Interested in Franchising? Listen to this!

[00:00:00] If you've ever thought about investing in a franchise or investing in a business that's ready to run, I've got a guest on the show today, Cliff Nahnemacher, who is an expert in the space.

[00:00:12] But we have a really amazing conversation and deep dive into some of the hottest trends, four key trends that are going on right now in America that you can capitalize on, that they already have strategies in place and they're seeing massive positioning for growth,

[00:00:28] that would be a huge opportunity if you're an investor. One of them involves real estate specifically, we were talking about the combination of a graying of America and real estate puts a new spin on the multifamily concept in a way to really create some wealth and accelerate it in a way that's already kind of laid out and systematized. So check it out.

[00:00:51] Welcome to The Brick and Mortar Money Show, the podcast dedicated to helping business owners and professionals achieve wealth.

[00:00:59] Wealth, autonomy and control through commercial property ownership. Join us as we unlock the power of real estate to transform your business and investment strategies.

[00:01:10] Whether you're seeking to expand, invest or gain more freedom in your entrepreneurial journey. This is your destination for insightful stories, expert advice and actionable strategies.

[00:01:23] Welcome.

[00:01:27] It's a distinct honor and privilege of having Cliff Nonnemacher on the show today. He is a franchise consultant, but he's much more than that. Yeah, he's the co-founder of Frenosity, which is a firm that focuses with buyers and really helping you to understand A, if it's a fit, B, if it's an opportunity and what opportunities make sense for you.

[00:01:47] But beyond and above that, Cliff is really a serial entrepreneur. He's had 12 businesses since he finished school and has made a serious mark in the entrepreneurial space coming from a Wall Street side to boots on the ground to the executive level.

[00:02:09] He's seen it all. So I'm excited to have Cliff on the show today to unpack all this. So Cliff, welcome today.

[00:02:16] Well, thank you so much. I appreciate it. What a kind intro. I appreciate it. Thank you.

[00:02:20] Yeah, yeah, absolutely.

[00:02:22] Well, no, man, it's exciting. I always love to talk to serial entrepreneurs.

[00:02:26] I've had five or six in my day and never owned a franchise. And so I do have friends that have franchises.

[00:02:34] And we have a lot of business owners and entrepreneurs that listen and follow.

[00:02:39] And some of them are franchisees. Some of them are looking for ways to expand their empires, their empire builders, and are always open for great opportunities.

[00:02:50] And I think I saw in the notes when we set this up that from your perspective, out of all the businesses you've had and been involved in, franchising is the single biggest opportunity that you've ever seen to create wealth.

[00:03:04] And so I just want to dive in there and maybe somewhere get into your background on how you got to that point and figured that out for yourself.

[00:03:12] Absolutely. Yeah, absolutely.

[00:03:14] Absolutely. That is accurate. So my journey goes back. I've been self-employed literally my entire life.

[00:03:23] I just loved it. And I knew it at a very young age. It's as if I knew that I wanted to be a business owner.

[00:03:31] I never wanted to be a doctor or a lawyer or anything like that. I knew I wanted to be self-employed.

[00:03:36] And I actually grew up in New York and moved to a little island called Marco Island, just south of Naples in Florida.

[00:03:46] And being on that island, thankfully it was so small, one of my first businesses was basically an Uber Eats.

[00:03:53] So I was delivering food using that technology, which would be pagers back in the very early 90s.

[00:04:03] And I was delivering food. And I believe I was the first subcontractor for McDonald's.

[00:04:08] I delivered for 16 restaurants. I delivered for pharmacies, auto parts.

[00:04:14] And then I started delivering for Subway, Little Caesars and McDonald's.

[00:04:18] We were so busy. I was like 19, by the way. I was young. It's when Hyundai first came out, the little Hyundais.

[00:04:26] The guy was explaining to me, I'm buying these cars for the guys to drive.

[00:04:30] And I'm like, how do you say this? I didn't even know how to say the name.

[00:04:34] The guy goes, just say Sunday. I go, Sunday. He goes, now say Hyundai.

[00:04:38] And I go, all right, that was it. That's how he told me to say the name of the car.

[00:04:41] Never heard of it. So that's how early on we were is when literally Hyundai just came to the market.

[00:04:47] Bought a bunch of those, put trunking units in it.

[00:04:50] And off we went. We were doing hundreds of deliveries a day on a three mile by six mile island.

[00:04:56] And then that evolved into buying water sport concessions.

[00:05:00] And I was in the Paris sailing business and Mark O'Wile in the Jersey Shore.

[00:05:05] I had large, these were large operations with catamarans and sailboats and jet skis and fleets of everything.

[00:05:13] I did that for many, many years.

[00:05:15] I was an investment banker with Solomon Smith Barney.

[00:05:19] That was kind of in the middle of all that.

[00:05:21] I said, hey, I started, I had money. I was young.

[00:05:24] I started trading. I fell in love with it.

[00:05:26] I'm like, this is right up my alley.

[00:05:27] Took my portfolio to Wall Street.

[00:05:29] It was offered jobs by every member firm.

[00:05:32] I ended up taking a job with Solomon Smith Barney at the time.

[00:05:35] They dropped Solomon, of course.

[00:05:37] Now today they're Morgan Stanley.

[00:05:39] And then just continued.

[00:05:41] I left there, ended up buying an Australian company called Cartridge World.

[00:05:45] I scaled 36 units in New York and Connecticut.

[00:05:49] This is the brick and mortar show, right?

[00:05:51] So that was a major brick.

[00:05:53] Yes, that was a major.

[00:05:55] Actually, in my entire discussion with you, that was my first brick and mortar brand.

[00:06:00] Everything I did was non-brick and mortar due to the fact that I was young and had no money.

[00:06:04] And then once I started making more money, I bought my first brick and mortar brand,

[00:06:09] which was again, Cartridge World, headquartered in Australia.

[00:06:12] And there's a whole backstory to how I got into that business.

[00:06:15] I'll spare you from it.

[00:06:16] But we scaled 36 units in three years, blew it up.

[00:06:20] And we literally saved people 50% on printer consumables.

[00:06:25] We had chip resetters where we could reverse engineer the chips and the secret handshake and the printer cartridges

[00:06:32] and reset them so that when you took it home and put it in your printer,

[00:06:37] your printer recognized the refill as OEM new, which was absolutely brilliant at the time.

[00:06:45] Sold that, got involved with private equity firms that fell in love with franchising,

[00:06:50] scaled a bunch of brands, bought a bunch of brands.

[00:06:52] I like to buy and then build and then sell.

[00:06:56] I like the momentum of that versus the buy hold, just a style of investing that I prefer.

[00:07:03] And then fast forward after that, I ended up co-founding Furnacity with my business partner, Justin, back in 2013.

[00:07:12] We've been doing this ever since, which assists investors with identifying business opportunities,

[00:07:19] mainly in the franchising space.

[00:07:21] But to your point, jet skis and delivering food, all that sounds great and fun.

[00:07:29] Right.

[00:07:30] No systems, no processes, no technology, no true understanding of a P&L, no KPIs,

[00:07:40] no clear understanding of cost of goods, labor costs, fuel costs.

[00:07:44] It wasn't until I got involved in franchising where it really exposed me to live and die by the KPI, right?

[00:07:52] You're going to live and die by it.

[00:07:54] And that's where my, my, I really, I have a famous line that I like to say, which is,

[00:07:59] you know, once your mind's expanded by new ideas, it never goes back to its original shape.

[00:08:04] And at that moment I said, wow, I've been running hard and fast in these small businesses thinking,

[00:08:10] I know what I'm doing, but I didn't.

[00:08:12] And it wasn't until I got in franchising where they brought operations manuals and systems and curbs.

[00:08:17] Man, your labor can't be more than X percent.

[00:08:20] Your cost of goods can't be more than that.

[00:08:21] How much are you paying your rent?

[00:08:23] That can't be more than this percentage of top line.

[00:08:25] At that moment, I said, okay, this is going to collapse time and I'm going to be able to scale

[00:08:30] and create wealth way faster.

[00:08:32] And it happened.

[00:08:33] And I attribute that to the systems of franchising.

[00:08:37] Well, you know, that's, that's really interesting.

[00:08:39] And to be clear, Cartridge World, that was a franchise concept, right?

[00:08:43] That you expanded.

[00:08:43] Out of Adelaide, Australia.

[00:08:45] That's right.

[00:08:46] It's still, that was your first units today.

[00:08:49] Yeah.

[00:08:49] I mean, I've, I've heard of Cartridge World and, um, you know, God bless you for coming

[00:08:54] up with a way or at least expanding a way where you could reset the cartridges, man.

[00:08:59] What a scam those ink cartridges were, you know, um, from the manufacturers.

[00:09:03] But, um, but, but, you know, so this whole idea of systems and KPIs and running a business

[00:09:09] like a business.

[00:09:11] So I'm picking up on this idea that obviously when you're expanding into 36 locations, you're

[00:09:17] not the typical small business owner.

[00:09:20] Your original foray into business, you were the typical small business owner.

[00:09:24] You're the Michael Gerber e-myth.

[00:09:26] You're like, oh, okay, I'm just going to get out there and do this and throw some mud against

[00:09:30] the wall and I'm making some money and we'll, so we'll expand here or whatever, kind of flying

[00:09:33] by the seat of your pants.

[00:09:34] But the problem is that's not very scalable and duplicatable, right?

[00:09:37] That's right.

[00:09:38] So, so you're limited on your, your upside potential and potentially even setting yourself

[00:09:43] some landmines along the way that you may not realize until downstream.

[00:09:47] And what I'm hearing you say is with your first exposure to the cartridge world and

[00:09:52] then subsequently this idea that, Hey, there are some, there's some best ways to do this.

[00:09:59] And, you know, you have these, these target numbers that you don't want to cross because

[00:10:04] there, these are, I had a friend, uh, used to say, check the pulse, keep it alive.

[00:10:10] He's like, check the various pulses.

[00:10:12] There's, there's not, there's not necessarily a million things you need to be watching, but

[00:10:15] there are a few critical things, you know, um, feedback elements that you need to be

[00:10:21] monitoring to make sure that if, Hey, okay, if I'm checking green and all these, then the

[00:10:25] business is on track, we're going to grow.

[00:10:26] But if we're a yellow or definitely a red, then we're, we're, uh, we're going to run

[00:10:31] off the rails at some point.

[00:10:32] And so that's where, from my perspective, never having a franchise to me, that seems

[00:10:37] one of the most attractive things is that, you know, not only are you getting a brand,

[00:10:40] but you're getting this whole manual and the system is kind of put in front of you that

[00:10:45] all you got to do is, Hey, the car's in the driveway.

[00:10:48] We won't call it a Hyundai.

[00:10:50] We're upgraded, right?

[00:10:51] It's a, you know, it's the Toyota or maybe eventually a Ferrari.

[00:10:54] It's in the driveway, the keys are in it.

[00:10:57] And all you got to do is get in and apply.

[00:10:59] So talk about that a little bit more and what you see, because we have a lot of business,

[00:11:04] you know, the refrain we hear all the time for small business people is, you know, I've

[00:11:08] hit the ceiling and, you know, I, there's no, only somewhere so many hours in the day.

[00:11:12] Right.

[00:11:12] And I'm making good money, but how do I, how do I expand?

[00:11:16] And so a lot of them are looking to spin off and invest in real estate and whatever, which

[00:11:20] is all great.

[00:11:21] You should invest your, you know, your cash and that sort of thing.

[00:11:24] But, um, but from a business standpoint, talk about that a little.

[00:11:28] Definitely.

[00:11:30] So this is a belief, right?

[00:11:31] So if you think about growing up and all the things that you're told, uh, you should be

[00:11:37] willing, you know, you know, that old saying, like, uh, you know, don't count your chickens

[00:11:40] before they hatch.

[00:11:41] Right.

[00:11:41] That's, it's, it's, it's obviously all bullshit.

[00:11:44] You're supposed thoughts become things.

[00:11:46] So mindset is everything.

[00:11:48] So absolutely.

[00:11:49] I think about exactly where I'm going to be.

[00:11:52] So I think mindset really has a lot to do with why maybe people are saying, you know,

[00:11:57] I've hit this glass ceiling.

[00:11:58] It's impossible to scale.

[00:12:00] You just can't find the labor.

[00:12:02] They're just riddled with excuses and looking for all the reasons really to fail instead of

[00:12:07] analyzing reasons for results.

[00:12:09] And I think mindset has a lot to do with it.

[00:12:12] There's another saying that we grew up with.

[00:12:13] If you want something done right, you have to do it yourself.

[00:12:16] That's another line to keep people poor.

[00:12:18] It is, it is.

[00:12:19] Okay.

[00:12:20] It, these are all suppression techniques.

[00:12:22] You know, don't count your chickens before they hatch is one of the most damaging statements

[00:12:26] to ever be introduced to humanity because it gets people saying, oh, you know what?

[00:12:31] I don't want to say I got the job.

[00:12:32] I don't want to say I got the role.

[00:12:33] I don't want to say I got the deal.

[00:12:35] I don't want to say I closed it.

[00:12:36] I don't.

[00:12:37] Yeah, you do.

[00:12:37] And you want to say it repeatedly thoughts become things and what you think about you bring

[00:12:42] about.

[00:12:43] So yeah, you put it out there.

[00:12:44] I'll constantly put it out there.

[00:12:46] So, you know, when you hear those stories, I listened to those people, you know, I feel

[00:12:53] bad for them because it's all self-limiting and they're really their own worst enemy.

[00:12:57] And, and quite frankly, Paul, we, we created wealth by buying businesses from those people.

[00:13:03] Our entrance in, in one of the techniques that my business partner, Justin, I did very early

[00:13:08] in our career is we looked for failure.

[00:13:10] Okay.

[00:13:11] This'll, this, this'll be a story that will help you.

[00:13:15] I'll help answer that question.

[00:13:17] So, and you'll find this interesting too.

[00:13:20] So we'd find some failure and we'd meet with the couple, always a couple.

[00:13:25] How did you get in this business?

[00:13:27] The answers are always bizarre.

[00:13:29] Our friend's neighbor's cousin had a great lifestyle and they owned one.

[00:13:33] So we thought it'd be right for us.

[00:13:35] Okay.

[00:13:36] It's always these bizarre lifestyle.

[00:13:39] I heard from a friend, this guy's got a beautiful house.

[00:13:42] He was doing this.

[00:13:44] Yeah.

[00:13:44] That guy's a salesman.

[00:13:45] You're an engineer.

[00:13:46] You don't belong here.

[00:13:47] Like this is not your brand.

[00:13:49] So we were buying businesses from people that did not belong in these businesses.

[00:13:53] Didn't have any business acumen.

[00:13:55] They weren't following the model.

[00:13:57] We were paying them literally 10 cents on the dollar.

[00:13:59] We started in fitness, brick and mortar.

[00:14:02] We started in brick and mortar fitness.

[00:14:04] Um, and we started to turn them around within a year.

[00:14:07] We'd pay 10, 20, 30 grand.

[00:14:09] The maximum I ever paid for a gym was 50,000.

[00:14:12] And we would sell these gyms for, you know, a quarter million or more in less than 12 months.

[00:14:17] That's how fast.

[00:14:18] Okay.

[00:14:19] That tells you right there.

[00:14:21] How quickly can now remember the seller is telling me we did everything to make this successful.

[00:14:29] It put Paul, it just doesn't work here.

[00:14:32] It just doesn't work here.

[00:14:33] We've done every, this franchise doesn't work.

[00:14:36] This brand doesn't work.

[00:14:37] This town doesn't like what we're doing.

[00:14:39] I don't know what it is, but we can't make it work.

[00:14:41] We would go in there, turn it around a less than 12 months netting six figures.

[00:14:46] And our goal was always to sell businesses for a two and a half to a three time multiple

[00:14:50] on EBITDA again of a hundred net.

[00:14:53] So we're just trying to get it to a hundred net.

[00:14:55] There's that, and you know, that number, everyone falls in love with that number.

[00:14:59] They want to exit Corp in America.

[00:15:00] They want to know they're making six figures right out of that transition.

[00:15:03] So we would turn these businesses around.

[00:15:06] As soon as they were netting, let's say, you know, eight, 9,000 a month, we would peel them off.

[00:15:11] So quick, quick other story on answering your question.

[00:15:15] We had a guy that we found.

[00:15:17] I live in Florida, Boca Raton, Florida.

[00:15:19] And we, we had a guy that we met in Annapolis, Maryland, and he was selling a business that

[00:15:25] was in the water, fire and mold industry.

[00:15:28] Right?

[00:15:28] So restoration.

[00:15:30] It, the business is a total failure.

[00:15:33] It's worth nothing other than the assets.

[00:15:35] So I said, look, why don't we discuss an asset sale?

[00:15:38] Cause you have nothing to sell.

[00:15:40] I'll buy your vans, your equipment, your everything.

[00:15:42] It's a true story.

[00:15:44] We, so we have a guy feet on the street in Maryland.

[00:15:46] We do the deal.

[00:15:47] We paid him 120,000 for the business.

[00:15:50] So our partner calls us and he's like, Hey man, there's a lot of unopened boxes.

[00:15:57] And he goes a lot of unopened boxes.

[00:16:00] And I go, what's in them?

[00:16:01] He's like, I don't even, I don't know.

[00:16:02] I go open them up.

[00:16:03] So he opens them up and he goes, he started cutting them with a knife.

[00:16:06] He's like, it's all marketing material.

[00:16:08] I go, wait a second.

[00:16:10] Wait a minute.

[00:16:11] We just bought a business from a guy who said I fought like hell to win.

[00:16:16] And he has boxes of, that's like raising a white surrender flag with boxes of ammunition.

[00:16:22] So, so the, you know, Paul, the point was people will only exert a limited amount of

[00:16:28] energy to get what they want.

[00:16:30] That's what I learned through all of this.

[00:16:31] People will say all the right things.

[00:16:34] What I've learned in business is this.

[00:16:35] People will exert a limited amount of energy to get what they want, but they will fight

[00:16:39] like hell to keep what they have.

[00:16:41] And we learned that very quickly in our business.

[00:16:44] So yeah, everyone is self-limiting.

[00:16:46] They have reasons for failure.

[00:16:48] They don't want to work that hard, you know, but if you want to scale a business to be as

[00:16:52] big as you want it to be, you could do that as an independent.

[00:16:55] You could do that in franchising.

[00:16:57] Absolutely.

[00:16:58] Yeah.

[00:16:59] Wow.

[00:16:59] That's, that's really good.

[00:17:00] A lot of, a lot of gold in there.

[00:17:01] Yeah.

[00:17:01] The self-limiting beliefs, I think keeps people down, down and we all fight it right

[00:17:07] to a degree.

[00:17:08] It's, it's something that it's, it's always, you're, you're, you're trying to push the envelope

[00:17:12] on yourself and say, you made a decision or thought.

[00:17:15] And then you look back and you're like, why did I think like that?

[00:17:18] Why did I say like that?

[00:17:19] So it's good.

[00:17:20] But it's good if you're aware that it's, it's, it's literally the, the, the bag of rocks on

[00:17:26] your back that's slowing you down that, okay, I need to kind of, kind of get out of myself

[00:17:30] and say, all right, why, why am I thinking this?

[00:17:34] What, what's the limitation?

[00:17:36] And perhaps surround yourself with the right people, right?

[00:17:38] That can ask that question too.

[00:17:40] And a coaching mentor or, or maybe a mastermind group or whatnot.

[00:17:44] Um, let's talk a little bit about the, cause I know we were chatting a little before we

[00:17:49] hit record on this whole idea of the graying of America and, and what, what that is and

[00:17:55] what's going on and what are the opportunities that you're seeing as a result of that?

[00:17:59] Absolutely.

[00:18:00] Yeah.

[00:18:00] Yeah.

[00:18:01] So there are little backgrounds.

[00:18:04] So there are four categories, uh, that we tend to focus on in our business and category

[00:18:10] number one is the, is the graying aging of America category number two.

[00:18:15] And this may sound strange and I can explain is the feminization of men, meaning men can

[00:18:20] no longer use tools.

[00:18:21] Men have low T men have low sperm counts.

[00:18:24] Men are no longer men today are not the same man, uh, that my father was let's call it a baby

[00:18:30] boomer.

[00:18:30] It's just a reality.

[00:18:31] And it's not a sarcastic or political statement.

[00:18:34] We're literally feminizing men, not only in America, but throughout the world, but I'm

[00:18:38] a capitalist and I operate in the United States.

[00:18:41] So I called feminization of men in America.

[00:18:43] Thirdly, we humanize pets and animals.

[00:18:46] We literally humanize them.

[00:18:48] They are no longer dogs strapped to a tree.

[00:18:50] These are officially furry children that sleep in the master bedroom.

[00:18:54] They have clothing, they have parties and they have daycare just like their child does.

[00:18:59] They have daycare.

[00:19:01] Right.

[00:19:02] And then the fourth most pop, but very popular.

[00:19:06] And they have what?

[00:19:06] They also have therapists.

[00:19:09] They have therapists.

[00:19:11] They have a masseuse.

[00:19:12] They get their, their nails done.

[00:19:14] I mean, it's, they have birthday parties.

[00:19:17] Some of these dog daycare brands have spa treatments, birthday parties.

[00:19:20] They have it all.

[00:19:21] They have bakeries for them.

[00:19:22] I mean, it's look, we, we literally humanize them.

[00:19:26] Um, and of, and of course the millennial generation would prefer to have a dog over a child.

[00:19:31] They prefer it.

[00:19:32] Um, you know, which is a separate conversation, which has a lot to do with the aging of America.

[00:19:38] Uh, countries don't age when you're constantly backfilling youth.

[00:19:41] They age because you don't repopulate.

[00:19:43] Right.

[00:19:44] So it's like, that's really what's happening.

[00:19:46] No, nobody really wants to have children anymore.

[00:19:48] So it's like, this is as good as it gets.

[00:19:50] If it wasn't for immigration or illegal immigration, I don't know where the numbers would really be

[00:19:55] based on the aging graying of the country.

[00:19:58] Uh, cause people are coming in at all, all ages, obviously, but I don't see 75 year olds

[00:20:04] crawling across the border.

[00:20:05] Right.

[00:20:06] So if you think about data skew, yeah, if you think about data skew, if you think about

[00:20:10] what's happening demographically in the country, it's aging.

[00:20:12] But before I begin, the fourth point is beauty and vanity, which is a huge space that dovetails

[00:20:19] with aging because with aging, you want anti-aging and you want to continue to feel youthful

[00:20:25] and beautiful.

[00:20:26] So those are really the four categories today, just out of the interest of time, you know,

[00:20:30] I thought we would touch on what's going on in the, the graying of America, you know,

[00:20:35] as a theme.

[00:20:36] And there's so much going on there.

[00:20:38] And then people always ask me, you know, what States, you know, what's interesting about

[00:20:41] the aging of America?

[00:20:42] They're like, Hey, what state should I operate these businesses in Florida, Arizona?

[00:20:46] Would you believe that Maine, Vermont, West Virginia, and Delaware have a higher percentage

[00:20:51] of 65 and overs than, than Arizona, which is just crazy or Texas.

[00:20:58] It's crazy.

[00:20:58] Yeah.

[00:20:59] Maine, 22 and a half percent of Maine's population is over 65.

[00:21:04] Almost 23% of the population.

[00:21:06] It's crazy.

[00:21:07] Florida is only 10 people live in Maine, right?

[00:21:09] I mean, that's what someone said to me the other day.

[00:21:11] They go, yeah, but they have no population.

[00:21:13] Nobody lives there.

[00:21:13] It doesn't matter.

[00:21:14] Right.

[00:21:15] That's true.

[00:21:15] That's true.

[00:21:17] So yeah, if you look at opportunities within their home care is the lowest hanging fruit.

[00:21:23] It's not my favorite.

[00:21:25] It is not my favorite.

[00:21:26] But when people ask me, what are the opportunities within that space?

[00:21:30] My issue with home care is the amount of employees required to execute the model and

[00:21:36] actually make a living.

[00:21:37] It's really a glorified staffing model.

[00:21:40] You're sending Julie to Mrs. Smith's house for companionship care Monday through Friday.

[00:21:45] And you're keeping the spread between what you pay Julie and what the homeowner is paying her.

[00:21:51] It's a staffing model and you need a lot of staff.

[00:21:53] And we're in the tightest labor market in history.

[00:21:56] And we're in the laziest generation in the history of the country that don't want to work.

[00:22:00] Right.

[00:22:01] So put all that together.

[00:22:03] That's why I sell against.

[00:22:05] A couple of businesses that I do like for people that don't want employees.

[00:22:11] It's like senior assistants in finding where should we put our aging parent.

[00:22:18] These are actually very unique businesses where this is how this plays out 90% of the time.

[00:22:24] Loved ones in the hospital.

[00:22:26] They're going to get discharged.

[00:22:27] Social worker or discharge planner tells the family, you need to take your mom home.

[00:22:32] Family says, we can't take her home.

[00:22:34] My spouse and I both work.

[00:22:36] We have children.

[00:22:37] We can't bring her home.

[00:22:38] And then the social worker discharge planner says, you need to make arrangements.

[00:22:42] That's how that works.

[00:22:44] If you've ever dealt with an aging parent and I have, I have in-laws right now and assisted living.

[00:22:49] And I have a mom and dad that are currently aging.

[00:22:52] And we've already toured assisted living facilities just due to our current culture.

[00:22:58] What these franchisees do is they meet for free with the family and they assess the elderly parent.

[00:23:05] Is it memory care?

[00:23:07] Is it, you know, is it a physical issue?

[00:23:09] Is it a stroke with left side paralysis?

[00:23:11] Like what happened?

[00:23:12] Or are we just aging and we're frail and we just need assistance?

[00:23:16] They then tell you exactly what facilities match your family needs in your community.

[00:23:22] And then they get paid by the facility, usually one month rent.

[00:23:26] Well, one month rent in a memory care facility is between five and 8,000 on average anywhere in America.

[00:23:33] Easy for one person.

[00:23:35] Yeah.

[00:23:36] So this is a business that you get involved in where it's just, it's just you, right?

[00:23:41] It's just, maybe it's just your spouse.

[00:23:43] And it's just someone that says, I like a little business.

[00:23:45] I want to make my own hours.

[00:23:46] I want to do my own thing.

[00:23:48] And I'm going to help people identified senior living facilities.

[00:23:52] I know you like real estate and I really like this model.

[00:23:55] The model is you purchase a, I'm changing gears.

[00:24:01] Okay.

[00:24:01] Now we're talking about assisted living.

[00:24:03] I love this model.

[00:24:05] You're going to purchase a three, 4,000 square foot ranch.

[00:24:09] And we're going to convert the garage, not the outside door.

[00:24:13] We leave it alone.

[00:24:14] It looks like a house.

[00:24:15] Convert the garage to bedrooms.

[00:24:17] Under the law, you and I reserve the right to put between six and 16 residents in a single family home.

[00:24:27] And, you know, in the United States, the number one state for, for, uh, headcount.

[00:24:33] For, uh, actual tenants would be Texas.

[00:24:35] Texas is law allows for 16 residents to occupy a single family home.

[00:24:42] They're paying on average of $5,000 a month per bed.

[00:24:46] So do the math.

[00:24:48] All right.

[00:24:49] So this is a real estate play and we're, we're now putting seniors in it.

[00:24:54] The care ratio is like five, six, eight residents per employee.

[00:25:00] Not one facility in America has a care ratio like that.

[00:25:03] Patient to care rate.

[00:25:04] No, it's amazing.

[00:25:06] The easy part, believe it or not, of this business is finding the tenants, finding the elderly to occupy the home.

[00:25:12] They love it.

[00:25:13] The kitchen is the same.

[00:25:15] The bedrooms are very familiar.

[00:25:17] The living room to them is very familiar.

[00:25:19] The curb, the aesthetics or everything is very familiar.

[00:25:22] They're not stressed.

[00:25:23] That is not the case.

[00:25:25] When you take them to a facility with a mile long hallway, you know, with a crazy rug and a bunch of doors that look, it looks institutional and it stresses them out.

[00:25:34] So they preferred to be in these environments.

[00:25:37] So anyone listening can get involved in assisted living through residential real estate.

[00:25:44] And you know what, what I love about it?

[00:25:46] There's the thing that we do, which is called taking it to zero.

[00:25:48] Let's say you're the worst franchisee in the United States and you fail.

[00:25:52] You're left with a single family home somewhere in America.

[00:25:55] I love the model.

[00:25:57] It really manages risk well.

[00:25:59] So this is a, this is a franchised model.

[00:26:01] Oh yeah.

[00:26:01] Everything I'm talking to you about right now is a franchise that you can buy.

[00:26:05] You don't need to figure it out.

[00:26:07] You don't need to understand what house do I buy?

[00:26:09] How is the layout?

[00:26:11] You know, what neighborhood, what demographics all done for you.

[00:26:14] The franchise systems have already plowed that field.

[00:26:17] So you have home care, you had assisted living locators, you have assisted living, right?

[00:26:25] Which is the single family homes.

[00:26:26] You have a look at stretch, look at stretching.

[00:26:30] What else?

[00:26:31] What other businesses can you have for seniors?

[00:26:33] Stretch lab, right?

[00:26:34] Stretch zone, assisted stretching where someone puts you on a bed and starts to do get you in

[00:26:39] an angle or in a position that you otherwise would not do on your own.

[00:26:42] So assisted stretching is becoming really popular.

[00:26:46] One of the largest brands.

[00:26:48] Yeah.

[00:26:48] Right.

[00:26:50] I run all the time and work out my, my daughter, my wife are like, you got to stretch.

[00:26:54] You got to stretch.

[00:26:55] I'm like, I don't have time for that.

[00:26:56] You know, but yeah, I could use it.

[00:26:59] If you look at injury, it's always the same with old people.

[00:27:02] They're just, their mobility is toast.

[00:27:05] Their flexibility is gone.

[00:27:06] I mean, the slightest little trip they can't even regain.

[00:27:10] They just collapse.

[00:27:11] So yeah, stretching mobility is, is critical just to be able to move, which brings me to

[00:27:17] another category, which is mobility.

[00:27:19] We have brands that will sell rent repair wheelchairs, assisted chair lifts, scooters,

[00:27:28] medical beds, massive industry.

[00:27:32] Massive.

[00:27:32] You would not believe how many people rely on mobility, uh, every day.

[00:27:39] And when those things break, they need a rental and they need it fixed immediately, or they

[00:27:43] need a new one.

[00:27:44] It's a huge business.

[00:27:45] And again, all you're doing is you don't need to be a mechanic.

[00:27:48] It's always motherboards and batteries and actuators.

[00:27:52] It's always based, right?

[00:27:53] It's not a transmission on a car.

[00:27:55] It's a very basic repair.

[00:27:57] Right.

[00:27:57] But it's brick and mortar and it needs to be done locally.

[00:28:01] And old people don't use Amazon to buy replacement parts.

[00:28:04] They find someone local that they can trust or they were referred to, to do business.

[00:28:09] So that's one of the reasons why I like this category or this investment theme is because

[00:28:15] everything I said is brick and mortar or it's feet on the street local, and it cannot be done

[00:28:21] through the internet.

[00:28:22] It's just not how they do business.

[00:28:25] That's, you know, that's, that's, it's a fascinating idea and concept because, you know, as our technology

[00:28:32] and distribution, you know, we've seen it obviously the last 15, 20 years with Amazon.

[00:28:37] But one of the things that, um, that I like, we help.

[00:28:41] One of the things we focus on is helping local businesses buy the facility that they operate

[00:28:45] their business out of.

[00:28:46] And we like the locally based businesses for that reason.

[00:28:50] It's like, you're not going to Amazon out the HVAC company, right?

[00:28:55] Somebody has got to show up at your house when it's 110 degrees out and your upstairs AC

[00:29:00] unit died and you're trying to go to sleep.

[00:29:04] Same thing with the plumber.

[00:29:05] I mean, the vet, to your point about the humanization of animals.

[00:29:08] I mean, you're, you're not going to put it.

[00:29:10] The Amazon guy is not going to drive up and, you know, take care of your dog or your cat.

[00:29:14] It's just not going to happen.

[00:29:16] But there are so many businesses that are, you know, that can be done from Silicon Valley

[00:29:21] or from, you know, Beijing for crying out loud that puts you out of business.

[00:29:26] And so this locally, locally based thing, I really love.

[00:29:30] And I think too, and I, and I want to, I don't want to stop you here, but I definitely want

[00:29:35] to touch on this idea as we advance.

[00:29:38] We're now in the AI age, right?

[00:29:40] We were in the, we were in the internet age, the search age for the last 20 years.

[00:29:44] But now we're moving into AI.

[00:29:48] And how is that impacting?

[00:29:50] I mean, I, I see a, I see an advantage again on the local.

[00:29:53] I can look at you face to face because I think trust is going to be one of the highest,

[00:30:00] most valued, it's not a commodity, but qualities for business going forward.

[00:30:06] And then maybe you couple that with, you know, this, this aging generation and population that,

[00:30:12] that already has distrust of the internet and who is already probably the number one primary

[00:30:17] target of the AI, you know, criminals that'll be out there.

[00:30:22] Cause you know, there's going to be good with it, but there's always going to be bad.

[00:30:26] There's the yin and the yang on it.

[00:30:27] Um, but there's opportunity I think here.

[00:30:30] So talk to that a little bit from what you see.

[00:30:33] Yeah.

[00:30:33] The op, I have more to probably say, uh, against AI than I do, you know, promoting it.

[00:30:41] So, you know, do I get it?

[00:30:43] I get it.

[00:30:44] Do I see, do I agree with some of these very successful firms that are calling for the destruction

[00:30:50] of around 350 million jobs globally?

[00:30:53] It's absolutely going to happen.

[00:30:55] I mean, it is absolutely going to happen.

[00:30:58] You're already seeing no one wants to be an accountant.

[00:31:01] It's not just the fact that the profession is a total grind of a profession.

[00:31:07] It's a grind.

[00:31:09] And if you've known anyone, right, if any, any family member that knows someone, they're

[00:31:13] never around.

[00:31:14] They're always working crazy hour long weeks.

[00:31:18] It's it is, it has to be, you and I can make five mistakes right now.

[00:31:21] Five mistakes.

[00:31:22] We can say words wrong.

[00:31:23] I can misquote a statistic.

[00:31:25] That profession has to be perfect.

[00:31:28] It's perfect.

[00:31:29] The math must tick and tie.

[00:31:32] It is a grueling profession.

[00:31:34] So what are you saying?

[00:31:35] Next generation wants nothing to do with it.

[00:31:36] And they're smart for it.

[00:31:38] Why?

[00:31:38] Because AI is going to replace them anyway.

[00:31:41] AI is going to kill H&R Block.

[00:31:43] It's going to kill Liberty Tax.

[00:31:45] They've outlived their usefulness in the introduction of AI by at least a decade now.

[00:31:50] The same way a local bank outlived this usefulness by a decade.

[00:31:53] The same way the Wall Street, Wall Street's outlived this usefulness by a decade.

[00:31:57] There should be no one standing on the floor.

[00:31:59] Stop.

[00:32:00] Like there should be no one standing there raising their hand doing trades.

[00:32:04] I mean, it's ridiculous.

[00:32:04] It's all automated now.

[00:32:06] It's all algo driven.

[00:32:08] So when you look at AI and you look at like what destruction it'll have or what opportunities it'll create.

[00:32:16] Here's my attitude on opportunities that it's going to create.

[00:32:20] If you can use your hands or if you can be in a business that requires the use of a tool, a tool, you're going to own this country going forward.

[00:32:32] That's my attitude.

[00:32:33] So my word for every – I love that you said HVAC.

[00:32:36] And I love that you said plumbing.

[00:32:38] And I love everything you just said about it because I completely agree with you.

[00:32:42] If you're an HVAC – we shit on the trades for decades.

[00:32:47] And we propped up college.

[00:32:49] Now we're finding out that these kids are graduating with degrees.

[00:32:52] They can't spell.

[00:32:54] They can't do math.

[00:32:55] They don't know history.

[00:32:56] And it's like – and they have $150,000 in student loan debt.

[00:33:00] And then I got the local HVAC guy grinding it out.

[00:33:04] Beautiful house.

[00:33:05] No debt.

[00:33:06] Amazing car.

[00:33:07] Lovely family.

[00:33:09] Home with the kids.

[00:33:10] And it's like, you know what?

[00:33:11] If you could use tools and you get involved in the trades in this country going forward, I truly believe they're going to own the world because it's Amazon proof and it's AI proof at the moment.

[00:33:23] Like you said, if my – I live in Florida.

[00:33:25] If my AC went off while I'm on this phone call, I would have already texted my guy saying, you need to come over right now.

[00:33:33] I can't last minutes without it.

[00:33:35] And you'll pay whatever price, right?

[00:33:37] And to your point about the kids graduating college with these – so many bogus degrees, they also don't know how to use a tool.

[00:33:48] That's right.

[00:33:49] So all they know how to do is work the coffee machine, you know, which, you know, is just not going to happen.

[00:33:58] So all right.

[00:34:01] So there you go.

[00:34:02] So we've got a lot going on.

[00:34:05] And so anything more on the graying population opportunity there?

[00:34:11] I can't believe we're already sort of end of our time, but I don't want to cut it off.

[00:34:14] I know we got a little sidetracked.

[00:34:17] Well, we talked about – so we talked about home care.

[00:34:21] We talked about finding the elderly a place to reside, like assisted living or a nursing home or a memory care facility, et cetera.

[00:34:29] We talked about mobility and helping people get their mobility back, which is huge.

[00:34:34] We talked about stretch, assisted stretching.

[00:34:37] We did not discuss the physical therapy components.

[00:34:41] We didn't discuss businesses that are actually centered – their fitness, their gyms, basically.

[00:34:48] So their gyms, instead of LA Fitness that will sell a membership to anyone, these businesses focus primarily on the aging population.

[00:34:56] I have gyms that actually focus exclusively with diabetics and how to get these people off of insulin.

[00:35:05] And they do it through meeting with a registered dietician, working out with them.

[00:35:10] And again, I'm talking about people with type 2, non-genetic predisposition, someone that got diabetes through a bad lifestyle.

[00:35:19] That is absolutely reversible.

[00:35:21] This stuff is over.

[00:35:23] It's unbelievable what we've done to everyone.

[00:35:25] It's crazy.

[00:35:26] And that's why people are aging even faster because they're so unhealthy.

[00:35:30] They're not you.

[00:35:30] They're not running.

[00:35:31] They're not doing what you're doing.

[00:35:33] That's right.

[00:35:34] You'll age beautifully.

[00:35:35] You'll age gracefully.

[00:35:36] But it's sad, right?

[00:35:38] I mean, it's sad, Cliff, that people literally dig in their own grave with their mouth and their lack of engagement in life, right?

[00:35:46] They're sitting around and back to the college thing, right?

[00:35:51] We're going to teach somebody how to go get some job working, a white collar job sitting behind a desk where your trades people, they're outside, they're inside, they're moving around.

[00:36:02] They're using their brain.

[00:36:03] They're using their hands.

[00:36:05] They're in the fresh air.

[00:36:07] But they're always moving and doing something, not just clocking in on the computer and the longest trip they have is to the coffee machine in the break room and have a couple of ho-hos and coffee or whatever you need to do.

[00:36:21] Sit down again.

[00:36:22] Sit down again, right?

[00:36:24] It's so true.

[00:36:25] Mike Rowe brought the trades to the forefront and praised them.

[00:36:32] Dirty jobs, Mike Rowe.

[00:36:33] It's like these are noble professions.

[00:36:36] These are great professions.

[00:36:39] God bless these people.

[00:36:40] We need them.

[00:36:41] I need the techs.

[00:36:43] You know, there's a lot of industries.

[00:36:44] You mentioned HVAC.

[00:36:45] That's an industry that's aging out.

[00:36:47] You talk about the aging of America and its unintended consequences.

[00:36:50] What do you do when a bunch of old guys own businesses and their kids don't want it, their grandkids don't want it, and these businesses are closing?

[00:36:59] This is what Cody Sanchez is saying.

[00:37:01] It's like these sweaty startups.

[00:37:02] We have all these aging people, and no one wants to take over their generational-grown businesses.

[00:37:08] It's really a tragedy.

[00:37:11] Yeah.

[00:37:11] Yeah.

[00:37:12] Yeah, it is.

[00:37:13] It is.

[00:37:13] It's a tragedy.

[00:37:14] But to your point also through this conversation, it also creates a great opportunity, right, for those of us that are looking to expand our mindset, right, and think about the limitless possibilities instead of what we can't do.

[00:37:29] What are the opportunities?

[00:37:30] How can we serve?

[00:37:31] And I think the coolest thing about this is – and, again, one of the coolest things about franchising is you guys have already – I mean, just right here, you can tell that – I mean, it's well thought out in terms of strategy, positioning, and opportunity.

[00:37:46] And so when someone engages with you or they engage through you to a franchise, what they're getting is this basically strategy on a silver platter that ideally will match up with their strengths and weaknesses, desires.

[00:38:07] And so when you're talking about this, you can't do that, you can't do that, but it's not just the mating of the two.

[00:38:11] It's the – here's the game plan.

[00:38:13] Here's the playbook.

[00:38:15] All you've got to do – we've done it 50 other times or 100 other times or 200 other times.

[00:38:20] All you've got to do is do A, B, C, D, E consistently and, oh, if you have any issues, we're here to come in and guide you and course correct you and all that.

[00:38:30] But all you've got to do is execute.

[00:38:31] You don't have to create anything new.

[00:38:33] It's just execution, right?

[00:38:35] That's right.

[00:38:36] You're exactly right.

[00:38:37] And as simple – like we said, there's nothing more deceptive than the obvious.

[00:38:42] People cannot help themselves but overcomplicate their entire life.

[00:38:47] You join a franchise.

[00:38:48] It tells you exactly as you said, A, B, C.

[00:38:53] This is the manual to execute our business model, get to break even as quickly as possible, get to profitability as quickly as possible, to scale to a second, third, fourth, fifth location, to create generational wealth,

[00:39:07] to have an annuity income stream in retirement, to have a business you could give to the children or grandchildren.

[00:39:13] People can't help themselves but say this doesn't work here because they just don't have the right attitude.

[00:39:20] It happens all the time and we see it all the time.

[00:39:23] But you're right.

[00:39:25] Franchising is the quickest path to creating what I believe is wealth.

[00:39:30] You can define wealth any way you want.

[00:39:32] But to me, it's the fastest way to achieve your investment objectives.

[00:39:35] And where we come in, Paul, is all where – you called it systems and you had a word that you were using.

[00:39:43] It's discipline.

[00:39:44] We're disciplined investors, right?

[00:39:46] And we bring that business acumen and discipline and strict adherence to due diligence to the client because the clients never have it.

[00:39:54] They never have it.

[00:39:55] Clients are always highly emotional and they make illogical or rational decisions, right?

[00:40:00] And all we do is come in and say, wait a minute, didn't you say you were 45?

[00:40:04] Yeah.

[00:40:05] Don't you have three kids?

[00:40:06] Yeah.

[00:40:07] Why are you buying these restaurants?

[00:40:09] I mean, you told me lifestyle was important and you just got done telling me how many baseball games you missed and how many dance recettes that you missed.

[00:40:16] Now we're going – this is where it's – you're right.

[00:40:18] You're right.

[00:40:19] I keep going that way because it's what I like.

[00:40:21] But it doesn't align with your investment objectives.

[00:40:24] You also said you wanted to make a half a million dollars a year.

[00:40:27] Why are you looking at a subway that makes 50 grand a year?

[00:40:29] Like nothing ever adds up.

[00:40:31] So we come to the table and say, why are you here?

[00:40:35] What are you willing to invest?

[00:40:37] What phase of life are you in?

[00:40:39] What are your investment objectives?

[00:40:40] What is your risk tolerance?

[00:40:42] What is your time horizon?

[00:40:44] Where do you live?

[00:40:45] What are the demographics of that community?

[00:40:47] Do you live in like the deep south with average household income of 25 grand?

[00:40:51] Or do you live in San Francisco, right?

[00:40:53] Like what market are you in that we know that these brands are sustainable in your market?

[00:40:58] People love – I just got off the phone before speaking to you.

[00:41:02] She sounded great on the phone.

[00:41:04] She sounded like she knew exactly what she wanted.

[00:41:06] I pulled up her town, 600 population.

[00:41:11] 600 people.

[00:41:12] I said to her, I go, no one wants to operate a business in that town.

[00:41:17] Like nobody.

[00:41:18] You don't want to buy a franchise for 300 grand and put it in a town with 600 people.

[00:41:24] Go start a little mom and pa operation.

[00:41:27] So discipline, some adherence to due diligence.

[00:41:31] And our process takes three, four months just for the record.

[00:41:34] We don't rush.

[00:41:35] I tell every client the same thing.

[00:41:37] You are not buying anything.

[00:41:38] Get that out of your head.

[00:41:39] We're not buying anything.

[00:41:40] We're not investing in anything.

[00:41:42] All we're doing is due diligence.

[00:41:44] Is franchising a fit?

[00:41:46] Is it the right vehicle for you to achieve your financial goals?

[00:41:49] That's it.

[00:41:50] That's it.

[00:41:51] It really takes – and we do it for free, Paul.

[00:41:53] I mean it's not like we charge for what we do.

[00:41:55] We're paid like realtors.

[00:41:56] So we're paid by the seller.

[00:41:58] And I represent over 600 brands.

[00:42:01] So we help the buyer through a massive superset of brands.

[00:42:06] We break it down to like five brands that fit what they're trying to accomplish.

[00:42:11] No one should do this alone.

[00:42:13] And unfortunately, no one trusts anyone.

[00:42:15] And we're trying to build that relationship publicly with people.

[00:42:20] I've been doing this over 20 years.

[00:42:21] You can trust us.

[00:42:22] We're not first time to the rodeo.

[00:42:24] We've been there, done that.

[00:42:25] And we could definitely help people.

[00:42:27] And our heart's in the right place.

[00:42:29] And again, it's free.

[00:42:30] You don't sign anything.

[00:42:31] You're not obligated to anything.

[00:42:33] I will shameless plug my company.

[00:42:36] It's Phrenosity.

[00:42:37] The website is www.franocity.com.

[00:42:47] And you can look me up on LinkedIn.

[00:42:49] Make a ton of videos.

[00:42:50] I make three videos a week on LinkedIn all about business.

[00:42:53] We had a ton of value.

[00:42:54] We've got an amazing newsletter.

[00:42:56] So I appreciate you bringing me on the show.

[00:42:59] And I think that your viewers, you're bringing value.

[00:43:03] Think about the value you bring every week to your audience.

[00:43:06] I hope I can pay that forward and contribute to what you're doing with your audience.

[00:43:10] Because I think we bring a lot to the table.

[00:43:12] Well, you certainly have, Cliff.

[00:43:14] This has been a fascinating conversation and very energetic.

[00:43:17] But I learned a lot.

[00:43:18] I mean, I know a decent amount about business and franchising, but not to the level.

[00:43:22] And I mean, the four categories and going deeper there and just the opportunity is pretty

[00:43:28] daggone amazing.

[00:43:28] So I would definitely echo if someone's listening or watching and they have interest in pursuing

[00:43:35] franchising as an opportunity.

[00:43:37] Hey, reach out to Cliff.

[00:43:38] Go to Phrenosity.

[00:43:40] As he said, it doesn't cost you a thing.

[00:43:42] It's free.

[00:43:42] And if you put something together, ultimately three, four, five months downstream, then he's

[00:43:49] paid by the franchise.

[00:43:51] So you don't want to navigate these waters yourself because, again, you don't know what

[00:43:57] you don't know.

[00:43:59] And to his point earlier, we make irrational decisions based upon emotion and information

[00:44:07] that might not even be correct.

[00:44:08] Certain paradigms that we carry with us.

[00:44:11] So Cliff, it's been awesome, man, having you on the show.

[00:44:14] I'm excited about punching this one out there to the world.

[00:44:18] And hopefully we're going to bring some connections your way.

[00:44:24] That's great.

[00:44:25] Thank you so much.

[00:44:25] I enjoyed my time with you.

[00:44:26] Thank you.

[00:44:27] Appreciate the invite.

[00:44:28] Hey, gang, just winding down here today.

[00:44:30] Thanks for listening to the show.

[00:44:32] And as always, if you need capital to grow your business, you're looking to purchase commercial

[00:44:39] real estate or build a building or invest in commercial real estate, or you're looking

[00:44:43] to acquire a business or a competitor or just need growth capital, we'd love to talk

[00:44:48] to you.

[00:44:49] We fund businesses all day long.

[00:44:50] Our mission is to help entrepreneurs win and to fund their businesses and fund their dreams

[00:44:56] so that they can make an impact in their community.

[00:44:58] Reach out to me today.

[00:44:59] Go to our website, click the button, schedule a 20-minute conversation, discovery call.

[00:45:04] We'll have a quick conversation, see if there's a need, see if there's a fit, and we can take

[00:45:08] it from there.

[00:45:09] The website is vpcvictorpaulcharlie.capital.

[00:45:16] That's vpc.capital.

[00:45:19] All right.

[00:45:20] There's no .com on that.

[00:45:21] It's vpc.capital.

[00:45:23] As always, keep crushing it and hope to see you soon around here.

[00:45:27] Take care.