Entrepreneur Thread

[Pointy Elbows]

A good number of forum members are either self-employed, entrepreneurs, or operating side gigs. Please consider a side-gig/business, as it has lots of benefits - and not only for taxes. Small biz ownership isn't for everyone, but it might be for you.

If you're in this forum regularly, you're red-pilled enough to have savvy and you're intelligent enough to solve problems. You might be surprised how low the competitive bar is in certain fields. You'll take your lumps, just learn from them and get it back in time.

 

[cosine]

I caught the real estate bug and so far have used that as my primary investment vehicle. Other asset classes are secondary, for me.

If real estate interests you, it's really not hard to obtain a real estate license in the US and practice a bit on the side.

Some pros:
- You get to open doors to nearly any home that's on the market. Just set up your own showing, go in and look at it.
- It's a conversation starter as so many adults are happy to talk about homes. You never know when you'll end up with an amazing client
- You can write your own offers and include your commission as part of the down payment. If you buy a $500k house, your commission is likely to be $15k, and that $15k is never taxed a dime until the day you sell the home. Whether you do this for an investment property or for your own home, it feels like cheating.
- I have really liked doing it on the side. Since it isn't my primary income, I am able to legitimately tell friends when I think the market is terrible(now) and when I think it's a bad idea. I don't need to lie.

Some cons:
- If you are an introvert, you're probably better off doing something else. You have to pick up the phone and call people a decent amount. It could also be a good way for introverts who are looking to become more extroverted.
- If you don't have much of a friend network, it's going to be rough.
- If you live in a poor area, closing deals still won't pay that much. 2-3% of the selling price is not going to do much for you in rural Mississippi unless you close many, many deals.
- Most states require you to hang your license at a brokerage. You literally need this in order to obtain the license. So, you have to find a brokerage that you are alright with. Generally this is easy because they want you; you bring in revenue for them.
- You have to split your commissions, especially the first 3, with your brokerage.
- You have to pay monthly dues, annual insurance, and other fees in order to keep your license active. I think mine average about $130/month in total.

 

[Pointy Elbows]

Thiis man is posting his experience starting a home service business. He's a handy guy and just hired his first two employees, after a year or so of misc handyman jobs. He's a decent model for anyone looking for a different line of work:



Inspiring stuff. If you hit a dead end in your career, such options are open and can be very fulfilling.

 

[thinkreadwritecode]

Thiis man is posting his experience starting a home service business. He's a handy guy and just hired his first two employees, after a year or so of misc handyman jobs. He's a decent model for anyone looking for a different line of work:



Inspiring stuff. If you hit a dead end in your career, such options are open and can be very fulfilling.

I will check him out. My wife and I are considering attempting to launch a home cleaning business in the next 30 days and I am currently doing research, brainstorming and attempting to follow a thread from a guy who did this years ago on reddit (sweatystartups sub).

 

[Thomas More]

I will check him out. My wife and I are considering attempting to launch a home cleaning business in the next 30 days and I am currently doing research, brainstorming and attempting to follow a thread from a guy who did this years ago on reddit (sweatystartups sub).

I have known people who ran a business like this. I've also known people who were employees for a business like this, and I've have used a business like this for my airbnb property.

From what I've seen, it is a real opportuity. Workers don't make big money, but it is competitive within the market of jobs they might have as alternatives. A person who can be a crew leader in charge of turning over airbnb units can make decent money.

As a business owner, if you can get commercial contracts, and get multiple crews out cleaning offices or restaurants every night, can make real upper middle class money. Even if you just do houses, there is room to make a profit.

 

[Pointy Elbows]

I have known people who ran a business like this. I've also known people who were employees for a business like this, and I've have used a business like this for my airbnb property.

From what I've seen, it is a real opportuity. Workers don't make big money, but it is competitive within the market of jobs they might have as alternatives. A person who can be a crew leader in charge of turning over airbnb units can make decent money.

As a business owner, if you can get commercial contracts, and get multiple crews out cleaning offices or restaurants every night, can make real upper middle class money. Even if you just do houses, there is room to make a profit.

This industry is a bit of a mystery to me, but I do believe there's good money to be made. Employee retention is tough, but I do know several cleaning businesses that have been long-standing and profitable for the owner. It seems like much (not all) of the workforce is always looking for another slightly better gig (they will leave a good cleaning company to work for a bad company that pays them $1.00/hour more, only to be let go in a few months and beg for the old job back). Still, there's money to be made in it. Just have to figure out employee stability.

One company I know made a killing. They were able to bond their work and pay for a very high liability insurance policy. As such, they could bid and win floor-polishing and janitor service jobs at big-box stores and some gov't agencies. That guy did very well, as there were almost no companies that could meet the insurance requirements for places like Home Depot, etc.

 

[cosine]

I will check him out. My wife and I are considering attempting to launch a home cleaning business in the next 30 days and I am currently doing research, brainstorming and attempting to follow a thread from a guy who did this years ago on reddit (sweatystartups sub).

I'm thinking about something similar, and when it comes to scaling the business by hiring employees, I am finding it is much easier to deal with Latina maids than hire blue collar construction workers.

Even if the maid doesn't show up on time or something, you let them know and they apologize profusely. With the trades you deal with a lot of ghetto, tatted-up low-life types who complain and moan about every ask, and commonly just don't show up or cancel. Maybe they're hungover or something. The maids also tend to be very Christian and it's easy to compliment them with "God bless you and your work ethic!" and it just feels easier.

That being said, I think if you are able to find and hire reliable men, that is ideal.

 

[Rainy]

I will check him out. My wife and I are considering attempting to launch a home cleaning business in the next 30 days and I am currently doing research, brainstorming and attempting to follow a thread from a guy who did this years ago on reddit (sweatystartups sub).

I think the biggest question is hiring cleaners as employees or using them as IC's.

The problem with IC's is you legally have little control over training them and enforcing standards. Although that isn't really enforced as if you vet/source cleaners correctly they are happy you are bringing them business. On the plus side any IC which doesn't work out you just immediately stop working with them. Firing employees open up risk.

IC's are considerably cheaper when starting too.

I've looked into this before and had a friend who did well doing this. Relatively easy to find 3-5 dependable IC's with experience on Thumbtack and Upwork. And they have reviews. Then I think the biggest thing is using a reliable CRM for quotes/funnels/leads/billing. In such a competitive industry quick responses/quotes and top communication is key. And it's somewhat simple with something like Jobber or similar CRM's.

 

[thinkreadwritecode]

I think the biggest question is hiring cleaners as employees or using them as IC's.

The problem with IC's is you legally have little control over training them and enforcing standards. Although that isn't really enforced as if you vet/source cleaners correctly they are happy you are bringing them business. On the plus side any IC which doesn't work out you just immediately stop working with them. Firing employees open up risk.

IC's are considerably cheaper when starting too.

I've looked into this before and had a friend who did well doing this. Relatively easy to find 3-5 dependable IC's with experience on Thumbtack and Upwork. And they have reviews. Then I think the biggest thing is using a reliable CRM for quotes/funnels/leads/billing. In such a competitive industry quick responses/quotes and top communication is key. And it's somewhat simple with something like Jobber or similar CRM's.

I was thinking about Jobber when I heard of it. There is other software I am looking into, but initially I will make a website with a booking system and some upsells. My wife and I will do all of the work initially, with one close friend taking occasional work if we are ever having the good problem of overbooking. I have read of others doing this and they seem to have found that hiring employees was the way to go, especially because the IRS decides if your worker is an employee or an IC. ICs can ditch you or they don't care about your reputation like you do since they have other sources of work, or they will even take a client from you, so I am going to go the employee route and hope my wife and I are capable of vetting potential employees.

 

[bubs]

Thoughts about stating a property management company? Seems like things are trending towards less home ownership and more rental properties. The investors in the properties probably don’t want to get their hands dirty and just want the checks coming in while someone else does all the work. I think if you have a variation of tradesmen in your network to quickly reach out to for the usual emergencies (toilet issues, AC, plumbing, electric etc), it may not be such a tough business to run. Got to deal with leases and eviction issues as well which may be the more challenging part. Any insights, pros/cons etc? May not be the best business for passion/enjoyment but the demand for the business I’m sure is there.

 

[Rainy]

I was thinking about Jobber when I heard of it. There is other software I am looking into, but initially I will make a website with a booking system and some upsells. My wife and I will do all of the work initially, with one close friend taking occasional work if we are ever having the good problem of overbooking. I have read of others doing this and they seem to have found that hiring employees was the way to go, especially because the IRS decides if your worker is an employee or an IC. ICs can ditch you or they don't care about your reputation like you do since they have other sources of work, or they will even take a client from you, so I am going to go the employee route and hope my wife and I are capable of vetting potential employees.

I used jobber for my landscape/construction business previously. Great experience and very easy to get them on zoom calls, run you thru it, help with setup, questions, etc. And it’s user friendly and built for service businesses.

I’d at least schedule a demo. They’ll run you thru everything.

I had previously used HubSpot and SalesForce and both are overkill for small service biz IMO.

 

[Pointy Elbows]

Thoughts about stating a property management company? Seems like things are trending towards less home ownership and more rental properties. The investors in the properties probably don’t want to get their hands dirty and just want the checks coming in while someone else does all the work. I think if you have a variation of tradesmen in your network to quickly reach out to for the usual emergencies (toilet issues, AC, plumbing, electric etc), it may not be such a tough business to run. Got to deal with leases and eviction issues as well which may be the more challenging part. Any insights, pros/cons etc? May not be the best business for passion/enjoyment but the demand for the business I’m sure is there.

Definitely looks like much demand for this going forward. Are you considering prop management as a pure service company or as an owner/operator? You are right to get a strong list of trades on board. You might want to have a maintenance crew for tasks like landscape maintenance, pavement maintenance, and painting (aiming at services that have lower licensing requirements and risk). Those are often high margin jobs that can be done by a crew of guys that are trainable across each field. You could sell those services at a small discount, make profit off of them, and save your customer some bucks and time (avoiding the contracting process as you could just offer them as line-item services to be performed at owner's request). For big properties you might want to pair up with one of those companies that does long-term capital expense projections. These folks help properties like HOAs and apartment complexes make budget decisions for necessary work in the out-years. They also find ways to depreciate different assets for tax protection (the roof is always getting older, so is the boiler, so is the asphalt parking lot). This can become a tax saving niche for your clients. Trying to add value beyond rent-collector and bill-forwarder.

I know a guy that installed some kind of computer wiring for properties new and old. He has a crew of decent workers. They work all winter pulling cables throughout buildings. In the summer, they do outside work for the same property management company that basically bought him out to keep him and his guys around.

 

[cosine]

Thoughts about stating a property management company? Seems like things are trending towards less home ownership and more rental properties. The investors in the properties probably don’t want to get their hands dirty and just want the checks coming in while someone else does all the work. I think if you have a variation of tradesmen in your network to quickly reach out to for the usual emergencies (toilet issues, AC, plumbing, electric etc), it may not be such a tough business to run. Got to deal with leases and eviction issues as well which may be the more challenging part. Any insights, pros/cons etc? May not be the best business for passion/enjoyment but the demand for the business I’m sure is there.

I self-manage a couple of rentals, I've been the real estate agent for clients buying rental properties, and know property managers.

In some states you need a real estate license to manage someone else's property. You'll also need to set up a Trust account with an approved bank(they have to have 100% cash on hand instead of fractional reserve banking). To me this is a benefit; it's a barrier to entry but it is NOT HARD to get a real estate license. You can also work for an active property management firm if they/someone already has a license.

Happy to answer other questions!

 

[bubs]

I was doing some reading online and it sounds like running a property management company is random/crazy hours, high stress etc and that is not what I’m looking for. I’ve got that in my current career and want to see if I can find a side business that I could shift to with some easy passive income that is low risk investment / low time commitment. Property management seems low risk but doesn’t really hit my other requirements. I have probably 10-12 years before I retire and would like my final act to be able to shift my day-job career to a lower stress/less long hours (and this probably 30-50% less annual pay then current), and offset that income loss with some passive income that isn’t physically demanding, low stress and low hrs commitment for success. Is this a fantasy request or are their business startup options for an older guy? YouTube videos? Seems like that window closed a few years ago perhaps.

 

[cosine]

I was doing some reading online and it sounds like running a property management company is random/crazy hours, high stress etc and that is not what I’m looking for. I’ve got that in my current career and want to see if I can find a side business that I could shift to with some easy passive income that is low risk investment / low time commitment. Property management seems low risk but doesn’t really hit my other requirements. I have probably 10-12 years before I retire and would like my final act to be able to shift my day-job career to a lower stress/less long hours (and this probably 30-50% less annual pay then current), and offset that income loss with some passive income that isn’t physically demanding, low stress and low hrs commitment for success. Is this a fantasy request or are their business startup options for an older guy? YouTube videos? Seems like that window closed a few years ago perhaps.

I've seen people retire with businesses in:
- laundromats
- vending machines

You really just walk around and maintain stuff from time to time. Vending machines can be scaled to more machines or fewer machines depending on how much work you do or do not want to do.

FOR ME, property management is ideal on my own rental properties. Maintaining 1-3 rental properties just isn't that bad. If you feel the urge to do more physical labor to repair/maintain places you can, or you can just hire out pretty much everything. Sure you do get a couple of random/crazy calls, but if you are managing your own little portfolio then it's not bad. The stressful part is when people manage huge apartment buildings.

 

[bubs]

I've seen people retire with businesses in:
- laundromats
- vending machines

You really just walk around and maintain stuff from time to time. Vending machines can be scaled to more machines or fewer machines depending on how much work you do or do not want to do.

FOR ME, property management is ideal on my own rental properties. Maintaining 1-3 rental properties just isn't that bad. If you feel the urge to do more physical labor to repair/maintain places you can, or you can just hire out pretty much everything. Sure you do get a couple of random/crazy calls, but if you are managing your own little portfolio then it's not bad. The stressful part is when people manage huge apartment buildings.

I know a guy (friend of the family) that now lives in Florida but has several rental properties around where I live. I could perhaps dip my toes in and try to see if he’d let me manage his couple houses? Take baby steps, vs jumping off the deep end. He’s probably even give me some tutorial and shadow me for a while.

 

[cosine]

I know a guy (friend of the family) that now lives in Florida but has several rental properties around where I live. I could perhaps dip my toes in and try to see if he’d let me manage his couple houses? Take baby steps, vs jumping off the deep end. He’s probably even give me some tutorial and shadow me for a while.

It has been invaluable having friends to talk to so you can find the BEST solution to tenant or maintenance issues and not just “some” solution.

Your “customers” are owners, so you will need to figure out how to sell to them, or buy your own properties. Does one of those excite you?

 

[bubs]

It has been invaluable having friends to talk to so you can find the BEST solution to tenant or maintenance issues and not just “some” solution.

Your “customers” are owners, so you will need to figure out how to sell to them, or buy your own properties. Does one of those excite you?

I’m not interested in buying property right now. Values are inflated and I focusing my on paying off my primary residence first. If housing costs were to crash and I’m under cover with no mortgage on current home, then I’d consider a Real estate investment. I’m not much of a risk taker.