As the owner of a private company, are you in charge of your own destiny or are you sitting in the passenger seat? Perhaps you’re tired? Or perhaps you have lost interest in the cause that got you so excited, all those years ago?
Whatever the reason it is never too late to grab back that passion and start driving the company forward in the direction you want it to go! But you need a fresh approach.
Call it a new strategic plan, a new mission, a new positioning. It doesn’t really matter what you call it. The key is that it is your plan that you would enjoy fulfilling. It is a cause you believe in.
What drives you? How could you align your strategic plan with your personal objectives?
But first we believe it is worth making a big assumption. As the owner we believe it is reasonable to assume that you want to build something that’s more valuable in 3 years time than it is today. Reasonable?
We’ve been talking a lot recently on LinkedIn, on our blog and in our new playbooks about a simple concept. Most owners are looking at their business through the wrong lens. The vast majority of owners are looking through a seller’s lens instead of a buyer’s lens.
Here is an extract from my friend Ted Schluter’s book Branding For Buyout (I highly recommend reading it). One of the best case studies in the book is Auris Health. Chris Velis founded Auris Health the surgical robotics company and ultimately sold it to Johnson & Johnson for almost $6 billion in 2019.
Chris’s takeaway on scaling private companies – “As entrepreneurs and technologists, we didn’t truly appreciate what brands were, especially in tech, entrepreneurs can think of the brand as fluff. But it’s not. It’s concrete. You build it. You communicate it.”
And that is just one playbook, the Positioning and Branding Playbook. Every area of your business needs a playbook. Marketing, Sales, Financials, HR, Engineering, Products, Service etc. These playbooks will drive you to success. These playbooks crystalize the operational processes and actions required to achieve branding success.
These playbooks are cherished by acquirers. It’s is risk mitigation for buyers and it is a safer way for you to run the business. You have blueprints that allow repeatable behavior. Staff are onboarded quickly and efficiently. Successes and failures are understood because you have a practiced methodology across your business. This is scaling through operational excellence. This is how you build businesses buyers love to buy. Of course you don’t have to sell it but let’s create a business that’s increasing in value over time.
Of course the big decision as the owner is to decide what business you are in or want to be in. As Ted asks in the book, is Elon Musk in the car business or is he scaling an energy company that’s in the business of changing logistics, and of changing mobility?
Entrepreneurs need a new report card to ensure they get what they deserve if they choose to exit one day. At present most entrepreneurs are being short changed for their life’s work.
To change that outcome on exit we encourage owners to step back and let us help you look at your business through the lens of a buyer.
As a starting point we encourage you to download our Saleability Test. This brief questionnaire was built by me in the 90’s! And of course I’ve tweaked it over the years after every deal. It highlights what buyers cherish. It demonstrates the issues that cause them to walk away from deals (and they walked away from me in my previous life as an investment banker). This test uncovers value leakage.
We’ve embedded the test in our white paper “Valuation Gaps and How to Close Them” (an operator’s guide).
The key is then to build a set of operational playbooks across all departments that scale your business by addressing value leakage and in the process creating a stronger and safer business that’s saleable!
Want a chat about your scores? Ian@TPPBoston.com
First 5 respondents get to book my calendar for 30 mins.
The Portfolio Partnership is a fractional executive practice. We build businesses buyers love to buy. We know 90% of companies are not ready for prime time. We take our clients through our proprietary Saleability Test to uncover value creation initiatives. We look at businesses through the lens of a buyer. Scaling through our operational excellence models including acquisitions creates a stronger, more predictable and safer business whether you ever sell it or not. We are your fractional operating partners. We actually do stuff.
