Your best asset might be holding you back

We had the privilege of being on Lance Bachmann’s “Build It To Sell It” podcast recently (you can watch the episode here) and it’s got us thinking a lot about what it means to be ready to exit.

A lot of owners, when we start working with them, they think they’re ready to sell the business or exit out of the business.

So we do an inventory with those owners of what they’re doing every day. And we often find that they’re involved in every single department in the business. They’re spread thin, and they really can’t work any harder.

Their biggest skills, like being a great salesperson, a great manager, a great leader, that all actually starts to hold them back because nothing can run without them.

And the problem is that, if you are the only person in the business who knows how to do everything, the business might not actually be worth anything. 

Your best assets, which are your experience and abilities, might actually be holding you back if you constantly depend on them.

I know, that sounds harsh. But a buyer is going to come in and say, “I’m buying your business, I’m not buying you.”

If you’re the one doing everything, or the only one who knows how everything works, they might not want to buy the business, because you’re too tied into the day-to-day operation.

That’s why we talk about building a team around you to be able to take all the parts that you do every single day and be able to run it without you.

The great thing, as we’ve talked about before, is that by preparing to sell, even if you don’t actually sell it, you end up creating more value in the business.

But if you do want to sell, ideally you’re starting to put these pieces together a few years out from when you want to exit. Because there are some hard decisions you’ll need to make, and a lot that needs to be addressed, depending on if the business is transitioning to the next generation, or if you’re looking for an outside buyer.

That means setting up the proper process procedures, all the bookkeeping, the leadership structure. If those aren’t in place, it may take a few years just to get it all up and running.

I’ve worked really hard to do something similar myself. My business partner Jason and I have built a team that can handle the day-to-day work, which allows us to take time off without worrying about what fires may have started while we were gone.

That is a big relief as a business owner who’s not even planning an exit right now, and it makes the business even more valuable if we ever do want to.

When you finally get that check, you’re going to want to know it’s for the right amount that will take care of your family and your legacy for the rest of your life. That’s the most important thing.

And it’s important that it not feel chaotic. You want to have confidence going into the deal.

If you’re worried that your best asset (your ability to do everything) is holding you back, that you’re too tied up in the business and you want to start untangling it all, let me know.

This is exactly the sort of thing we help with every single day.

-Michael

Book a JobWalk with me and we can start the conversation.

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