We have built up our businesses and if we still have them, they might be great, they might be just about OK or they might be really tough going.
We have all wrestled at times with why we do it – “I could have been paid more if I’d stuck to my old job” or even have fantasies about what else we would like to be doing.
For me, for a while, it was the imagined peace of being a long-distance lorry driver but that was before I found out just how tough that job is!
So – are you at “the right moment” in footy manager speak, is it time to make that decision and sell up or perhaps get some investment, or finally be comfortable with giving up a bit of control and really go for it to fulfil your true business potential?
What do you need to think about?
If it is your first business then you are almost certainly running a lifestyle business – people squirm and resist that description but anybody running their own, first business are almost certainly doing exactly that.
Why? Well, sadly, a lifestyle business doesn’t mean that you are working a couple of hours a day and surfing for the rest of the time, unless you have been extremely lucky. A lifestyle business is a choice we all made when we said – “I can do that”, whatever “that” was.
So the Lifestyle bit – that’s the willingness to give up a salary cheque to be your own boss, commit the long hours to develop potential that others couldn’t see, make your own mistakes and brilliant successes. Typically you found a nice product, service or customer and things developed from there. The prospect of personal freedom and being the only or main decision maker is very powerful and seductive draw.
The problem with lifestyle businesses is that they are built around us, certainly in the early stages. We make all the decisions, we are all over the business, we know everything that is going on and can do most of it. If that’s where you are – you are unlikely to get real value from a sale or an investment.
Remember that even if you sell you will almost certainly have a tie in, that could be six months, but it could be three years.
So, what do you need to do
Step 1 Decide you want to change
Are you emotionally ready to have someone else tell you what to do and call you to account? I remember introducing some of our excellent fast-growing MDHUB member companies to an investor. When he made it clear he would have no hesitation in selling them on, or even closing them down if they weren’t hitting the targets, I could see them almost physically hugging their business to themselves.
Step 2 Build a great team around you
Investors buy people – they really do say that – I hear it each and every time in pitches to private equity funds last year.
Step 3 Set your business up so that it can scale.
Step 4 Plan that growth
What markets, what products or services, which customers and how do we reach them?
Step 5 Execute
You may be able to sell a plan but to get value you must prove you can make it work, or at least you have started to make it work.
Step 6 Start to make yourself dispensable –
You don’t have to be redundant, but you must build a business that doesn’t rely on you for all the decisions, including some of the big ones.
Step 7 Start to work out who you might ultimately want to sell to -
and check whether that changes the shape of your business growth plan
I leave you with The Clash or maybe you talking to your business? If you say that you are mine I’ll be here ‘til the end of time; So you got to let me know, Should I stay or should I go?
Answer these questions...
1 Do I make all the important decisions?
2 Are all those decisions actually just the important ones or am I making most of the decisions?
3 Who can I rely on if I get sick or stuck in another country – say by a pandemic?
4 If our business increased by 20% tomorrow could we cope? – what if that was 50%, 100%?
5 How easy is it to bring in more team members – for them and for us?
6 How easy is it for customers to buy from us?
7 How easy is it for us to service our customers?
8 How good is my pipeline, do I know where that growth is going to come from?
9 How much can I grow from our own resources?