If you are thinking of selling a business...Know as much as you can about who you are selling to. Can you walk away from the sale with cash? If you can - take it. If you can't and if you have to take paper, make sure you have a short-term exit route. It's more important to know who you are selling to if you are going to take paper. Can you walk away from the sale with cash? If you can - take it.
If you are thinking of buying a business...Question how much you really know about the industry and the business you are potentially buying into. This is fundamental. Consider to what extent the business relies upon the person you are buying it from. In many cases when the owner leaves the business halves - and what will you as the buyer be left with? If you think this is going to be the case, don't buy it - unless you are part of the business.
If you are thinking of starting a business... Again, question how much do you know about the industry - do you know enough? Make use of the organizations that are out there to help you, for example Abundance Consulting Group. If you have to borrow money, never put your house up as collateral. It doesn't matter if you extend your mortgage, just don't give them your house. If you are someone who likes the nine-to-five aspect of working – don’t branch out on your own. Be prepared to work 12-hour days. Look your partner straight in the eye and make sure they fully support you. You won't see your partner or your family much when you start or buy a business. It will take a massive toll on your home life. No one does anything unless you do. No one else signs the checks, no one else works as hard as you do - these are the facts of running a small business. But it's a great life and if you can do it, do it. It is the freest, best life you can possibly lead.
Research shows that the majority of wealth in the world has been created through the starting, building, and eventual exiting from for-profit businesses. Abundance Consulting Group helps business leaders define exactly what business milestones (revenues, profits, assets, customers, etc.) must be accomplished to consummate a profitable business exit, and we then work alongside them to do it.
Research shows that 80% of pentamillionaires (those with a net worth of $5 million or more) are business owners who successfully sold their businesses. Yes, real wealth is not made simply by starting companies. And it’s not made simply by growing companies. Real wealth is made by selling a company. And particularly, selling to an acquirer who will pay a premium because it believes it can generate even more value from what you’ve built.
Importantly, the “hidden” secret behind ultra-successful entrepreneurs is that they start thinking about selling or exiting their companies early on. Specifically, these entrepreneurs create exit strategy plans; plans that layout the roadmap for them to grow their company so they can exit for the maximum dollar amount within a defined time period. They do this because when you build a business to exit (either via sale, IPO or other means), you set different strategies and goals then when you merely try to grow a business.
The good news is that short-term success and long-term success are not mutually exclusive; when you properly build your business with a defined exit plan, you can maximize short term revenues and profits, while preparing your company for a profitable exit. If you too would like to realize a profitable exit, then we should speak. We can work with you to develop and execute upon a comprehensive exit strategy plan that allows you to achieve your goals.