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I was in my mid-twenties, as wealthy as I had ever been on my own, and crushed.
I should have been pretty happy. The landscaping and snow/ice management company I started when I was 16 had just been bought by a strategic buyer — a competitor who liked our people, process, clients and equipment so much that he bought my business. As a teen, I had built a successful company with more than 20 employees.
But right there, before my eyes, my name was being ripped right off of the side of one of the seven trucks included in my business’s sale.
Related: 17 Founders Share How Their Very First Business Idea Helps Them Today
Let how you sit define you
The problem was clear: my stool was wobbly.
Think of business ownership as a stool with three legs: personal, financial, and sturdy. When you’re growing value — not just dollar value but intangible capital like people, systems and ideas — in your company, you need that stool to be sturdy and comfortable. That means alignment among all three legs.
I had sold a business, and eight months later, it was clear that one of the things I took with me was a wobbly stool. I had done no personal planning before my exit. Like many young entrepreneurs, I made the mistake of thinking that owning a business was simply about business. So, post-exit, I had no personal plan and didn’t know what to do next. I had spent years so focused on the business that I wasn’t excited about the vision for my next stage.
This time around, in the business I own now, I’m focused on building a business of significance — one that, when an exit comes, the result aligns with my business, personal and financial goals. My business isn’t just what I wake up and do every morning. It’s a financial asset that fits into my personal and financial plans. Instead of grinding through a business plan, I let my personal plan drive everything I do. Owning a business is part of that personal plan — but only a part. It’s helping me build a company where I am comfortable and ready to exit.
Related: When Should Business Owners Start Developing an Exit Plan? Here’s What You Need to Know.
Getting out of the way
The fact is an exit is coming for you and your business. Half of all exits in this country are caused by the 5Ds: death, divorce, disability, disagreement or distress. If a significant illness or sudden death happens to you, what will become of your company? And since most of an entrepreneur’s wealth is trapped inside their company, what assets will you be able to pass on to your family?
Fruitful exits happen to significant companies — not necessarily just successful ones. To have a significant company, it needs to be highly valuable, transferrable, attractive at any point, and in alignment with all three legs of the stool. The value can’t be about you and your ideas. It needs to be value that persists after you’re gone. And to build value, you’re going to have to get out of the way.
Get out of the way tip #1: Decentralize
My current company has 35 employees. As an owner, I know that two of my greatest strengths are people and culture. Because I follow the Value Acceleration Methodology — a strategic framework for executing exit planning that focuses on what I can do right now to grow the value of my business — I complete continuous 90-day sprints to mitigate risk through business improvements. One risk I’m focused on now is decentralization because I know that when my exit comes, the business can’t be about me.
I recently took a month away from my business to get married. When I returned, every goal we set for my time away was hit. But what I noticed was the culture wasn’t the same. Without me driving culture each day, the company wasn’t the same. That tells me that we need to work to build teams and processes that start to ingrain the culture into the business.
Related: 6 Critical Reasons Why Culture Should Be at the Top of Every CEO’s Agenda
Get out of the way tip #2: Get educated
Significant companies are ready to transition at any point. To be ready to transition, you must know that your company has value, either to an external or internal buyer.
Participating in a formal pre-transition value enhancement process is key. It’s not a one-time experience because while you’re building towards an exit, your goal is to be ready to exit at any point, agnostic to specific exit options. Educating yourself about your business by conducting annual business valuations, assessing your personal, financial and business goals, and putting what you’ve learned into a prioritized action plan is key.
Get out of the way tip #3: Get help
You don’t have to do this alone. Seeking out a Certified Exit Planning Advisor, or CEPA®, can help you develop your plans — based on a proven framework — that align with your business, personal and financial goals.
Exit planners uncover risks in an owner’s business, help build significant value before a transition, and align an owner’s business, personal and financial goals. And, because you’re paying attention to all three legs of the stool, you may need more than one. They may specialize in financial advising, legal assistance, accounting or leadership, and they can connect you to other planners to help you build your advisory team.
Getting out of the way doesn’t mean sitting out
While it’s important to build a significant company that has value post-owner exit, getting out of the way doesn’t mean you’re leading in absentia. In fact, the work of building a significant company is intensive. As entrepreneurs, we often feel like the lines are blurred between who we are and who our business is. For the people who work in your company — and the value that a potential owner might see in your company — it’s critical that the business becomes about more than just you.