Paul Alex joined the police force as an intern with the intention of building a career in law enforcement in the San Francisco Bay Area.
At the age of 35, Alex hit the road with gusto, eventually becoming a drug squad detective before being sent to the special victims unit. As of 2020, he was making a salary of $133,000 and the benefits brought him to an annual salary of more than $272,000, according to California state records seen by Insider.
Although his career placed him in a financially stable position, his weekly hours could range from 60 to 100 hours.
“I had no personal freedom,” Alex said. “I was neglecting my personal life. I wasn’t spending time with my family that I love. I’m a family man. And ultimately, I realized that this is not how life can be.”
She found she couldn’t live on salary alone during periods when overtime was suspended, which drastically reduced her income, she said. Some months, her biweekly check was as high as $2,000 after deductions. That meant she always had to save for those low-income months to cover bills, which could range between $5,000 and $6,000 a month, she said.
“What was really demoralizing was the desire to move forward in life. And I felt like I was held back when that happened,” Alex said.
He decided that investing in cash-flow assets would be a way out of wage volatility. Therefore, they could use the salary for optional purchases such as vacations, cars and additional investments.
He initially considered investing in real estate, but believed this would require a large amount of money and a mortgage that would create more debt. Additionally, he believed that the overhead costs of maintaining a property would add additional stress. They should keep any rental income in cash in case they need to cover their mortgage due to unpaid rent or repairs.
A business idea he knew nothing about
In 2017, Alex discovered the idea of investing in ATMs through a colleague who had researched this field. He started joining social media groups dedicated to the topic, watching YouTube videos of others who had done it, and reading whatever material he could find.
It was a business model that was out of his comfort zone because he knew nothing about it. But the attraction was that she had a low entry threshold; compared to purchasing a property, an ATM could cost less than $3,000. He also had a lower level of risk because if the ATM didn’t make a profit, he could move it, which he calls a flexible asset. And finally, it was a quick way to start a side business, because once an ATM was placed on site, it could start generating profits almost immediately.
Alex decided to get into this field as a side business in 2018. By March 2021, he had left the police force and had turned this business into his full-time job, offering ATMs for those who want to get into this business as well.
From January 2021 to April 2023, his profit and loss statements seen by Insider show total revenue of $12 million and net profit of about $3.5 million for his company ATMTogether, a provider of ATMs and ATM services . His company, Merchant Task Force, which provides credit card terminals, had revenue of $844,000 and net income of $742,000 for the same period.
In 2018, Alex took two weeks off from work and used this time to search for ideal locations in the city.
“I was building something for myself and I wanted to continue”
He looked for high-traffic areas that would benefit from having an ATM nearby. These are the tourist areas and places in the city populated by nightclubs, restaurants and car parks, to target the areas where staff receive tips. He also looked for small businesses that offered cash at home, which was a problem for companies because they had to make sure they always had enough invoices at home.
Alex approached business as if he were providing a service to them. He agreed to provide and maintain the ATM at no cost to them. He recalls having contacted over a hundred companies by telephone and having physically visited over 20 locations.
“When I first started and I was getting rejections and acceptances and wins and losses, it was really hard for me to go back to work and not think about my business. And I think that’s what got me, that I was building something for myself and I wanted to continue to develop it.”
He originally had the idea to start with three ATMs, but by the time he was finished he had managed to secure six locations: three liquor stores, two hair salons and a nail salon in the San Francisco Bay Area. The first three were motivated by cash and the other three by cash tips.
Once the ATMs arrived at those locations, he fed each one with about $2,000 – $3,000 in cash.
He found a mentor on Facebook
Not all locations were a total success. Alex noted that a decent minimum return for an ATM should be at least $200 per month per machine. In the first month, Alex could already see that the only three machines generating profits were the ones located in liquor stores. They earned $250 to $500 per month per location from withdrawal fees. In contrast, locations with lower traffic only produce between $25 and $100 per month. He let them run for two months before deciding it was time to move them.
Alex also found a mentor on Facebook who has been successful in this business. Based on his mentor’s advice, he moved the three cars to two convenience stores and another liquor store. From there, they began making a net profit almost immediately, with the highest return being $600 a month, he said. Suddenly, he had six machines operating that were bringing him about $3,000 a month in net profit, he said. It took him about six months to get a return on his investment.
Although Alex had enough money saved up to purchase the machines, he realized that he would need banknotes to power the ATMs. So instead, he applied for two personal credit cards and used them to purchase the equipment, he said. They were cards that offered zero interest for the first 12 months, he pointed out. This would give him enough time to build up cash flow without paying interest every month.
When he purchased his first set of six machines, Alex thought he would get a $2,100 ATM discount. He would later realize that it was a bad deal because it forced him to pay a 30% commission on the fees charged by his ATMs. Although the salesman he worked with told him it was standard practice, he later realized it wasn’t the only way.
He gradually used the profits to buy more cars
The next set of household appliances was purchased by his mentor. They were both new and refurbished and cost between $1,800 and $2,200 depending on the model.
Additional costs for the ATMs included a $150 wireless Internet modem, a $6.99 monthly Internet fee and a $300 technician installation.
Alex gradually used his ATM profits to buy more machines. And by 2020 he had amassed 30 operational ATMs in the San Francisco Bay Area. Each brought a net profit of between $250 and up to $1,500 per month.
Together, these small assets generated a net profit of between $9,000 and $12,000 a month, he said. Although his side business didn’t cover his entire salary, he managed to completely cover his bills from the profits. This was enough to make him quit his job in 2021 to start a business in this field.
During this time, he met an ATM salesman who he partnered with and they expanded the business to become an ATM salesman. This allowed him to sell his devices so he could work remotely.
His colleagues thought it was a bad idea to invest in an unknown business
Even as he built his side business, Alex still had doubts plaguing his mind. The words of those around him made him doubt his ability to succeed in this endeavor. Some of his colleagues thought it was a bad idea to invest in an unknown business and told him that he should simply work more overtime. In retrospect, he is happy he continued despite those doubts.
“Invest in yourself. Self-education is everything,” Alex said when reflecting on his journey. “It all started with a friend who gave me an idea, then I took that idea and did the due diligence, researched, bought books, watched videos, read, read, read until I was sure enough to implement it yourself.”
2024-01-03 14:24:46
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