Return on investment (ROI) is often treated like a simple spreadsheet calculation — but in small business acquisitions, it's much more than just a number. In this episode, Tim breaks down the real difference between ROI and cash-on-cash return, how leverage changes outcomes, and why focusing only on percentages can lead buyers to make bad decisions. Using practical examples, Tim explains how time, effort, risk, and financing all factor into evaluating whether a deal is actually worth pursuing.

Tim Delaney is an entrepreneur who believes everyone should explore the opportunities that business and real estate can provide on the path to financial freedom. He owns and operates a wine & liquor store, a software startup, a consulting company, and a growing portfolio of commercial and residential real estate.

Tim's passion for independent business has led him to support dozens of other business owners. For over a decade, he has worked with businesses on strategy, processes, finances, and marketing. These experiences, along with analyzing dozens of other businesses for potential acquisition, have provided Tim with an immense knowledge base to pull from.

Tim has appeared on multiple top-tier podcasts in the financial space, such as Bigger Pockets Money and The Freedom Chasers Podcast.

[00:00 – 02:30] ROI Is More Than a Spreadsheet

Tim explains why ROI shouldn't be viewed as just a financial formula, but as a broader measure of freedom, risk, and opportunity cost.

[02:31 – 06:15] What ROI Really Measures

Breaking down how ROI is calculated, what it includes, and why purchase price matters more than most buyers realize.

[06:16 – 12:45] Cash-on-Cash Return Explained

How cash-on-cash return works, why leverage dramatically changes outcomes, and how financing can increase early returns.

[12:46 – 18:30] Leveraged vs. Unleveraged Returns

Comparing all-cash purchases to financed deals and explaining why cash-on-cash returns are often much lower in pure cash acquisitions.

[18:31 – 26:40] Real-World Business Example

Walking through how owner pay, debt paydown, and equity growth affect actual cash coming back to the buyer.

[26:41 – 34:50] Comparing ROI Across Investments

How small business returns stack up against stocks, bonds, and real estate — and why business ownership should demand higher returns.

[34:51 – 42:30] Time, Effort, and Risk

Why there is no universal "good" ROI number, and how stability, workload, and industry risk should shape return expectaions.

[42:31 – End (~45:00)] Final Thoughts

Why ROI is only one part of the decision-making process and how buyers can avoid chasing.

If you found value in today's show, make sure to subscribe so you never miss an episode packed with insights to help you buy and grow a business that creates real financial freedom.

Connect with Tim and the community:
Website: https://www.powerofbiz.com
YouTube: https://www.youtube.com/@powerofbiz
Instagram: @timtdelaney
Threads: https://www.threads.com/@timtdelaney
LinkedIn: linkedin.com/in/timothytdelaney
Facebook: facebook.com/timtdelaney

Tweetable Quotes:

"ROI isn't just a spreadsheet formula — it's also a freedom calculation." – Tim Delaney

"Cash flow and profit are not the same thing, especially when debt is involved." – Tim Delaney

"There is no single ROI number that works for every business or every buyer." – Tim Delaney

In this episode, Tim talks with Tiffany Kao, an entrepreneur and creator who shares a candid look at what it really takes to bet on yourself, and the mistakes that come with it. Tiffany opens up about quitting her job early in her journey, the pressure to "burn the boats," and how that decision forced her to learn hard lessons about sustainability, timing, and resilience. She reflects on how her definition of success has evolved, why confidence without preparation can be dangerous, and how experience reshaped the way she approaches risk, growth, and long-term stability.

Tim is an entrepreneur who believes everyone should explore the opportunities that business and real estate can provide on the path to financial freedom. He owns and operates a wine & liquor store, a software startup, a consulting company, and a growing portfolio of commercial and residential real estate.

Tim's passion for independent business has led him to support dozens of other business owners. For over a decade, he has worked with businesses on strategy, processes, finances, and marketing. These experiences, along with analyzing dozens of other businesses for potential acquisition, have provided Tim with an immense knowledge base to pull from.

Tim has appeared on multiple top-tier podcasts in the financial space, such as Bigger Pockets Money and The Freedom Chasers Podcast.

Tiffany shares why she quit her job early, the mindset behind "burning the boats," and why she now believes timing and preparation matter just as much as courage.

The realities of entrepreneurship after leaving a steady paycheck, early missteps, and how pressure can accelerate growth — or expose cracks fast.

Why believing in yourself isn't always enough, how overconfidence can backfire, and the systems Tiffany wishes she had built sooner.

How Tiffany's view of freedom, income, and sustainability evolved as she gained experience — and why stability matters more than proving a point.

Tiffany's advice for anyone considering quitting too early, what she'd do differently now, and how to approach risk with clearer eyes.

Tiffany Kao is an entrepreneur and creator who shares honest insights about the realities of self-employment, risk-taking, and personal growth. Through her experiences leaving traditional work and navigating entrepreneurship, she emphasizes thoughtful decision-making, resilience, and redefining success on your own terms.

If you found value in today's show, make sure to subscribe so you never miss an episode packed with insights to help you buy and grow a business that creates real financial freedom.

Instagram: https://www.instagram.com/tiffany_on_the_go_/

Website: https://www.powerofbiz.com
YouTube: https://www.youtube.com/@powerofbiz
Instagram: https://www.instagram.com/timtdelaney/
Threads: https://www.threads.com/@timtdelaney
LinkedIn: https://www.linkedin.com/in/timothytdelaney/
Facebook: https://www.facebook.com/timtdelaney

"I promptly quit my job — which, by the way, is highly not recommended — but I was young and strong-headed, and somebody had given me the speech about how you need to burn your boats." – Tiffany Kao

"Confidence without preparation can put you in a really tough spot." – Tiffany Kao

"Looking back, I would've timed my leap very differently." – Tiffany Kao

In this episode, Tim breaks down a real-world post about a struggling food business where the seller is trying to recover build-out costs despite little to no profit and a long-term, expensive lease.

Tim explains why this situation is a textbook example of the sunk cost fallacy, why buyers often confuse assets with value, and how leases, franchises, and zero cash flow can quietly turn a "deal" into a long-term financial burden. He also discusses the difference between running a healthy business and trying to turn around a failing one—and why most buyers underestimate that gap.

Tim Delaney is an entrepreneur who believes everyone should explore the opportunities that business and real estate can provide on the path to financial freedom. He owns and operates a wine & liquor store, a software startup, a consulting company, and a growing portfolio of commercial and residential real estate.

Tim's passion for independent business has led him to support dozens of other business owners. For over a decade, he has worked with businesses on strategy, processes, finances, and marketing. These experiences, along with analyzing dozens of other businesses for potential acquisition, have provided Tim with an immense knowledge base to pull from.

Tim has appeared on multiple top-tier podcasts in the financial space, such as Bigger Pockets Money and The Freedom Chasers Podcast.

[00:00 – 02:15] Is a $200K Build-Out Still Worth $200K?
Tim opens with a simple but critical question: if a business isn't profitable, does the money spent building it out matter at all?

[02:16 – 05:00] Breaking Down the Original Deal
Reviewing the details of the post: a struggling food business, $6,000 monthly rent, long-term lease, franchise involvement, and no meaningful profit.

[05:01 – 06:45] You're Not Buying a Business
Why this deal is really about taking over a lease and a space—not acquiring a functioning business.

[06:46 – 08:30] The Sunk Cost Fallacy Explained
What sunk costs are, why sellers fixate on them, and why buyers should never pay for money that's already gone.

[08:31 – 10:20] Lease Risk and Personal Guarantees
How long-term leases, rent obligations, and personal guarantees can quietly become the biggest threat to a buyer.

[10:21 – 12:30] What Is This Business Actually Worth?
Why a business with zero cash flow has little to no value, and why used restaurant equipment usually sells for pennies on the dollar.

[12:31 – 14:40] Franchise and Legal Red Flags
Potential issues with rebranding, franchise agreements, and trademark risks that buyers often overlook.

[14:41 – 16:30] Don't Pay for Someone Else's Mistakes
Why turning around a failed business requires a very different skill set—and why confidence alone isn't enough.

[16:31 – End] Final Thoughts
Cash flow is king. Without it, even a "great location" and expensive build-out can't justify a bad deal.

If you found value in today's show, make sure to subscribe so you never miss an episode packed with insights to help you buy and grow a business that creates real financial freedom.

Connect with Tim and the community:
Website: https://www.powerofbiz.com
YouTube: https://www.youtube.com/@powerofbiz
Instagram: @timtdelaney
Threads: https://www.threads.com/@timtdelaney
LinkedIn: linkedin.com/in/timothytdelaney
Facebook: facebook.com/timtdelaney

Tweetable Quotes:

"Money already spent does not equal value." – Tim Delaney

"If a business has no cash flow, it isn't a business—it's a liability." – Tim Delaney

"Confidence doesn't fix bad numbers." – Tim Delaney