Nobody knows the future BUT, although history may not repeat, it rhymes!
The masses ALWAYS need money! This has always been the case and will remain so.
What is “The Business of Lending to the Masses” all about? Let’s get a few things straight!
How to Buy or Start a Consumer Loan Business. Why “Baby Boomers” make the best sellers.
Payday loans, pawn shop loans, car title loans, installment loans, line-of-credit loans, wage advances, loans on smartphones, car title loans… basically the same business. Some loans are collateralized and some are not.
- YOU ARE LENDING MONEY TO THE MASSES.
- The masses ALWAYS need money. [Read “The Ascent of Money” and “Debt: The First 5000 Years.”
- The Chinese virus/pandemic, protests, looting… will subside. These events have ACCELERATED the move to the digital money movement.
- Change is MOST CERTAINLY here! Job environments are changing. Work from home will increase. It’s a digital world.
- There will NOT be another lockdown! 40 million jobs cannot be allowed to happen again!!
- Our recovery will be V-SHAPED. The Federal Reserve is flooding our economy. $3Trillion in stimulus and 75%+ has not even “hit the streets” yet!
- The use of CASH – dollar bills – for anything will continue to diminish. Doubt me? Ever been in line when a Chinese or Nigerian needs to pay for ANYTHING while visiting the USA and they COMPLAIN about having to have dollar bills? They bitch.
- Commerce, mindset, jobs… will not return to the “old normal.” The tsunami of liquidity about to overwhelm our economy will create boundless opportunities, speculation, innovation, prosperity, and dramatic increases in employment.
- Inflation, at least for the next 18+ months will not be an issue. The world needs the dollar! Everything is paid for in dollars.
- Continued pressure by regulators, politicians, lawyers. consumers… will result in downward pressure on lender fees. 36% max APR’s anyone?
- The Media will continue to distort EVERYTHING. “Click Bait” is the name of their game. That’s how they make MONEY.
- Tech is enabling lenders to minimize brick-n-mortar footprints, reduce CAQ [customer acquisition costs], headcount to perform consumer onboarding, servicing, underwriting, verifying employment status, bank account verification, collection processes… yielding qualified borrowers at lower servicing costs.
- MOIP [Money Over Internet Protocol] is here today. Both lenders and consumers can participate in someday funding – credits/debits – through a variety of payment channels [discussed in our Manual].
- A plethora of banks, 3rd party vendors, cloud platforms, lead providers, and capital sources can easily be integrated via API’s today thus negating the need for a Lender to “build” all the pieces required to loan money to the masses while continuing to earn a superior ROI.
- Online lending will replace brick-n-mortar lending. Smartphones will lead the way!
- Never forget! Your best new customers are your old customers.
Hundreds of thousands of Baby Boomers” own small businesses today. Many of them are money Lenders, pawnshop owners, money transmitters, currency exchangers… They OFTEN have no one to sell their businesses to! Their kids don’t want them. Their grand-kids dream is not to become a money lender. Their only option? Sell! However, buyers are scarce. So… the only option is for the Boomer to close her business. [Often, it’s the significant other who has to deal with selling/closing the business.] 90% of businesses simply close their doors rather than sell.
What does this have to do with you, Dear Reader? OPPORTUNITY!
Let’s be honest. A majority of these Boomers don’t know what TikTok is! Instagram? Twitter? [Maybe if they follow President Trump.] The power of “Google My Business” for SEO to gain more borrowers? Sure, it’s likely us Boomers use Facebook to view the latest grand-kids photo. But use these platforms to scale their business, NOT A CHANCE.
- The existence of an App the Lender can enable a consumer to download to their smartphone and tap a $500 line of credit?
- An App that enables a Lender to install an App on their borrower’s phone rendering it inoperable if the smartphone owner fails to make their monthly payment? [The phone is referred to as “bricked.” It’s a BRICK. Worthless. The borrower cannot uninstall the App. The borrower can only make 911 emergency calls with their BRICK! Either the borrower makes their $75 [or whatever $$ payment] payment or loses ALL access to their contacts – THEIR PHONE NUMBER – their FB, Venmo, Zelle, Telegram, WeChat, WhatsApp, photos, camera, digital wallets, bank Apps. music Apps…
The average price of a smartphone in the USA is $600! Many are much more expensive: Statista
Top 10 millennial App downloads 2020:
- Snapchat
- YouTube
- Amazon
- Spotify
- Netflix
You want to get into the “business of lending to the masses? Run your business from anywhere in the world? Fund small-dollar loans to anyone in the world?
Look for opportunities. Again, many Boomers are tired, burned-out, or simply want to pass on their years of hard work to someone who recognizes what they’ve built, will carry on the business, AND pay the Boomer overtime for all their years of hard work. This strategy certainly makes more sense than simply closing the doors and walking away.
If I were attracted to this industry – ANY industry – I’d be looking for the following scenario:
- A motivated seller [Ask me, your accountant, your lawyer, biz brokers, walk into businesses you want to buy… tell Everyone you’re looking for a business.]
- A seller lacking an easy “out.” No family to take over. No buyers.
- The regulators, the compliance bureaucrats, the Chinese virus, and the riots and the looters have burned them out; mentally.
- A seller who has finally recognized 90% of businesses don’t sell. They just close.
Let’s say a Boomer’s company is making $100,000 in profits/year.
- Don’t pay more than $200K for it.
- Don’t just handover $200K to the Boomer.
- Offer $10K and a payout of $220K over 3 years, or 4 years, 5 years…?
- NEGOTIATE!
- Say you both agree to a payout of $200K over 4 years for the business.
- Out of the $100K/year in profits, you pay the Boomer $50K/year for 4 years.
- Accomplishing this, you the young, savvy, tech-oriented entrepreneur that you are, add value to the biz. You scale it BIG.
- You buy more of these little moneymakers.
- The Boomer is thinking, “You’re going to pay me $10K for my lease and a few desks and old computers plus $50K/year for 4 years and I don’t have to simply walk away from my life’s work with ZERO $$?” DONE DEAL!
- IT’S a NEGOTIATION! Get creative!
- Negotiate the down payment
- Negotiate the number of years you have to pay the Boomer off.
- Negotiate how much training the Boomer provides.
- Negotiate any real estate involved.
- Negotiate with all the current vendors the Boomer has accounts with.
- Almost 11,000 Boomers are retiring EVERY DAY! What do you think the numbers will look be after the current MESS this planet is in? MORE!
- Buy MORE! Add the Internet MOIP strategy. Scale this monster cash machine. Eventually, you can sell for 10X+ the “sellers discretionary income.” [I prefer this metric vs EBITDA.]
SUMMARY:
- The MASSES always need access to cash over the long haul.
- Get the word out. Find that perfect”TARGET” company to acquire and enable you to accomplish YOUR GOAL!
- Get control.
- Build a TEAM. Incentivize them to succeed. Clear, transparent rewards given often.
- Hire quick. Fire fast.
- Scale it. Add social media, integrate with 3rd party vendors, and reduce your costs. Evolve to the phone. [NOTE: Need an App for your biz? Want more info about “bricking a phone” so you can use it to collateralized your customer’s smartphone? Email: Jer@TrihouseConsulting.com
- Renegotiate ALL existing contracts and leases with vendors.
- Review every line item on your P & L. Cut…
- Implement MOIP.
- Outsource those tasks others can perform faster, better, cheaper than you. Your time is VALUABLE! Ask me for the PASSWORD: Resources.
- The economy is not yet fixed BUT it will be very soon!
- Protests will not end but OPPORTUNITIES are here now.
- Be ready to rock-n-roll. While your competition is crying and moaning, you are ready to POUNCE!