How to Leverage Crypto Currency to Buy a Business
What if I told you I know someone who bought a wheelbarrow load of a Popular -Crypto Currency and only a few pennies per token. Like 50,000 ‘tokens’ for .03@ and only about $1,500.00 out of pocket? And that 6 years later he bought a small business listed for about $900,000 and his out of pocket cash cost was only 10%? No mortgage, no bank loan. Paid in full at Closing. Now, that’s LEVERAGE!
Buy Low, Sell High
If this example of ‘Buy Low, Sell High’ seems a bit extreme, it is.
For every 100 persons who bought the most hyped Crypto Currency since 2014, only a handful hit the moon. Many of those would-be moonshots went to zero and many are still only worth pennies. But some did. And that’s the point. Leverage.
What is Leverage?
Leverage is increasing potential. Hopefully: Exponentially. In the business world, it is an investment strategy of using borrowed money. O.P.M. Other People’s Money. The idea is using various financial instruments (even Bitcoin, Crypto Currency) to increase the potential return of an investment. In this case to buy a cash-flowing small business.
Therefore, leverage can also refer to ANY finance source. Find an asset and leverage it.
Thank you, Archimedes
May I quote a Greek Mathematician from 212-287 BC?
“Give me a long enough lever and a place to stand, and I can move the world.”
Some prefer: “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world”
So You Suggest Running Out and Buying a Penny Crypto?
No, Crypto is like any other Financial Instrument. You have become knowledgeable before you buy. And this is not the page for a quick tutorial on How to Buy a Crypto Currency. Ask me in person and I can suggest resources that are easily available, but I’m not a Crypto Salesmen.
Buy a Business Using Crypto Currency
Assume a while back you bought Bitcoin (BTC), Ethereum (ETH), Ripple (XRP) or another top brand name and you are sitting on a Huge gain. Perhaps you want to secure your phenomenal gains before the market retreats, as it has a dozen times on the way to today’s sky high values. What do you do with the money? Well, you can pay off debt, that’s always a good idea. But most likely you are thinking about another Investment. So, what has greatest ROI today? I can list the usual suspects, like stocks or bonds, but my area is as a Business Buyer’s Representative. I’m a Consultant to help you find and evaluate a good Businesses. To help you achieve the Great American Dream. Small business ownership.
Crypto Currency Owners Have Concerns
One concern is taxes. If you invested $1,500.00 and your Crypto is now worth $100,000, think of the taxes! Here’s a tip, Reinvest! In the case of the person above, he reinvested in a Printing Franchise. With no debt service, he is netting more than $100,000 a year. He gave up his day job and is now living the dream.
This is not tax advice. See your accountant or CPA.
The biggest concern for someone who hit ‘a home run’, is ‘preserving the win’, not giving it all back on a down turn.
Home Runs are Atypical
Just like stock investors, there are some people sometimes hit home runs and many more that do not. But you never hit one if you don’t step up to bat.
Over 36% of businesses today accept Bitcoin. There are estimated to be 100 million Bitcoin wallets worldwide and an estimated 11% of all Americans currently hold Bitcoin.* Source: Bitcoin Market Journal
You will find Digital Currency is not just the wave of the future, it is already here It is as commonplace as PayPal, eBay, Amazon Prime, Netflix, and Facebook. Many are predicting that all tax-paying Americans will have a Digital Wallet before this year is out. Embrace the Cryptocosm! Make it work for you!