Words: Corey Adams
Do you ever question why you are doing this? What is driving us to work countless hours building our businesses, negotiating deals, and generally driving ourselves crazy with the stress of day-to-day operations? For some, it is purely the money, but I would wager that the majority of us torture ourselves by owning our businesses for one main reason: we want to be successful.
Now I will revise my previous statement a little; when you are wired with the entrepreneurial spirit, owning your business is not torture, but more of an ingredient to our normalcy.
The real question here is, what defines success? Maybe we should up the ante some: while you are nearing the end of your mortal life, what will you look back on professionally and consider a success? I doubt you will be looking at any specific project, year, or monetary value.
This question was jackhammered into my thoughts recently by a good friend that loves teaching the trades as much as I do. We share quite a few conversations on business, life, and sometimes nothing at all. He recently sent me a text message that was one line. “You are not considered a success unless you have a successor.” At face value, I chuckled a bit, pondered for a second, and replied with a quick, “I like it, HAHA.” Then I began to feel that intense focus in my brain. We all have it. That feeling of something nagging and forcing us to acknowledge that there is something more to be seen. Yep, it hit me hard.
When I circled back to it a few minutes later with a fresh mind, it read completely different. It reaffirmed my belief in what I was trying to accomplish in my businesses. I want to have enough financial and personal freedom to enjoy my life, on my terms, when I am ready. In short, I want to retire.
The most gut-wrenching thing in our industry is watching a business close. Sitting by watching what someone built with their bare hands just vanish into thin air. I never understood this. Why not sell it, why not pass it on, why not do something? A well-established business should have some value, right?
The problem is that most small business owners never create, or even think about the endgame. What are we going to do when we do not want to do this anymore? This lack of an exit strategy prohibits the business from succeeding to its fullest in the present. Everything needs a goal. Something to work towards, something to focus on, and something to desire. When we started our latest companies, we started from day one that our goal was to sell them in 10 years. Now, that may sound crazy to some, but it forces me to work myself out of the business before it is too late.
A business only has value if it can run independently from the owner. Many small business owners never work their way out of the business, never train a successor, or keep so active in the company that without them nothing gets done. This is not the way to harvest the fruits of your labor.
As we continue in ownership our focus needs to turn to an exit strategy, and it is never too early to start. Planning a way to transition the companies we built to whomever we want. Maybe it is a son or daughter, a key employee, or a third-party buyer. No matter who, a plan needs to be in place. Without a plan, the successor is destined to fail, or worse, never come at all.
We spend an enormous amount of time perfecting our businesses. Making things easier, installing systems, and building a reputation. Closing the doors is equal to forfeiting all that effort. We all take pride in building things that will be standing long after we are gone, it is time we build our businesses to do the same.