Building a Business in the Next 5 Years of Radical Societal Change (Chat with a 150M€ Entrepreneur)

[00:00.3]
I just got off a call with a client of mine, who is a very successful German entrepreneur. I’m not gonna name the guy, but we’re talking about someone running a business doing over 150 million € a year. Not exactly what you would define as a “small business.” And it’s also a quite traditional business, it’s not some fancy startup or anything like that.

[00:24.5]
Anyways, so we were in that meeting with the client and part of his leadership team, and that meeting ended, like, 40 min ahead of schedule. So at a certain point, it was basically just the two of us left, me and the client. And we just started talking.

[00:41.1]
We had some time ahead of us. We started talking and freewheeling, and it actually turned into what I would say is a really interesting conversation. It’s actually the kind of conversation that I believe could help a lot of people and whether you are already running a business, or thinking about starting one.

[01:02.1]
So I thought, you know what? Let me just hit the record button right away and share that side-conversation now that it’s still fresh on my mind. Now, before I do that, before we dive in, just know that I have nothing to sell here, okay?

[01:20.3]
This is just pure information sharing. I’m not gonna ask you to subscribe to anything or whatever, or clickbait you into something. I’m just sharing that conversation, and I’m building onto that conversation because obviously, I’m gonna share more than just the conversation. So… what happened is that we were in that freewheeling, and he basically hit me with a question, and he said something like…

[01:43.1]
“With everything going on in the world right now, the chaos it’s basically spiraling into… What do you think is the smartest way to scale?” I’m paraphrasing a little bit. It’s not like the exact question was like that, but it came down to something like that.

[02:00.4]
It was more a question out of curiosity, I think, for the guy. So we entered into this conversation, and something funny about that question, in a way, is that over the past few months, I’ve started sharing some content on LinkedIn.

[02:17.2]
And the interesting thing that happened with me sharing that content is that I got a lot of DMs, if I had to guess. I don’t have the exact numbers, but I would say that on a weekly basis, I get probably 15-20 DMs on LinkedIn. If you set aside all the sales DMs and all of that.

[02:33.9]
And most of these messages that I get, they’re coming from two very different profiles. The first profile is what I’ll call established business owners. So people that have a business and run a business, and I would say that most of their DMs, they fall under that umbrella of “How to grow? How to scale?” Personal Branding is also one…

[02:58.4]
That’s been my theme lately. Some even asking, if I do personal consulting, or if I have services like that. Whatever. #1 established business owners, then the other profile… For lack of a better term, I’ll call them aspiring entrepreneurs.

[03:15.6]
A lot of them probably in their early 20s, but not all. They are basically the kind of people who want to start a business, but they have absolutely no clue where to start or even how to start. And the conversation that I just had with that client, I believe it’s one of the best way to answer a lot of the questions that I’ve been getting lately.

[03:38.1]
In this video, I’m gonna talk about… 2 massive trends that in my opinion, are creating one of the biggest business opportunities of the next decade. And I know it’s a bold claim, but it’s genuinely what I believe.

[03:56.7]
Now, what kind of opportunity are we talking about? You might be wondering. I would say it’s twofold. On one hand, there’s that opportunity to scale your business and take it to the next level—or next levelS— if you already have a business or run a business. And on the other hand, maybe it’s an opportunity just to get started… Even, and that’s probably the interesting part.

[04:18.3]
Even if you don’t have a lot of money or a lot of experience! Because this is the kind of question that I get a lot, “I don’t have the money…” or “I don’t have the experience… Where should I start? How should I start?” So whether you’re looking to grow your business or just to get started, I think this video is basically for you.

[04:35.2]
And it’s also funny to have a theme like this. That’s also why I wanted to hit the record button. It’s funny to have a THEME that addresses both very advanced entrepreneurs, and people that don’t have a business yet. because that opportunity is basically for both of them.

[04:51.1]
And please, this is a freewheeling video. I have a few notes that I wrote down on paper. But I would say, be indulgent if sometimes I get lost in my train of thoughts. Now, before I dive in, let me start by I would say setting the scene, right?

[05:09.1]
Because those 2 massive trends, they’re actually the buildup of something underlying. If you live in the same reality, and in the same world, as I am, you’ve probably noticed that the world is changing… and it’s changing FAST!

[05:25.7]
And even more than that, it’s not exactly… How to put it… it’s not exactly heading toward what most people would call a “bright future.” Everyone’s talking about —the people, the media— It’s just everywhere you look… They’re talking about a few different themes.

[05:42.0]
And the first theme that’s probably everywhere is INFLATION. And I mean, it’s a real theme, right? It’s not just something of the mind. It’s literally squeezing us —businesses and consumers alike— I mean, it’s squeezing us. And the thing about inflation that I want to say: It’s here to stay.

[05:59.6]
It’s not going anywhere. I mean, don’t get fooled into thinking otherwise. I know they’re bombarding us with, “Oh, it’s going better!” and this and that, and “2025 looks better than 2024!” It’s not! And the reason is simple: They’ve just printed too much money.

[06:17.3]
So… INFLATION. Then we have the AGING POPULATION, and the demographic collapse. That’s maybe a bigger word, but it’s a reality. We’ve got an aging population, especially here in the Western world. Fewer young people, more retirees. Hmmm…

[06:32.5]
It’s not building up to a good mix. We have BANKRUPTCIES that’re on the rise—skyrocketing. Wherever you look, you see it. And we’ve got ENERGY prices that are high. They’re high and unpredictable. Now, it’s not just about ENERGY, right?

[06:48.2]
We all know that the economy is just converted energy. So, when you got high prices —and unpredictable prices— it has rippling effects. Massive ones, on top of all the rest. And then we’ve got, just to, I would say, to keep things interesting, we got that possibility of a looming World War 3.

[07:08.4]
Some would say we’re already in World War 3, which is another form of Cold War or whatever. But… So, that’s for a starter. Then we’ve got everything that is AI. And… I can see on LinkedIn there is so much excitement around AI —and it’s very exciting.

[07:26.5]
But what we also know, it’s still in its infant years, and it’s already reshaping, rewriting entire industries. And so that’s a sidetrack I want to make around AI: If you are not AI literate you’re already falling behind.

[07:44.6]
Because AI is here to stay. You may hate it, you may like it, whatever. I don’t really care what your stand is. That train has left the station, and it’s not coming back. And then last but not least, since we’re talking about business, we got HYPER COMPETITION.

[08:01.8]
And I’m not just talking about “competition.” No, I’m talking about HYPER competition. If you look over the last few years: it’s brutal, it’s everywhere, and it’s only getting worse… So you could say it’s in a incredibly uplifting video so far, right?

[08:20.1]
A real ray of sunshine. But the idea for me is not, you know, I don’t like to be a prophet of doom, but at the same time, I’m also telling you, let’s not be naive. This is the reality we’re dealing with. In the equation of life, this is our reality. The question now becomes, HOW do you solve that equation?

[08:37.5]
Because the next 5-10 years, that’s my belief. I hope I’m wrong. One of the rare cases where I hope that I’m wrong. But I believe that the next 5 to 10 years, man, they’re gonna be tough. I think that for a lot of people, they’ll probably be the hardest years of their lives.

[08:55.6]
Businesses will fail, people will lose jobs. And I mean, the gap between those who adapt and those who don’t is only gonna get bigger… and wider. Adapt to AI or not; Go with the flow or not. All of this.

[09:11.5]
That’s just that part of the introduction. But you also know what they say, right? It sounds like cliché, but “every cloud has a silver lining.” I cannot stop the motion of what’s going on. But we… There are basically only 2 options.

[09:26.6]
Two ways to react to that… Or, you crawl into a little ball, you know, into your bed, and you cry. That’s one. Or… And you probably already know where I’m going with this, but with every major shift, with every crisis, there’s opportunity.

[09:43.1]
It’s embedded right into the crisis. Now, not all of the challenges that I just mentioned are opportunities for everyone —or opportunities at all. No one wins if there is World War 3… but there are 2 massive trends that I believe anyone can benefit from.

[10:06.3]
And it’s not by starting something new. It’s not some kind of radical disruption, and innovation, or whatever. No, no. It’s not by starting something new. It’s just by taking over what’s already there… and making it better. So, what am I talking about?

[10:23.3]
We’ve been through a long introduction, but… If you take a step back, and if you analyze all that doom and gloom that I’ve just been through, what you can actually see is that most of these challenges are building up… you could say, into a perfect storm, Yes.

[10:43.4]
But they’re also creating 2 massive trends that are colliding right now, right as we speak. It has already started. And I believe that if you understand these trends, you will see why this moment in history is so unique.

[11:01.5]
So. Enough with the suspense, I would say, and let’s maybe dive into this. I’m talking about two massive trends. And trend number one, it’s the AGING POPULATION. But aging population also means aging business owners.

[11:18.2]
Two o three years ago, I can remember exactly when or where, but I came across a statistic that has really stuck with me since. And that statistic is pretty simple: In the US and Europe —most of the Western world, actually—more than 50% of business owners are over 50.

[11:37.7]
And if I remember correctly, —don’t quote me exactly on the numbers— but more than 50% are over 50, more than 20% are over 60. And the crazy thing about this is that most of them, they have no succession plans.

[11:53.8]
Their kids, they don’t want to take over the family business. It’s not a shiny startup or it’s just too much work. That’s the reality also with the new generations. And so as these people approach, —these business owners— as they approach retirement, they’re really only left with 2 options.

[12:12.8]
They can either sell, or they can shut down. Now, another interesting stat for you—because I dug into the subject— 70 to 80% of small and medium businesses will never be sold.

[12:29.9]
Again, 70 to 80% of small and medium businesses will never be sold. But here’s the thing: A lot of these businesses, maybe they’ll never be sold, but they’re profitable. They’re just undervalued because the combination of several factors.

[12:47.7]
One of them is that most of these businesses are not structured to be sold. They were just running a business… and that business has never been properly structured into something that can be sold and taken over. Another one is that the owners are just usually tired or they absolutely even don’t know where to start to really sell their business.

[13:10.6]
And then we’ve got another one, —which is probably, I think the biggest one—it’s that even when they try to sell their business, they’re usually too attached emotionally to their “life’s work.” And so what happens is when you get emotionally attached to something, you’re biased to that.

[13:27.2]
And so they try to sell their business, yes, but they try to sell an unstructured business for crazy prices. And it’s not about whether they’re worth it or not. It’s just that most cannot afford these businesses, even if they wanted to. And that… that first trend, that creates an opportunity.

[13:44.6]
It should already be pretty clear to you by now. But that was just the first trend. If we look at the next trend, which is a bit more dramatic… But next to profitable businesses, we’ve ot a lot of businesses in distress. Again, just look at the bankruptcy stats.

[14:02.2]
Look at… the predictions for 2025, 2026, and beyond. What’s happening is that… I would say post-Covid, post-pandemic, a lot of businesses are struggling just to adapt to the new world.

[14:18.6]
That’s how we called it, the “new world,” the “new reality.” But that new world… they’re struggling to adapt DIGITALLY, and also including AI and all of that; OPERATIONALLY, again, also including AI and all; COMPETITIVELY… brutal.

[14:37.3]
And in the end, when you take all of these factors together: FINANCIALLY. So, what’s happening is some are going bankrupt —it happened already. And others, a lot of them, are just barely holding on. But again, here’s the thing: For those who know HOW TO FIX THEM, many of these businesses can still be absolute gold

[15:23.8]
Before we do that, I first need to talk about LBOs, which stands for “Leveraged Buyout,” for those who don’t know. Before you tune out and say, “Oh! some Wall Street, Private Equity stuff and…” I would say it’s not that kind of LBO, that’s one.

[15:43.1]
I will also not get too technical, because it’s not needed, but I need to really introduce the concept of LBO. And even if you already know what an LBO is, I would say stick around… Stick around anyway, because I’m gonna give another spin to that. I’m gonna talk about what I believe to be the next wave of LBOs.

[16:02.4]
Because there is not just one type of LBO. It’s a concept. But there are different types of LBOs. So what’s an LBO? To keep it simple, I would say there are 3 steps probably in an LBO.

[16:19.8]
One, you find a business that’s making money—or if it’s not really making money, that has the potential to be profitable. It usually needs to have a steady cash flow, that’s important, or valuable assets, say it has real estate, or it has IP —Intellectual Property—or something like that.

[16:39.2]
But step one is you find a business like that. Step number two is you buy that business using borrowed money. Borrowed money could be from banks; could be from private investors; could be from a pool of associates; could be private Equity… but you buy that business using borrowed money.

[16:59.8]
Now… How much choice you really have regarding the source of the financing, that’ll also depend on your business… If you have no track record, no experience, no nothing: your options are gonna be limited. Then we need to talk about “creative financing,” and we’re gonna cover that later.

[17:18.4]
But that’s step two. And maybe to add, generally speaking—if we’re still giving a crash course on LBOs—you will usually hear two types of financing. If you go through investors, through banks, for example, you will usually finance with DEBT.

[17:35.3]
We say it’s financed with DEBT. That means that it’s money that you have to pay back on usually fixed schedules, with interest, and no matter how the business performs. That’s financing through DEBT. Then the other one, if you go with private investors or, associates or whatever, you will finance it with EQUITY.

[17:55.2]
That means usually no repayment schedules, but you share the ownership. So… You can either (1) finance with borrowed money, and that can be through DEBT. You take the money, and you repay that on fixed schedule with interest. OR (2) through EQUITY: You give some shares of the company as a counterpart.

[18:14.6]
So… One you find the business. Two, you buy it with borrowed money. And three, and that’s the key, that’s the final step of the LBO: You use the business’s own cash flow, own money, own profits, to pay back the loan over time. It’s just like, to simplify, it’s just like buying a house with a mortgage.

[18:32.6]
But instead of just LIVING in that house, you make it more valuable. You renovate it… I don’t know, new doors, you isolate, whatever. You renovate, you improve it. And then you have 2 options. You, you can either (1) sell it for a profit, you flip it.

[18:49.2]
Or (2) you can keep it and just let it generate passive income through the rents. But here’s the thing: I would say that the real beauty of an LBO is LEVERAGE —Leveraged buyout— The more you optimize the business—whether it’s improving operations, cutting costs, boosting revenue, all of that— the more you optimize the business, the more value you create.

[19:13.0]
If it’s still confusing to you, I’ll try to clarify as we go. But the more you optimize, the more value you create. And with a business, it’s not like in real estate, where, sure, you can renovate and maybe you can increase the value or the rent by 10, 20, maybe even 40% if you’re lucky.

[19:33.2]
But with a business, you can actually double or triple the revenue— or maybe even more. The potential upside can be huge. Some will say the downside too, because it’s not a hard asset. But anyway, the potential upside can be huge.

[19:48.9]
Now I said you can double or triple the REVENUE… Actually I would say forget the revenue. What really matters is the EBITDA. To give you all the basics, so that you really understand the opportunity we’re talking about… EBITDA, it’s another technical term —it’s a financial term— But let’s not over complicate things.

[20:11.1]
I’d say that there are really 2 things that you need to know about EBITDA, in a nutshell. And that’s, number one, what is EBITDA? E-B-I-T-D-A… EBITDA, it’s an acronym. And it stands for Earnings Before Interest, Taxes, Depreciation and Amortization.

[20:29.8]
Quite technical, but EBITDA is basically a metric. It’s a way to measure the overall profitability of a business, you could say, BEFORE factoring in things like how much debt it has (based on the interests), the taxes, or what we call the non-cash expenses—depreciation or amortization.

[20:52.2]
Think of it as the way to see how well a company is performing in its day-to-day operations, without getting distracted by how it’s financed or just how it handles taxes. So that’s EBITDA. It’s a measure of the overall profitability of a business.

[21:11.3]
And the second thing you need to know about EBITDA, which is important, is that it’s also the metric that most investors look at when buying or selling a business. A company is usually sold for a MULTIPLE of its EBITDA.

[21:29.2]
For example, in Tech, where we hear all those big numbers and valuations all the time, that multiple can usually be anywhere from 10 to 20x… Or even higher if we’re talking about Deep Tech. Let’s say a company’s EBITDA is, I don’t know, 1 million euro.

[21:49.4]
If the multiple is 10x, that means that company would be valued at 10 million. They have an EBITDA of 1 million, the multiple is 10x, so it’s 10 million. If it’s 20x, it’s worth 20 million. Now tech is extreme…

[22:07.9]
It’s really an extreme example. And in more traditional businesses, the multiple is usually way lower. When we talk about small and medium businesses, a typical range is 2 to 4x. But it can be lower —like in retail, for example, sometimes it’s 0,5x, whatever— or also higher, in very specialized services.

[22:28.4]
But remember, with small and medium businesses we usually have a multiplier of 2 to 4x. Now that you know everything that there is to know about LBOs and EBITDA. Let’s talk about what I call the next wave of LBOs.

[22:47.6]
Or maybe better said is the next type of LBOs. LBOs (Leveraged Buyouts), it’s not something new. It’s been around for… I don’t know how long, but decades. And over time, all these LBOs, they’ve gone through some pretty interesting waves.

[23:07.8]
Each wave was driven by a SPECIFIC FOCUS. If you look at the history of LBOs all-in-all, you would say that it was the first wave. And that first wave was all about optimizing management.

[23:23.0]
To put it bluntly, most managers sucked… More than often, you could say that they didn’t really know what they were doing. That first wave of LBOs was focused on “cleaning the house,” optimizing management and the way these companies were run…

[23:39.5]
Then watching the sales and the margins grow, as they optimized. Then came the second wave, the wave of internationalization —”We’re going global!” That was a bit of the idea. The playbook was actually pretty simple: You take a local business, you expand it internationally—or even nationally—and you watch the sales and the margins grow.

[24:01.8]
The “easy days,” you could say! After that it was all about —that’s the third wave of LBOs—it was all about digital transformation. That’s the way we’re the most acquainted with, in our generation. Basically, you come in, you take the business online, you go e-commerce, omnichannel, and all of that, and you watch the sales grow.

[24:23.6]
But now we’re entering a new wave, and I call it the AI LBO, the Artificial Intelligence and Automation. And this is where I think things get really interesting for you. Spoiler alert: To play in that space, you got to be AI LITERATE.

[24:42.8]
You don’t need to be a coder, you don’t need to be a Machine Learning engineer or whatever, but you need to understand how AI works. You need to have an idea of WHAT AI & Automation can do; You need to know HOW to find the right tools; and you need to know WHERE to implement them.

[24:59.6]
We’re not even talking about “how to implement” them —you can still outsource that part, although it’s gonna cost you— but WHERE to implement them. Also, it’s not just about AI. Automation in general can already be a game changer.

[25:14.8]
If you’re not already learning this stuff, now’s the time. Regardless of whether you want to get into the AI LBO business or not. How does an AI LBO work? I think so far, if we had to recap, we’ve just established a few key things.

[25:33.1]
One, we have a lot of struggling businesses out there that you can buy or take over for a good price because on paper they’re worth… not much anymore—if they’re worth anything at all. So, we got struggling businesses. Then, there are all the businesses owned by retiring owners, and there’s a lot more of those coming our way.

[25:55.4]
Again, you can often buy them at a good price because, remember what I told you, 70 to 80% of these businesses are never gonna get sold. And of course, that’s if you know how to source them, structure a deal, and so on —we’ll get back to that.

[26:11.6]
And then the third thing that we learned is that the principle of an LBO is to use the business’s own cash and the profits to pay back the loan—if there is a loan. So you want to maximize profits, that’s the idea.

[26:26.6]
So that you can (1) reimburse the loan and (2) that you can pay yourself as well. And… if you want to maximize profits, you basically have 2 big levers: You can either (1) maximize sales, so generate more income. Or (2) optimize costs, spend less.

[26:42.1]
Ideally, you do both. But optimizing costs is usually the fastest and the easiest way to start with. Let’s try to make that concrete with an example.

[26:57.7]
Let’s say you take over a struggling business, and when you do your analysis—your due diligence—you look at its COST STRUCTURE, and you optimize that cost structure using AI and Automation in first line. There are other things that you can do, but first line you just optimize processes and you streamline that.

[27:16.4]
Of course, the same principles work just as well with businesses from retiring owners, but let’s say it’s a struggling one. You look at the cost structure, you look where you can find the biggest efficiencies, and you implement AI and automation. Now, let’s say that you realize, I don’t know, that operations and admin, they account for 15% of the company’s spendings…

[27:39.4]
15% of the revenue is spent on admin and operations, which honestly isn’t unusual. Now imagine that if you use AI & Automation and best practices and all, you can cut that in half. You go from 15% of the spendings to now, I don’t know, 8% of the company’s revenue that’s spent to that.

[28:00.8]
That’s PURE PROFIT… That is added straight to the bottom line. If you take a business that had a flat, or maybe even a negative EBITDA that the business was struggling with, well, you’ve just found the money to turn it around… Almost instantly, right there.

[28:18.1]
And I know that some people will say, “But this means firing people!” Short answer, YES. And it doesn’t make me happy. Generally speaking, I’m really not the kind of guy that advises small or medium businesses to reallocate their productivity gains from AI & Automation into firing people.

[28:42.2]
That’s not the idea. Never. I usually say, keep your people and level them up! Because they already know your business and all of that. But let’s be very clear here. We are talking about struggling businesses. We’re talking about businesses that’re barely holding on.

[28:57.7]
It never feels good to fire people. It doesn’t. But the question you need to ask here is “What’s best?” Do you let go of 10% of the workforce to save the business, OR do you just watch 100% of them end up in the unemployment line because the business goes bankrupt?

[29:16.8]
That’s it. Of all evils, it’s the lesser evil. Now we can argue about it morally all day. I mean, that doesn’t change the world. As I often say, the world doesn’t care about our feelings. And let me be clear also, it’s not JUST about “cutting costs.” That’s an example that I just gave you on how you find a few points of EBITDA if you were flatlining, or a negative EBITDA.

[29:39.9]
But it’s not JUST about cutting costs. AI can help you streamline operations; It can help you improve customer service; It can even drive sales. And then there is also, next to AI, all the non-AI stuff: Marketing, Personal Branding, the economies of scale that you can do, better buying,…

[29:59.3]
The possibilities are endless. The only limit is your creativity. But for those starting out, and especially if you need to find that cash FAST because the business is on the verge of collapsing, these are the basics. You look at where you can optimize to reduce costs.

[30:24.6]
Now, as we were going through all of this, there is also an advanced version of this, which is very clearly for advanced entrepreneurs. You either have a business or run a business that you can leverage, OR you did a few operations… But I said it’s for both profiles.

[30:41.1]
So let me sidetrack into the advanced version of this. If you’re already thinking bigger, like running a holding company or start starting a private fund, why not? You can scale this strategy. How do you do that? Well, you acquire multiple businesses, you optimize their operations, you improve their EBITDA, basically, and you watch the value stack up.

[31:07.9]
I know it’s technical, but let me break it… or try to break it down with a concrete example. Say you are structured as a holding company. You have a holding company and you buy different companies related to that holding. Since you buy a business at a multiple of its EBITDA —we’ve covered that already.

[31:29.1]
Usually we look at the EBITDA—which is the overall profitability— and then, there’s some kind of multiplier we agree on, and that’s the valuation of the business. So… since you buy a business at the multiple of its EBITDA, let’s say that that multiple is 6x… Six times the EBITDA is how you buy it.

[31:45.1]
It’s the price at which you buy a business. Now, if you can create, quickly, 7 points of EBITDA by cutting costs and streamlining, quickly. Between the moment you buy, and if you look by the end of the year, you might have just created 42% more FUND VALUE.

[32:04.0]
You didn’t create more value per se, real value in the business, but you created more FUND VALUE, right? Because you BUY at the multiple of the EBITDA, but your fund is also evaluated and you SELL at the multiple of the EBITDA. If you created seven points of EBITDA, and that the multiple for that kind of company is 6x— the multiplier.

[32:25.4]
Well, 7% of EBITDA at a multiplier of 6, 6 times 7% equals 42%. So that’s the value that you’ve created just by finding seven points of EBITDA. And that’s… In the Private Equity world, it’s called the N-A-V.

[32:42.3]
NAV. The NAV of your fund, the Net Asset Value. And that’s the power of, optimization and small changes at scale. Now, of course, this is a simplified example. It assumes a stable multiplier, sustainable growth of the EBITDA, and it also assumes no major surprises.

[33:03.7]
Okay? But the principle is solid. We cannot argue on the, principle: Private Equity funds thrive on doing this. And they thrive by finding ONE key lever for improving the business—whether that’s sales, costs, operations—and then they SCALE that improvement.

[33:20.7]
And in the US this is often done through SALES. They buy a company, they optimize the sales process, they bring in a f*cking killer Head of Sales, then they triple the sales team and… Cha-Ching! Right? That’s, that’s how it works. Okay, now… Technical side…

[33:39.8]
Technical sidetrack apart, let’s get back on the main track.

[33:53.5]
Now that you know the theme of the game: You find businesses, either distressed or from retiring entrepreneurs; You do an AI LBO, and all of that— I’m not gonna go through the whole process again—but now that you know the theme of the game, the next question then becomes: How do you play it?

[34:16.8]
And I won’t be able to give you a complete playbook here. First of all, because I don’t have one. But also, second of all, because it would take way too long. It’s almost a masterclass. But what I can give you is a general idea of my current thinking.

[34:34.9]
What are the things to look for so that you can dig deeper in and figure it out on your own. Now, let me start by saying that the principle is that ANYTHING is possible. When it comes to LBOs, the possibilities are endless.

[34:52.1]
The type of business; How diversified—or not— is your holding; Where you buy it; How you finance it. I mean, it’s all up to your imagination. It’s the only limit. Let’s think about the big themes and the big picture.

[35:08.9]
One of the main questions is: Where to buy? Some say “Europe is crumbling,” “I wanna go to the US” and whatever, whatever, as I’ve said. And I don’t really know about the rest of the world, but if you look at most of Western Europe, the UK and rhe US, both trends are massively present.

[35:31.1]
The aging and the business on the verge of collapse. Basically, within that space, you can buy businesses anywhere. If you’re young and geographically mobile, I mean, the world is your playground… And even if you’re not young, actually—that still applies, it’s just less easy.

[35:48.8]
But why not? Why not? Go for the big adventure. That said, YES, you can buy businesses ANYWHERE. But don’t underestimate the importance of language and culture. I’ve done through my career, business all over the world.

[36:04.1]
I’ve worked internationally for 8 years or something like that. I can tell you: Belgium isn’t France, although we’re neighbors. The US isn’t the UK, but they speak the same language. Each market has its own specificities, sensibilities —which is often overlooked— and dynamics.

[36:24.2]
And if you get any of those wrong, that can cost you a lot. So… You can go where you want, but my advice would be: Start with markets that you know. That’s already one, let’s say, challenge less that you put in your own way.

[36:39.4]
It’s not a requirement, but it’s a good way if you want to optimize for safety. Whatever you choose, do your homework… Due diligence. Before committing to a deal in a new market—any deal— you need to understand the local business environment, the cultural nuances, and also the legal frameworks— because there are different legal frameworks.

[37:05.5]
So, do your homework. But ANYWHERE. Which leads to the second question: What types of businesses should I buy? And here again, I’d say, there is no right answer. There is no one answer.

[37:21.7]
The type of business you target will depend on so many factors. If you already have a business, you can expand that business— try to find more of the same and grow bigger. You can diversify, do things that are radically different— so that you spread the risk.

[37:40.8]
You can also look for a middle way: Diversify, but you look for complementary opportunities. Maybe you buy a supplier, or you buy one of your clients or whatever. If you have a business you can do a lot, there are lots of different strategies depending on what you want.

[38:03.5]
I’d say it also depends on your experience and on your strengths. It depends on your personal interests. Don’t buy something that absolutely doesn’t interest you. Now, the idea is NOT for you to go and run the businesses. That’s also very important. If we’re talking about SCALING now. If you have to seal your 1st, 2nd, 3rd deal…

[38:22.4]
Yes. But if you’re already “big” and think about scaling, never run the business. But you should have some interest for the business. Ideally. I’d say it depends also on your ability to optimize the business. Always scan for, are there clear inefficiencies? Like high overhead costs or outdated processes.

[38:42.2]
Those are often the best opportunities for FAST improvement, for finding those points of EBITDA. It depends also how quickly you can implement the optimizations. And that is key, especially if you think about scaling. Now, if it’s your first business, as long as you can repay the loan—if it’s financed through DEBT—and that you can pay yourself, it’s not that important.

[39:04.9]
But it’s another one. It also depends on the structure of the deal. Is it a good deal or not? And again, the more advanced you become, the more money and options you have to finance, the better the deals will be. Doesn’t mean that you should start on a bad deal.

[39:20.6]
Never. But you have more options, more power, more flexibility when you grow more advanced. Also, some businesses are simply EASIER to turn around than others— that’s another reality.

[39:36.4]
Now… As I’m saying this, let’s say that something else pops to mind. We talk about AI LBO, but if we zoom out for a second, there is AI on a much broader spectrum. A few days ago, Sam Altman—who is the founder of ChatGPT, OpenAI—he gave an interview where he said something that got me thinking.

[39:59.5]
And he said—paraphrasing again— but he said something like: “My child is never going to grow up being smarter than AI.” And his vision tied to that, linked to that, which is scary, but I agree with him actually is that AI will revolutionize the economy and the workforce.

[40:21.6]
So, in other words: Many, many jobs will be rendered useless. Of course he said that in more “politically correct” terms, that it’s going to “shift focus from raw intelligence to other human skills” Now why do I bring this up?

[40:39.1]
Because, what type of business to buy? To answer that question, I think you should factor in and think very clearly about is it gonna be SERVICE vs. NON-SERVICE businesses? Because will service businesses still hold in the future?

[40:58.5]
Probably… but my prediction is: probably most of them will not. So, think very clearly about SERVICES— and I know it’s shiny—versus NON-SERVICES, that’s key. And again, I’m not talking about, when I talk about “service businesses,” I’m not talking about the plumber, the electrician, the HVAC technician, the carpenter, all of that.

[41:24.2]
I’m talking about laptop-based, white collar services: Consulting, creative agencies, all of that. See, we always thought AI & Automation would come for blue collar jobs first, right? Because first the robotics came and we automated the supply chain, and the industries, and all of that.

[41:46.9]
So we thought: Yes, that’s the logical progression. That’s how it’s gonna continue to be. I think we were wrong. We thought “AI is never gonna be creative.” It is. Without even talking about AGI or getting too technical on AI, but a major shift is happening already… as we speak. Right now, we’re still in, in the age of Generative AI—ChatGPT, Midjourney, you’re generating music, art, text, pictures, all of that.

[42:21.0]
But we’re coming to the age of AGENTIC AI… Agents. AGENTIC AI is basically AI that can actually think like an employee. It can solve complex problems without human intervention —outside of its playground or confined environment.

[42:41.6]
It can do that across multiple digital environments. It’s not contained anymore. And so, what happens with Agentic AI or with “AI Agents”? They will be able to do extremely complex tasks BETTER than any human employee could.

[42:59.8]
They’re going to do it way FASTER than any human employee could. And they will do it at maybe… for a fraction of the cost, maybe 1% of the cost. We’re entering an age of INSTANT RESULTS.

[43:14.9]
We’ve all heard about SaaS, right? “Software as a Service.” I think we’re entering the age of RESULTS as a Service (RaaS). Now, why am I telling you all of this? Again, not to be a prophet of doom and gloom, but I’m telling you all of this so that, if you want a SAFE BET, don’t go for businesses that AI can immediately overtake.

[43:39.3]
It might be worth to think BLUE COLLAR again. Just putting it out there.

[43:51.0]

3. HOW do you buy a business? And again, there are countless options. Even if you don’t have a lot of cash upfront. We talked about this. You can PARTNER UP with others. You can team up with other business owners and build a fund together, entrepreneurs, aspiring entrepreneurs—to move faster if you’re together, to pull money together, to multiply the acquisitions—you can partner up.

[44:19.1]
You can also partner up… That’s EQUITY kind of partnering up. Then you have the DEBT partnering up. You can partner up with investors, private business angels, private equity, family, friends… Also rich people who’re bored, as fuck…

[44:38.3]
or that have something to prove. Why not? If you know those or if you build a strategy to reach out for them. Those are all sources of investment. Basically, whoever is willing to back you. That’s the idea, if you look at investors. But here’s the thing, if it’s your first deal, people will not trust you. Period.

[44:58.8]
You will need to sell them a VISION. You gotta make them believe in what you’re doing. Which brings us to: How do you buy a business with NO cash upfront? Or almost none? Now, I’m not an expert in this.

[45:15.1]
I’m talking about trends and I’m talking as I think. But I’ve got a friend who’s quite good at this. I think he’s just acquired his… I think it’s his 5th or 6th business… and he started with no cash. It’s not that he came from a rich background.

[45:31.2]
I’ll try to “channel” a few of our conversations for the sake of this exercise. But if you want to buy a business with no cash upfront—or almost no cash upfront—the thing is that you need to master a process from end-to-end.

[45:48.3]
It’s not magic, it’s a f*ck’n skill set. The first thing you need to do is to learn how to source leads— how to find these businesses. That’s number one. And again, there are many ideas that I have, and there are probably thousands more that are actually actionable.

[46:05.5]
So look for this, I’m sure that other people have written about this. But the key is: If you want to buy a business, you need to know how to find them. Right? That number one. And whether we’re talking about distressed businesses or businesses from business owners that’re closing in on their retirement.

[46:22.5]
So one, you need to source them. Two, you need to learn how to build rapport with sellers —a relationship of sorts, if you wish. Because, and this is critical, remember for most of these sellers—if we’re not talking about distressed businesses—you’re talking about their LIFE’S WORK.

[46:42.6]
They are emotionally attached and emotionally biased to it. That attachment drives the prices up. Usually, you will need to build that rapport, and again, sell them a VISION so that the continuity—the perspective of the continuity— and the trust that they’ve in you will bring that price down, or will open the door to Creative Fundings.

[47:04.9]
Another key element is that you must LEARN how to structure CREATIVE OFFERS. I’m not gonna get into technicals, but look up things like seller financing, earnouts,… Something else to look into is “does the company own hard assets?” Usually a company that owns hard assets—like real estate— is more expensive.

[47:25.6]
But maybe there are also deals you can make where you can sell the real estate, or you can leverage it. Or maybe there are also more technical deals… Like, is there any Intellectual Property? Is there any Intellectual Property in the company? Because then maybe you can structure that, that the company does finance payouts based on Intellectual Property rights.

[47:45.8]
Okay, it’s very technical, but you got to get creative here—structure creative offers. Another one is, you need to be able to secure the meetings and close the deals. That’s another skill that you need to have. Further down the road, you need to know how to— that’s an important one— how to reduce, I would say the “legal headaches.” Because when it comes to legal: One, legal headaches will come; but two, it can cost you a lot of money— lawyers and all of that are not known to be cheap.

[48:20.7]
Still under that umbrella, you need to be able to increase the business value. You’re not just “buying it” Okay? You want to make it better. So… In all of that, if you want to structure a deal with no cash upfront, you will need to be able to increase the value, because you’ll still have to pay the owner.

[48:37.3]
Even if you find something creative, like an “earnout,” or “deferred payments,” or whatever—if you’re not able to increase the value, you will not able to find the cash to pay out. Those are all… I’d say… It’s doable! Right? It’s totally doable. But let’s also be real: Buying without cash, that takes some preexisting skills and experience.

[48:59.2]
If you’ve got no money, no skills, no experience, no cash… Your best bet is probably to start with distressed businesses. And another thing, —if you want to scale, of course— you gotta learn how to either (1) exit quickly or (2) leverage that business to acquire more businesses.

[49:21.5]
But remember that the “mother of all skills” in this will always be NEGOTIATION. That’s where deals are won or lost. That you can build the necessary trust; That you can paint—and sell—a clear vision for the future. That can make all the difference.

[49:47.2]
Let me think about: How do you STRUCTURE yourself? This is an important question. If it’s your first deal, please, don’t overcomplicate things. Forget about legal structures, and fancy setups, and the holding, and all of that.

[50:04.0]
Get the basics right, and focus on getting the deal done. That’s it. I mean, you can sort… You can sort out the legal and the structuring later, as you grow. I’m not saying do crazy stuff, again, due diligence. But don’t go into fancy. Don’t overcomplicate, don’t overengineer. Okay?

[50:19.5]
Get it done. If you’re an existing business owner, or that you’ve closed a few deals already, then it’s probably time—if you want to go down that path— then it’s probably time to think bigger. And bigger basically means for me, I don’t see 10.000 ways of thinking bigger: Set up a holding company with an external growth strategy.

[50:41.8]
Now, I’m not here to give you detailed financial advice… I’m not qualified to. But… still, I’m gonna… There’s one killer strategy to scale, and it’s the Bernard Arnault strategy.

[51:00.1]
For those of you that don’t know Bernard Arnault, he’s the founder of LVMH… Louis Vuitton and all of that—that consortium of luxury brands. He’s also one of the richest men in the world. And in his early days, his strategy was like, you could say it’s a “Corporate Russian Doll.” The principle of the Russian Doll is when you open the doll, there is always a smaller one inside.

[51:23.5]
That’s also how he did it. But it’s a reverse Corporate Russian Doll. The idea is: You buy a small—or a smaller—business, and you use that success to buy a bigger one, then a bigger one, and then… And so on, and so on, and so on… And you combine this within an LBO strategy, to scale exponentially.

[51:42.5]
Another side benefit, if we’re talking about structures, another side benefit of scaling through a holding company, because holding companies have serious benefits. Is that one, you can reinvest profits from one business into acquiring the next.

[51:58.2]
So you can… And you can also structure that with EQUITY or with DEBT. So, it’s a very interesting way to structure yourself financially. Again, not getting into the technicals, just pointing out a few creative strategies because most accountants— most financial strategists—they are too conservative.

[52:14.6]
They don’t think far enough outside of the box. And that’s killing, I think, the progress of many entrepreneurs. If you want to grow, if you want to scale: financial literacy is also important. Now, not… We don’t really care about the Wall Street financial literacy.

[52:30.8]
It’s really about how do you structure yourself, you need to think outside of the box. As I said, you can reinvest profits from one to the other. And another benefit is that you can consolidate part of the operations to cut costs, right?

[52:48.6]
So, for example, you can build a killer internal marketing agency— once you reach a certain size. You can centralize finance, you can consolidate, and so you cut costs… There are also economies of scale: part of it by consolidating the operations, But you can buy— you will buy more cars, you will buy more stuff,…

[53:12.2]
So you can consolidate and BUY CENTRALLY. And… you can consolidate to boost profitability: Is it possible to cross- fertilize business? Can you leverage one client database, etc. Etc. So… consolidate.

[53:28.0]
And I’d say that maybe the best part—I thought this one would be short— maybe the best part about structuring yourself into a holding company as you scale is: If you’re already thinking about your long-term EXIT STRATEGY, you can sell the holding company as a whole.

[53:45.4]
As a massive, highly profitable engine. Think about EBITDA valuation and multipliers again, it all consolidates in the holding. Structuring yourself financially—again, when you start out it doesn’t matter— But as you grow, as you scale, especially if you’re an established business entrepreneur, it’s one thing to listen to your accountant, but…

[54:09.9]
Experience has proven, and when you talk with many business owners, that usually they’re not the one who made… They play conservative. That’s their job, they’ve got a lot of legal constraints, and all of that. I’m not saying go into the shady stuff, I’m not saying go into the black stuff—or dark stuff— that’s not what I’m saying.

[54:26.7]
But I’m saying there are rules. Don’t bend them, but toe the line. They’re there for reason, and there is a line for reason. Don’t cross it. But toe it… Now, something else that’s crucial: Again, I’ve said it already, due diligence.

[54:45.1]
Before jumping into ANY deal, due diligence is non-negotiable. You need to understand the business inside-out. The financials, the market position, the competition, the operational risks.

[55:02.4]
You don’t just take the seller’s word for it. You need to dig deeper. Another critical one, and it’s super underestimated: RISK. Whenever you enter a venture, most people are optimistic—or they don’t enter the venture.

[55:20.7]
I’m not telling “don’t be optimistic,” but I’m saying every deal comes with risks. What if the market conditions change? Black Swans, 9-11, a bubble, Agentic AI. What if the market conditions change?

[55:36.0]
What if the business doesn’t generate enough cash flow to cover the loan? You need a contingency plan. You need to know exactly what you’re walking into. Understanding the risks upfront can save you from a world of pain further down the road.

[55:54.0]
I’m not saying that you can— because I said Black Swans— I’m not saying that you can “predict Black Swans.” I’m just saying you need to think: What if the market conditions change radically? What is the backbone this business is relying on? What happens if it collapses?

[56:10.6]
How can we pivot?

[56:23.7]
To summarize, to get started in this—whether you are an existing entrepreneur or not: (1) Research industries or businesses that, ideally genuinely interest you. Don’t just, especially if you’re starting out, don’t just chase the trends, okay?

[56:41.6]
Find something you can commit to. (2) Learn the basics of negotiation, deal structuring, financing. You don’t need to be an expert, but you need to know and be good enough. (3) Build a network of potential partners, associates, mentors, investors.

[57:03.7]
I’ll not say that relationships are EVERYTHING in this game, but consider them. They can usually accelerate things by a lot. (4) Start small. Number four, I’d say start small. Focus on one deal, nail that deal, understand the dynamics of that deal, and scale from there.

[57:23.8]
Even if you’re an established business owner, because it’s one thing to jump from day-to-day operations to acquiring businesses, integrate, optimizing them, integrating them, etc. Etc. Start small, focus on one deal, nail that deal, and then you just scale from there.

[57:41.2]
The opportunities are literally endless. Only if you’re willing to take the first step. And by the way, as a final thought… I’ve recently posted a Personal Branding keynote on YouTube and Spotify, and it’s called “Trillion-Dollar Faces.” And the good news is, just like this video, it’s 100% FREE.

[58:05.9]
Now, why do I mention this? Because I said at the beginning that I have nothing to sell. I still don’t have anything to sell. But I mention this because I think it’s really highly related to this topic. Because there is something that you cannot—and should not—underestimate.

[58:21.7]
We’re living in what I call the “Scroll Society.” Scrolling, scrolling,… You could say that the economy has been TikTokized, if you will. Attention has always been, but is now the biggest currency. And I genuinely believe, to my core, that the businesses that’ll dominate the next decade will be businesses led by founders with bold, authentic PERSONAL BRANDS.

[58:49.7]
Your story, your voice, your authenticity— that’s what’ll set you apart in this “new world.” People don’t just buy products anymore—or not for long— They buy into people. And in the context of everything that I’ve just talked about, a strong Personal Brand can also be a gigantic accelerator for everything.

[59:11.8]
It helps you build credibility, source deals, attract investors… Attract talent, to run your businesses, as you scale. To conclude, I think that the next 5 to 10 years will create more societal chaos, but also more wealth creation, more opportunities than probably any other time in history.

[59:37.6]
The opportunity is now. Go make it happen.