Is Your Business Still A Baby?
In my blog post dated March 3, 2021, I wrote about the need to understand the type of journey you’re taking in your business and knowing both where you are now and where you want to go… nothing super complicated or ground-breaking about that… common sense stuff.
Many of the owners I speak with haven’t really given much thought to exiting or selling their business. They see their business as their “baby,” and like many parents, they rarely think about the actual day they will “say goodbye” to their kids. But when that time comes, whether you’re the parent of a child or the parent of a business, you hope you’ve done all you can to make your “baby” ready for the next step in life so they can thrive in the world without you.
So, this idea brings me to my topic for this article…HOW much does your business rely on you? Have you grown a business that can thrive in the world after it has “left the nest”—once you have exited and gone?
This simple question is one of the key drivers of company value… “Have you grown your business, so it is ready for the day you say goodbye?” I could say, “Is your business now an adult business”—but that has a bit of a different connotation, especially here in Las Vegas!
All jokes aside, having a business that can thrive without you is a key driver of company value because it means your “baby” is no longer dependent on your knowledge, expertise, or your relationships to be successful. Ideally, your business is one that can be run by someone else, whether you decide to sell to a third party or transfer ownership to employees, family, etc.
Having a business that can thrive without you also means that you can exit the business while maintaining ownership and simply handing-off day-to-day operations to a leadership team.
My point here is that creating a valuable business, one that can be successful without you, doesn’t have to wait until you’re ready for retirement. Parents often remain in the lives of the children they’ve raised, long after they’ve become adults with responsibilities of their own—think Thanksgiving, Christmas, vacations, etc. As the owner you can also remain a part of your business without continuing the “parenting role.”
So have you built an “adult business” or is your company still dependent on you? There are a few ways to test this out without undue stress. Try taking a few days off from the business… Can it function without you checking in? Are you getting calls from your team, from your customers, from your vendors?
If you’re saying yes to these questions, then your business will remain a child that is dependent on you. Is that really what you want for your offspring? Are you really doing anyone any favors by “baby-ing” your business? (Leave your answers in the comments below.)