Digital Social Hour
The No-BS Guide to Selling Your Business Like a Pro | Chad Peterson DSH #1280
Sun, 30 Mar 2025
🚀 Ready to master the art of selling your business like a pro? This no-BS guide is packed with valuable insights as Sean Kelly sits down with Chad Peterson, a seasoned expert with 25+ years of experience in buying and selling businesses. 💼 From turning a teenage lawn mowing hustle into $400,000 to coaching entrepreneurs on creating life-changing liquidity events, Chad shares his proven strategies for building wealth and achieving entrepreneurial freedom. 💰 In this episode of the Digital Social Hour, discover why paychecks lead to poverty, how liquidity leads to wealth, and why owning a business—not real estate—is the ultimate path to financial success. 🏆 Chad also uncovers how to leverage SBA loans, avoid common pitfalls, and create the "next larger business" to multiply your income. Plus, hear his no-holds-barred takes on passive income myths, retirement, and the secrets behind billionaire success stories. 🔥 Don't miss out—watch now and subscribe for more insider secrets. 📺 Hit that subscribe button and stay tuned for more eye-opening stories on the Digital Social Hour with Sean Kelly! 🚀 Join the conversation and learn how to take your business—and your life—to the next level! 💡 CHAPTERS: 00:00 - Intro 00:34 - Chad’s First Business 01:52 - Liquidity Leads to Wealth 04:52 - Trump’s Economy Insights 06:42 - Real Estate Market Predictions 09:58 - Understanding SBA Loans 11:25 - Cody Sanchez's Business Strategies 12:32 - Alex Hormozi's Entrepreneurial Tips 17:02 - Business Purchase Success Rates 22:55 - Importance of Mentorship 23:31 - Upcoming Event Details 25:13 - FTC Crackdown on Businesses 26:49 - Investing in Laundromats 27:46 - Generating Passive Income 29:50 - Factors for Business Valuation 34:14 - Brad Lea and Patrick's Event Highlights 37:14 - Strategies to Buy a Business 38:25 - Path to Becoming a Billionaire 41:09 - Accessing Knowledge and Resources 42:37 - Is Work Ethic Teachable? 43:55 - Learn More About Chad Peterson 43:56 - Outro APPLY TO BE ON THE PODCAST: https://www.digitalsocialhour.com/application BUSINESS INQUIRIES/SPONSORS: jenna@digitalsocialhour.com GUEST: Chad Peterson https://www.instagram.com/realchadpeterson/ SPONSORS: KINSTA: https://kinsta.com/dsh LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast/digital-social-hour/id1676846015 Spotify: https://open.spotify.com/show/5Jn7LXarRlI8Hc0GtTn759 Sean Kelly Instagram: https://www.instagram.com/seanmikekelly/ Digital Social Hour works with participants in sponsored media and stays compliant with Federal Communications Commission (FCC) regulations regarding sponsored media. #ad #mergersandacquisitions #dealmakerwealthsociety #dealmakermastermindprogramme #liquiditywealthbuilding #businessacquisitions
Chapter 1: Who is Chad Peterson and what is his background?
All right, guys, Chad Peterson in studio today in Vegas. We're going to talk wealth building today. Who doesn't love talking wealth, man? Thanks for coming on. Yeah, thanks for having me. Absolutely. You've been in this space for a while now, right? How many years? Yeah, I've been buying and selling businesses for 25 years.
Chapter 2: How did Chad Peterson start his business journey?
Wow. What was the first one you bought? Man, believe it or not, I was a teenager pushing a lawnmower, just mowing grass, but it turned into $400,000 for me. What? Can't complain. A lot of business owners just don't know that what they have, even though they don't like it, it's worth a lot of money.
Mm-hmm.
So just because you don't like it and you're tired of it doesn't mean somebody else wouldn't want to buy it from you. Yeah. So someone actually bought a lawn mowing business. Yeah. I was making about 50 grand a year and there was another guy who owned a larger company than mine. And he said, Chad, why don't I buy this from you? And I was like, buy what, man? I don't even want this thing.
He's like, well, you've got all the accounts. I don't have to go win the accounts. He bought it from me. I was 19 years old. Holy crap. You got a taste of it at an early age. Yeah, that's where it all started for me. Were you in college at the time? No, I was getting ready to. I was getting ready to go to flight school. Wanted to be a pilot. And...
Listen, if I would have been smart, I would have sold that company and leveraged that money into a larger business. Yeah. You know, I've been inside. I went to flight school. 9-11 happened. Lost my career is what it is. But I took that lesson forward and I just kept doing it and kept doing it. That's how I made my money. Now I teach other people how to do it. Nice.
So that set you back when you went to flight school for a few years? Yes, absolutely.
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Chapter 3: Why does Chad believe liquidity leads to wealth?
I would have been worth $10 million by the time I was 25 if I used my principles. Damn. Let's talk about some of these principles. Yeah. What are some? How many you got?
well a lot of them i mean liquidity leads to wealth and paychecks lead to poverty so if you have a business and you're just making paychecks and you're getting tired of your business which is normal most people get sick of what they're doing then sell your business and create liquidity because look man everybody who ever made it big had liquidity in their past whether they like i asked you whenever i got in here like hey who you podcasting with today you're like well i got a billionaire that came in and i said
How did he become a billionaire? You said he sold several nine-figure businesses. There you go. Liquidity leads to wealth. Nobody ever got rich off of paychecks. Yeah. If you look at the billionaire list, you can't find a single one, probably. Every one of those billionaires had multiple liquidity events, and they used that liquidity to leverage into wealth. And that's what I teach.
Yeah, because there's also that second battle, because some people can get liquidity, but they can't invest it.
Absolutely, they don't know what to do with it after they have the liquidity. So I teach people how to run your business in a certain way, sell that business to create the liquidity event, and then leverage that liquidity into the NLB, the next larger business. So you want them to invest in another business basically after they sell theirs?
Absolutely, and if they do it in the same year and if they do it the right way, they're going to reduce their capital gains tax, which is huge, enormous. And by the way, Trump right now is trying to reduce the capital gains tax. And I think he'll do it because he's doing great things. But, you know, 22% capital gains. In fact, Kamala Harris was going to try to get it up to 46%.
That would have killed the economy, man. Oh my gosh. And she was going to tax 25% on unrealized gains on investments. It would have been terrible for our economy.
Yeah.
But Trump's in there. He's doing great things. I'm proud of the man. And he's going to get those taxes from 22% to 15% on capital gains. So there's never been a better time to sell your business.
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Chapter 4: What are Chad's insights on the economy and real estate?
Just give the man some time. He'll turn it around. Absolutely. I'm totally confident about it. I mean, he's completely competent. He understands negotiation. He understands how money works. He understands how to, you know, he's playing chess and everybody else is playing checkers. Yeah. You know, and every, you know, liberal out there is saying, oh, he's selling us out to Russia. Bullshit.
He's making deals. He's ending wars, you know, and the Trump derangement syndrome has never been stronger. TDS. But if he'll just, if you just give the man some time, he'll get it done. And what's wrong with supporting the president regardless of who he is? I had to support the last president we had who had dementia. I had to support him for four years.
So let's just support the man and let's see what he can do. And I'm sure he can do it.
Yeah. Yeah. I never let politics get in the way of business for me.
Well, yeah, absolutely. I mean, you know, money is green. You know, it doesn't matter whether you're blue or red, right? But I'll tell you this. I was doing really, really well before Biden. Now, let me ask you this. If you sell, let's just say I sell a $10 million company and the rates are around 6%, six and a quarter. Yeah.
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Chapter 5: How can SBA loans be a game changer for entrepreneurs?
Hire more editors, hire more staff. Oh, you don't need an SBA loan to do what you want to do. Really? No, you don't. Don't waste your time on getting an SBA loan for small dollars. If you're going to use your SBA loan, then try to borrow $5 million for something bigger. Yeah, I'll show you how to, after the podcast, I'll show you how to get money for that.
You don't even want to go to SBA to do that.
That's good to know. I just finished, you know, Cody Sanchez. I do. I just finished her book and it sounds like it's kind of similar to what you teach. It is not similar to what I teach. Really? Buying businesses?
No. Cody Sanchez is an actress. Really? Yeah. She's not doing deals. She's not a transactionalist.
Isn't she buying like retail laundromats and stores and stuff?
Bro, why would you leave Wall Street, like she says, and why would you go buy a laundromat chasing quarters for a living? It's a soundbite. It sounds good. The people that, you know, the Walmartians of the world listen to her. It's not real. I'm an actual transactionalist. I've been doing this for 25 years. I own a brokerage nationwide. We have 20 locations.
I speak, I teach, I actually do the transactions. We're pros at doing the transactions. I don't know, man. Coda Sanchez is an actress. She's doing something to pull in hopeful buyers for, I can't, I don't have it figured out, but- Yeah, no, she's not a transactional. She's not helping people get into businesses. She's not helping people sell businesses.
If she is, she's a marketing mouth for another company. Wow. Okay. Yeah, absolutely. What about Hormozy? What do you think about him? I think solid dude. Solid dude. I like Hormozy. Him and his wife are helping people scale their business, and they're teaching people about M&A. And I have nothing but good things to say about Hormozy. He doesn't do exactly what I do, though. Yeah.
I mean, I'm the only one in the world that does what I do. I literally show people how to take a quantum leap into wealth. I show them how to get their time back. And, and how to experience freedom as an entrepreneur versus being owned by their business. Yeah. Which a lot of people are. Oh yeah. People say, why own a business? And I'm like, are you sure it doesn't own you? Yeah.
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Chapter 6: What are Chad's thoughts on passive income and real estate?
Love that. You said 500 grand isn't a lot. Do you think a million dollars is a lot of money?
I mean, it's all relative, but I'm just saying that $500,000 a year
is not a lot of money i mean you know yeah i guess a subject to interpretation i guess there are some people that would say that's a lot of money i don't think it is yeah you know i mean i want to be making you know five to ten million dollars a year that's what i want to be making but 500 grand i'm just saying if you had 500 grand you can walk right into
an SBA loan to buy a $5 million business, and you're giving yourself an enormous pay raise. You're going from 200 grand a year in earnings, sell that company for 500 grand, walk right into the NLB, the next larger business, because liquidity leads to wealth, and now you're making $1.7 million a year. You cannot find that kind of return anywhere.
and and i get everybody through the sba process i help them find five million bucks okay that's valuable yeah right so everybody again with the 680 credit score no bankruptcy no felony can qualify for five million dollars to buy a business crazy and the interest on that is lower No, right now the interest rates are high, but they're going to come down. Oh, and the SBA is high?
Yeah, they're about 11% right now. Oh, wow. I didn't know that. Yeah, but here's the deal. Here's what most people don't understand, that the debt service that you pay, whenever you pay down that note, let's just say you borrowed $5 million over 10 years. If you borrowed $5 million, you're going to pay it over 10 years. In five years, the company itself has paid the debt service.
So people say, man, that's a lot of money to pay to the bank. Well, no, not really, because after five years, the company itself has paid down half of that $5 million. If you sell it, you get all that back. So you walked into this situation with only 500 grand. Okay, you got a $5 million business that was paying you $1.7 million a year.
But after five years, you've made the income over five years and you paid off essentially half of the debt. So now you sell the company and you walk with that $2.5 million in your pocket. Now what can you buy? Well, you can probably buy a $20 million business paying you about $7 million a year. This is what I teach people how to do.
And we have a team, you come to me, we put you in a program and we walk you through the entire process.
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Chapter 7: What makes Chad's business strategies unique?
And so when we bring on a seller, when we bring on a buyer, we coach them on what not to do. And that's the problem. All these gurus out there are telling people what to do, but what about what not to do, right? Like what if you could stop somebody from making a massive mistake, they can just send them right into bankruptcy, right? So I tell people what not to do more than I tell them what to do.
Right. You ever going to retire, you think? I'll never retire, man, because I call it retirement-itis. It's a disease where you think that one day you're going to rat hole enough money. And 65 is the age. I think that's been set by Wall Street, right? Wall Street and Social Security, because they've set the number. But man, I've seen people retire and they lose their purpose.
You can only play golf so much. And I've had people come back to me after I sell their business and they think that they're going to go play golf. I had one guy snap his golf clubs in his garage. He was so irritated his life. He called me back and said, get me back into a business. You can't sit on your ass and do nothing. You have to work.
So people that tell me they want to retire, man, I know they've been bitten by the disease, retirement-itis. You know, you, you got the disease that says it's sitting around on your ass as a life well-lived and it's not.
Yeah.
It's fun for like a month and then you're like, what's next? Oh yeah, man. I can sit on my nuts for two weeks. No problem. But I got to get back to work. Yeah. A hundred percent.
Even on vacation, I'm itching to work sometimes. Absolutely.
I got to check my phone.
Yeah.
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Chapter 8: What is the success rate of Chad's business transactions?
Yeah, if you love what you do, it's not work. No. I love what I do. I absolutely love it. You couldn't get me to do anything else. Yeah. I love being here with you. I love working with my team. Like, I don't want to work part-time. I don't care about Timothy Ferris' four-hour work week. What am I going to do? There's 168 hours a week. What am I going to do for 164 hours for the rest of the week?
Hmm. And you can only go out to dinner so many times. You can only go exercise so many times, sit at the beach so many times. 164 hours of doing what? Yeah. I got to work, man, because working is fun. Like, I like working with you. You and I have plans, right? We're going to do things together, you and I. I like that. I like, you know, the community of that.
So find something you love is what I would say and just keep doing it over and over again.
Any industries you're targeting? Any ones that have high multiples like AI or anything crazy? Yeah.
No, we sell business of all stripes, you know, any kind of business we sell. So it doesn't matter what it is. It comes down to cashflow. So when I teach people is the number one important thing, whenever evaluating a company, buying company or selling a company is cashflow. Number one, number two, cashflow last, but not least cashflow. So it doesn't matter what business it is. What does it make?
What is it cashflow? And a lot of people don't even know what cashflow is. They have no idea. And what cashflow is, is net to the bottom line to the owner. That's everything the owner gets out of the company. So the salary basically? No, salary plus the company earnings plus ad backs. Like, you know, let's just say your taxes that you pay for your income. That's an ad back. Okay. Your vehicle.
uh, your, that water you bought. So all the assets basically? Yeah, all, well, no assets are different. I'm talking about like whatever you spend. Okay. That's an ad back. Okay. Your vehicle, the fuel you put in your vehicle, your cell phone, all the ad backs go in. So whatever your company does for you, Those are add-backs.
We add those back in as long as they're verifiable and defendable to the bank. We can prove that the business is expensing those for the benefit of you. We can add that back in. Wow, I didn't know that. Yeah, absolutely. So that's cash flow. That's good to know. Yeah, a lot of people think they're going to sell businesses off of EBITDA, earnings before interest, depreciation, and amortization.
Businesses are not sold off of EBITDA. Businesses are sold off of cash flow. So let me give you an example. Let's just say you're making $5 million a year in your company. You're tired of the tax bill. So you buy an airplane. That airplane costs you $2 million. But you go to sell your company and the new owner doesn't want that airplane. That's an ad back.
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