To buy a business or form a startup

[grumpydasmurf]

I'm treading some mighty dangerous ice here but the time may be for me to spread my wings and break away from my boss. I'm not totally sure I will but I've put together a business plan and marketing plan. The main decision I have to make, after I decide if I should split or stay, is if I should form a start-up or look into purchasing an existing business.

Any advice?

[Rich]

If the cash is there I would suggest a start-up. Historically if you look at existing business's that fail - it typically happens during a change in ownership or when transferring a company within the family. People work differently and have different business ideals. So it is difficult to step into an existing business and continue on a profitable path. It's not impossible but it does lend itself to a breakdown of sorts.

[grumpydasmurf]

I was actually only thinking of buying an existing business for a few reasons.
Reason 1) Home owners love a company that's been around for awhile.
Reason 2) Having an existing customer base makes it easier to sell additional services.

The problem is I have alot of freedom at my current job... but not total freedom. I feel like my boss is holding me back with his lack of vision.

[Rich]

I can totally relate to what you are saying. I sold my home building business several years ago and went to work for a multi-billion dollar (annual) general contractor. The company is so structured that I find it difficult to suggest a better way of doing something without going through a bunch of hoops and red tape. I hear "Well we've done it this way for years and it's worked" so many times in a day my ears hurt. The statement does have merit but change is sometimes good for a large company that typically gets mired in the "tradition" of doing work.
I still do quite a bit of side work in the evenings and on weekends.
Anyway sorry for my rant..
The reasons you have stated are excellent reasons to buy a company. Good company standing in the community is a must - but when buying that company you will typically pay a premium for it. Research the company you are planning to buy. Call existing clients and make sure they were satisfied. Sometimes a change in management may cause clients to react adversely.

[grumpydasmurf]

That was actually another thought I had... Actively persue working for a large company like your with so that I can broaden my horizons and take in another point of view... and more industry contacts.

Then absorb as much knowledge as possible and after that start my own company!

[Rich]

It's an excellent opportunity to get training that you typically wouldn't get with residential contractors. The one thing with the company I work for is that you start as a Field Engineer and then work through the office and then back in the field as a Superintendent. The education you get is priceless. From layout and surveying to accounting and scheduling.

A problem though is they don't care if you have experience or not - you start low man on the totem. I'm not sure if other larger GC's promote from within or hire people as project managers and superintendents. Out biggest asset and the main reason that we only promote from within is because we do such a large portion of self-work. Our crafts people do all the concrete and masonry on most of our jobs.

It's definately a different side of construction.

[grumpydasmurf]

I like the militaristic approach your company has. How long does it take to go from field to office to field?

[Rich]

Typically it's anywhere from 1-2 years as a field engineer... and then 8months to a year as an office engineer and another year or two as a project engineer. Then into the field as a superintendent.

[grumpydasmurf]

That's too many years. If I do the math I would be past the age I have designated to be running my company.

[Rich]

I've been fairly lucky at being at the right place at the right time. I've been with the company about 2 yrs 9 mos and am a Project Engineer already - soon to be a superintendent.

It is a long time though.