandon: And then when you're working with 6, 7, $800,000 upwards, you're now in the realm of somewhere from three, four, sometimes five, depending on the industry as well. So yeah, it's on the lowest scale of businesses, which provide excellent income for people.

Brandon: The exit or the value that people get from the exit isn't life changing. It should be a life changing amount, but based on the income that they're getting, what can they do with that? So the conundrum of selling, passing the business on or looping in your child to be able to run it, but somehow you get a retainer on it. I don't know. And then you start working in the dark magic of family business arrangements, that kind of might not turn out well.

Daniel: Exactly. And touching on that, I mean, the biggest point that you've made is that there's so many businesses in New Zealand that have one to five operators, family business, that over the years we haven't been able to build proper processes to remove the owners.

Daniel: Maybe that's the owner's choice. 'Cause they want to keep more of the revenue and they don't want to grow that way. But there's these businesses that'll be looking for sale, but they're actually, it's actually just a job. Yes, it's actually just a job. It's a job where you get to control your hours and but there is no structure and process in place that makes it a scalable business.

Daniel: Like the purchaser would have to scale it themselves. So that's another thing I think that you've done really well, is looking at some of these businesses that are maybe set up like that and built the processes, built the systems around that to remove yourself from that business. And then you've just got this, obviously it's never that easy, but you've just got this nice income, right, that you can add to the portfolio.

Brandon: Right. So I think the key issue in that is that people are really reluctant to find belief that there are other people who can do the thing that they can do. Especially in business. Could you imagine operating a business in a way where you believe that you were the only person who can do the job that you were doing?

Rory: I mean, confidence is a really big part of our business, so I definitely...

Brandon: Replaceable. Everybody is, right? So I think you want to realize, I think all you're saying is right, like no one is, like everybody is replaceable, right? Maybe not to the same level, but people can do the stuff that you do. That goes for business owners as well. Unless if there is something, unless if you are Leonardo da Vinci and you are making the Mona Lisa, that's, and that is your thing. Like it is all you, it is all...

Daniel: Or if you're Taylor Swift, right? That's a perfect example. If it's the, yeah, needed.

Brandon: Until we get the AI Taylor Swift bot. Right. She's needed for the gigs every weekend.

Daniel: Totally. I'm more of a Sabrina Carpenter, to be completely...

Rory: You would be, aye.

Daniel: And the album's out today, so...

Rory: You're giving her free promo on the...

Daniel: Why wouldn't you? All, to our pool of...

Brandon: Right. So I think it's an element of not wanting to let go and I've sat opposite plenty of business owners who are in the thick of it who've maybe tested the water, run up against a problem, which is normally a training or recruitment problem as well, and never really back themselves to understand that if you give it one shot and that you don't hire someone that's gonna work out to do the gig that you need to do it.

Brandon: And they cause you issues. It is kind of your fault. Right. Like you are a participant in that reality, so you should think about what you've done. Probably do things a little bit differently or at least learn your lessons and then make an attempt. That's all. And make a second attempt.

Brandon: Make a third attempt to try and figure that out. So if it's a hard job, if you solve it, you will bear the fruits of the solution. That's right. So I think that's really what holds a lot of business owners back is that they will get to this point where, it's not to say anything that there's anything wrong with being an owner operator.

Brandon: Being self-employed or having a business that is a job. It's awesome. It is. Because there's an element of sovereignty that comes with that. Of course. And some people, they want that. And they're not thinking about an exit and a big capital gain on their sale.

Brandon: What I say to people like that though, is that if you're that ambitious to have that kind of level of sovereignty over yourself, you have so much more inside of you to be able to take it one step further.

Daniel: Already taken the step. You're halfway there.

Brandon: The second step is just basic momentum. That's it. And if you, and that's the next step of character development, because if you're saying things like, oh, I can't make enough money in this business, I don't know how, like the numbers just aren't working. Fantastic. You've got a new problem to solve.

Daniel: A hundred percent.

Brandon: That's what's in the way a lot from a lot of owners getting to that point where perhaps they're a bit more distant.

Brandon: But if you want a shortcut to that, I'm not saying that it's easy, you could just do another acquisition. You can buy a competitor, you can buy a business that's similar enough to the one that you operate within. Collect the revenue. You practically grow the size of a business overnight. So if you were to double your revenue or increase your revenue significantly, the same would happen to your profitability.

Brandon: And if it's just a numbers issue, then you've got all of the financial resources to be able to start hiring staff. And re-engineering the operation of a business so that you've got the machine working. It's there.

Daniel: Because I do wanna talk about something amazing that I was talking to Rory about this week that you've done in a section of your hire businesses, right? So you run these hire businesses and you've bought in an equity partner. By doing that, them taking on the load, that operational load of this massive pool of businesses, you've been able to remove yourself from the day-to-day of running that business. So the business has been built, it's earning an income. And you're able to continue working on the portfolio, growing other businesses while that's just sort of ticking over the side, which is something that, I mean, most business owners, that is that sovereignty that we're talking about, right?

Daniel: If we're talking about wealth creation, why are people so drawn to property investment? Everyone uses that word, passive income. I mean, it's incredibly not passive when you're making it, but we're all working towards that day where maybe we could make a little nest egg or empire for our family where there's a passive element to that income. It's an achievable goal and we know many people who've done it.

Daniel: And so you've done that through the businesses, which I think is just such a feat. And is that something that you're trying to continue to extrapolate and keep doing that, or you want to be more involved in certain businesses? Like what is the goal?

Brandon: That's a great question. And it's off of the back of hitting the constraint of I'm still just one person.

Daniel: Bloke. It's another constraint. Right. And think about the journey. Went through five years of figuring out what the strategy was gonna be, in terms of developing and creating wealth. Then went through the team orientated stage, obviously finance and doing that as a team. Then go through another five years of like this solo slog. Being the one person who's responsible, who's the decision maker. No teammates to a degree, but the one person, right? It's still a solo battle. And then I just hit the point where I realized, okay, if we want to move forward, I'm gonna need some f****** help.

Daniel: Yeah, right. A hundred percent. I just thought it's getting to the point where...

Rory: Get the bleeper out there.

Brandon: Please. The F-bombs are coming in hot now, but I just thought to myself like, the journey is gonna be so much more fun if I get to curate the team that I get to do this with now.

Brandon: And that's gonna be the best part about the journey now, which made me incredibly excited to bring Reagan on board to help out.

Daniel: Oh, he's a great partner.

Brandon: And we're sort of talking about that initial experience we had in business with the original iRefi company. Recreating that sort of atmosphere of people who are growth focused, good values, family values, and just want to build great businesses that provide great services and products. That's what it's all about.

Advice for Aspiring Entrepreneurs

Daniel: You can't do it by yourself.

Brandon: And the good thing about having gone through a business relationship previously was that you learn all of the lessons of that. And all the shortcomings of that.

Brandon: And all of the lessons in what worked well, what might not have worked well, understanding personalities. Then going into a solo stage where it's okay, you start learning. I needed help with this. I needed help with that. This could have been a lot easier if I had someone who was really good at this.

Brandon: So then bringing into a new partnership where I have a minority shareholder in the fund or in the private investment company now, it has allowed me to again cherry pick who I think is the best person and the best match for me, which is obviously my best mate. Right. And we compliment each other really well in the way that we operate and mutual respect for each other.

Daniel: Hundred percent.

Brandon: So that, similar goals. Right. And it actually has created an environment where we've been able to build what each person thrives in. Myself, front end, deal orientated, vision, content, building relationships, that's my focus. Regan, operationally driven, pursuing perfection.

Daniel: To the, he's your pro to this...

Brandon: Ends of the world. Right. And for anyone who kind of reaches that point of where they are stretched too thin, they need that person, especially if they're front end orientated. There can be people who are backend orientated in business who then need the front person as well. But I think it's a lot easier to find that person who kind of wants the operational responsibilities ahead of the, especially...

Daniel: He's an engineer.

Brandon: Yeah, he's an engineer who gets it.

Rory: Do you see any opportunities, I suppose with maybe a growing number of Kiwis moving into that retirement realm and very much operating that owner operated style business, that 250K type model that you're talking about, that they're gonna be kind of cheap deals for what they are? And then businesses like that, that can be then turned into what you are doing is rather than the owner operator, just the owner. Do you see any big cash cows out there that you're just like...

Brandon: Are you telling me to snitch on an industry? What's the most lucrative industries that our customers should look to buy businesses in? Let's just speak candidly.

Rory: Totally. We're trying to get everybody wealthy.

Brandon: The best thing you can do is just start looking on Trade Me. Right? And seeing what's actually for sale. So that you can see volume of transactions, right.

Rory: Online. You see all the, oh yeah, let's get a laundromat, let's get a vending machine business, which it's very, oh, we let the machines do it. Car wash. It's very, the car wash.

Brandon: It is. Car wash. It's another good one. The gas station. No one really talking about doing deals on dairies though, which is a little bit of a shame.

Brandon: But if you take a look at what's actually listed for sale, you'll start to see where transaction volume is. So you really have to put your eyes on it and say, okay, to your question, where could I string two of these together? If you wanna try and build an owner perspective, you're gonna do it one of two ways.

Brandon: You're gonna buy the thing then grow it, or you're gonna buy one thing that you're gonna be able to pair it with another thing and you're gonna have some kind of management in place to run it. That is probably a three year process. And it's a fun three years and you'll learn a lot and you'll make great money doing it and you can very, you'll be able to re-engineer the kind of sovereignty that you want a lot sooner than taking the pathway of real estate.

Brandon: 'Cause if you're gonna do it, you might, you can get into the throes of flipping property and trading property, which I would argue is actually a business. It's not property investment. That's a property business. You're buying a product. You are doing something to the product, then you are selling the product.

Daniel: That's it.

Rory: Can we talk about, this is tying into that. And I think it's something that we wanna discuss at the start, you would've mentioned it's, we've been covering it in this chat, but buying business versus starting one. Right. But what is the philosophy? What is the philosophy on that? Like, why are we not starting from scratch rather than getting an existing one?

Brandon: My belief is that people want to start a business for a couple reasons. One, they either don't wanna buy one, so it's the money and spending the money to buy something.

Daniel: Bootstrap it.

Brandon: Bootstrap refers to starting a business, growing it with your own capital, your own time. Figuring out all the lessons, right? So people can think that that is the better way to do it, which in some instances it will be. Like, if you're highly talented in one particular area, then you definitely should be, and you are one of one.

Brandon: Or you can become one of one doing something that you're very skilled and passionate about. Then by all means, that is what you should be doing.

Daniel: Yep.

Brandon: But the fallacy that I think people fall into is thinking that that is the easier route or the better route. Where I would disagree, I would say that you are far better off to have bought something that has all of the momentum, and business is a resource orientated game.

Brandon: So if you buy a business, it's a collection of resources. It's a collection of systems, it's a collection of customers, it's a collection of products or services and everything that is known to currently work, and that there is evidence that that works. So when you buy that, you have a running start. So that's where you can figure things out. You can improve things, you can learn more about business, and you can figure out how to grow it.

Brandon: If you think about starting a business, you run into all of these issues just like talking about the mortgage volume as well, right? You have a lower volume of work, so you can't yet figure out all the problems that you're going to run into in the future.

Brandon: And I think you end up getting business fatigue in the starting process as well.

Daniel: That's all your sweat is going into it. It is. Which you could replace with capital by buying one.

Brandon: Yes. And so people would say that capital, that it's the capital that they don't wanna forego, that it's expensive to buy one. But when you think about it, if it spent, if it took three or four years for you to get that capital back after tax of the earnings in the business that you were to buy. Compared to 10 or 15 years of figuring it out. I would say that that time is so much more expensive than the money that you could lose if you were to make a bad...

Daniel: Hair loss. A lot of hair loss as well.

Brandon: You're not, and you're not actually paying a premium for that. 'Cause you are actually, like the multiples we are talking about is like a multiple of the EBITDA or whatever it is, or the director's revenue, that all that blood, sweat and tears isn't even priced.

Daniel: It's a hack.

Rory: Yeah. I think it all comes back to this concept, obviously why we're here, at Blueprint Finance and how you started out, is debt, the lifeblood of this game we're playing called capitalism that we're all in, regardless of if we love it or hate it.

Rory: That is the true lever for wealth creation, leverage referred to as leverage. So obviously property owners use it. All of our customers use it. I use it. You use it. Everyone loves it, but it's dangerous, right? It's fire. It can cook food, it can create incredible things, right?

Rory: It can mold glass, but it can also burn your house if it's not used properly. So there are these ideas. Obviously I'm always referring to Dave Ramsey on this podcast. Dave Ramsey...

Brandon: I know him.

Rory: Educator, he hates debt. He thinks you shouldn't borrow more than 25% of your household income and you should, if you're borrowing money on a home mortgage, you should have it on a 15 year loan term, and that's the maximum you should borrow, which in New Zealand would just not be possible.

Rory: Everyone would just be living in apartments or leasehold apartments or something like that, right? But debt is such an important thing because it allows us to jump forward into time. But with that time travel, it requires a lot of thought out processing and planning and financial planning about where you're gonna end up, right?

Rory: I'm gonna buy this house. I'm gonna take on a 30 year mortgage, but in 30 years time, or if I can pay it quicker, that's great. My house is gonna be paid off. I'm never gonna have a rent expense and I can retire, right? That's the goal for most of our customers. But when we talk about property investment, I'm gonna buy this house. I'm gonna have on interest only debt, and I'm gonna expect to have gains in 20 to 30 years from the capital growth and inflation devaluing my debt. When we talk about the pairing in business, we are gonna use this capital to buy the resources, buy the income, and how can we make a return on that?

Rory: Obviously, debt in the debt market, debt for business purchase is priced more expensive than for property.

Brandon: Why is that?

Rory: 'Cause it's inherently risky. It's risk priced. That is a fact. When you think about, and it's based on liquidity. 'Cause the liquidity of real estate exists because there are people who understand that that is a market and the banks are incentivized to lend against residential real estate.

Rory: So you can always cycle out bad investments and it's easy for them to capitalize on an actual deal gone bad. We are with businesses and we are in a period right now where we've had record levels of liquidations, right? So when those businesses go bad and they're holding bags of debt, it's very difficult for anyone to get anything out of it because there's debt to this person.

Rory: There are customers or suppliers that are owed money, there are the staff and employees, the Inland Revenue or the tax departments from particular companies of countries are normally involved. And then you also have the liquidators who get paid first. So you have this very interesting car crash that happens when a business goes down.

Rory: And it's a crash. And it's holding the bag, right? It's holding everyone's bag. That is an accident that happens on a main highway in front of everybody, but with real estate you can just cycle it out 'cause there always is a buyer for that, not normally the case for business.

Brandon: So those deals, when you end up being able to access finance for businesses, you typically have a good business in front of you. Because you are putting it in the face of someone who doesn't know anything about business for the most part, like the bankers who you would deal with on entry level acquisitions or maybe mid-size acquisitions.

Brandon: They don't know everything about business, but they just understand the key metrics that they're looking for to when the bank will be interested in lending you money. So they have a very watered down view of it, and if those work, then typically the debt and the deal is okay. They can't be said for every deal or every bank loan that gets issued for a business, but it's priced differently with that risk involved.

Brandon: But then what I've realized is really interesting with banks and debt for businesses is that they start to be able to offer you different products based on the comfort level that your business and you as a person and how you operate, the comfort level that that provides the banks.

Brandon: So you can end up doing, and I've had conversations with bankers where they end up rolling business debt into similar products that are just like mortgages, except they're just not secured by any property. So you can work it into interest only lending. You can work it into 30 year style products or 15 year style products based on the fact that your business has always cash flowed consistently. You've always been able to operate in time. There's no defaults or late payments to any tax departments, and you've got some kind of established relationship with the bank and they know you to be a good operator.

Brandon: So the way that debt operates at the business level can be just like a mortgage. It's earned though. It's not given initially.

Brandon: Yeah, so I agree that people really shouldn't be borrowing and leveraging businesses aggressively.

Daniel: Yep.

Brandon: I a hundred percent agree with that. I don't believe that anyone's first deal should be 100% financed and borrowed from this person and that person.

Brandon: 'Cause I've been in positions where I've financed a lot of debt to buy businesses, but I've always been cash flow heavy and still not red lining, but getting to the point where you are operating within an element where you feel a little bit uncomfortable. And that's very different to real estate 'cause you have the, if you are owning real estate and you're an investor, you typically have the luxuries of having a job.

Brandon: So that you're gonna be getting income every week, a set amount in the bank account, and you can split the money however you need to, to put out fires with debt or unforeseen expenses, et cetera. When it's business and if you're holding debt, if you run it too close to the line, you'll get in trouble very quickly.

Brandon: So yeah, there's a level of experience and operational understanding and understanding of cash flow that you need to be able to operate a business under debt. And I just don't think that people can do that off the bat with not much experience.

Daniel: Yeah, a hundred percent. You hear stories. I've got a friend who, he recently sold his business for quite a good take and he came off the back of a failed venture and he started it on credit cards.

Brandon: How about it?

Daniel: Just got a couple of credit cards and just, so...

Brandon: Do what you gotta do. Aye.

Daniel: That's not what the, I mean, he just...

Rory: Business. Points.

Daniel: The rewards. He went to Thailand.

Brandon: What you said was great. I'm just saying, the risk is a spectrum. And you can do this business thing, you can do this property thing, this life thing with really calculated risk. It's pretty much mathematically certain that you will be successful as an entrepreneur, or you can set up that way with the help of insurance.

Brandon: Not to plug this, but like, you can literally set up your life. So I'm gonna have the wealth that I want to hand down to my next generation or for myself for retirement. You can set it up that way and things would have to go horribly wrong for it not to work out, but you can manufacture that life for yourself through business, through safe debt structures and calculated. So I think that's what you're saying. There's a full spectrum to it. I don't think you would recommend people to do it exactly the way you did it, because I feel like it takes a lot of more personal backing and just faith in yourself. That someone else can't tell you to do it.

Brandon: You have to go and do it. Right.

Daniel: It's really sort of being drawn into the fire. Right. And it's just the unknown.

Brandon: It's hard to explain it in a way where everybody can understand it, being willing to know that while the next few steps might not necessarily be certain that they're worth walking because of all the lessons that you'll learn.

Brandon: And typically the fruits of labor on the other side are very difficult things to do and very hard things to accomplish. So, and the same goes with business. And you're right on your point to structuring everything correctly and safely. What tips most businesses over is lack of cash flow and lack of capital in the bank.

Daniel: Money.

Brandon: So if you take too much money out, if you do not have stored, just like your business is a thing. It's its own living, breathing entity. And if you decide to rob it of all of its money and don't pay the people who need to be paid to keep that thing alive, it will not be alive.

Daniel: It will cease to...

Rory: So impatience and greed. Right.

Brandon: And greed. And then no focus on growth. So the growth that we've been able to focus on has always been acquisition driven, like I said before. If we buy a business, we grow by the size of a business. So that's what fuels the top part of the funnel, which means we can keep more at the end of the day and operate from a baseline of comfort.

Brandon: So you need to be focusing on growth. You need to keep cash flow, you need money in the bank, and you just don't want to be frivolous once you get on the board. The way a lot of people will see it is they'll think that buying the business or getting the deal is the big job, and they'll see that as this huge obstacle.

Brandon: Like that's the thing that they have to do. But really that's just the first step. And then it's a lifetime of more steps like that after you have bought that business. So, yeah, that's something that I really hope that people leave with is not just thinking that it's as simple as just buying a business.

Brandon: You wanna buy a business and then have a plan as to what that enables you to do, what a growth plan is, if you're gonna buy one more and what that business actually means for you and why you are actually buying it.

Daniel: You've spoken about different mentors that you've had, and then you've obviously just learned a lot through the journey. There's probably only so much you can learn before you dive in the water. Would that be right? Like you're never gonna solve the problems because you're actually not gonna know the problems that you'll run into until they arrive on your doorstep.

Brandon: Definitely. So you kind of get your list and your textbooks and your tools and everything, and a backpack, and then you kind of head out.

Daniel: Yeah, yeah, and so you have to learn it through the fire, which is the best part of the journey.

Brandon: Hundreds of difference between going to a job interview or getting offered the job, and then just knowing that if I just go to that place every day, I get paid.

Daniel: A wild ride.

Brandon: Nothing more satisfying than coming home, sitting down, drinking a cup of water, and then thinking back on the day and being like, well, I really f***** that up. Like, there's nothing more satisfying than like...

Daniel: Probably not a cup of water you drink here.

Brandon: And so you learn so much from people. I've found it particularly difficult to find people in New Zealand that I would consider and gravitate towards as a mentor in this space because it's nothing that we've really covered in detail.

Brandon: But I think part of the origin story, which is really important is this one moment where I'd sat, it was during COVID. So it was during the lockdown.

Daniel: Oh, and you've started your business journey.

Brandon: After start trying to figure out what we're gonna buy. Right. So I've started trying to figure out what kind of deal I'm gonna do. I've done some duds. Right. Nothing's working. You guys having a great time rebranding to MHQ. I'm no longer part of the...

Daniel: Are, loans are flying around.

Brandon: Everybody's getting wealthy over there. Exactly. I'm thinking I've really made a mistake. I had this conversation with a great friend of mine. And he, on the phone, I told him I was just running into all these walls.

Brandon: And I just didn't know what was next. And he said to me, it was so genius 'cause how simple it was. He said, well, you're trying to buy businesses. And that's what Graeme Hart did. Why don't you just figure out what he did. And why don't you just Google it and do a bit of research. Maybe there's something there.

Daniel: So Graeme Hart is one of our great entrepreneurs.

Rory: Wealthiest.

Daniel: One of the wealthiest people in New Zealand. He's known for Whitcoulls.

Brandon: Whitcoulls. But something different.

Brandon: And Graeme Hart's journey, I think is one that definitely needs a little more light on it. I think that people obviously had known him to have been the richest person in New Zealand for so long, but I think that the deal journey of his is something that a lot of Kiwis could probably really benefit from.

Brandon: From understanding how you can go from towing vehicles and working in a mechanic shop or whatever, to being one of the richest people.

Daniel: Being the guy.

Brandon: Being the guy from here. Hopefully one day more of that journey comes out in a colloquial environment where it's willing to be talked about.

Daniel: We'll have to do the documentary.

Brandon: Well, yeah. So Graeme Hart, he wrote his thesis in the 1980s about a roll up, which is a strategy of buying several businesses that are in a similar industry and was of the rental equipment space. So it was just 70 pages of just really straightforward, no fluff.

Brandon: Every word purposeful. A detailed plan of how he put together a series of transactions to build a holding company of rental equipment businesses. And I took one read of that 72 page document, I said, that's the Bible. I'm sure there's some of these for sale right now and I'm gonna go buy some for myself.

Brandon: And that's what sparked the journey into the hire industry. So the clues are out there, they've been there for decades, and people would just need to look and then take action. So no real mentors had kind of existed in New Zealand, except for at least this trail of an acquisition trail that happened.

Daniel: An idea 30 years. And then proof and evidence.

Brandon: And so that's what sparked that journey. And yeah, obviously he's not, I've not been able to sit down and have a cup of coffee or jump on his podcast and talk to him about it, which obviously I'd love one day.

Daniel: One day.

Brandon: But that's that kind of mentorship representation here. And then along the journey, that's the great thing about business is you just meet all these phenomenal people who see the world so similarly to you and also different to you. Who add tremendous value in your life, who you kind of pick up along the way and they just become absolute champions for you, your mission, your cause, and then fill that mentorship role in some way or another.

Daniel: I mean that Graeme Hart story about finding his Bible is such a great lesson and it's, you called it simple and it's really common where pick people that you like that have done the thing that you want to do and just copy them, do what they did, whether it's fitness or whether it's acting or whether it's business, it doesn't matter.

Daniel: There's great examples in the world of people who have done the thing that you want to do. A hundred percent. And it doesn't need to be more difficult than that. Do a bit of DIY, do your own research, roll the sleeves up, get in the truck.

Brandon: So gotta go after it.

Brandon: And I think that there are repeatable steps to it, so it'd be interesting. I've got a question for you, Dan.

Daniel: Oh, okay. Flip.

Rory: He's flipping on you.

Daniel: Get your own podcast, mate. This is what the...

Brandon: If you, I'd be interested in your take on this. If we had a younger brother. And he's, let's say he's early twenties. Right. And he's looking at you and me.

Brandon: And he's like, I don't wanna be, I can't be like these two jokers. 'Cause I'm me and I'm different.

Daniel: Not at all saying that we are the vision of success, but...

Brandon: No way. He wants to work towards the, what are you gonna be recommending for him to do if you had to give him some kind of advice.

Brandon: And he is like, all right, I just finished, or I'm thinking about uni, or I've just finished uni. What should I be doing?

Daniel: He's already got a massive advantage and it's not because we're his older brothers, but it's 'cause of his parents, right. He's got these incredible parents who are supportive and encouraging and...

Brandon: A sweet thing to say.

Daniel: No, it's a hundred percent true. That's the reason that we're here. We had a massive leg up and it's not anything financial. It's from the foundations of our family. And the teachings from our parents and the guidance and support. So he's got that.

Daniel: But then he's going to need some extra, a bit of grit is what we call it. It's the main value of Blueprint Finance is grit. Doing the work that no one wants to do, working at Countdown, doing the late shifts, taking the late night meetings, driving out eight o'clock to meet a client. All that stuff that is just, it's not like a skill, it's just a characteristic.

Daniel: So he needs that. And then he needs to figure out what he's pushing for. So you and I always talk about the 30 year goal, right? Stop. Yes. We've got these short term achievements we're trying to achieve in our lives and our business. But what's the 30 year vision? So we need to do that roadmap for him.

Daniel: So we'll sit down with him. Get the felt tips out. We'll do a bit of a sketch. We'll do this...

Brandon: He can write. Yeah, that's all we are. He's literate. We'll give him that. He's literate. He can read and write. Let's say he's got no university degree, right? He's just got the grit, right?

Brandon: So he's got the grit. Now he's got the 30 year vision. He wants, he's drawn wife. He's drawn kids, or maybe it's a man. And some kids, support that a hundred percent. Anything. He wants a family and he wants just a great life and he wants to be wealthy, right?

Brandon: He wants to have money in the bank. Let's work towards that. So he's got the grit. He's got the vision. And...

Daniel: Thrifty.

Brandon: Needs to be thrifty. Okay? He needs to be thrifty with his money and other people's money, okay?

Brandon: And that's how you get ahead. You get that compound growth on every little single thing that you can. You save money where you can, not to an extremist, but you're always conscious of your resource, reserving it and saving for later, right? I had lunch with a good friend of ours who's a very, very successful entrepreneur.

Brandon: 10 mil plus in business equity. Took me out for lunch, got to the checkout, and then the thing pops up. Here's your bill, $70 or whatever, PayWave surcharge, and he's holding the debit card in his hand and he looks at it.

Brandon: He doesn't do the PayWave, he plugs it in.

Daniel: Right.

Brandon: Avoid the surcharge and this guy is worth $10 million. You don't give it away. You don't give nothing away for free. He's not too good for the surcharge. He's plugging in.

Daniel: You want the surcharge, come get it. That's the, that is that 1% that this guy has to have to be successful. He's plugging in.

Brandon: He is not doing the PayWave. He's plugging in and he's saving that money even though he's so wealthy already. And that's because that's how he got there. It's just always having that thrift, that grit, and that vision, and then it all compounded to this point where he is at now.

Daniel: And I'd say that compounds even further because how hard it was to, in the first instance and never forgetting that. And that's right. There are elements between you and I which are really aligned with everything that you've said.

Brandon: There's stuff that I think's front end as well that I'd be giving advice to, or like a direction that I think they really should go.

Brandon: Number one is find something sales orientated. That is it. Like if you're gonna do anything early on, it has to be not an operational or functional element of business. It has to be front end.

Daniel: That's your potential is uncapped.

Brandon: You're gonna unlock your charisma, your ability to speak to people, your ability to be confident, the ability to go into situations that you're not necessarily aware whether or not you either belong or can be successful and you walk away with lessons. It gets you ready for rejection. If you can sell one thing, you can sell anything. And that's the first thing. It has to be built around something like that. So it's either gonna be mortgages, insurance, real estate, cars, something like that, which is...

Daniel: Solar panels, whatever.

Brandon: And a bonus is being able to do that in a small business environment. So you're not gonna go and do that at like Big Four. You're not gonna go and do that anywhere where the company's bigger than 30 people. You wanna be as close to the coalface with a...

Daniel: You're in the financials.

Brandon: Yeah, you are right there. You're next to the decision makers. You see the inner workings of business owners' minds and you learn by proxy all of the lessons that they're learning without taking any of the risk so that when his time or anyone else's time would come, they've already pre-packed a lot of those lessons and they've got the ability to be a go-getter as well.

Daniel: A hundred percent.

Brandon: So that's 100% the direction that I would say that anyone in that position should go.

Daniel: Did we miss anything? Rory? What would you...

Rory: Well, no, no. I'm just wondering what do you think about university? Because you can go straight into a sales role. Pretty raw dog. Like skip the trade. Skip the university, or do you think there's something that needs to be learned there first?

Brandon: I say skip it.

Daniel: Skip it.

Brandon: I would, I think university or learning needs to be far more intentional than just being the next thing that you do out of university. Just out of...

Daniel: Yeah, absolutely.

Brandon: Intentionality behind it. Raw must-haves. So if you have an intention to work in a certain career that you need accreditation for, if you need a degree for, right. But I think if it's coming in there just to do it, you will end up burning three years. And don't get me wrong, there's value to being on the turps. There's value to meeting new people.

Brandon: There's value to going to, unless if you're gonna do uni outta town, I think that's relatively valuable.

Daniel: You'd learn a lot in that process.

Brandon: You would. What I've noticed is a lot of entrepreneurs can self-regulate environments that they don't want to be in. So they would look at, okay, well if I go to university here, am I gonna get sucked into drinking? Am I gonna get sucked into partying, drugs, whatever, like, am I gonna, is that what I want to be a part of?

Brandon: I wouldn't want to discredit anyone who is at university or who has gone to university or aspires to go to university, but there has to be some purpose to it.

Brandon: If it's just by proxy of having finished high school and everyone else is going there, you are being herded. Whether or not you understand that or not, you are just being pushed in that direction. A lot of people who have spoken to me and are aware that I've been buying businesses, they have the assumption that they need a finance degree or an accounting degree to be able to do that.

Brandon: Where I would say that is probably one of the most underutilized elements of business ownership and acquisition is your degree. Like there's no, I haven't sat there and been like, yeah, like accounting has been the reason why I can buy these businesses. Finance and understanding finance is why I can do this.

Brandon: If you can add and subtract and multiply and divide and know the order of operations, which is just basic BEDMAS. And you can apply a business and how it functions to BEDMAS, you can run a business.

Daniel: Yeah. So just focus on your BEDMAS and you're sweet.

Brandon: BEDMAS and you're sweet. So, and there's obviously the application of actual what is going on in business, but for the most part, that's like 80% of the work with numbers.

Brandon: The rest of it you will only learn on the job. There is no way that anything in university will prepare you for business ownership. Maybe marketing, maybe connections, but from a numbers and financial perspective, f*** 'em.

Daniel: Agreed. I think when I took the time to reflect on my university degree and how it helped me in my career, was when I paid, made the last student loan payment. 'Cause obviously I had some time to reflect on...

Daniel: I had to earn that money to pay it off. And my takings, my findings were, it was a $40,000 networking event. And when I'm, don't say that with any anguish or talking down to university, but had a great time through university, outside, very formative years. But all those people I met through university and on that journey, I would trade $40,000 for in a heartbeat.

Daniel: So that's how I view my university experience. But yeah, I've never gotten to a point where I've thought what I've learned here directly is helping me here. We might be taking that for granted. It might be very passively learnt, it might be muscle memory, but yeah, I agree. $40,000 networking event.

Brandon: Who's to know what the networking event would've been if you went down like the Harvey Norman sales road and went straight on the tools. Exactly.

Daniel: What kind of people would I be around? Exactly.

Brandon: I like the intentionality part of it, and maybe I'll just add to the Lipman's younger brother, don't try and solve the rest of your life in a single sitting and work out what I'm gonna do for the rest of my life.

Brandon: Work out what your next step is and then lean into it, and don't worry if it's the wrong step. Just take another one.

Daniel: Think about the long, long term where you want to end up. And then just as long as you're heading in that direction...

Brandon: It'll be fine. And you'll take a few, there'll be a few detours.

Daniel: Quite a few.

Rory: Some, a couple of holes. Potholes.

Brandon: Yeah, the potholes are the best bits.

Daniel: Oh, awesome. Well, Brandon, I don't even think we've halfway through all this stuff we wanna talk to you about. So this is definitely by far the longest Blueprint Finance podcast.

Daniel: We'll have you back on within the next couple months, mate.

Brandon: Whenever. We can do it tomorrow if you want.

Daniel: Rory, thank you so much. This has been such an enjoyable chat and hopefully for the listeners, some valuable lessons, aye?

Rory: To be continued, aye? Legend.

Daniel: Thank you, brother. Love you like a brother, man.

Brandon: Yeah, you're like a brother to me.