Historically, businesses were passed to apprentices who learned the trade over years. With this model gone, millions of retiring baby boomer business owners have no clear successors. This "apprenticeship gap" creates a massive opportunity for entrepreneurs to acquire established, profitable businesses.
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Before acquiring a company, the most valuable preparation is to work as a "right-hand person" to an existing small business owner. This apprenticeship provides crucial, ground-floor experience with the operational realities that financial models and spreadsheets completely miss.
A primary driver of M&A in wealth management isn't just a race for scale, but a demographic reality. An aging population of advisor-owners needs to find succession plans for their books of business, creating a steady supply of firms available for acquisition to ensure client continuity.
At 18, Alex Marechniak acquired his first business with minimal capital by negotiating an "earn out" with the sellers. This seller-financing structure allowed him to pay for the business using a percentage of its future revenue, proving lack of capital isn't a barrier to ownership.
It takes years of dedicated practice to master a technical skill like being a chiropractor. Entrepreneurship is no different and demands similar patience. Expect a multi-year learning curve where the primary outcome is skill acquisition, not immediate financial success.
The market for buying and selling small businesses is currently opaque and inaccessible to the average person. In the future, these businesses will become more commoditized and tradable, much like how real estate investing and flipping have been democratized over time.
Aspiring business owners can overcome capital constraints by negotiating seller-financed deals. The original owner effectively loans the buyer the purchase price, often in exchange for a share of future profits, making acquisitions more accessible to individuals.
The career arcs of venture and buyout investors differ starkly. VCs rely on networks relevant to young founders, leading some to retire by 45 as connections become stale. In contrast, buyout investing is an apprenticeship business where age and experience are increasingly valued.
Banks started in the 80s and 90s are led by founders nearing retirement. With no new generation of talent eager to run small, three-branch banks, these institutions are increasingly looking for an exit. This succession problem is a primary driver of M&A activity in the sector.
The anticipated flood of businesses for sale from retiring baby boomers—the "silver tsunami"—has not materialized as predicted. Owners are holding on longer while the pool of buyers has increased, causing demand to outstrip supply and keeping acquisition multiples high.
Periods of intense technological disruption, like the current AI wave, destabilize established hierarchies and biases. This creates a unique opportunity for founders from non-traditional backgrounds who may be more resilient and can identify market needs overlooked by incumbents.
