Houston is among the entrepreneurial capitals of the world. More than 60,000 small businesses sprout in Harris County annually, making this area one of the largest for startups in America.

Unfortunately, Houston is also one of the failure capitals of the world because so many new businesses go under. As many as 50 percent fail in their first year.

Jeff Jones believes he has a better idea for would-be-entrepreneurs: Buy an existing business. The odds of success are much greater, he maintains.

Jones, a partner with a Houston-based business brokerage firm, said that seven out of 10 acquired businesses are still around five years later.

The reason the risk is much lower, he said, is that you already have an established customer base, skilled and trained employees and existing suppliers.

"All that takes years to develop," he said. "If you can have that from Day One," you have a big advantage.

Jones' 25-year-old firm, Certified Business Brokers, handles small-to mid-size companies and is one of the largest such firms in the country.

Recently, he brokered the sale of B&D Meat Company in north Houston.

The original owner, Charles Dobesh, was proud of his butcher shop, loved his customers and was making a nice profit.

It was the traffic he could no longer take -- two hours each way between his Needville home and the Acres Homes-Lincoln City area. After 10 years in business, Dobesh decided to retire.

Through Jones, Dobesh sold B&D to Bob Cole, the president of a local computer distribution business. Cole had been looking to diversify. He had seen how volatile the high-tech market can be and had been looking for a "necessity" business. Meat fit the bill.

No matter what happens to a family financially, Cole reasoned, "they're going to want steak, brisket, pork ribs and sausage. It's almost recession-proof."

The vast majority of buyers come to Jones and his CBB partners not knowing the kind of business they want. Many are corporate executives who have been dreaming of having their own business. Typically, Jones said, their ages range from the mid-30s to early 50s, and they are pulling in between $80,000 and $100,000 a year.

About 300 people a month come to CBB looking to buy a business, but Jones said only 5 percent of them actually buy a business.

According to Jones, a person needs two things to become an entrepreneur: Money and guts.

"Often money's not the problem, but a lot of these corporate execs don't have the guts," he said.

Owning a business is part of the American Dream, but there are a lot of people who never get past the dreaming stage, said Jones, who noted that only 2 percent of American adults own their own businesses.

An owner who wants to sell his business must go about it in a "cloak and dagger" manner, Jones noted.

It's not like selling a house. You can't just put a sign up in front. That would make a lot of people nervous.

"People get paranoid," Jones said. "They think that if it's for sale, there must be something wrong with it."

If word gets out that a business is on the market, employees will often start looking for other jobs, customers will move on and suppliers will have second thoughts about taking new orders.

In fact, Jones said, the business may be healthy, but the owner may want to walk away from it because he is suffering bad health, going through a divorce, frustrated with government regulations or just burned out.

For Cole, having a business broker made the buying process much easier.

"They provide a meeting ground and an organized structure," he said. "They have the appropriate meeting rooms, escrow attorneys and other such facilities that help you complete the business transaction."

Jones sees the role of a business broker as part attorney, part accountant, part salesman and part business counselor.

Business brokers often arrange the financing for the buyer through an SBA lender.

For the seller, the broker compiles a business profile, which includes all the financials of the business, including consolidated tax returns.

Three out of four times Jones will decide not to represent a seller, often because it's a losing business or the seller has an unrealistic assessment of its value.

Jones estimated that about 600 local businesses change hands annually.

Cole discussed about 10 businesses with Jones before settling on B&D, one reason being that the shop's sales have been steadily rising the past few years.

Before making his decision, he did a little spy work. He walked into the butcher shop and surreptitiously purchased a few T-bones to make sure he liked the taste.

"I also sent my financial officer in," he said. "She's good at seeing details."

She bought T-bones, too.

Dobesh will stick around B&D for a few weeks, guiding the new ownership.

Cole will not run the butcher shop. He is in the process of hiring a manager.

Noting that B&D already goes through about 800 pounds of sausage a day, Cole said he wants to sell even more. He hopes to make the sausage available to food distribution channels.

Dobesh's cousin, Larry Dobesh, makes the sausage seasoning from his own recipe, and Cole plans to talk to him about an aggressive retail marketing of the seasoning mix.

Cole has been a local entrepreneur since 1966, when he opened a surfboard shop off the Gulf Freeway.

"They say the average millionaire has 16 businesses before he finds the one he likes," Cole said. "This is my 10th."

Dobesh will live in Needville, spending his time hunting, fishing, playing golf and restoring old cars.

Speculating on the fate of his meat market under its new ownership, Dobesh said, "As long as people can walk in feeling your appreciation, they'll be back."

More Small Business articles at the Houston Chronicle: Small Business Section