Addressing each will have you on your way to a future euphoric exit event
How do you sell your company one day and command a premium valuation? On one level, it’s quite simple:
- Identify what good looks like long term – what is ownership wanting to achieve long term from owning the business? What will make ownership euphoric.
- Identify (or build) and protect your unique core competence.
- Develop a strategic thinking, planning and execution muscle amongst your leadership team to close the gap between what your company might be worth today and what you want it to be worth when you exit.
The first is the easiest of the 3 but often not addressed. Unless you tell me where you want to take your family on vacation, how can I help you know what your flight, boat, car or walking options are? How can I recommend what to pack? I can’t unless you tell me what good looks like for your trip and where you want to get to. Without knowing long term what you’re trying to achieve with your company, every day managing of your business is more difficult and you have no way of knowing if you’re closing the gap in its value between today and what you want to receive one day from an acquirer.
The second says if you’re going to work hard and invest time and money into your company, why would you want to build something that others already have. Build something unique, something special and the “special” means you have a core competence that others lack. This will help differentiate you in the market. And spoiler alert, a core competence isn’t necessarily what you’re good at as a company. It’s more than that as it is something your customers see and are willing to pay a premium for. Every company leadership team should identify what their business core competence is.
And thirdly, as a company owner or CEO, there are two options for helping you achieve near-term and long-term results that you’re striving for. Option 1 is hope. Option 2 is having a strategy. Statistically I know which one I would bank on and most people would. But often times, executives lack a good strategic thinking and planning muscle so that leaves them relying on hope. This muscle can be built but it takes focus and consistency, just like improving a golf or tennis swing.
Don’t overcomplicate what is already complicated enough. Owning and leading a business isn’t easy and it’s not for the faint of heart. But if you think in terms of addressing these 3 critical areas, you’ll have it easier than those that don’t and you are far more likely to achieve a euphoric exit event one day. Call us today and we can help you think about how to chip away at each of these must have elements.
