Howdy readers!
This week, we’re keeping it light → 9 weird ways I’ve seen people get rich.
Before we get started:
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1. Sell insurance that never pays
We all know the grandfather of insurance that never pays: property title insurance. In Texas last year, only about 3.2% of policies paid out.
But a guy here in San Antonio found something even better. He’s a therapist, and about 30 years ago he went around to corporations and offered them a service: on-call therapy for employees.
Companies were happy to have it because it was another benefit they could offer their employees. And the employees… never called.
He’s rich now.
2. Tax harvest facilitating
When a company has equipment, it can write off a portion of its value as depreciated every year.
But once that equipment has depreciated all the way, sometimes it’s better for the company to get new equipment so it can keep claiming those write-offs.
That means they can have perfectly good stuff they want to offload — maybe medical imaging machines, heavy equipment, or a big load of laptops.
I have friends who operate businesses that buy depreciated or slightly used equipment, fix it up a little bit, and put it back out on the market.
It’s win-win-win. The company is happy to have improved its tax perspective. My friend has made a cut. And the end customer gets a deal on perfectly good hardware.
3. Help rich people show off
My favorite company that does this is in the Northeast, mostly by the water, and it's called Seabags. They buy used sails from sailboats and hire local folks to sew them into tote bags.
Then they sell those bags for huge markups — like $150 or $200 each — to rich people who then have a cool accessory to brag about.
The angle here is recognizing a cheap raw good that can make a rich person feel good, ethical, rustic… you’re selling a feeling as much as you are a product.
Seabags has dozens of stores now, and I’d bet they’re making millions of dollars a year helping rich people show off.
4. Geographic arbitrage
Arbitrage is basically “buy low in one place, sell high in another.” It’s a simple concept, but when you find the right circumstances, you can make a lot of money.
For example, an influencer sells super expensive Moroccan rugs. When they’re out of stock, they fly to Morocco and buy them at a market for pennies on the dollar.
I did this for years with fireworks.
We live right near the Mexican border. Mexico has a high duty fee on fireworks imported from China but a low duty on fireworks from the US. So we’d import our fireworks, then sell them to people from Mexico who could then take them back across the border.
with a lot of questions. What type of business should you buy? Where are you going to get the money? Who can guide you with true expertise?
5. Polishing diamonds
Here's how it works: find something that's a little bit broken or a little bit off, fix it, then flip it for a profit.
The well-known path here is house flipping. But there’s a lot of competition for real estate, so look to slightly more niche flips.
I have a buddy who travels around to auctions buying heavy equipment. He repaints them, fixes what’s broken, and makes a huge profit on the market.
How do I know he’s doing well? He flies to those auctions on his private jet.
6. Selling to collectives
When you’re selling a product or service to an individual, they want to make sure they’re getting the best return for the best price.
When you’re selling to a group, like a city or an HOA, the individual decision-makers are more removed, and the calculus changes: what matters to a group is minimum hassle.
People don’t care as much if the purchase goes wrong, they just want to get through to the next item on the agenda.
A buddy of mine sells services to HOAs representing big neighborhoods and packages his deals to be as simple as possible.
(This guy also flies private.)
7. The side hustle carve-out
I knew a guy whose job was to scout out locations for new grocery stores. Pretty quickly, he spotted a side hustle.
It turns out a lot of businesses want to be next door to a grocery. All the standard stuff: dry cleaners, UPS stores, liquor stores — all the stuff you expect to find in a little nearby strip mall.
So, this guy, whenever he put a piece of land under contract for the grocery store chain, would personally buy the land right next to it and build a strip mall. The grocery store didn’t mind, because having a strip mall next door just gave them more traffic.
These days, he clears over $4M / year.
Ask yourself: whatever your job is right now, what edge does it give you over the average person? (Except insider trading. Don’t insider trade!)
8. Buy by the acre, sell by the foot
About 10 years ago, I bought a 23-acre piece of property. Over the next five years, we split that land up and sold off individual pieces, ultimately for more than we paid for it. The best part: we kept a little piece of that property, which is now a cash-flowing asset for us.
In the long run, we basically got paid to take a piece of valuable property off a seller's hands.
There are lots of opportunities out there to buy in bulk then sell in parts. You need the capital to take advantage of it, but just as much, you need to be constantly scanning for opportunities.
9. Rent out a brand
A few years ago, my podcast Acquisitions Anonymous looked at a listing for a Wine & Spirits Tasting Competition business for sale. Get a load of this:
So this person builds a brand, charges wineries to enter their competition, then charges the winners to put an award on their label. Not to mention they only work 5 hours a week.
This business was making $900k/year, and the owner was selling for $3.3 million.
Pretty, pretty, pretty good.
Have a great week!
Michael
