May 17, 2025 • 21 mins
Unlock the investing wisdom of Warren Buffett and apply it directly to YOUR franchise journey! In this solo episode, Giuseppe Grammatico breaks down Buffett's 5 core rules for building wealth (Long-Term Vision, Staying Informed, Competitive Edge, Quality, Managing Risk) and shows how they translate into actionable strategies for franchise owners and aspiring entrepreneurs. Timeless advice for lasting success!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Giuseppe Grammatico (00:00):
Warren talks about investing and when
(00:02):
he does invest, he doesn'tinvest in stocks.
He invests in companies and hiswhole intention is.
To own a piece of that companybecause he believes for what
that company stands for.
I personally do not invest incrypto.
I have nothing against crypto.
I don't understand and I'm notcomfortable.
With that type of currency.
So I don't wanna invest in it.
(00:22):
Can you make money?
Absolutely.
Can you lose money?
Absolutely.
Is there a plan?
It's doing your homework and notgoing in into anything blind.
And that goes back to owningyour, and understanding your
business and industry.
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
(00:49):
welcome to the Franchise Freedom Podcast.
I'm your host, GiuseppeGrammatic, your franchise guide.
I am gonna mix things up today.
We've been doing a lot ofconversations around franchise
ownership.
We've had various franchisors,franchise companies on here,
funding and franchise attorneys,and wanted to mix things up a
little bit because, a lot ofthings flow altogether.
(01:11):
And the reason I bring that upis just.
Had the opportunity this weekendto listen to the Berkshire
Hathaway annual meeting, and forthose that haven't listened to
that, that meeting.
They I believe the entire twohour of Warren's, two plus hours
of Warren speaking is up onYouTube.
And you can listen, there's asix hour plus recording.
(01:31):
So there's some commentarybefore and after.
But Warren is someone I've beenfollowing since I was was in
college going into the latenineties.
And someone that.
His principles really aren'tjust about investing in the
stock market, but investing inbusinesses, investing in
yourself.
Wanted to really discuss,because he's been a role model
(01:51):
to me.
I follow his ways of investingand really had an impact on me
over the years.
Again, if you haven't listenedto it, check it out.
I'm gonna see if I can includethe YouTube blank here.
And yeah, just a great listen.
So he will be stepping down andreplacing himself in the
business as he approaches theage of 94, 95.
So just a quick little.
(02:12):
Bio and who Warren EdwardBuffet, billionaire investor,
philanthropist served as CEO andchairman of Berkshire Hathaway,
is known as the Oracle of Omahaand is considered one of the
most successful investors in the20th century.
1965 buffet game majoritycontrol of Berkshire Hathaway, a
textile manufacturer, and turnedit into his primary investment
(02:34):
vehicle.
Why do we talk about Warren?
The reason we do is number one,he has consistently beat the
stock market and has a differentapproach.
The overall stock market, werefer to that as the s and p
500.
And he is got some investmentprinciples that I think, remain
true regardless of whateverindustry.
If you own businesses or ownstock bonds, whatever you real
(02:56):
estate, it all applies.
And the reason we talk aboutthis quite a bit and we're gonna
get some future guests on theshow is that, everything flows
together.
So for myself, for example.
The income I make for myfranchise consulting and
coaching business I reinvestback into my business.
I reinvest into real estate.
I reinvest into the stockmarket.
(03:17):
The money is flowing.
There's definitely some.
Additional income streams Warrentalks what we're gonna get into
his five rules, but his numberone rule number one and two,
which are pretty funny, here arenumber one never lose money and
number.
And rule number two is rememberrule number one.
But yeah I wanted to just listhis five rules and then we're
(03:37):
gonna, we're gonna dive deepinto a few of them here.
So Warren's five rules we callit Buffet's wisdom.
For potentially building wealth,include investing for the long
term, staying informed,maintaining a competitive
advantage, focusing on qualityand managing risk.
(03:58):
So those are some of theprinciples.
There's plenty more.
But for this episode, for thisshow we're gonna talk about the
five.
So investing for the long term.
I find this one very interestingbecause in order to invest in
the long term, you need to havea vision.
When you're looking at aninvestment, whether that be a
stock you're looking to investin, in the stock market, or even
(04:20):
your own franchise or nonfranchise business before
getting into that, you need tohave a vision.
Where do you want to be?
What are you looking are youlooking to own it, the business
for five years and flip for aprofit?
Are you looking to own for thenext 20 years, retire and create
a legacy for your family?
Having that long-term vision iscrucial.
(04:41):
It'll help you put everything ontrack, place everything out.
So you have annual goals.
So if it means starting at onelocation and adding a location
every year, ending with 10 inthe course of 10 years, you
write that out, that way youhave something to work off of.
I personally use Google Docs anda Google Sheet so that I can
share with my mentors.
(05:02):
If you have a coach, you canshare with your coach, anyone on
your team, your investors andpartners and your spouse,
whoever's involved in theprocess.
But having that, that long-termvision, I think is crucial.
Warren talks about investing andwhen he does invest, he doesn't
invest in stocks.
He invests in companies and hiswhole intention is.
To own a piece of that companybecause he believes for what
(05:24):
that company stands for.
He believes the comp company isundervalued.
He could potentially add valueand or see value down the road.
So this is not something aboutbuying a stock and trading it.
He's talking about actuallyowning a piece of the business,
having that mindset and shiftthat as opposed to just trading
stock and just, dealing withnumbers on paper.
(05:45):
Or tickers on, on, on paper,you're actually owning a piece
of the company.
So the intention is to own forthe long term.
So that, that is number one.
Number two, staying informed.
Staying informed means a lot ofthings, knowing on, what's going
on in the industry.
Has your industry changed?
Staying informed goes into, Ilook at it for, on, on the side
(06:05):
of business ownership islearning about ai.
What are some of the, what someof the advantages of using the
technology?
What are some changes that theindustry, I.
Is experiencing.
And again, this applies tobusiness ownership as well as if
you're owning stock or as Warrensays, owning publicly traded
companies.
But staying informed as to thechanges, what effects will there
(06:26):
be with the change in additionof ai, what does the market look
like?
Figuring out what are.
What is the competitive pricing?
What are things we should lookat when it comes to equipment
staying on top of the equipment,if there's equipment involved
staying informed of, and we'regonna talk about this, I.
Your competitors, but knowing,what the competitors are doing
(06:47):
specifically in the market whenit comes to pricing, when it
comes to equipment and ways ofgoing about business.
Staying informed is also a bigone.
Whether it's, again, investingin the stock market or your
business because you wanna knowwhat's going out there going on
in, in your industry and how youcan stand out.
So if you are in the paintingspace, what is it that will help
(07:08):
you?
Maintain that advantage and helpyou stand out in the industry.
Which brings us into numberthree, which they merged
together there, but you know, ismaintaining a competitive
advantage.
You need to know what yourcompetition is doing.
You're not spying on them in abad way, but you wanna know
Exactly.
I.
What they are doing, what theyare doing differently, what's
working, what's not working.
(07:29):
You're in the same industry.
You're potentially, competingfor the same customers and
clients.
So what is gonna make you trulystand out in a painting
business, going back to a verysimple business to understand.
It's the simple fact of customerservice and follow up, showing
up for an appointment on timeand really being professional,
(07:49):
being able to quote the customersame day, show them before and
afters, give them differentoptions when it comes to the
finish of the paint if maybe.
Someone in your family hashealth issues and there's more a
paint that offers anti-microbialproperties.
That is also something standingout to me is that okay, you
(08:10):
don't wanna, consider yourself acommodity, but what can you do
to stand out amongst yourcompetitors?
And I think.
Some of the simple stuff likefollow up, showing up on time
being able to give a quote andpotentially even schedule the
job all in the same day.
I think that gives you a majoradvantage.
I know for myself, we've went toget a few quotes on home
(08:31):
services, including powerwashing and took three, three
emails, three communications ormessages I should say.
For that first return and reply.
So that alone leaves a bad badtaste in your mouth followed by
number four, focusing on qualityand always going over and beyond
your customer.
So if you own a business, I.
(08:53):
They have options.
Odds are whatever product orservice you're offering there's
gonna be competitors out in themarket.
So what do you do?
And again, a lot of these arebleeding together, but what do
you do when it comes to qualityas far as follow up and that
follow up?
I always tell everyone is that.
Mistakes or issues are inevinevitable.
It's part of business thingswill happen.
(09:15):
It's how you go about fixingthat.
And when I had my lastcompanies, we would go back and
say, we know that mistakes andissues are inev inevitable and
they're gonna come up.
What we will do is in the event,something were to come up,
number one we try to prevent itby doing an a daily inspection,
but in the event something doesfall through the cracks, this is
(09:35):
your main point of contact andthis is how we will go about.
Fixing that issue fixing theissue, being proactive to make
sure it doesn't happen again.
And depending on the extent ofwhat happened whether it was, a
missed service, a missed area,going over and beyond and
issuing a credit for the day or,for a partial credit.
And going back into theinvestment world, focusing on
(09:57):
quality, is that you're reallygetting to know the businesses
that you're investing in, whatyou know, what service or
product they're putting out,getting to experience the
service or product.
If you don't believe in theservice or product, this, that
may not be the right investmentfor you.
Same as it may not be the rightbusiness for you.
These are things that come up.
Over and over again.
(10:18):
And the over kind of archingtheme, behind all this too, is
that you need to also be able tounderstand your market.
And that's a I should actuallysay, I take that back.
You should really be able tounderstand your business, what
business you are in.
A lot of franchise companies,again, they may be in the
painting space, but what theyreally excel is they're a
(10:38):
marketing and sales engine.
That's the true business.
They excel at marketing sales.
They're a lead generation enginethat they can really apply to
just about any home service typeof business.
I.
Really understanding thebusiness and not investing in a
business or starting a businessyou don't truly understand and
taking your time beforelaunching or investing in a
current business or investing inthat specific stock, that
(11:00):
publicly traded company.
Really understanding thebusiness is gonna be key.
Knowing everything about it.
Experiencing it.
If you're gonna invest in acertain business, you wanna
experience a service andproduct, as I mentioned earlier
before diving, diving in andinvesting in that business.
And you don't have to beinvested in anything in the
stock market.
There's mutual funds, there'sbonds, there's commodities
there's crypto.
(11:20):
There's so many differentoptions.
Don't feel like you have to beable to invest in, in all those
areas.
I personally do not invest incrypto.
I have nothing against crypto.
I don't understand and I'm notcomfortable.
With that type of currency.
So I don't wanna invest in it.
Can you make money?
Absolutely.
Can you lose money?
Absolutely.
But you know, the whole premisethere is investing in things
(11:40):
that you're comfortable with.
I have experience with, andthat's not to say I don't, get
up to speed and maybe investdown the road.
But currently I feel likebetween my business, my
investments in real estate, inthe stock market, that's
comfortable for me gettinggrowth, I'm getting.
In monthly and quarterly incomeand distributions, and that's
okay.
So don't feel like you have tobe in every aspect of the market
(12:04):
or that you have to have 20different businesses.
Mark Cuban talks about this allthe time.
We had one of his, one of hiscompanies he invested in on
Shark Tank called So soap youonly have to Be Right Once is
something he talks about all thetime.
And you're gonna have somefailures in the mix as well.
So you don't have to have 20businesses.
You can really focus in.
On one business and do a lot ofdamage with that business.
(12:25):
If you think about it, 24 hoursin a day, if you're focusing on
one business versus I had metsomeone early on in my career.
He owned seven businesses, and Igo, why seven?
He's like, well, for every dayof the week, he would literally
dedicate himself and go to thatcar wash.
And he owned a a separate autodetailing business and five and
a business that, that dyedclothing and sold dyes and four
(12:46):
others.
And he would actually spend.
That day in and off a smalllittle office talked to everyone
and dedicate a day a week foreach business, which I thought
was cool.
Did they all equally make himmoney?
They all made him money.
He did say there was one or twothat made a majority of his
income, but I found thatinteresting.
So I.
There's no rights.
No right or wrong here, I guessis the point I'm trying to make
(13:06):
is that, you really, you don'twanna spread yourself thin,
especially when you're launchingyour first business.
Really, get to know thebusiness, the platforms to be on
and focus on quality.
You wanna give that, thatproduct or service, everything
you have, you don't wanna.
Go in halfway and have a lot ofmistakes and forget the follow
up and things like that.
And number five on buffet's.
(13:28):
Five rules that we summarizedfor today would be managing
risk.
Managing risk starts with yourdue diligence, and that goes
back to, sta long-term.
Viewpoint and reiterating hisrole, staying informed,
maintaining a competitiveadvantage, focusing on quality
and managing risk is reallygoing back to say, okay, where,
(13:48):
what are the risks?
What are the threats in theindustry?
Will AI affect my business andor service?
Are there more competitorsmoving in and offering a similar
type of business, specificallyin the market I am in?
How do I manage risk?
Well, I also look at things.
When you're starting a businessand it's managing your cash
flow, I always say when you owna business, you're always gonna
(14:10):
find ways to reinvest back intothe business.
So a big part of that is okay,using I had Rocky Lani from
Profit First, and it's payingyourself first before expenses.
Figuring out a way to say, okay,for every dollar that comes in,
20 20% are going to taxes.
I'm making these numbers up, 30%operating expense maybe a 10%
(14:33):
profit, kind of distribution andthe rest goes to the owner's
salary.
In that way you're managing riskin that you're not overspending
in certain areas by not having abudget.
And you're knowing your numbersso that you're figuring out
ways.
Okay.
Do I have to cut costs?
Managing risk also has to dowith KPIs.
Reviewing the numbers, makingsure you have enough lead flow.
(14:53):
If you're having enough leadflow, is the quality there?
Is the sales person able toclose those specific deals?
And the same goes, when you'reinvesting in the stock market,
managing risk, looking at you'regonna have the advantage of
being able to look at thefinancials do the.
Is there a, a lot of sellingbeing done from the corporate
office.
Are they buying back a companystock?
(15:14):
Is has there been continuousgrowth?
Is there a plan?
It's doing your homework and notgoing in into anything blind.
And that goes back to owningyour, and understanding your
business and industry.
When you're managing risk,you're doing the due diligence
upfront.
Again, you're never gonna be ahundred percent, you're gonna do
as much research as you can on afranchise.
You're gonna talk to thefranchisor, you're gonna talk to
(15:35):
the franchisees.
You're also going to meet withthe franchisor at a virtual or
in-person discovery day.
But you're doing your duediligence the best you can.
Same thing when you're investingin, in a stock, in you, a
publicly traded company.
You're going in, you're lookingat the numbers.
You're looking at, who o whoowns the business.
Is there a lot of selling?
(15:55):
Is there a lot of buying?
Has there been growth?
Where does the company seeitself?
So there's a lot of analystskinda research, which is
helpful, but just knowing what,where the company is going.
That information is all readilyavailable.
You can find that on GoogleFinance, but just seeing where
that business is going to figureout, hey, it has done well.
But that past performance willthat help and predict future
(16:18):
performance and not necessarilyright.
We wanna make sure thatcompanies still.
Being innovative, utilizing ai,cutting costs while still
growing and really increasingthe the bottom line, which at
the end of the day, we wanna beprofitable, but we don't wanna
be so profitable that we'repulling so much outta the
business that we're, hurtinggrowth by not reinvesting in
(16:39):
technology, by not addingheadcount and staff and things
like that.
To.
recap, war Warren's five rules.
You have long let's see,potential building wealth,
including investment for thelong term, staying informed,
maintaining a competitiveadvantage, focusing on quality
and managing risks.
And as I mentioned at thebeginning of the show focus on
not losing money and rule numbertwo.
(16:59):
Is, don't forget rule numberone.
So obviously no one goes intobusiness with the intention of
losing money.
But I think, when you start abusiness, the intention is let's
make money.
Let's get systems in place.
A franchise will give you thatcompetitive advantage.
But let's reinvest back in thebusiness.
So we have the blueprint, weknow exactly what to do and the
systems in place, but we wannamake sure to increase headcount
(17:21):
should the demand be there onthe market.
So a lot of great stuff.
I wanted to do this quick showbecause just as I mentioned,
I've been following Warren forthe, for over I would say close
to 30 years now.
Love what he is done back in theday.
Value investing really didn'tappeal to me because it was the
tech bubble.
So it seemed like anything youpurchased went up in price and
(17:41):
in value until that bubbleburst.
Warren has always had a long, akinda long view, a perspective
and how we approaches hisinvestments.
And I think you can use thosephilosophies to find your, your
your business focus is gonna bigis big.
Know your market.
Don't spread yourself too thinby having to invest in every
(18:02):
single investment out there tofeel like you're diversified.
You could be diversified.
As Warren mentioned he's hisadvice, and I heard this on a
previous call, was investing 90%in the s and p index fund.
It could be Vanguard, it couldbe the spiders, SPY, and then
10% short short term governmentnotes.
And that will be one way dollarcost average.
(18:24):
That way you're getting fullaccess to the market, you're
getting a little bit of cashflow in there as well.
And and some diversification.
So it's very hard tocontinuously beat the market.
Warren and Berkshire have havedone that consistently and yeah,
I just wanted to, I.
Just wanted to give a shout outto Warren.
Warren, if you're listening,we'd love to have you on the on
the show.
Maybe I'll have him on as whomay have some more time on his
(18:45):
hands.
But really appreciate your wordsof wisdom.
We'll put the link there.
So if anyone wants to check outthe video really inspiring stuff
and be curious to get yourfeedback.
Wanted to mix things up a littlebit.
The investment world it's hardto find financial advisors that
are able to come on the show.
There's so many rules andregulations and topics and
things like that, and, we're notwe're not overly structured.
(19:07):
We like to have open and honestconversation.
Con considering I, I come fromthe investment world and I am
not a no longer a financialadvisor and not giving any type
of financial advice, just thingsto, to think about.
Someone like Warren.
And I think that his lastmeeting here before the new CEO
takes over was definitelyinspiring.
And definitely learn somethingfrom that from that talk.
(19:29):
Thanks again for joiningeveryone.
We're gonna mix things up.
We're gonna, we're gonna add theshows like this going forward.
Just some value adds, somethings to think about.
We did mention.
We had Jeremy Dyer I think itwas towards the end of last
year.
We talked about real estatesyndication.
We do have people that have mademoney in their franchise and
reinvested in, in that in thatarea.
(19:49):
And those are different types ofinvestments, different types of
returns.
A little bit more structured,less involvement.
Those are there, there's someappealing aspects and not so
appealing aspects depending onyour situation.
Franchise obviously is notpassive.
It's you could be full-time orpart-time, but there's still
involvement there.
It's not a kind of buy thefranchise and then walk away and
(20:09):
it runs on its own.
So really figuring out theinvestment that's right for you
when it comes to the the type ofbusiness, your, in, your
involvement, the role, how manyhours you can put and when those
hours are the investment.
And there's a.
Quite a few other elementsthere, timeframes and things
like that.
If you are interested in havinga chat, I'd be more than glad to
(20:30):
help you figure out moreimportant than anything else.
If a franchise may be a good fitor not.
Go to gigi the franchiseguide.com.
You can book a call.
I.
Top right, corner of thewebsite.
There's a button there.
We'd love to help you out.
There's no cost for our servicesin 20 minutes or less.
We'll figure out together if afranchise may or may not be a
good fit before deciding on theon the next step.
(20:51):
So hope you take me up on thatoffer.
Hopefully you found this type ofvideo informative and helpful.
We'll share as many links asthat we come up with here.
And if you have any comments ora idea for a future topic.
Definitely let us know.
Be more than glad to cover thatarea.
Do like to mix things up asbusiness ownership is fun.
We're not in silos here in stockmarket.
(21:12):
Business ownership, franchisereal estate, all flows together
when you look at it.
Hit me up.
Thank you for your support.
Thanks for listening in today,and we'll talk to you guys soon.
Bye-bye.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
(21:33):
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
achieve financial and timefreedom today.
Warren talks about investing and when
(00:02):
he does invest, he doesn'tinvest in stocks.
He invests in companies and hiswhole intention is.
To own a piece of that companybecause he believes for what
that company stands for.
I personally do not invest incrypto.
I have nothing against crypto.
I don't understand and I'm notcomfortable.
With that type of currency.
So I don't wanna invest in it.
(00:22):
Can you make money?
Absolutely.
Can you lose money?
Absolutely.
Is there a plan?
It's doing your homework and notgoing in into anything blind.
And that goes back to owningyour, and understanding your
business and industry.
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
(00:49):
welcome to the Franchise Freedom Podcast.
I'm your host, GiuseppeGrammatic, your franchise guide.
I am gonna mix things up today.
We've been doing a lot ofconversations around franchise
ownership.
We've had various franchisors,franchise companies on here,
funding and franchise attorneys,and wanted to mix things up a
little bit because, a lot ofthings flow altogether.
(01:11):
And the reason I bring that upis just.
Had the opportunity this weekendto listen to the Berkshire
Hathaway annual meeting, and forthose that haven't listened to
that, that meeting.
They I believe the entire twohour of Warren's, two plus hours
of Warren speaking is up onYouTube.
And you can listen, there's asix hour plus recording.
(01:31):
So there's some commentarybefore and after.
But Warren is someone I've beenfollowing since I was was in
college going into the latenineties.
And someone that.
His principles really aren'tjust about investing in the
stock market, but investing inbusinesses, investing in
yourself.
Wanted to really discuss,because he's been a role model
(01:51):
to me.
I follow his ways of investingand really had an impact on me
over the years.
Again, if you haven't listenedto it, check it out.
I'm gonna see if I can includethe YouTube blank here.
And yeah, just a great listen.
So he will be stepping down andreplacing himself in the
business as he approaches theage of 94, 95.
So just a quick little.
(02:12):
Bio and who Warren EdwardBuffet, billionaire investor,
philanthropist served as CEO andchairman of Berkshire Hathaway,
is known as the Oracle of Omahaand is considered one of the
most successful investors in the20th century.
1965 buffet game majoritycontrol of Berkshire Hathaway, a
textile manufacturer, and turnedit into his primary investment
(02:34):
vehicle.
Why do we talk about Warren?
The reason we do is number one,he has consistently beat the
stock market and has a differentapproach.
The overall stock market, werefer to that as the s and p
500.
And he is got some investmentprinciples that I think, remain
true regardless of whateverindustry.
If you own businesses or ownstock bonds, whatever you real
(02:56):
estate, it all applies.
And the reason we talk aboutthis quite a bit and we're gonna
get some future guests on theshow is that, everything flows
together.
So for myself, for example.
The income I make for myfranchise consulting and
coaching business I reinvestback into my business.
I reinvest into real estate.
I reinvest into the stockmarket.
(03:17):
The money is flowing.
There's definitely some.
Additional income streams Warrentalks what we're gonna get into
his five rules, but his numberone rule number one and two,
which are pretty funny, here arenumber one never lose money and
number.
And rule number two is rememberrule number one.
But yeah I wanted to just listhis five rules and then we're
(03:37):
gonna, we're gonna dive deepinto a few of them here.
So Warren's five rules we callit Buffet's wisdom.
For potentially building wealth,include investing for the long
term, staying informed,maintaining a competitive
advantage, focusing on qualityand managing risk.
(03:58):
So those are some of theprinciples.
There's plenty more.
But for this episode, for thisshow we're gonna talk about the
five.
So investing for the long term.
I find this one very interestingbecause in order to invest in
the long term, you need to havea vision.
When you're looking at aninvestment, whether that be a
stock you're looking to investin, in the stock market, or even
(04:20):
your own franchise or nonfranchise business before
getting into that, you need tohave a vision.
Where do you want to be?
What are you looking are youlooking to own it, the business
for five years and flip for aprofit?
Are you looking to own for thenext 20 years, retire and create
a legacy for your family?
Having that long-term vision iscrucial.
(04:41):
It'll help you put everything ontrack, place everything out.
So you have annual goals.
So if it means starting at onelocation and adding a location
every year, ending with 10 inthe course of 10 years, you
write that out, that way youhave something to work off of.
I personally use Google Docs anda Google Sheet so that I can
share with my mentors.
(05:02):
If you have a coach, you canshare with your coach, anyone on
your team, your investors andpartners and your spouse,
whoever's involved in theprocess.
But having that, that long-termvision, I think is crucial.
Warren talks about investing andwhen he does invest, he doesn't
invest in stocks.
He invests in companies and hiswhole intention is.
To own a piece of that companybecause he believes for what
(05:24):
that company stands for.
He believes the comp company isundervalued.
He could potentially add valueand or see value down the road.
So this is not something aboutbuying a stock and trading it.
He's talking about actuallyowning a piece of the business,
having that mindset and shiftthat as opposed to just trading
stock and just, dealing withnumbers on paper.
(05:45):
Or tickers on, on, on paper,you're actually owning a piece
of the company.
So the intention is to own forthe long term.
So that, that is number one.
Number two, staying informed.
Staying informed means a lot ofthings, knowing on, what's going
on in the industry.
Has your industry changed?
Staying informed goes into, Ilook at it for, on, on the side
(06:05):
of business ownership islearning about ai.
What are some of the, what someof the advantages of using the
technology?
What are some changes that theindustry, I.
Is experiencing.
And again, this applies tobusiness ownership as well as if
you're owning stock or as Warrensays, owning publicly traded
companies.
But staying informed as to thechanges, what effects will there
(06:26):
be with the change in additionof ai, what does the market look
like?
Figuring out what are.
What is the competitive pricing?
What are things we should lookat when it comes to equipment
staying on top of the equipment,if there's equipment involved
staying informed of, and we'regonna talk about this, I.
Your competitors, but knowing,what the competitors are doing
(06:47):
specifically in the market whenit comes to pricing, when it
comes to equipment and ways ofgoing about business.
Staying informed is also a bigone.
Whether it's, again, investingin the stock market or your
business because you wanna knowwhat's going out there going on
in, in your industry and how youcan stand out.
So if you are in the paintingspace, what is it that will help
(07:08):
you?
Maintain that advantage and helpyou stand out in the industry.
Which brings us into numberthree, which they merged
together there, but you know, ismaintaining a competitive
advantage.
You need to know what yourcompetition is doing.
You're not spying on them in abad way, but you wanna know
Exactly.
I.
What they are doing, what theyare doing differently, what's
working, what's not working.
(07:29):
You're in the same industry.
You're potentially, competingfor the same customers and
clients.
So what is gonna make you trulystand out in a painting
business, going back to a verysimple business to understand.
It's the simple fact of customerservice and follow up, showing
up for an appointment on timeand really being professional,
(07:49):
being able to quote the customersame day, show them before and
afters, give them differentoptions when it comes to the
finish of the paint if maybe.
Someone in your family hashealth issues and there's more a
paint that offers anti-microbialproperties.
That is also something standingout to me is that okay, you
(08:10):
don't wanna, consider yourself acommodity, but what can you do
to stand out amongst yourcompetitors?
And I think.
Some of the simple stuff likefollow up, showing up on time
being able to give a quote andpotentially even schedule the
job all in the same day.
I think that gives you a majoradvantage.
I know for myself, we've went toget a few quotes on home
(08:31):
services, including powerwashing and took three, three
emails, three communications ormessages I should say.
For that first return and reply.
So that alone leaves a bad badtaste in your mouth followed by
number four, focusing on qualityand always going over and beyond
your customer.
So if you own a business, I.
(08:53):
They have options.
Odds are whatever product orservice you're offering there's
gonna be competitors out in themarket.
So what do you do?
And again, a lot of these arebleeding together, but what do
you do when it comes to qualityas far as follow up and that
follow up?
I always tell everyone is that.
Mistakes or issues are inevinevitable.
It's part of business thingswill happen.
(09:15):
It's how you go about fixingthat.
And when I had my lastcompanies, we would go back and
say, we know that mistakes andissues are inev inevitable and
they're gonna come up.
What we will do is in the event,something were to come up,
number one we try to prevent itby doing an a daily inspection,
but in the event something doesfall through the cracks, this is
(09:35):
your main point of contact andthis is how we will go about.
Fixing that issue fixing theissue, being proactive to make
sure it doesn't happen again.
And depending on the extent ofwhat happened whether it was, a
missed service, a missed area,going over and beyond and
issuing a credit for the day or,for a partial credit.
And going back into theinvestment world, focusing on
(09:57):
quality, is that you're reallygetting to know the businesses
that you're investing in, whatyou know, what service or
product they're putting out,getting to experience the
service or product.
If you don't believe in theservice or product, this, that
may not be the right investmentfor you.
Same as it may not be the rightbusiness for you.
These are things that come up.
Over and over again.
(10:18):
And the over kind of archingtheme, behind all this too, is
that you need to also be able tounderstand your market.
And that's a I should actuallysay, I take that back.
You should really be able tounderstand your business, what
business you are in.
A lot of franchise companies,again, they may be in the
painting space, but what theyreally excel is they're a
(10:38):
marketing and sales engine.
That's the true business.
They excel at marketing sales.
They're a lead generation enginethat they can really apply to
just about any home service typeof business.
I.
Really understanding thebusiness and not investing in a
business or starting a businessyou don't truly understand and
taking your time beforelaunching or investing in a
current business or investing inthat specific stock, that
(11:00):
publicly traded company.
Really understanding thebusiness is gonna be key.
Knowing everything about it.
Experiencing it.
If you're gonna invest in acertain business, you wanna
experience a service andproduct, as I mentioned earlier
before diving, diving in andinvesting in that business.
And you don't have to beinvested in anything in the
stock market.
There's mutual funds, there'sbonds, there's commodities
there's crypto.
(11:20):
There's so many differentoptions.
Don't feel like you have to beable to invest in, in all those
areas.
I personally do not invest incrypto.
I have nothing against crypto.
I don't understand and I'm notcomfortable.
With that type of currency.
So I don't wanna invest in it.
Can you make money?
Absolutely.
Can you lose money?
Absolutely.
But you know, the whole premisethere is investing in things
(11:40):
that you're comfortable with.
I have experience with, andthat's not to say I don't, get
up to speed and maybe investdown the road.
But currently I feel likebetween my business, my
investments in real estate, inthe stock market, that's
comfortable for me gettinggrowth, I'm getting.
In monthly and quarterly incomeand distributions, and that's
okay.
So don't feel like you have tobe in every aspect of the market
(12:04):
or that you have to have 20different businesses.
Mark Cuban talks about this allthe time.
We had one of his, one of hiscompanies he invested in on
Shark Tank called So soap youonly have to Be Right Once is
something he talks about all thetime.
And you're gonna have somefailures in the mix as well.
So you don't have to have 20businesses.
You can really focus in.
On one business and do a lot ofdamage with that business.
(12:25):
If you think about it, 24 hoursin a day, if you're focusing on
one business versus I had metsomeone early on in my career.
He owned seven businesses, and Igo, why seven?
He's like, well, for every dayof the week, he would literally
dedicate himself and go to thatcar wash.
And he owned a a separate autodetailing business and five and
a business that, that dyedclothing and sold dyes and four
(12:46):
others.
And he would actually spend.
That day in and off a smalllittle office talked to everyone
and dedicate a day a week foreach business, which I thought
was cool.
Did they all equally make himmoney?
They all made him money.
He did say there was one or twothat made a majority of his
income, but I found thatinteresting.
So I.
There's no rights.
No right or wrong here, I guessis the point I'm trying to make
(13:06):
is that, you really, you don'twanna spread yourself thin,
especially when you're launchingyour first business.
Really, get to know thebusiness, the platforms to be on
and focus on quality.
You wanna give that, thatproduct or service, everything
you have, you don't wanna.
Go in halfway and have a lot ofmistakes and forget the follow
up and things like that.
And number five on buffet's.
(13:28):
Five rules that we summarizedfor today would be managing
risk.
Managing risk starts with yourdue diligence, and that goes
back to, sta long-term.
Viewpoint and reiterating hisrole, staying informed,
maintaining a competitiveadvantage, focusing on quality
and managing risk is reallygoing back to say, okay, where,
(13:48):
what are the risks?
What are the threats in theindustry?
Will AI affect my business andor service?
Are there more competitorsmoving in and offering a similar
type of business, specificallyin the market I am in?
How do I manage risk?
Well, I also look at things.
When you're starting a businessand it's managing your cash
flow, I always say when you owna business, you're always gonna
(14:10):
find ways to reinvest back intothe business.
So a big part of that is okay,using I had Rocky Lani from
Profit First, and it's payingyourself first before expenses.
Figuring out a way to say, okay,for every dollar that comes in,
20 20% are going to taxes.
I'm making these numbers up, 30%operating expense maybe a 10%
(14:33):
profit, kind of distribution andthe rest goes to the owner's
salary.
In that way you're managing riskin that you're not overspending
in certain areas by not having abudget.
And you're knowing your numbersso that you're figuring out
ways.
Okay.
Do I have to cut costs?
Managing risk also has to dowith KPIs.
Reviewing the numbers, makingsure you have enough lead flow.
(14:53):
If you're having enough leadflow, is the quality there?
Is the sales person able toclose those specific deals?
And the same goes, when you'reinvesting in the stock market,
managing risk, looking at you'regonna have the advantage of
being able to look at thefinancials do the.
Is there a, a lot of sellingbeing done from the corporate
office.
Are they buying back a companystock?
(15:14):
Is has there been continuousgrowth?
Is there a plan?
It's doing your homework and notgoing in into anything blind.
And that goes back to owningyour, and understanding your
business and industry.
When you're managing risk,you're doing the due diligence
upfront.
Again, you're never gonna be ahundred percent, you're gonna do
as much research as you can on afranchise.
You're gonna talk to thefranchisor, you're gonna talk to
(15:35):
the franchisees.
You're also going to meet withthe franchisor at a virtual or
in-person discovery day.
But you're doing your duediligence the best you can.
Same thing when you're investingin, in a stock, in you, a
publicly traded company.
You're going in, you're lookingat the numbers.
You're looking at, who o whoowns the business.
Is there a lot of selling?
(15:55):
Is there a lot of buying?
Has there been growth?
Where does the company seeitself?
So there's a lot of analystskinda research, which is
helpful, but just knowing what,where the company is going.
That information is all readilyavailable.
You can find that on GoogleFinance, but just seeing where
that business is going to figureout, hey, it has done well.
But that past performance willthat help and predict future
(16:18):
performance and not necessarilyright.
We wanna make sure thatcompanies still.
Being innovative, utilizing ai,cutting costs while still
growing and really increasingthe the bottom line, which at
the end of the day, we wanna beprofitable, but we don't wanna
be so profitable that we'repulling so much outta the
business that we're, hurtinggrowth by not reinvesting in
(16:39):
technology, by not addingheadcount and staff and things
like that.
To.
recap, war Warren's five rules.
You have long let's see,potential building wealth,
including investment for thelong term, staying informed,
maintaining a competitiveadvantage, focusing on quality
and managing risks.
And as I mentioned at thebeginning of the show focus on
not losing money and rule numbertwo.
(16:59):
Is, don't forget rule numberone.
So obviously no one goes intobusiness with the intention of
losing money.
But I think, when you start abusiness, the intention is let's
make money.
Let's get systems in place.
A franchise will give you thatcompetitive advantage.
But let's reinvest back in thebusiness.
So we have the blueprint, weknow exactly what to do and the
systems in place, but we wannamake sure to increase headcount
(17:21):
should the demand be there onthe market.
So a lot of great stuff.
I wanted to do this quick showbecause just as I mentioned,
I've been following Warren forthe, for over I would say close
to 30 years now.
Love what he is done back in theday.
Value investing really didn'tappeal to me because it was the
tech bubble.
So it seemed like anything youpurchased went up in price and
(17:41):
in value until that bubbleburst.
Warren has always had a long, akinda long view, a perspective
and how we approaches hisinvestments.
And I think you can use thosephilosophies to find your, your
your business focus is gonna bigis big.
Know your market.
Don't spread yourself too thinby having to invest in every
(18:02):
single investment out there tofeel like you're diversified.
You could be diversified.
As Warren mentioned he's hisadvice, and I heard this on a
previous call, was investing 90%in the s and p index fund.
It could be Vanguard, it couldbe the spiders, SPY, and then
10% short short term governmentnotes.
And that will be one way dollarcost average.
(18:24):
That way you're getting fullaccess to the market, you're
getting a little bit of cashflow in there as well.
And and some diversification.
So it's very hard tocontinuously beat the market.
Warren and Berkshire have havedone that consistently and yeah,
I just wanted to, I.
Just wanted to give a shout outto Warren.
Warren, if you're listening,we'd love to have you on the on
the show.
Maybe I'll have him on as whomay have some more time on his
(18:45):
hands.
But really appreciate your wordsof wisdom.
We'll put the link there.
So if anyone wants to check outthe video really inspiring stuff
and be curious to get yourfeedback.
Wanted to mix things up a littlebit.
The investment world it's hardto find financial advisors that
are able to come on the show.
There's so many rules andregulations and topics and
things like that, and, we're notwe're not overly structured.
(19:07):
We like to have open and honestconversation.
Con considering I, I come fromthe investment world and I am
not a no longer a financialadvisor and not giving any type
of financial advice, just thingsto, to think about.
Someone like Warren.
And I think that his lastmeeting here before the new CEO
takes over was definitelyinspiring.
And definitely learn somethingfrom that from that talk.
(19:29):
Thanks again for joiningeveryone.
We're gonna mix things up.
We're gonna, we're gonna add theshows like this going forward.
Just some value adds, somethings to think about.
We did mention.
We had Jeremy Dyer I think itwas towards the end of last
year.
We talked about real estatesyndication.
We do have people that have mademoney in their franchise and
reinvested in, in that in thatarea.
(19:49):
And those are different types ofinvestments, different types of
returns.
A little bit more structured,less involvement.
Those are there, there's someappealing aspects and not so
appealing aspects depending onyour situation.
Franchise obviously is notpassive.
It's you could be full-time orpart-time, but there's still
involvement there.
It's not a kind of buy thefranchise and then walk away and
(20:09):
it runs on its own.
So really figuring out theinvestment that's right for you
when it comes to the the type ofbusiness, your, in, your
involvement, the role, how manyhours you can put and when those
hours are the investment.
And there's a.
Quite a few other elementsthere, timeframes and things
like that.
If you are interested in havinga chat, I'd be more than glad to
(20:30):
help you figure out moreimportant than anything else.
If a franchise may be a good fitor not.
Go to gigi the franchiseguide.com.
You can book a call.
I.
Top right, corner of thewebsite.
There's a button there.
We'd love to help you out.
There's no cost for our servicesin 20 minutes or less.
We'll figure out together if afranchise may or may not be a
good fit before deciding on theon the next step.
(20:51):
So hope you take me up on thatoffer.
Hopefully you found this type ofvideo informative and helpful.
We'll share as many links asthat we come up with here.
And if you have any comments ora idea for a future topic.
Definitely let us know.
Be more than glad to cover thatarea.
Do like to mix things up asbusiness ownership is fun.
We're not in silos here in stockmarket.
(21:12):
Business ownership, franchisereal estate, all flows together
when you look at it.
Hit me up.
Thank you for your support.
Thanks for listening in today,and we'll talk to you guys soon.
Bye-bye.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
(21:33):
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
achieve financial and timefreedom today.
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