This month we are spotlighting Seth Lederman, CFB (Certified Franchise Broker), Franchise Acquisition and Development Specialist as the CEO of FranNexus and author on Amazon’s 3 Best Seller’s lists.
Seth’s professional background is in running a practice as a Chiropractic Physician and healthcare entrepreneur. During his practice he became influenced and motivated by Michael Gerber’s “E-Myth” books – so much so that Seth became involved in Mr. Gerber’s business development consulting incubator. Through that process, Seth began embracing franchise concepts such as implementing standards, facility codes, procedures, and all the things that franchises do. After adopting these methods, he took his business from 1/2 Million a year in his first year to $4.5 million in 3 years!
Seth was absolutely convinced that franchises and proven concepts were the best way to become a business owner. He also knew himself. He knew that he would have a hard time following someone else’s systems. Seth says “I’m just too much of a rugged individualist, the proverbial ADD entrepreneur. I know I would always just want to do things my way. I felt I’d make a much better franchisor or consultant instead.” He had been exposed to franchise consultants with his experience with Michael and the E-Myth Mastery Program, and knew he would be a good fit. So he began pursuing the idea of entering the franchise consulting business.
Seth is now entering into his 16th month in the business and says he’s now crystallizing his strategy on how he wants to run and build his business. “This has been the first real year in business. I trained in December of 2013, but didn’t kick off until March of 2014 when I decided to leave my healthcare consulting business, started taking my leads and working them 100%. So far I have closed 6 deals and have 3 more that are very close. My hope is to have 10 closed deals by the end of the summer. Ultimately, I have a goal to build my pipeline out so that I am closing at least 1-2 deals a month. It just takes some time to build that pipeline and you need to be financially and emotionally prepared for that.”
Using the contacts Seth has made since entering the business he has been working on expanding into franchise development. “With franchise development you’re building a long term revenue stream. Franchise acquisition is great, but it is a one time pay day. With development I’m able to help my business as a whole by generating recurring income and inbound lead sources. I’m currently working through the franchises development of four different businesses. I’ve discovered that there are many potential revenue streams with this business and that effective time management is critical. You have to know what opportunities to say no to.”
Seth is also close to the release of his latest book,Profits are Better Than Wages – How to achieve the life of your dreams by being in business for yourself but not by yourself, early this coming fall.
Where are you getting the leads for your business?
Seth says that he’s been doing a combination of internet leads and networking to find qualified franchise candidates. “My local BNI group really helps. I am doing just as many deals through networking as I am doing through internet leads. I’ve closed several of my franchise acquisition deals and two of my four franchise development deals came directly from networking at my BNI group. That’s a huge ROI as it only costs me $500 and a couple of hours a week to be involved there.”
“The people I am working with are earning well into the 6 figures. They aren’t just going to jump ship into any franchise I show them without a very thorough and analytical due diligence process, which I guide them through. I make sure the process is very systematic and methodical. The fact is, I end up saving them a lot of time and effort. You don’t know what you don’t know. I help each one of them to understand their options, the process and how to transition from unconscious incompetence in franchising acumen to conscious competence”
He’s also set up rebound lead opportunities with franchisors that he’s done deals with or met at trade shows. “Rebound leads are working great for me. They are very responsive candidates and I enjoy speaking and working with them. The franchise development deals I’m doing will also supply me with rebound leads as well. My hope is that the work I am doing today will provide me with all of the leads I’ll need and I won’t have to do any outbound lead generation.”
Tell us a little about the last 3 deals you just closed.
Liquid Capital
June 2015 – Dallas, TX – 1 Unit – Commission: $20,000 +$500 CFB Bonus
“This was the 2nd Liquid Capital deal I have closed. I was introduced to my candidate, Brad, from a BNI referral. Brad has been in supply chain management for the bakery industry and his career required frequent travel time away from home. Being recently married and wanting to start a family, Brad knew that he needed a change. Looking at franchises made sense to Brad, as he knew that owning his own business would provide the sense of satisfaction and fulfillment, not to mention freedom and control of his own destiny he always dreamed of. He was very accomplished, but wasn’t satisfied. He was frequently getting promotions at his job, but wasn’t receiving much more in the way of compensation.”
“I ended up showing him several concepts. Getting to know him better I saw that he was very analytical and the Liquid Capital concept rang for him because it’s numbers-oriented. He saw the ability to tap into the supply chain net worth that came from his career. He liked that they had a corporate location near him in Dallas and liked that he could work nationwide. One of the great things about Liquid Capital is that their territories are only marketing restricted. With Liquid Capital, Brad could work from home and didn’t have to get an office space or work 9-5 Monday through Friday.”
It wasn’t an entirely smooth process though. The deal died a thousand deaths before it finally went through. However, as it would fall it apart I was supportive and remained consistent with my communications and coaching. I worked very closely with both the candidate and franchisor to help see it through. Liquid Capital handled everything very well. They are true professionals.”
Mr. Handyman
July 2015 – McKinney, TX – 1 Unit – Commission: $24,000
“This deal was with a fellow BNI member who realized, after hearing my elevator pitch, that he wanted a career change. Steve is an employment/labor law attorney, who like many attorneys had a strong sense of career dissatisfaction. Steve wanted to do something he would enjoy and that was more of a natural fit for him. Many aspects of being an attorney were not fulfilling for Steve and he wanted something more for himself and his family. Steve was excited to know that there was available territory for a Mr. Handyman in his home area. He was very familiar with the brand, as they have a strong presence in the DFW area.”
The tricky thing with this deal was that Mr. Handyman was that the brand representative although not new to the industry had just joined Service Brand International, the parent company of Mr. Handyman. In addition, they were acquired by the Dywer Group right when we were in the middle of FDD review. This meant that all of a sudden we were on hold until an updated FDD was available! I had to help my client overcome this change and helped him to understand that it was a good opportunity for him since the Dywer group has a large infrastructure and a lot of resources that would be able to help him.”
Project Walk
July 2015 – South New Jersey/Philadelphia – 1 Unit – Franchise Fee is $60,000 – Avg. Commission is 50%
“This deal came from an internet lead on Franchise Help. Dan has been in sales for product package labeling for several years and was making a very nice six figure income, but something was always a ‘thorn in his side’. As successful as he was financially, he was always concerned the success he had could be taken away from him because it wasn’t his business. He soon to be wife, Leslie, a carer school bus driver was retiring and Dan wanted something that he and Leslie could do together. Project Walk was a great fit as they wanted something unique that made a difference in people’s lives. He wanted a franchise where he would be able to maintain his job and keep his income, while Leslie could start and build the business. Dan can then choose to join the business whenever he wants to, when the timing is right.”