Mont Sainte Victoire, Aix-en-Provence.
Yesterday I had a call with a woman from The Strategic Coach. We were discussing the possibility of a partnership but she didn’t like the name of my book, “Built to Sell”.
“We encourage our members to keep their business forever” she said, “and I don’t think we want to be associated with a book that recommends entrepreneurs sell their company”
Hmmm, how strategic of them…
Distancing one’s self from a book called “Built to Sell” is actually pretty common. Often reviews of the book start with the following disclaimer, “Now I’m not thinking of selling my business, but if I were, this would be worth reading because blah blah.”
Somehow, the idea of selling a business has become something only money-grubbing, heartless mercenaries would contemplate.
I think it’s all part of the current trend being espoused by the flavour-of-the-month pundits who talk about “purpose-driven businesses” as though commerce is some sort of spiritual endeavour. Last time I checked, business is about buying something for one price and selling at a profit. For 99% of employees, companies are not a place of worship; they go to work so they can get paid enough to put dinner on the table. I’m not sure which god these people pray to, but I don’t see business as a spiritual undertaking.
Is there something wrong or immoral with the idea of building a company to sell it? Or wanting to do more with your life than just one thing for 35 years?
Almost a year ago, my wife and I moved our young family to Aix-en-Provence in southern France. I had just sold my last business and I wanted to take a few years to decompress.
It’s all part of an approach to thinking of my life in ten year chunks instead of one long continuum. If you own a business, I think you’re in the luxurious position of being able to contemplate a life less ordinary. Most employees need to stay on the ladder or risk being passed over or bumped off all together. But as a business owner, you can think of your career in relatively autonomous episodes. Here’s my list of five reasons to think of your entrepreneurial life in 10 years chunks:
10 year chunk reason #1: Return On Investment
As an entrepreneur, I add the most value in the first few years of a business. I enjoy the planning part when I figure out what to sell and to whom. It’s a time when you can invest a few thousand dollars and see its value grow very quickly. After a decade or so, most businesses start to level off and the financial return for the founder starts to dampen.
10 year chunk reason #2: The Finish Line Adrenalin Rush
Our house here is at the top of a hill. Yesterday I went for an eleven mile run. Towards the end, it was getting hot and I was starting to fade until I got to the bottom of our hill. I knew I was on the home stretch so I marshalled the last stores of my energy and accelerated up the hill.
It’s amazing how hard you can push yourself when the finish line is in sight. For me, planning to sell a business after a decade of growing it feels good. Ten years is enough time to get the company off the ground and scaled up and, just when you start to get tired, the finish line appears.
10 year chunk reason #3: Hard Drive Space
A few months ago I interviewed Tim Ferriss for a story Inc. asked me to write on selling a business. I asked Tim why he sold his company BrainQUICKEN even though he had figured out how to run it on less than fours a week. Tim’s response resonated with me: “My brain felt like a computer running antivirus software in the background. Even though the company didn’t take much time to run, it was consuming more than 10 percent of my mental energy.”
That’s the problem with owning a business. It’s always in the back of your mind. It’s only one thumb swipe away on your iPhone. Before selling my last business, I can remember waking up many nights to the realization that I had been resting half conscious for hours plotting my business. Sometimes it was because there was a problem, but most of the time everything was going fine and I was still spending subconscious time on my business. It’s the curse of entrepreneurship: you just can’t turn it off.
10 year chunk reason #4: Building Spaceships
We have two kids, aged three and five. Right now, they still want to play tag, soccer and build spaceships with me. In ten years, I won’t be quite so cool in their mind.
Being over here for the last year has enabled me to be around as a dad. Often times I pick them up from school and we just play until dinner – that would never have happened in my old routine.
10-year chunk reason #5: Boredom
Truth-be-told, I was getting pretty boring in the final few years of owning my last company. Everything was getting just a little too comfortable. We had a nice house in a nice neighbourhood. Our kids went to a nice school and played nicely with others in a nice park. It was all a little…too nice.
My universe had shrunk into a few square miles around our house and my vocabulary had descended into a mixture of corporate jargon and Starbuckseeze.
Moving to France with two young kids has us learning a new language, making new friends, and navigating a new town. Even mundane things like getting a new propane tank for the BBQ is a little adventure over here. I bought a scooter and – as corny as it sounds – I feel more alive, like the lights have just been turned up inside my head.
And I’m not alone.
In the last year, we’ve met a number of other entrepreneurs who have subscribed to some form of the 10-year chunk plan. Last weekend we all got together for a game of petanque and there was a Parisian who had moved his young family to the south after selling his business last year; a New Yorker who had sold his finance company and moved here with his wife and two kids; an Aussie who had recently sold his commercial real estate business, at least in part, to have time to bond with his boys before they go off to high school; a software entrepreneur from Seattle with three young kids.
We won’t stay here forever. I’m already getting the itch to start my next business, but I’m putting it off for now and trying to enjoy the buffer zone between 10 year chunks.
How about you? Do you think selling a business is selling out? Are you on your own version of the 10 year chunk plan?
I think perhaps what they fail to realize is that in life you are either selling or being sold. Ideas, products, services are all sold. The question is not “if” you are going to sell your business – it is “when” are you going to sell your business. The choice then comes to when and how are you going to transistion it and working everyday towards that goal. This is the difference between “working on” your business versus “in your business”.
Perhaps the reason that individuals don’t want to think of there business as being “sellable” is because their god has become their business and it has become their life – a sacred cow of sorts. In order for a business owner to grow they have to get past the point of looking at their business as their life.
Eric: what’s that old expression….something like “every business is for sale at some price”. I might be butchering the saying but I think I have the sentiment right. Thanks for your note.
John,
I think you have it right! It’s a never ending challenge to balance work and family.I enjoyed your book and look forward to reading your articles.
I help business owners plan for the transition and exit from their business. It’s sad that most business owners don’t really have an exit plan to maximize the value of their business, realize their goals and leave on their terms.
Stephen:
Sounds like you guys provide an important service to business owners. Thanks for sharing your thoughts.
The only way to make your business last forever, is to build it to sell and sell it while it’s still viable and attractive. The simple truth is an owner’s business is as certain to die as the owner is with a plan to keep it forever. If not for the money, prepare to transition your business for the sake of the employees, vendors, and customers. How selfish is an owner that doesn’t show up on that fateful day, and in addition to their tragic loss, leaves a huge mess for all the loyal and faithful survivors to contend with?
There is nothing wrong with a business that has a transcendent cause as its mission. I tend to be one of those that lean this way. I tell my customers that making money is not a goal, it is a necessity. Unfortunately, this lady doesn’t grasp the principles behind your book. We should be building companies that grow in valuation and provide owners with multiple exit options and one of those is outright selling of the company and walking away, but that in no way means the company or its mission goes away. If the company was built properly the new owners can leverage this success into even greater good and yes, profits.
The idea is to have a long-term vision. If you’re building your business thinking you might sell it, you’re going to make different decisions than if you just look at your business as income for you and your family. You made this point in your book. I’m looking forward to the new one to see what you’ve added!
Hi John. While this makes a great opener for a blog post, it is a rather misleading representation of the actual substance of our conversation. What I, the “woman from the Strategic Coach”
actually said was that we help our clients find ways to make their business the foundation for all their other goals in life, and how to keep growing the enjoyment and excitement they get from it so they don’t want to retire and don’t want to sell it. I also said that some of our clients do, of course sell businesses, and all need succession plans, which may involve selling, but it’s just not the focus of our Program, particularly at the beginning, though, as you pointed out, many of the tools we teach help make businesses much more salable.
I never said I “don’t like” the title of your book, only that our using it for lead generation might confuse people, because selling one’s business has never been part of our core value proposition. That’s not because we don’t think entrepreneurs should ever sell their businesses, but simply because the people who come to us are more interested in knowing how they can work less, make more money and do more of what they love, and our process helps them do this within their current business. Our focus is on helping entrepreneurs avoid the issues of boredom and hard drive space, and have all the time they want to “build spaceships”, while they grow their income 10x or more within their business or businesses. We have many clients in a variety of industries who’ve managed to find this balance and they love their lives, and their businesses.
I never said that the content of your book was not valuable, or that we look down on entrepreneurs who want to sell their businesses (which we certainly don’t!), only that using it for lead generation for us might give people the wrong idea about what our Program was about, and that they might be a bit confused when they read our actual materials and find nothing related to selling a business, because it’s not our focus.
Our conversation was focused on the suitability of using your book launch as a marketing opportunity for Strategic Coach, and these, I think, are natural issues to bring up, particularly since I wasn’t provided with a copy of the book to review before the conversation, and so had only the title to go on. As we left it, the conversation was to continue after I got more information on the book’s actual content through a resource you recommended. I have done that, but this post came as a surprise.
p.s. I think everything else you’ve said in this article is very true!!
Wonderful Post! So much inspiration from a personal and professional standpoint. I admire the life you have created and am excited to see what is next.
Excerpt from my business plan:
“Every business should be built with the ultimate goal of its sale in mind, and simultaneously as an enterprise that will generate so much profit no one in his right mind would want to sell it.”
From my perspective, the benefit of owning a business is the choices you make available to yourself. Everyone has a different vision of their ideal lifestyle. Building a successful business can facilitate the achievement of that end, if done consciously. The main problem is that far too many people fail to live an examined existence, taking time to really know what they want out of life. If you don’t know what you really want, chances are you won’t get it.
I’m a huge fan of the 10-year plan. In fact, I was thinking about that very thing this morning in the shower before this email came in. Kismet.
Thank you for the great book and the inspiring blog posts, John.
The thrust of the argument is right on, but I think the Coach’s clarification” is also quite right – it should be “Build before Exit”, which is the point of the book. John, feel free to post this to our LinkedIn Group.
Another great entry, John. Thanks. The trouble I have, which perhaps is the point of the entry, is thinking what to build after exiting.
When one builds a business to sell, they are giving themselves more options. Just because someone builds a business to sell doesn’t mean they’re going to sell the business, it just means that it’s ready to sell.
The Strategic Coach is at the other end of the spectrum from the exit planning people. Exit planners think business owners should only sell their businesses, The Strategic Coach thinks they should only keep them. The real opportunity is creating choice and the best way to do that is through options.
Josh Patrick
http://www.stage2solution.com/blog
http://www.stage2planning.com/blog
Strategic Coach is a great program for entrepreneurs, and I have benefited enormously from belonging to it. I gather from Ms. Nomura’s post that your conversation with her was solely about whether Strategic Coach should use your book “Built to Sell” as a marketing tool for Strategic Coach. As she says, using your book as a marketing tool might mislead prospective Strategic Coach members, who might read your book and then be disappointed when selling the business turned out not to be the *main point of Strategic Coach.
Strategic Coach, contrary to what Josh Patrick says, does not think only that business owners should keep their businesses. Ms. Nomura in fact makes that clear. I see no inconsistency.
Mary Campbell Gallagher
http://www.BarWrite.com
You have moved to Aix-en-Provence! Bien joue!
MCG
ask your sell this question
can i see myself doing this until im 60?
well can you?
then your business it ready/can be to sell/sold!