When I started Compass Point nearly 20 years ago, I heard a quote from business owner (and my now mentor) Tom Stine, “The only reason to get into business is to get out.”
I remember thinking at the time, “That’s a bit cold. Sounds like consultant talk.”
But 20 years later, I can honestly say that truer words have never been spoken. From an owner’s perspective, the whole goal is to build a transferable business. It’s transferable IF it has value. If there is no value, then why would someone want to buy it?
This is paramount to transitioning family businesses. The goal is to set up the Next Gen for success without you. Starting with a strong business focused on maximizing value gives the Next Gen a leg up on the challenges they will inevitably encounter.
A business that is maximizing its value gives owners options:
The concept of “always being for sale” isn’t just about a mindset of “I’ll sell if the price is right.” The hard truth is that if you aren’t maximizing value every day that you’re actively in the business, the price ISN’T EVER going to be right.
Unfortunately, there is no crystal ball to show you the timeline. You never know when there will be a knock on the door. But when there is, you better be ready. Or fortune will pass you by.
Get to work today on the BIG picture of the business. Make maximizing value a part of your strategy. Focus on the value drivers in your business – things like:
You’ll like running this company and will dramatically increase the odds of passing it on to the Next Generation successfully.
BLOG | FAMILY DYNAMICS / GOVERNANCE
I’ve had my share of family business owners who avoid discussing this four-letter word to the point of pure denial, quickly ending the conversation when this word bubbles up. The word? E-X-I-T. It sounds so final. The brutal truth is that 100% of owners exit the business, yet only 50% – just 1 out of 2 owners – will do it on their terms...Read More
BLOG | LEADERSHIP
Many family-led companies hire business consultants to grow the business. Some even send their emerging leaders to personal development programs. But there is a gap – and it’s a BIG one.Read More
BLOG | PEOPLE / TALENT
The Golden 5% is the full expression of our ability, multiplied by our maximum possible effort, multiplied by our full contribution of heart. It is the performance equivalent of what we offer in a deeply loving relationship – the absolute best of ourselves. And yet, we rarely give it or reliably inspire the giving of it by others in organizations. Why?Read More
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