Young and Profiting (YAP) with Hala Taha
Codie Sanchez, 7 Boring Businesses to Replace Your Income | Entrepreneurship | YAPClassic
Fri, 06 Dec 2024
After climbing the ranks of the high finance ladder, Codie Sanchez felt lost. She was no longer in charge of her day-to-day life, despite her years of schooling and hard work. She decided to use the insights she had gained to build her own portfolio of what she calls “boring businesses.” Now, she is out to help others do the same, quickly becoming one of the biggest female business influencers in the world. In this episode, Codie breaks down her step-by-step approach to identifying, buying, and scaling small businesses that most people ignore but yield big returns. In this episode, Hala and Codie will discuss: (00:00) Introduction (03:18) From Journalism to Finance (05:11) Breaking Corporate Chains (08:09) Battling Bias as a Woman in Finance (11:21) Unorthodox Wealth Creation Strategies (20:00) Should You Really Diversify Your Income Streams? (24:06) Wealth from Boring Businesses (27:09) Six Creative Strategies to Buy a Business (35:11) Spotting Motivated Sellers (37:05) Key Metrics for Evaluating Businesses (40:27) Finding Hidden Gem Businesses (53:53) Codie’s Secrets to Success Codie Sanchez is the founder of Contrarian Thinking and co-founder of Unconventional Acquisitions, focusing on small business acquisitions and roll-ups in the micro-PE space. She runs a holding company of service-based SMBs under $10M EBITDA, emphasizing "boring businesses." She previously led First Trust’s $1B Latin America business and held leadership roles at Goldman Sachs, State Street, and Vanguard. She started her career as an award-winning journalist and has since become a recognized investor and thought leader. She holds an MBA from Georgetown University and serves on boards like Permian Investment and Magma Partners. Resources Mentioned: Contrarian Thinking: https://contrarianthinking.co/ Unconventional Acquisitions: https://unconventionalacquisitions.com/ Sponsored By: Airbnb - Find yourself a co-host at airbnb.com/host. Mint Mobile - To get a new 3-month premium wireless plan for just 15 bucks a month, go to mintmobile.com/profiting Found - Try Found for FREE at https://found.com/profiting Working Genius - Get 20% off the $25 Working Genius assessment at www.workinggenius.com/ with code PROFITING at checkout Shopify - Sign up for a one-dollar-per-month trial period at youngandprofiting.co/shopify Indeed - Get a $75 job credit at indeed.com/profiting Active Deals - youngandprofiting.com/deals Key YAP Links Reviews - ratethispodcast.com/yap Youtube - youtube.com/c/YoungandProfiting LinkedIn - linkedin.com/in/htaha/ Instagram - instagram.com/yapwithhala/ Social + Podcast Services: yapmedia.com Transcripts - youngandprofiting.com/episodes-new All Show Keywords: Entrepreneurship, entrepreneurship podcast, Business, Business podcast, Self Improvement, Self-Improvement, Personal development, Starting a business, Strategy, Investing, Sales, Selling, Psychology, Productivity, Entrepreneurs, AI, Artificial Intelligence, Technology, Marketing, Negotiation, Money, Finance, Side hustle, Startup, mental health, Career, Leadership, Mindset, Health, Growth mindset. Career, Success, Entrepreneurship, Productivity, Careers, Startup, Entrepreneurs, Business Ideas, Growth Hacks, Career Development, Money Management, Opportunities, Professionals, Workplace, Career podcast, Entrepreneurship podcast
Chapter 1: What is the story behind Codie Sanchez's career journey?
Today's episode is sponsored in part by Airbnb, Open Phone, Shopify, Mercury, Built, Indeed, and Microsoft Teams. As always, you can find all of our incredible deals in the show notes or at youngandprofiting.com slash deals. What's up, YAP fam? Earlier this week, we aired my latest interview with the remarkable investor, entrepreneur, and influencer, Cody Sanchez.
We talked about the gospel of ownership and her new book, Main Street Millionaire. It's all about how you can become extraordinarily wealthy from buying very ordinary businesses. If you haven't checked it out, then believe me, you'll wanna do so. But why stop there? Last year in episode 231, I interviewed Cody for the first time, as you're about to hear in this YAP classic.
We talked about her background as an award-winning journalist, her jobs at places like Goldman Sachs and Vanguard, and how she gave it all up to become an entrepreneur and investor with her own portfolio of what she calls boring businesses.
Chapter 2: How did Codie Sanchez transition from journalism to finance?
Cody shared some of her contrarian investment ideas about how to earn horizontal income and create multiple revenue streams, as well as some tips for buying boring businesses like laundromats, car washes, or vending machines. So young and profiters, take some time this week and listen to both of these conversations with Cody Sanchez.
They're packed full of insights about how you can transform yourself into a fully-fledged, financially independent business owner by learning how to spot some awesome investment opportunities that are right under your nose. And here she is, Cody Sanchez. Cody, thank you so much for being here today on Young and Profiting Podcast. Welcome to the show.
Thanks. I'm excited to be here. Finally, actually, since we messed up earlier, but now we're going to crush it.
Yeah, we had some technical difficulties, but all that matters is that you're here now. So Usa, let's just have a great interview. We're very, very pumped to have you on the show. I was telling you off camera how excited I was to have you on the show because it's not so often I have such a great female business leader on the podcast, really few and far between.
So I appreciate you coming on the show. So you have an unorthodox background for an entrepreneur and investor. You actually started as a journalist. You started back home in your state of Arizona. And not just any old journalist, you were an award-winning journalist that covered really important issues like human trafficking, drug smuggling, and Mexico border issues.
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Chapter 3: What are the challenges faced by women in finance?
So can you tell us what made you get into journalism and why you ultimately left that field?
idealism, really. You're young and you want to save the world, but you haven't even figured out your own life. And I think that was me. And so if you're young and listening, I imagine there's a moment in time where you think everything's screwed up, nothing's the way it should be, and I'm going to be the one to fix it. That was me at a young age.
And I thought, it doesn't seem right that so many people don't have while few have. It doesn't seem right that I'm Latina and a bunch of Latinos are hanging out to dry along the US-Mexico border, and maybe I could make an impact. And I think that was a noble, beautiful idea in a lot of ways, but also pretty ridiculous in some, which is that I really hadn't figured out life in general.
Chapter 4: What are unorthodox wealth creation strategies?
And it's hard to give much if you don't know much. And so at that time, I was in school. I graduated about a year early from Harvard of the West, really, aka Arizona State. And I was looking for what my purpose was going to be in life. And I needed to make some money because I didn't have any either.
And so I got a grant from the Howard Buffett Foundation and decided that I was going to go cover border issues along the US-Mexico border. And I did that for a while until I really realized there is a difference between being the one that tells the stories and getting someone's story rewritten. I wasn't rewriting anyone's story.
I was just telling them in an almost voyeuristic way to a void of humans that really didn't make much change. And that didn't sit well with me. And so I thought, I better figure out how to become something besides a journalist or I'm going to become very jaded, very young.
So then from my understanding, you went into the finance world. You ended up working at Vanguard, Golden Sacks. You were head of Latin American investments for First Trust. Really exciting stuff. And you were in corporate for 12 years before you decided to take the golden handcuffs off. So why do you feel like you were in golden handcuffs and what made you ultimately leave the finance world?
It's amazing how fast 12 years flashes, which is something only old people say, which apparently I'm nearing. But the beautiful part about working in corporate America is you learn on somebody else's dime. And I'm a huge advocate for failing often without the ability to bankrupt yourself.
These days, there's so much entrepreneurship porn about how you have to sleep on somebody's couch and you've got to do it the hard way. And if you weren't homeless for a minute, you're never going to make it. And I don't actually think that's true.
I think you right now could be working in a corporate job and feel like you are stuck because your lifestyle has crept up to the point where it matches or sometimes even exceeds what you're making, even if you're making a decent amount of money.
And those handcuffs will tie you to a job you hate, working for people you don't like on things you don't want, where you are no longer the architect of your life. And that's what happened to me and what I mean by golden handcuffs. They're self-imposed, but they're still there.
Yeah. And I really like how you're highlighting that you didn't feel that this 12 years was a waste. You actually gained a lot of experiences. And without those 12 years in corporate, you wouldn't have gained the skills that you know now to buy all these businesses.
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Chapter 5: Should you diversify your income streams?
And I'm sure you learned a lot from private equity and this area in the world in terms of how you're investing as an everyday person now. Is that right? Absolutely.
I mean, I was a young idiot, just like the rest of us. When I was first investing, I thought I knew everything until I lost my first dollar and then a couple dollars and then a couple more dollars. And so big corporations are soul-sucking in many ways.
But one thing they do well is they usually invest a lot in their employees because they understand the numbers, which is simply that if you hire somebody and then that person doesn't work out, you typically spend at least twice the cost of anywhere from three to six months of their salary. In some companies, it could even be a year.
So you basically waste hundreds of thousands of dollars for every employee you hire that doesn't work out. And so they do a lot to try to train the people that they have in the seats that they need them. And I benefited from that. One of the companies I was at, Vanguard, they told us, who knows if that's true, that they spent about $100,000 on the training of the
Chapter 6: What are the benefits of investing in boring businesses?
group that I was in, which was this accelerated development program. So I actually think you can learn a ton by working for somebody else.
And you've probably seen this too, because in internet land, there are a bunch of people that have never worked for anybody, that have never been an employee, never had an employee, never had a boss, never really been a boss, except maybe to vendors or some one-off individuals. And they're almost kind of like these cute little morons running around with no idea how real business works.
And I think it's a huge disservice to them. And if they had just spent like a few years working for or with somebody else, then they could go jump to the next level and build something big, as opposed to what happens is they build something kind of big fast, but then they don't know how to sustain it, what a business is, what a P&L is.
And that's actually all hard to learn while you're on the rocket ship.
I completely agree with you. And I've seen that for myself. So we both started in corporate. And for me, I was at Hewlett Packard and Disney had leadership roles, I ended up leaving, a lot of it had to do with COVID and having more opportunity and starting a side hustle.
But at the same time, I also felt a little bit like I didn't get the same respect, like other people my age with the same experience level of experience. And so I decided to leave the corporate world. I'm wondering, from your perspective, did you feel like any sort of patriarchy in the corporate world? Or were you treated differently as a woman?
Yeah. I mean, I've had my ass grabbed more times than I can count in finance, for sure. That was 12 years ago. So could you imagine like 20 or 30? I mean, it must have just been... No wonder those women are kind of hard. I remember when I was coming up and there were a few, very few women above me in finance. I was always like, oh, I don't want to turn into her. She seems kind of mean and mad.
And I kind of get why. actually, because there was allowed to be one. It wasn't a real rule, but it was kind of there. On the flip side, though, I do think you get to choose your reality. And the reality that I chose was I look different than everybody else. You look different than everybody else. So every Chad, Brad, Tom, Matt, Larry is going to be forgotten in their gray, blue, or black suit.
And I'm going to be probably remembered just for having a name that's a little bit different. And I look slightly different than them. And the way that I communicate my skill set comes across differently. So I think there's huge benefit to being slightly outside the norm.
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Chapter 7: How can you spot motivated sellers in business acquisitions?
And I was like, whoa.
Oh God.
Chapter 8: What key metrics should you evaluate when buying a business?
There it is. Yeah. But on the same vein, at that point, I was just kind of like, hey, fuck you, man. Like, what a dumb thing to say. You've been drinking too much. Go home. And then the next day he comes in, he's like, I'm super embarrassed. What a silly thing to say. And so I think there's always colors or shades of gray to the fact that for a long time, men have been in charge of much.
But I also have an incredible dad and an incredible husband and incredible guy friends that have lifted me up. And so I try not to paint too broad of strokes for one particular sex or the other.
I love that perspective. I really, really agree with your approach. It's like there are some downsides and some things that you have to deal with, but there's also a lot of opportunity and looking different and being different and standing out. And a lot of people are really supportive in the corporate world as well. Okay, so let's talk about contrarian thinking.
I really wanna go deep on this and get an understanding. So you have a news, a blog called Contrarian Thinking. You talk about this topic a lot and the benefits of being a contrarian investor. So what is the transformation that you take people through in terms of gaining financial freedom through this approach?
It started in 2020 when what I really wanted to do was I wanted humans to question any of the narratives that were being thrown at them. At that point, I'm really big on one thing, which is freedom for every human to make their own personal life choices as often as they can. And my understanding at a baseline from starting in Latin America was,
The difference between me, last name Sanchez, and all these other last name Sanchezes was really that I had some economic freedom. I was born like lower middle class in the US. And so I had more opportunity than a lot of these people do. And so I thought, gosh, if finance is the cornerstone to financial freedom, if it's at the bottom, then the next level is physical freedom.
So like you can do what you want, where you want, with whom you want. And then at the top of it is philosophical freedom, aka I can think what I want. I can do what I want. I can't get people to think for themselves until they feel safe and secure for the most part. It's hard for most people to do that. They need a roof over their head. They need to know they can pay their rent.
And so contrarian thinking came from this idea of, I want people to think differently, but my Trojan horse is money. It's if I can tell you how to become really ridiculously wealthy, Then, and I can kind of glean that towards humans that I think are by and large good because they also believe in freedom, which I find as an underlying principle is really important.
Then that means finally, once these people become financially free, they can share this pervasive mentality I have, which is we should question the world around us and that should be okay. And so at Contrarian Thinking, that's what we do. We talk about civilizing the mind. We talk about building the bank account and we talk about making savage the body.
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