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What is the Small Business Opportunity Curve?

When people think about investing and entrepreneurship, they often think of the big guys with the big bucks looking for unicorns with 10x returns. You know, the ones you hear about in the media: Angel Investors, venture capitalists, and private equity firms.

These groups are at the top of the small business opportunity curve looking for 10x returns and most small businesses don't fit into that category.

At the bottom of the small business opportunity curve, we have small businesses that fail. This generally happens for two reasons: They A) have no market or B) run out of funds.

In reality, most small businesses fall in between.

They fall into 3 categories: lifestyle businesses, franchises, and existing businesses.

A lifestyle business is usually a start-up that becomes sustainable. It's making just enough money to pay your salary and take care of you, your family, and your employees. It sustains your lifestyle.

Then, there's a franchise. When you buy a franchise you're buying a business in a box and there's a lower chance of failure. They are successful because they have taken the "have no market" risk off the table.

Last, we have existing businesses. Now, these are the greatest opportunity and get the least amount of love. Most business owners look forward to an exit strategy. Maybe they're ready for retirement or their family doesn't want to take over the business. It's time to pass the keys to someone else and sell.

That's where entrepreneurs going into small business ownership come in. Each of these are great options and your goals will determine which route you take.

Watch the video above to learn more about the Small Business Ownership Opportunity Curve.

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