Andrea Palacio and her husband thought they were playing it safe. In a search for a passive income business, they paid $470,000 for a South Florida landscaping company a few years ago. It was, in their words, a “boring business,” which was hands-off and had good cash flow. Within days of the deal closing, though, the seller vanished, 10 of the 12 employees quit, and revenue took a sudden dive from $70,000 per month to $40,000.
Making matters worse, they had pledged personal assets as collateral on their Small Business Administration loan. Palacio, pregnant while raising a 7-month-old, was thrust into a role handling booking, marketing, admin work, and customer service.
“We got into this business thinking that we’re going to be these investors, that we’re going to acquire the companies and just eventually exit for millions of dollars,” Palacio said on The Side Hustle Show podcast. “And I end up just driving a landscaping truck that’s old without air conditioning. . . . Quitting was never an option because we would lose our home. I can tell you that it was the hardest moment of our lives, and that the pressure was—it got a few tears, a lot of tears out of us.”
Over the course of the next year, Palacio and her husband rebuilt revenue to $60,000 to $65,000 a month, sometimes hitting $70,000. The problem was, they were working 80-hour weeks, leaving Palacio feeling like she wasn’t present for her kids.
Her sister mentioned ChatGPT, a tool that had just come out, and the tech-curious Palacio began experimenting with it. She eventually hired a freelancer to create AI customer relationship software. She created an AI receptionist herself, which would forward calls to her if the client was upset, and book estimates on a calendar automatically. The automations saved her 20 hours a month, she said.
By December 2024, Palacio and her husband put the business up for sale. The couple were hoping to simply recover the money they had invested.
“The thought at this point is we can at least recoup what we paid for the business,” she said. “Maybe it’s not going to be a huge profit per se, but it’s better than it was, and we can kind of get out and try the next thing.”
An offer came in: $750,000—a 60% premium on what they had paid.
Ultimately, the couple decided not to sell, since doing so would leave them without an income source. But since the business was running so well, they moved abroad for six months, leaving the manager in charge.
When they got back, the bank account had just $2.50 in it, Palacio claims, a result of alleged employee theft.
“We just didn’t know how to lead a company. We were not good leaders,” she said. “Being a good leader is, like, are you able to see . . . the real important information, the real KPIs on your dashboard? Do you have those numbers? Are you keeping track of the key metrics? And we weren’t doing that.”
Palacio fired the manager, but the asking price of a good replacement was beyond their budget. That led to more AI-driven automation, including a dashboard that tracks the efficiency of crews, how long jobs take, and salaries compared with what clients are charged.
“AI just changed everything for me,” she said. “It’s the tool that allowed me to get my freedom back and really stop wearing so many hats as a business owner. You can delegate all these little tasks that you haven’t even thought of.”
In June of this year, the company posted $75,000 in monthly revenue with seven employees. Palacio’s husband now goes into the office just one day per week to handle sales appointments. And Palacio launched her own company, called Crewless, which helps other owners run AI-first ventures.
As nerve-fraying as the saga has been, Palacio says it has taught her some important lessons. For example, she said she won’t ever buy a company “if the seller is not willing to finance at least a portion of it. They need to have some stake in the game.”
Additionally, she said, when things become overwhelming, it’s important to take a step back and try to remove yourself emotionally from the situation and look at things logically.
“My dad has the saying, ‘Just climb up the highest tree you can possibly find and look at things from a different perspective,’” she said. “Look down and see how you can come out of the maze that you’ve gotten yourself inside of. . . . Don’t ask yourself, ‘Why is this happening to me?’ but ask yourself, ‘What do I need to learn from this?’ And just keep going, because things will get better.”
—Chris Morris
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This article originally appeared on Fast Company’s sister website, Inc.com.
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