Throat Cancer Is Why You Will Never Sell Your Business
I’m not a hypochondriac, but sometimes I get worried. It happens on those days when I see an article that asks. . .
Do you have these 5 symptoms of throat cancer?
If I read the symptoms, and I happen to have 3 out of 5 on that day, I’ll admit to a little anxiety.
Crap. Do I have cancer or just a sore throat?
Thankfully, when I wait a day or two, the symptoms almost always disappear. Probably no cancer. But, on the rare occasion where symptoms persist, I’ll go get things checked out – because why take the chance right? I can be as lazy as they come, but when I believe something might have a huge impact, I’ll do some homework to confirm, or disprove, the belief.
Except When it Came to the Biggest Financial Transaction in my Life
I remember reading the article that said that businesses in my industry would sell for 1-2 times annual revenue. We were doing around $3 million in revenue at the time. I did the math and figured if I was able to get the business to $5 million in revenue I was gone – shoot, even if we were at 1x revenue, $5 Million was going to buy me a lot of runway. So, for the next two years we worked, and grew, and got to that $5 million dollar level. Then I decided to explore a sale.
That’s when I found out that revenue was meaningless when it came to the value of my business. MEANINGLESS.
Like many owners, selling my business was the biggest potential financial transaction of my life. But I operated for years, making big decisions, based on what I quickly read in a magazine. I read the article, I assumed it was correct, and then ran my business for the next two years focusing almost exclusively on growth in revenue.
What if I approached my health the same way?
The article said I might have cancer . . . time to tell the kids I’m dying, sell the house and schedule chemotherapy? “Forget the doctor”, I’d scream, “I know what the article said.” Silly right? I would never dream of making those decisions based on a tidbit of information. Yet I made massive business decisions based on a five minute scan of an article.
Selling your business is likely the biggest financial transaction in your life, and if you’re like I was, you spend almost no time on the topic at all.
You are too busy owning.
You are too busy doing.
You are too busy “creating value.”
Yet you don’t take even a little time to learn what really creates transferable value in a business. What really creates a business you can sell.
I didn’t take the time to learn until it was almost too late. I got lucky — most who wait as long as I did pay a huge price.
Have you bothered? Do you spend any time learning about that huge financial transaction you hope is in your future?
Do yourself a favor and learn to leave.
Oh, and go get that sore throat checked out.
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