Forget the Next Big Startup. This ‘Boring’ Business Model Is Quietly Making College Students Rich

While much of the startup world, including us at TechStartups, keeps a close eye on startups raising billions, college students are quietly getting rich off a business model most tech founders would laugh at. No app, no pitch deck, no viral launch. Just boring, repeatable operations, financed smartly and scaled with a playbook.

That’s the core takeaway from a recent My First Million episode featuring Alex “The Franchise Guy,” who argues franchising is “one of the most overlooked paths to wealth in America.” His proof isn’t motivational talk. It’s economics, operator stories, and a simple truth: predictable demand plus a proven system can beat a “next big startup” bet more often than many people want to admit.

The idea runs counter to modern startup culture. For the past decade, the dominant narrative has pushed young builders toward venture-backed software, creator brands, or AI tools. But beneath the noise, a different class of operators has been quietly compounding cash flow through service businesses and franchise systems that most founders ignore.

Alex knows the path firsthand. As a freshman at Wake Forest, he didn’t build an app. He bought a campus laundry service using seller financing, scaled it aggressively, and exited before graduation for what the hosts described as a mid-six-figure outcome. The business itself wasn’t flashy. The economics were.

“[I] learned what a discounted cash flow analysis was at 18 just talking to business school professors before I got into the business school. And I ended up buying that business and learned more doing that than any class I took at Wake. We ran it, we grew it, we sold it for a little over 10 times what we bought it for and had an exit our senior year for about 10 times what we bought it for. And that set the path to complete addiction,” Alex said on the podcast.

The turning point came when he realized the real customer wasn’t the broke college student.

“The big unlock for us was kids aren’t paying for this,” Alex noted. “It’s their affluent parents.”

By setting up a booth during orientation week and selling directly to families, the business jumped from roughly $30,000 in annual revenue to just under $300,000 in a single school year. That experience reshaped his view of entrepreneurship — and set the stage for his bigger thesis about franchising and “boring” businesses.

The “boring” path that broke the startup spell

The episode opens with a framing that flips the usual founder narrative. Instead of inventing something new from scratch, Alex describes franchising as a business model already embedded across large swaths of the economy.

“It is 8% of our country’s GDP is produced from franchise business models,” he said. Most people don’t realize how often they interact with franchises, from hotels and gyms to home services and fast food.

For years, franchising has lived in two mental buckets: ultra-expensive brands like McDonald’s that feel out of reach, and smaller concepts that many founders dismiss too quickly. Alex argues the reality is far broader. “There’s 4,000 franchise brands. And if you’re willing to do the research… there are a lot of hidden gems.”

That shift in perception matters more today than it did a decade ago. As venture funding has become more selective and profitability has returned to the forefront, proven cash-flow businesses are drawing renewed attention from both individual operators and institutional investors.

For college students and early-career builders, the implication is straightforward: you don’t necessarily need to invent the next breakout app. In many cases, the faster path is learning how to operate something that already works.

A freshman-year exit most startups never reach

To illustrate the point, Alex shared the story that changed his own trajectory.

As a freshman at Wake Forest, he didn’t launch a software product. Instead, he bought a campus laundry service using seller financing. The model was simple: students left laundry outside their dorm rooms, runners collected it, off-campus vendors cleaned it, and the service returned it a few days later.

What looked like a small side hustle quickly revealed real leverage.

The biggest breakthrough came when Alex realized the true buyer wasn’t the student.

“The big unlock for us was kids aren’t paying for this,” he said. “It’s their affluent parents.”

By setting up a booth during orientation week and selling directly to families, the business jumped from roughly $30,000 in annual revenue to just under $300,000 in a single school year. By senior year, the company sold for what the hosts described as a mid-six-figure outcome.

The business itself wasn’t flashy. The lesson was.

Predictable demand, smart distribution, and disciplined execution can outperform far more complicated startup ideas.

Why franchising keeps producing outsized outcomes

The broader thesis from the episode is that franchising works not because it is easy, but because it is structured.

Alex points to return expectations that often surprise newcomers. While many real estate investors celebrate mid-teens internal rates of return, he said, many franchise operators target significantly higher performance.

“I think franchising is one of the most overlooked paths to wealth in America. And I think it deserves more attention and people giving it a shot,” Alex explained.

“A real estate investor would be jumping up and down about 12 to 16% IRR. A franchisee is upset if they’re not north of 25% IRR.”

Part of that appeal comes from the built-in systems. Franchise operators aren’t starting from zero. They typically gain access to:

• established branding

• operating playbooks

• vendor purchasing power

• training systems

• peer networks

• and, in many cases, more predictable exit markets

Franchise businesses can also trade at higher EBITDA multiples than comparable independent operators because lenders and buyers view the model as partially de-risked by the broader system.

In effect, the model shifts entrepreneurship from pure invention toward disciplined execution at scale.

The modern entry path is more accessible than many assume

One of the biggest misconceptions the episode tackles is cost. While some well-known franchises require millions in capital, many concepts sit much lower on the spectrum.

According to Alex, many lenders — particularly SBA programs — will finance qualified operators who have roughly $50,000 in liquid capital and around $150,000 in net worth, depending on the brand and structure. SBA programs can lend up to $5 million across multiple loans over time, typically backed by personal guarantees.

That financing layer is what makes the model viable for a broader pool of operators, including corporate employees looking to transition into ownership.

The economics can also look different from what many founders expect. In one example discussed on the podcast, an unattended indoor golf simulator concept generates just under $300,000 in average annual revenue per unit with margins around 55% due to minimal labor requirements. The expectation, Alex said, is roughly $150,000 in profit per location after expenses.

Scale several units, and the model begins to resemble a portfolio rather than a single small business.

Where operators still get burned

Despite the upside, the episode also surfaces real risks, particularly around franchise selection and broker incentives.

Alex describes parts of the franchise brokerage world as “the wild west,” noting there is currently no universal licensing requirement to become a franchise broker. Some brokers, he said, can earn commissions as high as 60% of the franchise fee, creating misaligned incentives.

That dynamic can lead prospective buyers to see only a narrow slice of available brands rather than the full market of roughly 4,000 concepts.

His advice to prospective operators is direct:

• study the Franchise Disclosure Document (FDD) carefully

• review Item 20 to track unit openings and closures

• speak with multiple existing franchisees

• and never rely solely on broker-provided references

One question in particular tends to reveal the truth quickly:

“Would you do this again, knowing everything you know now?”

For many operators, the tone of that answer says more than any spreadsheet.

Watch the full My First Million episode below: