65% of businesses fail in 10 years. But that's only true if you pick the wrong type of business. So, how do you pick the right business that's more likely to succeed?
I want to start with the data and tell you exactly what I'd do if I lost it all and how to start over tomorrow. By the way, I'm Cody Sanchez, founder of Contrarian Thinking and we've built dozens of businesses. So, let me let you steal our homework so you can build without much cash or talent.
The framework that I'm going to talk about today is called signals. And this is the number one way to grow your wealth in 2026. Let's start with the S.
In 2026, your biggest advantage isn't talent. It's not capital, it's speed. And that's the first S in signal.
How we think about this is called the udaloop framework. Basically, we stole this from the military. And it goes observe, orient, decide, act.
If you can move from idea to launch in 24 hours while your competitors are circling back next quarter, you win. I've seen this time and time again. Like Spencer Scott, who we talked to about building a trash business.
Did he wait to figure out how to actually do trash, how to get permits, how to do whatever? No, no, no. He put up a Facebook post on his local community site and said, "Hey, by the way, do you guys also hate our trash company?
And if you do, here's a pre-sale link right here to something that does not exist today. But if you click this and you give me a monthly amount of 30 bucks or whatever, and I get to at least 10K, I'll start this company and I'll create a better garbage hauling system for all of us. That one decision, which took him 24 hours from the idea to the action in the post, led to $13,000 in monthly recurring revenue before buying a truck.
Most people take millions of dollars in venture capital funding to do that. So, he used Web Flow, Stripe, and a Facebook rant to pre-sell. He had a few of referral incentives like sign up for 5 months you get a shirt.
10 months you get three months free. No licenses, no capital, no equipment, just an idea on a landing page. And that, my friend, is what I mean when I say sell first and build second.
Next, I want to talk about the I in signals, which is industry selection. When you pick the right industry, you don't die. Most people start businesses in industries where the odds are already against them.
If you want to win, you start with where the math is in your favor. Let's talk about the survival rates of small businesses. If you look at a typical survival rate, you're going to find that most businesses die.
90% of them within 10 years. But you look here and you see, wait a second, information businesses, they have a 29% 10ear survival rate. Not great.
That's an F. That's below an F. Versus manufacturing and agriculture, 49% survival rate.
You got 50/50. So, this isn't actually about being sexy. It's about being solvent.
Do not pick places where dreams go to die. That's why we obsess on a bunch of businesses like lawnmowers, power washers, older small business owners answering the phones. These industries are wide open because the people running them, they're all aging out.
So, I think there is an inverse relationship between age of owner and length of solveny. The older the owner, the more likely that business is to stay solvent when you either start it or buy it. Next, I want to talk about the G in signals.
This is the generational transfer or what we're calling the boomer exit. 7 trillion to be precise. So, every day, how many business owners are retiring?
Well, guys, that's 10,000. And of these 10,000 businesses retiring, 8 to 10% of them are business owners. You could go and put some cash down on Carnival Cruise stock because I hear that's what you do once you're retired.
>> Or you could go talk to small business owners and see if any of those businesses that you go to that are little tiny things you could actually buy. This means thousands and thousands of businesses are about to go up for grabs. Look at the share of the United States population that is over 65 years old.
This population is going to increase. And what's fascinating is this trend may never exist again because we won't have another baby boom. So we are seeing what is a really big balloon where a bunch of these people created businesses that will either deflate and there will be something popped or we can continue the trend by buying them overall.
And what's fascinating to me is 41% of all small business owners are owned by boomers. 52% of business owners are near or at retirement. 52% of boomers.
We make fun of them a lot cuz there are a lot of them and 52% of them are about to retire. But what's the crazy number? 40% of them no exit plan.
That's not a stat. That's where money goes to be made. And the truth is most of these owners who want to retire from running their cash flowing business.
They don't want to close the business. They just simply don't know anyone to hand the keys to. They have a business that is kind of like a job, not a business.
So it's not like private equity is knocking on the door. But would you like to be your own boss and make six figures in revenue? Probably.
So, what would I do? I'd buy a business someone else built and I'd scale the hell out of it. Next, I want to get to needs-based cash flow.
What does this mean? Follow the cash, not the headlines. So, while tech bros are getting laid off and influencers are hawking, I don't know, gut gummies or tea for affiliate cash, the real money moves in silence.
>> I am very, very sneaky, sir. >> It goes into what we call the songhurst matrix. And the songsturse matrix is fascinating because what it actually means is that aging industries like equipment repair, home maintenance, landscaping, these businesses are not sexy.
And what happens when you have an unsexy business that makes a lot of money? Well, the sexier the business, the less money typically you make in it. Think about actors.
90% of them can't even afford their SAG after union fees. >> Lipstick for men. But a 100% of electricians get all of their money from their job.
So what's also fascinating about these industries in household maintenance, people 60 plus outnumber under 30 by 2:1. In equipment repair, the 65 plus age group is growing faster than any other. So this is where I'd be looking to have a business as the opportunity to stand out from the competition is just greater.
Bringing upto-date tech to an industry run by 70 year olds probably easier than having to stand out by starting the a thousandth social media app and trying to compete with all of these people who are getting funded by giant venture capital companies. So once you've picked the right industry, the first step to building real credibility is your website. Business owners spend thousands trying to make their website look legit.
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Famous Facebook line. Then we're going to pick the right industry so we don't die. Then we're going to look at generational wealth transfer from the boomers.
And finally, we're going to make sure our business is focused on cash and nothing else. But we got to also ask ourselves, who are we going to sell to, which is how I think about my clientele. I want to sell things to rich people because they pay more.
So, this is our affluent clients. You need to understand that it's not more work to sell to rich people. It's actually often less.
You just need to understand why they buy. And let's talk about this first. Rich people, they have a lot of money.
And in order to validate the fact that they've worked incredibly hard for that money over time and to keep up with the Joneses, what do they do? They spend more money. In fact, you are actually limited by something that is called wallet share.
You think right now in your life and business that other people would never spend $100,000 on a private chef because that's crazy. That, oh my gosh, I couldn't even imagine getting custom engraving on my seats in my car and paying somebody $2,000 for it. But they actually spend a lot.
And that's why typically most people underpric their business by 30 to 300%. And simultaneously, most people who sell things to rich people don't change their prices except every 3 years. We're not going to be that because I'm going to show you something called the K-shaped economy spending graph.
What does this mean? Top earners now drive over 50% of US consumer spending. The bottom half increasingly squeezed by inflation.
And so, do we want to go to the people at the bottom who have less money than ever because inflation is eating it, or do we want to go to the people who have all the money even though there's fewer of them? This K-shaped recovery is what we are having now today. And in it, you're going to find that you'll make more money selling to people like people in finance, people who have college degrees, people who live on the coast.
It's not fair, but life isn't fair. And so, we're going to focus on the things that make us money. Now, the question you might be asking yourself, which would be the right question, is how do we sell things to rich people?
What do they actually want? Rich people are pretty specific. So, we have something called the rich desire pyramid, which is how I teach all our 14,000 business owners in order to sell more things at the boardroom.
And if I owned a lawn care business or was starting one in 2026, I wouldn't be focused on $99 lawnmowing for the masses. I'd be building a $10,000 commercial package because rich clients don't want cheaper, they want better. and then they'll send the wire without a single follow-up.
So for this, let's talk about the get-rich pyramid. At the bottom of the pyramid, we have scarcity. That is the first reason why rich people buy things.
They buy it when there's not a lot of it. So that limited edition Hermes Birkin bag, that might be the thing that makes them want to buy. Second, we've got privacy.
That's why people fly on private jets, have private security. That's why people have really big hedges and will buy really big trees from your landscaping. Then we've got exclusivity.
That's like this is a special club nobody that can get into. That's why we have country club memberships. That's why you're actually seeing experience memberships pop up all over the country.
Then we've got convenience. And that's just my time is so valuable because I'm rich and I make a lot of money with my hours that I don't want to spend much. So, hey, can you come to my house and clean my car instead?
So, hey, can I have a concierge doctor that I pay $10,000 a month to? Time. And then finally, we've got status.
And status games are the things people will pay more for than anything else. This is why people donate entire buildings to their alma modders and get nothing back for it. What do they want?
They want their name and lights, right? So, anywhere you can sell somebody something that makes their name really big, they will write you a really big check for it. So, if you're thinking about starting a business, this might mean, can you put them on a billboard?
This might mean we only sell a hundred of these spots. That's called fake scarcity. This selling to rich people is the number one reason why most business owners will make 2 to 3x more when we teach them our processes at Boardil.
We are going to help you raise your prices and have your customers thank you for it. Next, the L, which is leverage through distribution. Build distribution first.
What does that mean? Get an audience. AI has made it easier than ever to build products, but harder than ever to get people to care.
So, let's think about this for a second. Look at the daily amount of time spent with media. We are at an all-time high friends and family.
Now, whether that's good or bad, I don't really know. In fact, I think it's probably bad, but it's certainly a way for you to make more money. We see the usage by almost every age cohort on Facebook, YouTube, Tik Tok going up.
That means the CAC is up three to 5x since 2014. So every founder should have a newsletter or a YouTube channel somewhere you can build your audience. And by the way, it's way cheaper.
Renting attention is a tax. That's what we do when we use things called ads. We are paying a tax to Mark Zuckerberg.
When you own the attention, that's actually a compounding asset. That's when you have your YouTube or your email list. So, every startup now needs a founding content creator.
That's a quote from my friend Bali Servasan who was the CTO of Coinbase. And I want you to think about this in a couple different ways. Video and podcasts, for instance, these things are up in a huge way.
Not only are we seeing customers acquired through here go up, we're also seeing usage go up. So you can actually acquire customers at a much lower cost on video and podcast than you can for instance on email. Well, what about B2B?
So let's say you sell things to other companies. When you sell things to other companies, your CAC is even lower. CAC stands for client acquisition cost, by the way, if you don't know that.
One of the most important stats you can have if you run a business. And if you don't know about that, make sure you dive into the world of CAC. We can do a video on it.
If you guys don't know about it, tell me in the comments. Now, what's fascinating about this is that it tells you that customer acquisition cost overall is actually increasing. So, over time, it is more expensive now than ever to create a customer.
You've seen it go up like this. And this is because we're talking about paying ads for our customers or what's called PPC, pay-per-click. And this PPC game is a very competitive one to play.
It is also why Facebook for instance is the most expensive place to do ads typically over time. In fact, Facebook can be even more expensive than TV these days because of something called CTV, which we won't get into today, but if you want to tell me in the comments and I can explain the difference between the two. So, you have to start thinking about what is the social media platform with the highest ROI for you and anyone else.
And look at this bad boy. Where are you guys located right now? Where are you watching?
Oh, it's YouTube. And YouTube actually has the highest return on investment, which is probably why people want to advertise on my channel to all of you guys. And I beat them up and say only the right company.
Then we've got Facebook, then we've got Instagram, and then we've got all the way down to LinkedIn, which is actually a really hard place to advertise. But it's not just enough for you to have a distribution or a moat. You've got to have systems.
And the systems with AI is something that if you don't get, you'll lose. You've got to be AI first, not AI eventually. While everyone and their mom I know is now using chat GPT in some way, that is not actually where the money always is.
It's an AI powered businesses, not AI written emails. And I want you to think about it like this. We own a company called Resibrands.
It's one of the largest trade franchises out there. And when we do our resibrand franchises, when we do their SEO, we do something called AI programmatic SEO, which is a fancy way of saying we try to get their listing on Google all over the place everywhere. So, if you need a painter in Tuscaloosa, if you need a window cleaning in Piedmont, North Dakota, we're going to have a custom site that looks like it's right there in Piedmont with you.
All powered by AI. That's not chat GPT and questions on how to write something. This is taking AI to the next level of the game.
You're going to have to think about how to do this in your business. I want you thinking about clearly describing what is going to make you more money in your business. And one of the things that I think not enough people think about today in making money in 2026 is Agentic Workflows running service businesses.
Agentic Workflows kind of works like this. First, you understand the problem. The AI agent gathers detailed information from the employee asking clarifying questions like, "Do you have this problem because Zapier is not connected to HubSpot?
" Very standard questions that you might ask an employee. Then step two, they're going to execute diagnostic steps, which basically means based on the user's responses, your responses, the AI is going to tell you different problem solving steps. It might say, "Well, let's ping Zapier and see if that's working.
Let's check the network. Maybe that's off. Let's set to specific time changes so that your emails get sent when you want it.
Let's retrieve and summarize all this information. I'm going to give you a little plan. I'm going to be working behind the background on a bunch of stuff you can't figure out.
I'm going to give it to you. Then there's adaptive tool use. If the AI detects a serverside issue, it can call an internal monitoring tool or an API to check for outages.
This is kind of cool because it's basically working behind the scenes for you. It can also iterate based on results. So, let's say it doesn't work.
An action doesn't actually fix the problem. The AI adjusts its approach and it changes ideas. It goes, "Oh, wait.
Not this, but that. " This isn't searching chat GPT. It's literally having a little robot figure out your issues and reattempt, reattempt, reattempt instead of just saying, "Hey, Cody, I couldn't figure this out.
" Then finally, it finalizes and learns. If the issue is fixed, the AI logs the solution, and then in the future, it never asks you again. It just remembers exactly what works last time.
This makes troubleshooting or repeating yourself kind of irrelevant. And if it doesn't work, then it basically will send you a nice little report and say like, "This didn't work, this didn't work, this didn't work. What else are we thinking?
" So if you can imagine today the tasks that you hate the most and another AI running it for you. That's what's happening in 2026. It's not about using AI.
It's about architecting around the AI. And I think AI will do things in the future and they already are like AI sales reps, AI quote systems, AI dispatch. I'm not talking hypotheticals.
We've invested in companies doing this right now. I want you to first play the systems game, but then I want to add one little extra one on for you, which is the human game. The scarcer human touch becomes, the more valuable it gets.
I want you to think about most of us young people today. If you had to choose between text and phone call or doornocking, which one are you choosing? You're probably going text, right?
Because it's easier, because it's less scary, because there's less friction. Well, what does that mean in today's world? The easier something is, the less effective it is.
And so what you actually want to do is you want to put humans in spots where it really matters to have interpersonal connection because most people their ability to communicate has gone down. In fact, interpersonal sales skills among young workers, look at this, it's plummeting. In a world addicted to fast responses, technology, being a human who can actually connect, you're going to make more money, especially in small business.
And the interesting part about having a human in the loop, I think in the future, we are going to pay a premium to talk to a human. You're going to go to restaurants, there will be AI plus robots doing everything. Then those things will glitch out.
You'll be like, for the love of all that's holy, I want the latte, but hold the almond milk. And they'll just keep pouring the almond milk in there, and you're going to lose your mind. >> It's not bad.
This coffee dumb. >> And for the ability to talk to a human, you're going to pay a premium. And that for you young people, I think will be your ace card going forward.
And then like lastly, I want to go a little Emerson on you before you think about making your new business in 2026 and making your millions. Ask yourself this question. What do you want your obituary to say?
Might sound a little heavy, but the truth is you're not just building a business. This is a legacy. Warren Buffett has this last letter quote that I love.
He says, "Eventually, someone else will be running Birkshshire. That's his business. The measure of our success is not just in returns, but in stewardship, which is a fancy way of saying, when I die, does this thing continue after me?
" I think too many people think they're going to build the next Tesla. I've got news for you and for me. You probably won't.
But not enough people are asking the right question. What story will this business tell when I'm not here to tell it anymore? Am I going to actually want to do this thing when it is hard and impossible and everybody is stacked against me?
Because that is what it's going to take to win in business. So in 2026, skip the startups that sound sexy but don't scale. Don't chase cool.
We chase cash flow. Own the thing nobody's bragging about because that's where the money's hiding. And that's how we play the quiet game really loudly.
2026, I want you guys to be millionaires. And the way that you're going to do that is not that complicated. You're going to move faster than everybody else.
You're going to have speed. You're going to pay attention to the industry and not focus on whether it's cool or not, but whether you have a high likelihood of success. You're going to go in an industry where the trend is already working in your favor of generational wealth.
You are going to obsess on cash flow in your business because businesses need cash. You are going to sell things to rich people because they pay more. So, we're going to find the affluent and you are going to look at leverage in distribution to get your buyers before you even have something to sell them.
Then finally, you're going to layer systems and AI on top of it. And remember that humans get added in the loop at the moments where you need a little bit of magic. If you do these things, 2026 will be your richest year yet.
