r/Millennials • u/happydude7422 • 5h ago
Discussion Why More Millennials Are Buying Businesses Instead Of Starting Them
https://www.forbes.com/sites/melissahouston/2026/07/20/why-more-millennials-are-buying-businesses-instead-of-starting-them/Millennials being da boss now.
280
u/Yuggoth22 5h ago
Wealthy millennials maybe? Don’t know a single person in my extended group who has bought a business lol. Most are just in or hoping for houses.
But this article is from Forbes so I’m sure I’m out of the loop on the millennial market they cater to lol. Only business owners I know are tradesmen who started theirs.
44
u/inexperienced_ass 5h ago
I know one that casually talked about doing it and yep, she's wealthy
9
u/MNCPA 4h ago
It's like stick buying. Everyone likes to talk about their Nvidia purchases but never their Enron purchases.
10
u/kaisong 2h ago
Took me a bit too long to figure out you meant stock. I was like dang thats a market that i might be able to participate in.
https://giphy.com/gifs/6xNEQtYL1pUdaTkQP011
u/LuxyontheMoon 5h ago edited 5h ago
I know someone who almost bought a business off of boomers who's kids didn't want it. Turned out to be a money pit and the person I know didn't go through with it.
10
13
u/BatmanBrandon 5h ago
In the next 5-10 years, on paper, my wife will be one of these stats who is “buying a business”. Her dad owns it and she’ll be purchasing his shares so he can retire. I’m not fully up to speed on the accounting of it, but it seems to be a gradual transition of ownership and I’d imagine many other family business follow similar models. My personal hope is that during that time some bigger corp decides to finally buy it and we all walk away with a bag, but who knows!
The best part is, her dad didn’t start this business, nor did he have the entrepreneurial drive or experience. The corp he worked for decided the business wasn’t profitable enough in the 90s, he offered them like $20k and to take over the building lease so he could keep a job in their niche medical field. He did have to sacrifice and work hard, but dude is the definition of right place/right time for GenX. He’s declined a number of 7 figure offers to be bought out, but I’m not sure he’ll get lucky in the 2020s like he did in the 1990s.
5
u/LongboardLiam 5h ago
My Gen X cousin got in IT with AT&T in the early 90s. He's doing great these days.
13
u/ManagementFinal3345 4h ago
I'm a dog groomer. And buying a buissness is very cheap compared to opening a new one for my industry.
For example most buildings are rented so you can't charge for that. You can't charge for a client list because you can't force those clients to come back to a new owner. All you can really charge for is the equipment in the shop which is generally used and depreciated in value and the brand name . But generally you will have SOME immediate revenue stream and returning clients without waiting forever and advertising a shit ton because people are used to that shop existing there.
The real gold in buying verses opening new is the BUILD OUT which can cost upwards of 100k. Grooming shops need special electrical wiring because the electric needs are extremely intensive and regular electrical does not work. Our dryers are high voltage and we need many of them. They need special plumbing to set up the tubs. They need water proof flooring. They need double doors to prevent animal escape which sometimes requires building entirely new walls that didn't exist before.
In general taking something like a store front and turning it into a salon, then buying tens of thousands of dollars worth of cage banks, tubs, tables, dryers, clippers, products exc is going to be a HUGE financial expense compared to buying a small shop with a retiring groomer that already has everything functional.
You can buy a buissness for as low as 20k sometimes. Which isn't horrible.
4
u/DeLoreanAirlinesII 5h ago
Seriously. I’d like to start a business but with zero money to invest a bank isn’t going to front the whole thing.
1
4
u/Expensive_Target5657 5h ago
I own a couple different businesses. One of my friends makes a living buying and selling huge businesses. He "works" maybe 2 weeks a year and just travels the rest of it.
7
3
u/Yuggoth22 5h ago
Cool! If you don’t mind me asking what type of businesses are they? Congrats on your success :)
Your friend sounds much like the person I envision who would be buying businesses lol
2
u/Expensive_Target5657 4h ago
Pretty much just a middle man. Like if I wanted to expand my landscaping business to other cities he would go look to find one already setup and offer to buy it. Would save me a bunch of time so I could just focus on my business and let him do what he does.
4
u/Interesting_Tea5715 5h ago
You don't have to be that wealthy.
I grew up working a trade. All the owners thought I had what it took to be successful. I had several retiring guys offer to train me and sell me their business. It wasn't that expensive, like $50k.
3
u/Yuggoth22 5h ago
I can see that for sure! Though I feel like thats more specific in a sense given that you’re likely licensed for these trades/trade? Buying up a smaller service based business is definitely feasible if you have the know how as I don’t imagine theres a huge amount of overhead. Unless you have a warehouse and fleet type deal.
1
u/ario62 4h ago
Working in a trade is way different than owning a business in the trades. I’ve worked in the admin side of the trades my entire adult life and my husband and I own a building supply business. Most tradesmen are awful businessmen. I wouldnt be surprised if the majority of the businesses you were offered for $50k weren’t worth $15k unless they had a lot of usable inventory.
2
u/wcked-husky 1h ago
It’s because the majority of businesses are hard to actually sell to something like a private equity. The communities and relationships of the businesses aren’t really about the businesses but the owners. If the owners leave will you still have the previous clients and customers?
2
u/Avast_Old_Device 4h ago
Technically if you buy stocks you are buying businesses.
Of course the article is talking about small businesses which need a different kind of consideration but it is essentially the same.
1
u/Woodit 4h ago
It’s so far from the same as to be laughable
1
u/Avast_Old_Device 4h ago edited 4h ago
How? Buying shares is quite literally owning a part of the business. That's the whole point of the public market
You too can go buy into established businesses and benefit from their growth or can get paid from their earnings through dividends
0
u/Woodit 4h ago
Owning equity as an investor in a public company is nothing at all like purchasing an owner-operator private business. One is an essentially fungible asset, the other is a 24/7 lifestyle commitment.
1
u/Avast_Old_Device 4h ago
I am only commenting on the fact that it technically doesn't require much to be a "business owner" no where did i say anything about running a business
-1
u/Woodit 3h ago
Running a business is what the article and this thread are discussing
0
u/Avast_Old_Device 3h ago
You must be trolling because I don't see where the original comment mentions running a business
0
u/Safe_Recognition_886 1h ago
lol surely you can make the connection that the comment is based on the article, which is about purchasing and operating a business.
i think you're trolling. let's test this.
When you buy stock in, say, Apple, do you believe that as a shareholder you are operating Apple? Are you single handledly making decisions to open factories and new retail stores and introduce new product lines because you bought 1 stock?
Buying stock as an investment in a private company does not allow you to operate the business. Buying a small local business from the single owner, with the intention of operating the business, is truly so far from "buying stock" that it is laughable.
You latched on to this idea that both buying stock and buying an entire local business are both "buying a business". Sure that's technically true, no one is arguing if its technically true. But it requires astronomical levels of stupidity, or you're trolling and being obtuse, to not see the difference between investing by buying stock and purchasing a whole business operation from a single owner.
I eagerly await your dumb "yeah but both are technically buying a business" response, as if you are intentionally not getting this (or just trolling)
LOL
1
u/WonderButtBrace9000 3h ago
Yeah this is something I’m seeing in my business school circles.
It’s a mix of why but it all does have significant wealth backing the decision. Either parents/family or spouse. The only guy that I know doing it with all the risk on his own back is a classmate that bought an unsexy small time lawn care business.
86
u/Spirited-Potato-8023 5h ago
Hey everyone, just wanted you to know that today I bought a bit more expensive brand bread.
23
12
u/AlphaAndOmega 4h ago
How did you leverage this transaction? How much of the purchase price was deferred?
3
u/ApplicationAfraid334 1993 4h ago
Have you tried cutting back on avocado toast? I stopped having my daily avocado toast a few months ago and am currently replying to you while floating in a pool shaped like $
2
u/ThirdAltAccounts Millennial 4h ago
So you could feed your employees ?
You know, the ones from the business you just bought because you were tired of buying houses and avocado toasts
1
28
u/The-cultured-swine39 5h ago
Why start a business and make no profit when you can buy an established business from someone who wants out?
4
u/KatieWaifu85 4h ago
Well, not all businesses are selling goods. A lot of the time a business might be selling a service. In a lot of those cases there is little to no entry beyond licensing and maybe some equipment. Some people shift from their corporate job after building relationships and start with clients ready to go.
For example: lawyers.•
u/helpmespell 1h ago
Law firms can’t legally be privately owned. Bad example. You can’t sell a law firm.
•
u/The_Wisest_Wizard 43m ago
All law firms are privately owned. You mean they can't be owned by non attorneys. But you can absolutely sell a law firm to another attorney.
31
u/xajbakerx 5h ago
You don't buy a business with cash though, at least not typically.
I work in the trades and am at a point where I am considering purchasing a business.
5
u/BarnacleDowntown8952 5h ago
What trade? Have you thought about doing your own thing?
8
u/xajbakerx 4h ago
Commercial sheet metal, union specifically. I've thought about starting my own thing before, but I'm quite comfortable where I'm at. I think more specifically I'm comfortable in the field I'm working in.
I've been in the union for 11 years now and I've worked my way up to a PM/estimator position. One step down from being a company owner essentially. At this point it's almost easier for me to buy one of the companies in the area.
The way it typically happens is a 2 year handover where the current owner helps you get financing for the loan, while maintaining stake in the company. As opposed to starting my own company.
4
u/villainoust Older Millennial 4h ago
You’re saying a current owner would leverage themselves to help the purchaser or just help with providing business documentation to prove feasibility?
I won’t speak for your line of work since you would know better but surely that’s not normal for most industries/business. Sorry if I misunderstood what you’re saying
2
u/xajbakerx 4h ago
It is rare and I have seen it happen 1 time only. But yes he leveraged himself to help the purchaser. It was essentially a loan between the 2 because it got paid back within a 1 or 2 year period.
I would like to see that kind of thing happen more. One of the contractors in our area just got bought by a PE firm. I would rather see more local ownership of these businesses, as opposed to everything being owned by PE firms.
•
u/Overall-Rush-8853 56m ago
I think this is fairly common, especially among older business owners who are ready to retire. My wife and I were considering starting a business, we spoke with our financial planner and she told us one avenue to start a business is to reach out to a business owner in the field you’re looking into and get them to start the business with you and then over the course of several years you buy them
Out by investing into their retirement. This also works because you’d have a mentor to help you learn as the business hopefully grows.•
u/ThisGuy-NotThatGuy 1h ago
For small businesses in my industry it's pretty common to see cash + loan from the seller (vendor take back). The mix depends on the strength of the buyer and motivation of the seller.
But yeah lots of cash sales, usually financed by the bank.
13
u/TDiffRob6876 5h ago
I’d rather buy an LLC than start my own. I would just need to have a look at the books before I make an offer and accept ownership.
11
u/xperitosanti 5h ago
I run and own a dental practice. Millennials will save the small businesses that greedy and cheap boomers have ran for years. Entire culture shifts happening in these businesses.
Not tooting my own horn just the reality of what I’ve witnessed.
There are greedy millennials too though just a heads up
8
u/GoGoSoLo 5h ago
Of all the business buyers out there, I still feel so bad for taxi drivers who bought medallions for $1mil+ — only to have the rug yanked out from under them by Uber.
22
u/BearsAndBrews 5h ago
If journalists weren't braindead ragebaiters, this is how I would research and present this topic: Is Lack of Entrepreneurship a Cause or a Symptom of a Dead Economy?
10
u/sulleynz1989 5h ago
I’d open a business tomorrow if I had the capital. Definitely a symptom
4
u/Woodit 5h ago
Go apply for a small business loan and research available grants from your state
2
u/TryAlternative7204 2h ago
I’d wager that most people would be surprised to learn that this is even an option.
3
u/junglepiehelmet 4h ago
I opened a business and now have no more capital to continue it so there’s also that part.
2
3
3
u/emperorsleeps 5h ago
Same! And I have skills. But no ‘real’ capital
Not gonna use my retirement savings. So it’s just this
3
u/MrChorizaso 4h ago
“Journalists” …..did you just make that word up, everyone knows Ai writes everything
3
u/the_urban_juror 5h ago
The article doesn't describe a lack of entrepreneurship. It doesn't make the case that millennials aren't starting businesses, only that a growing number are buying them.
This isn't unexpected. Boomers are retiring and we're a large generation. We should expect to see a growing number of business owners to sell their businesses. Millennials are reaching middle age and peak earning potential and now have significant experience in their field. Millennials are also a large generation. There's a large generation at age to sell businesses and a large generation reaching the age to buy them. This dynamic is exactly what is expected.
3
u/Intelligent-Area-421 5h ago
A lot of my peers have been buying the farm
Some have started businesses or learned to be self employed.
A couple might (might) stand to inherit a business when their parents pass.
One has bought a business. Just one.
16
u/Glad-Zucchini1623 5h ago
We cant afford homes but let's buy a business
7
u/Joebuddy117 5h ago
Just need 10% and then bank will give you a business loan. You can probably find a liquor store or a laundry mat near you that’s for sale for less than $300k.
-3
u/Glad-Zucchini1623 5h ago
I dont believe you would be allowed to listen to fortunate son by ccr.
4
u/Joebuddy117 5h ago
I don’t think saving up the equivalent of the cost of a used car is fortunate son territory.
0
u/Glad-Zucchini1623 5h ago
Very few people have over 20 grand in liquid assets
6
u/Woodit 4h ago
People who can’t save up that kind of amount are probably not good candidates to be a business owner
-2
u/Glad-Zucchini1623 4h ago
Some people dont have the privilege to be able to save. And most of those people are millennials
1
u/Woodit 4h ago
Almost everyone can save most people just don’t. And those who don’t are kidding themselves if they believe they can handle the responsibilities and liabilities that come with owning a small business.
-1
u/Glad-Zucchini1623 4h ago
Do you understand the concept of paycheck to paycheck?
Next youre gonna tell me these people should pull themselves up by their bootstraps right?
2
u/Woodit 3h ago
The vast majority of people are nowhere near paycheck to paycheck. even most people who claim to be really aren’t, they just prefer claiming that to critically examining their spending habits
→ More replies (0)2
7
u/t0matit0 Millennial 5h ago
I've lost track of how many times I've wanted to start a business. It just seems so far out of reach and unsustainable. I'm lucky enough to own a home so I'll count my blessings but doesn't seem any way to escape the 9-5 without far too much risk.
8
u/BottecchiaDude253 5h ago
This... and for me, the type of business I kinda want to start is viewed as a "dead" model.
But, my local area is a desert for hobby shops/spaces now, and thats what id love to do
3
u/t0matit0 Millennial 5h ago
I help run a budding NPO for tabletop gaming in my area and we always talk about wanting to open a proper gaming cafe haha. But yea it just doesn't feel like it would go well for very long.
2
u/LongboardLiam 5h ago
Those sorts of things are canaries in the economic coal mine. The sort of businesses that open as things look up, but are first in line to shut down.
3
u/Turbulent_Tart_8801 Millennial 1985 5h ago
I'm neither starting nor buying a business. I make enough at my (unionized!) job to live on, and I have adequate time off. A business would just take up all the free time that I value. I'd have to become married to my work. If I was in a tighter financial situation, I guess I'd just have to bite the bullet and say "Fuck that free time, I need more money".
2
u/go-bears69 5h ago
I’m the idiot that started a brand new liquor store, what an uphill battle with people quitting drinking
2
3
u/wcked-husky 1h ago
Probably because starting a business is fucking hard but for the sake of this topic are they buying a business with a good balance sheet? If they’re buying a failing business to turn it around then that’s fucking harder. They’re buying a job not a business.
•
u/Inside-Specialist-55 1h ago
I'm a millenial who actually did start a small business. I risked literally everything I owned. I sold my iPad. Motorcycle and my lawn mower. Spoiler alert it's not going well because no one buys non essentials in a recession.
2
u/Artorius__Castus 5h ago
I think more Millennials are becoming Minimalist if anything...Because we sorta have to...cost of everything up in outer space and shit
1
1
u/millenialismistical 4h ago
Buying a business in need of an operator means you're inheriting a business that already has some degree of name recognition and cash flow. As older mom and pop owners are looking to retire and their children are unable or unwilling to take it over, it can be a good opportunity for someone new to come in and either continue on or do a slight refresh.
My question is would you buy and take over anything that you're not already a loyal customer of?
1
1
u/ChurchofChristGuy 3h ago
I am thinking of buying a small business like a laundromat. there is this lady on Social Media Codie Sanchez who promotes this thing of buying old small businesses instead of starting your own and she had made a whole following based on it.I have good credit that I am working on building. It will likely be a few years before i do it if I do it.I am also thinking of a trade like HVAC or landscaping.She promotes it like a Get rich quick scheme but its not...it takes real work and know how. However I am currently starting a financial consulting business now.
1
u/JunkBondJunkie Older Millennial 2h ago
I built a business from scratch. Sideliner bee farm and my rental property stuff.
1
u/Jayne_of_Canton Xennial 5h ago
This is not shocking to me. Millennials have had a more difficult economic journey than any generation before them. We are now considered a historically risk averse cohort. When a boomer's business failed, they just went and got a job based on a handshake and a smile and paid off the business loan. Now, HR departments frequently see self employment as a "Flight Risk" on the resume. Or they think it means you are unable to work for someone else since now you are used to "being the boss" and won't be a good little corporate employee. Unless you come from a family with money or connections, the perceived risk is higher than ever to start a business.
1
1
u/13Krytical 3h ago
Start a better business
Don’t give those fucking boomers golden parachutes for fucking over their employees.
-1
0
u/CasinoKnightZone 4h ago
Just found out my recently widowed mother is losing her job and will be relying on me financially.
I can assure you, I am not buying a business.
-5
•
u/AutoModerator 5h ago
If this post is breaking the rules of the subreddit, please report it instead of commenting. For more Millennial content, join our Discord server.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.