How Codie Sanchez Built a $50M Portfolio Buying Boring Businesses

Introduction

Discover how Codie Sanchez built a $50 million portfolio through buying boring businesses. In this revealing interview, she shares her unconventional approach to business acquisition, why boring businesses outperform startups, and how anyone can achieve financial freedom through strategic business purchases. Learn the exact framework she uses to identify, acquire, and grow small businesses that generate consistent cash flow.

Founder Success Story QnA

How did you get started in this space?

Well thanks for having me. I appreciate it. You know back when we first met years ago, I think I was still working inside of a private equity firm. I would have had to have been if it was only if it was six years ago. So you know I kind of got started in the fact that I worked in finance forever. You know I had a corporate job for a long time. I was kind of too much of a wuss to ever leave it and so the only out that I saw was doing what I did in my 9-to-5 but by myself kind of privately quietly meaning buying small businesses on the side and I did that you know for years before I left and had the guts and enough money saved up to actually go and buy my own business.

What was your first business?

The very first business was actually a cross-border consulting business so it would have been a professional services business. The problem is that business didn’t do that well so that was not my best transaction and it was I basically bought a job. It’s okay we made a little bit of money but I didn’t think that was repeatable and then I had a second business which was threads refined and that was a fashion styling marketplace maybe like some of your people. It was an online business it was kind of sexy. That business didn’t make much money either and I had started that one not bought it and so finally I was like all right turns out I’m not the idea girl like my ideas aren’t making me money this isn’t really working and I didn’t have anything brilliant and so one of the first businesses that I ever bought was a laundromat and I I basically just went the opposite end of the spectrum I was like all right it’s not working out great to do these sexy things what’s like the most simple boring I can’t mess this up business that I could buy and how could I do it with an operator because I was traveling a lot at the time for work.

Why do you particularly like boring businesses?

I sort of realized I think early on that every business is the same every business is widgets you have in every business you need sales you need product you need operations you need marketing you need some sort of distribution or logistics and so we it all like every business has this like same inside now the outside could look very different you could be selling washing services like we do you could be selling e-commerce products you could be selling media spots and ads and sponsorships but it’s all actually kind of the same and after doing tons of deals in private equity I realized this I at the time didn’t realize the power of the internet like you knew that way before that I did but what I did realize is that boring businesses are not as competitive as the internet like the game we’re playing right now this game for attention is the hardest game I play like I’m competing against every single human out there from Donald Trump right and the best at media to whatever the hottest show is on Netflix like you and I compete against everybody there’s no moat and it’s complete competition for attention when I live in a geographic area the businesses that service me as an individual and my business as an individual entity they’re not the ultimate competitors you know I would much rather compete against the other local window washing companies or painting companies then I would compete against HBO competing against HBO is hard competing against my local handyman service not that hard and so I think what I realized early on is startups have let’s call it a 90% failure rate over any 10-year rolling period right for businesses that you buy that have the same term so 10 years the SBA loan term shows that small businesses you buy have a 25% failure rate at the height and a 5% failure rate at the low so we have a 90% fail rate or a 10% success rate in startups and we’ve got a 25% fail rate and a 75% success rate in buying businesses and so that just made me realize huh I’m just going to go where the odds are better like I just have a better shot at winning if I’m good at poker than I do at playing slots and that was really the difference between the two and why I started to look at this industry.

Do you buy struggling businesses and apply your framework?

I try not to I try not to buy businesses that are struggling I think turnarounds are really hard I did a lot of those in cannabis I was a cannabis private equity investor for a while and man you know there are businesses that were two weeks out of cash and you know $25 million in assets and millions in dollars in liabilities and you know we had four weeks to turn them around and that was miserable and so I try not to do that very often if at all humanly possible but I try to buy what I call like the nicest house or I’m sorry I try to buy a nice house on a normal block I don’t have to buy the shitty house and fix it up I don’t have to buy the nicest house I kind of want average and the reason is because the first time you do a deal and buy a business and you know this because you’ve done deals before too but something will go wrong you will pick something wrong in your first deal and so you want to make sure that you have enough cushion of cash flow in the business where that’s something going wrong is okay it’s like a buffer you know you know that you’re not going to die if you play a game of basketball and you scratch up your knees you’re like hey that’s the price of playing the game right and so when I buy a business I try to buy businesses where they have enough cash flow in them they’ve existed for at least 5 or 10 years they have operated they have product market fit you know they have a lot of users they have diversified users because that way I have more confidence that they’re going to continue to succeed.

Can you explain your BRRT framework?

We have a couple different strategies we call one BRRT which is we buy boring businesses in recession resistant asset classes raise their prices and add technology and so the playbook is essentially we want sort of a normal business we make it a little bit nicer we increase prices because usually they’re underpriced and then we potentially add on a few more of those businesses and so that’s one of the methodologies that we teach in the book on how to do this.

Can you talk about your book “Main Street Millionaire”?

I didn’t want to write a book and so I feel like there’s enough inspiration books there’s enough books out there telling you that you’re sufficient you’re good you can do this whatever my idea instead was I think that acquisitions can be really intimidating and when people hear about buying a business they just inherently think that it is harder to buy a business than it is to start one and if you are a founder and you’ve already founded a business a few times and you’re good at it you also think it’s harder to start to buy a business than found one and you feel that to the core like I talked to founders they’re like no it’s so much easier to start and I go first of all you’re rare like founders don’t realize that if you are if you have started a business and it is profitable you are the top 6% in the US only 6% of Americans have a profitable longstanding business you’re very rare most people are like me where they’re like you know I can follow directions I can work really hard I can get after it but I don’t know how to create something from nothing and make it profitable and lasting where they’ve like tried a bunch of different things and none of the things have really worked and stuck and I think that’s totally okay because we don’t actually need all the innovation in the world continuously we need like clean streets we need coffee served we need landscaping done we need houses built and you can just buy those and so that’s the idea in the book is like you don’t have to come up with a billion dollar idea to make a billion dollars and in fact if anybody becomes a really good founder like you know they’ve done and built a business that’s doing let’s call 50-100 million in annual revenue at that level you don’t get there without acquisitions actually like once you get to $100 million in revenue your likelihood of not having done an acquisition is basically 10% in business once you create a billion dollar business it is 0%.

What do you mean by Main Street versus Wall Street?

I noticed a trend in the US which is really concerning and I imagine it’s the same exact trend in Australia it’s almost a global phenomenon if you were to look in 2000 private equity companies owned 4% of all US companies in the year 2023 they owned 20% in the 1800s in the US we had 80% of Americans were owners in something now we have 6% are owners in something we are very quickly losing our ownership and we are giving it up to the few who own and you know if you go out and you talk to people today they say well most people can’t handle it most people can’t handle being an owner most people can’t handle being a founder well maybe if we do it the startup way if we do it where there’s a 90% failure rate and we have to come up with a novel idea in order for us to become owners yeah that’s not for everybody that’s hard but we have owned businesses and had apprenticeships and transitioned businesses from one generation to the other since the advent of bartering and so I think what we have done is we have let these intermediaries come in the middle of just about every type of ownership we have we no longer think that we can buy a business straight from a business owner we need an investment banker we need a bank we need a title company we need title insurance like it’s just it’s bizarre and so we’ve let these middlemen make the transactions harder and we’ve let these middlemen make the transactions more expensive and we’ve let them talk us out of the fact that we might be able to do it ourselves individually and so I do think we’re at a little bit of a war it’s a quiet war but it is a war between the few who own everything and the many who don’t even realize it and you know not to to get so dramatic about it but if you look at the S&P let’s look at just the S&P 500 you know there’s three companies that own 80% of the S&P 500 and that’s State Street and black rock and Vanguard at which point you might say Codie those are passive investments those are those are exchange traded funds and mutual funds they don’t actually they don’t have any decision-making power oh whoops except Bill McNab the CEO of Vanguard a company of which I worked for and I have met Bill many times said publicly we’re not passive in governance we’re actually quite active in governance of our companies and so I don’t think any of these companies are bad I worked at Vanguard it’s full of great people I worked at State Street it’s full of great people but should anybody have all the power and ownership not even me or you I don’t think that’s right and so that is what I mean by Main Street over Wall Street we’ve got to push back on feeling like we have to get bigger and bigger and bigger and that the few of us have to own it all when instead why can’t we be happy with like our little corner coffee shop.

Are local businesses tough to run?

All business is really hard and it’s a way to become a better human because it’s getting punched in the gut continuously but then the last little tidbit I would go on is I love this is my favorite thing I always go all right you say your business is really really tough and not everybody could cut it and you know they shouldn’t be in this industry why don’t you go back and be an employee for somebody then and they’re always like well the thing is you’re like I’ll believe that your business sucks when you go back and get a job and you think that the job is better than the job that you have today and sometimes people do they’re like actually I need a break but all business is tough I guess as my saying and I do think it’s easier sometimes in some ways to run bigger businesses but I also think higher levels higher devils.

What kept you from going all in earlier?

I kind of was joking with my team two minutes before this they were like why’d you write the book I was like for all my haters and I think that is I think that’s part of it you know I had bosses I hated who had lives I didn’t want who I thought I knew more than not always true by the way but you know I think most of us founders are totally unemployable at some degree and we realize that later on in life but when we’re young we’re just we fuss and moan a lot and so that was me but you know eventually I got to what I call my my fuck you ometer basically went too high you know it was like I couldn’t handle it I was bursting and so there was some point where I was like the way we’re doing business doesn’t make sense I actually really liked my job I liked what I did every day I liked my team I ran a team in finance but I hated how the bosses wanted to run the business and I was like if you guys saw what we could do on the internet like you would change how we did investing and you would change how we did distribution and then you know they told me no and they were like listen you’re on my boat if you want to go left and I want to go right you have to roll my direction and you got to get a boat and I was like very mad about that and then now I realized that’s totally reasonable and that was the right move by them and but it was basically that like I couldn’t take anymore I was like this is not how we should run the business and so it was at that point I had already had a few deals go through I was already making money on the side that I realized like I could do this by myself and so I finally finally did but it took way longer.

When did you start building this movement and community?

You know Naval Ravikant talks about the three layers of leverage I think I realized in 2020 when I wasn’t traveling so much I wasn’t doing road shows which is what you do to go raise capital for funds and private equity so I had some time to think and I realized you know that at the time I think he was right there were three types of leverage there was capital which is you know money the banking regulations happened Rothschilds became very very wealthy that was like a big lever there’s labor right which historically was slavery and then became employees and then there was code so Bill Gates and Elon Musk and Jeff Bezos and they all had like an army of labor in the form of code that did things for them and I started seeing in 2020 this idea that audience could be an even more powerful form of leverage and in finance we understand leverage pretty well because that’s how you make more money is you see a deal you think it makes sense and then you add more money to it in order for the returns to get even higher than they could if you didn’t have leverage and so I saw this leverage happening in in audience and I tried to at the time get my firm that I was a partner at to do more to gain an audience like I wanted us to have a big email list I wanted us to go on substack I wanted us to build a little bit of a media company and they were like you’re out of your fucking mind no way that’s so the word in finance would be retail they called me retail like which means you know that’s that’s like what low-level finance people do not the fancy finance people and so we would never do that because that would not be sophisticated and that would be beneath us and then serious people wouldn’t take us serious and so I kind of fell for that for a while and listened to it and then finally I was like you’re wrong you’re literally wrong and I don’t think you see where the puck is going and so I started creating content myself and I was like I fuck it I’m gonna do it and so I started doing it and then I remember at some point this is a similar unemployable Codie thing my boss was like well he wasn’t my boss because I guess I was a partner but the senior partner the one who had founded the firm was like you we don’t feel comfortable with you creating this content you know this this doesn’t look good for the firm overall you’re going to need to stop doing it and I was like one you can’t tell me what to do and two no this is actually huge for us and we’re raising millions of dollars what are you talking about and at that point you know he said well you really need to make a decision between the two and I said well it’s no decision I’m going to go do my own thing so you guys need to pay me out for my percentage of the firm I don’t want to I don’t want to have anything to do with it anymore.

How did you grow your community so quickly?

If I could give one piece of advice on what I think we did well it’s we try to not be takers but be givers so like if you come on to any of my platforms you don’t see me doing a lot of advertisements for one-off random shit all the time in fact you’ll probably never see me do that you’ll see me advertise very particular things for companies I really like normally have invested in and own part of I’m real transparent about and usually like with some sort of giveaway or something associated so I tried to not take a lot from the audience which I think is the opposite of what a lot of influencers do because they make money off of their audience’s attention what we do is we I make most of my money off of my small businesses that I own and then we have an academy that we help people buy businesses and now scale businesses and eventually exit businesses but it’s expensive and what that does is that means that I am actually only selling a very small percentage of my audience every single month like I don’t need tens of thousands or hundreds of thousands of people to buy from me it’s a very few people that the price is so reasonable for them it’d be ridiculous for them to not do it because even if even if what we sell is a five figure investment in order to learn how to buy a business your ROI on buying a business is six figures millions dependent but for most people it’s like give everything possible for free you really don’t find a like a lot or any low ticket anything from us and so I think that was really powerful in the beginning I never said that you know I never said that I didn’t have anything to sell because I don’t think there’s anything wrong with selling I think it’s if I have a product that is amazing for a human I want to give it to them that’s that’s incredible love that transaction same thing for me Instagram knows the stuff I want to buy better than my husband half the time sucks got me down but but I was really thoughtful on like give give give so I think for the first year we were in business I took not a single dollar from the audience we didn’t charge for anything the second year in business we started charging for a few things and the third year in business I started taking a salary from the business but before that I didn’t take anything out of the business and so I think the give versus take thing is super super important and then the other thing I think I got lucky in but it wasn’t my plan is just I really obsessed on like what was my niche I didn’t try to be as everything to everybody you know especially when I started it was like I talk about boring businesses and how to buy them and how to grow them and that’s it and if you want to see some wild videos on that awesome will be buds but I didn’t try to go wide and I think a lot of creators they try to be relationship advice home advice personal advice business advice and I was just like here’s the one thing I think I might be the best in the world at which is how to buy businesses paired with how to make it really simple paired with content and so that’s all I’m going to talk about.

Can you explain seller financing?

60% of all businesses are sold with seller financing which is essentially the seller of the business will help you pay for the business using their future profits if you would have told me that even when I was in finance and had done like I don’t know probably dozens of deals by then if not 50 plus I I don’t think I would have known that like we were so indoctrinated to think we raise capital from investors we get loans by banks that’s how deals are done and and yet that’s not really the case in small business the second thing that’s wild is that like the government doesn’t really want you to talk about seller financing and again I think it goes back to intermediaries and some scammy people like listen there are scammy people on the internet that will be like you too can buy a business with no work zero dollars down in 20 minutes in your backyard and sell it for millions right and so there are protections in place to make sure that there aren’t scammy people trying to sell you a pipe dream and because of that seller financing or creative financing they get a bad rap and also because maybe sometimes when people do them they try to take advantage of the seller so they’ll be like I’ve never run a business before I don’t know anything about your business I don’t know you but I want to buy it for zero dollars down and you seller or finance the whole thing to me you’re like kid what and so so I think for all those reasons this thing not a bad route which are like reasonable reasons but the truth of the matter is there’s really no difference between seller financing and bank financing except one is normalized expensive and has an intermediary in between one is not normalized harder to get and does not have an intermediary in between so getting bank financing is faster typically and more expensive high and seller financing is slower and potentially cheaper upfront maybe could be cheaper overall the thing that’s cool about today is that we have a supply and demand imbalance so we have we have millions and millions and millions of small businesses for sale all around this country we have hundreds of millions of businesses around the world that people don’t realize they can even sell they think about it as jobs they’re just going to close them down we have a baby boomer generation that doesn’t have retirement plans that doesn’t have enough money because most their net worth is tied up in their small business and they’re looking for an out eventually but they’re just going to work in the business forever because they really don’t have any other option and so the idea that I have is let’s pair together the two generations the Baby Boomers or the elderly generation and the generation you know ZX and Millennials and let’s let those two generations instead of being mad at each other all the time become each other’s solution and I think we can do that through seller financing because the Baby Boomers want an exit and the Millennials and gen Z and Gen X want some ownership and they want wage increases and so that is where cell financing comes in and I think is a really powerful tool for businesses that otherwise are unsellable.

Codie Sanchez Business Stats

Codie has built an impressive eight-figure portfolio through acquiring boring businesses. Her strategic approach focuses on businesses with proven cash flow, existing customer bases, and recession-resistant qualities. Below are some key statistics about her business portfolio and investment strategy.

• Portfolio value: $50 million across multiple boring businesses
• First business acquisition: Laundromat for $100,000
• Business types: Laundromats, car washes, window cleaning services, paint companies
• Acquisition strategy: BRRT method (Buy boring businesses, Raise prices, Recession-resistant, add Technology)
• Failure rate of acquired businesses: 5-25% compared to 90% for startups

Business Type	Investment Range	ROI Timeline
Laundromats	$100K – $500K	2-3 years
Car Washes	$200K – $1M	3-5 years
Window Cleaning	$50K – $300K	1-2 years

Codie Sanchez Method

Codie has developed a systematic approach to acquiring and growing boring businesses. Her method focuses on identifying undervalued businesses with strong fundamentals and implementing strategic improvements to increase their value and cash flow.

• Identify businesses with 5-10 years of operating history
• Look for companies with diversified customer bases and product-market fit
• Target businesses with sufficient cash flow to provide a cushion for errors
• Implement price increases as most boring businesses are underpriced
• Add technology to streamline operations and improve efficiency
• Acquire multiple businesses in the same industry to create economies of scale

Codie Sanchez Tools

Codie utilizes various tools and platforms to identify, evaluate, and manage her business acquisitions. These resources help streamline the acquisition process and improve operational efficiency across her portfolio companies.

• Biz Scout: A marketplace platform Codie acquired to connect business buyers and sellers
• Contrarian Thinking: Her media platform and community for sharing business acquisition strategies
• SBA Loan Programs: Government-backed financing options for small business acquisitions
• Seller Financing Structures: Creative financing arrangements with business sellers
• Operational Management Systems: Technology implementations to streamline business operations

Key Notes

Throughout the interview, Codie shared several critical insights about business acquisition and ownership. These key takeaways highlight the fundamental principles behind her success and the philosophy driving her approach to building wealth through boring businesses.

• 60% of all businesses are sold with seller financing, making acquisitions more accessible than most people realize
• Private equity ownership has grown from 4% of US businesses in 2000 to 20% in 2023
• Only 6% of Americans own profitable long-term businesses, creating a massive opportunity
• Audience-building is a powerful form of leverage that can accelerate business growth
• Being a business owner is challenging but not being an owner is worse for financial freedom

Get Started in Just 5 Steps

Interested in following Codie’s path to financial freedom through business acquisition? Here’s a simplified five-step process to get started with buying your first boring business, based on the strategies she shared during the interview.

• Research recession-resistant industries: Identify service-based businesses with consistent demand regardless of economic conditions
• Build your acquisition fund: Start saving and explore financing options including SBA loans and seller financing arrangements
• Connect with business brokers: Establish relationships with brokers who specialize in small business transactions
• Evaluate opportunities systematically: Use Codie’s criteria – businesses with 5+ years of history, diversified customers, and strong cash flow
• Implement the BRRT method: After acquisition, raise prices gradually and add technology to improve efficiency and profitability

Conclusion

Codie Sanchez’s journey from finance professional to business acquisition expert demonstrates the power of thinking differently about entrepreneurship and wealth building. By focusing on boring businesses with proven track records, she’s built a $50 million portfolio while avoiding the high failure rates of startups. Her approach combines strategic acquisition techniques with operational improvements and community building, creating a replicable model for others seeking financial freedom through business ownership. Whether you’re an aspiring entrepreneur or an experienced business owner, Codie’s strategies offer valuable insights into how to build wealth through acquiring and growing small businesses.