3 reasons why entrepreneurs should consider entrepreneurship through acquisition

3 reasons why entrepreneurs should consider entrepreneurship through acquisition

Interest in entrepreneurship is at an all-time high. Data shows Generation X’s share of 46% of small businesses It is set to grow over the next decade, while 93% of all Generation Z Steps have been made toward business ownership, suggesting that entrepreneurship is poised to explode again.

With traditional methods of dealing with entrepreneurship now failing, changing the paradigm has become necessary. This is the place Relatively recent The concept of entrepreneurship by acquisition (ETA) is coming into play, especially among mid-career professionals as they benefit most from current demographic trends.

The idea of ​​acquiring a company rather than building one from the ground up is not new in itself. But what makes ETA different is the strategy surrounding the acquisition. From finding the right opportunities and securing financing to improving post-acquisition growth, this emerging trend has changed entrepreneurship in more ways than one. Here are three reasons why every aspiring entrepreneur should consider this.

Getting a business is easier than ever

When learning about an ETA, one of the first concerns that comes to the mind of aspiring entrepreneurs is the initial costs. This is the result of the assertion that having a profitable business is definitely more expensive than starting one, at least in most cases. Although this concern is reasonable, it does not reflect the changing reality as ETAs become easier to achieve by the day.

Investment companies such as Halbar Partners They focused their efforts on helping aspiring entrepreneurs find and obtain suitable work. The company not only removes financial barriers by financing deals upfront, but also provides strategic support along the way. This support comes from experts like the co-founder Nate Wassonwho has a background in family offices, portfolio building, and entrepreneurship.

You can focus on innovation from the beginning

Often times, entrepreneurs find themselves spending most of their energy trying to keep the lights on in the early stages of running a business. some Estimates He estimated it took three to five years for a startup to become profitable, which can be an eternity when you’re competing to make it in a competitive field. Let’s not even talk about the impact this has on innovation.

Using an ETA, entrepreneurs, or search fund “researchers,” can reverse the equation by ensuring that reaching profitability is no longer a concern. Given the complete business infrastructure is in place, entrepreneurs can focus their efforts on innovation inside and outside the company, whether it is in terms of new offerings, improving operations, or expanding the brand.

There are lots of options to choose from

Demographic shifts have long been one of the main drivers for relocation of private companies. With the entire boomer generation reaching retirement age by 2030, “Silver tsunami“He is expected to perform More than 10 trillion dollars The value of variable business assets. This makes the coming years a unique opportunity to acquire a profitable business and move it into the 21st century.

When we consider that the companies owned by millions of these recent retirees have been around for decades, their intrinsic value is enormous. In addition to the profitability it potentially offers, it has already been woven into the fabric of their communities. This provides not only the brand recognition that comes with a long history but also a time-tested infrastructure, a loyal customer base, and an experienced team.

The world of entrepreneurship has long been dominated by the narrative that success requires either disrupting entire industries or raising millions of dollars in venture capital. ETA is working to change this paradigm and show that entrepreneurship on a smaller scale can be not only more sustainable and achievable, but also more impactful. With the foundations already in place, it is up to the new generation of entrepreneurs to build on them.

Juan Fajardo is Grit Daily’s news desk editor. He is a software developer, technology and blockchain enthusiast, and writer, areas in which he has contributed to numerous projects. Born in Bogotá, Colombia, he is a jack of all trades, but currently lives in Argentina after traveling extensively. With a new interest on his mind and a passion for entrepreneurship, Juan works as a news desk editor at Grit Daily where he covers everything related to the startup world.

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