Ever catch yourself daydreaming about that sweet, sweet exit? You know, the one where some bigshot company swoops in, throws a mountain of cash your way, and you ride off into the sunset, mai tai in hand?
Yeah, me too. But here’s the kicker – building a business that’s actually sellable? It’s a whole different ballgame.
Now, full disclosure: I haven’t sold a business… yet. But the idea of creating something so well-oiled, so damn irresistible that someone else would want to buy it? That’s been living rent-free in my head for years. And let me tell you, it’s changed how I think about business entirely.
Your business is the product
Most of us entrepreneurs are so caught up in our products or services that we forget the biggest product of all: the business itself. We’re like chefs obsessing over a single dish while the whole restaurant’s on fire.
Building a business with the end goal of selling it isn’t just about cashing out. It’s about creating something that can thrive without you. It’s about building a machine that prints money, not a job that prints your paycheck.
Why build to sell, even if you never do?
Now, I can hear some of you already. “But I love my business! I don’t want to sell!”
Fair enough. But here’s why you should build as if you’re going to sell anyway:
- Freedom: A business that can run without you is a business that doesn’t own you.
- Scalability: Systems and processes that attract buyers also allow for easier growth.
- Value: A sellable business is usually more valuable.
- Options: Maybe you won’t sell. But isn’t it nice to have the choice?
The subscription dream
If there’s one thing that makes potential buyers weak at the knees, it’s predictable, recurring revenue.
I’m talking subscriptions, baby.
Think about it. Which would you rather buy: a business that has to hustle for every dollar each month, or one where the money just shows up, like clockwork?
Yeah, me too.
But building a subscription model isn’t just slapping a “monthly” label on your existing offerings. It’s about creating ongoing value that keeps customers coming back. It’s about becoming indispensable.
Here are a few ways to subscription-ify your business:
- SaaS it up: Can your product or service be turned into software? SaaS businesses are hot commodities.
- Membership models: Exclusive content, community, or services can keep people paying month after month.
- Retainer services: For service businesses, move clients from one-off projects to ongoing retainers.
- Product subscriptions: Even physical products can go subscription. Think Dollar Shave Club or Blue Apron.
Remember, the goal is to make your revenue as predictable as possible. Because in the world of business sales, predictability equals desirability.
Building a business that doesn’t need you
The hard truth is that if your business can’t function without you, it’s not a business. It’s a job.
And jobs? They don’t sell for much.
The key to building a sellable business is creating systems and processes that anyone can follow. It’s about making yourself redundant.
I know, I know – it feels counterintuitive. But it is the secret sauce.
Think of it this way: you’re not just building a business; you’re writing a manual for success.
Every process, every procedure, every little detail of how your business runs should be documented. It’s like creating a franchise, even if you never actually franchise.
Here’s how you can start:
- Document everything: And I mean everything. From how you make sales to how you handle customer service. If it happens in your business, it should be written down.
- Create standard operating procedures (SOPs): These are step-by-step guides for every task in your business. Make them so clear that a newbie could follow them.
- Use technology: Look for tools and software that can automate or streamline your processes. The more that can run on autopilot, the better.
- Build a strong team: Hire people who can take ownership of different areas of the business. Train them well, then get out of their way.
- Test your systems: Take a vacation. Seriously. If your business can run smoothly while you’re sipping cocktails on a beach, you’re on the right track.
Working on your business, not just in it
Alright, let’s address the elephant in the room. How the hell are you supposed to document everything, create systems, AND actually run your business? It’s like trying to change a tire while the car’s still moving.
I get it. I’ve been there, trying to juggle the day-to-day grind while also thinking about the big picture. It’s not easy, but it’s necessary.
Here’s how I try to balance it:
- Schedule time for systems: Block out time each week specifically for working on your business, not in it. Treat it like any other important appointment.
- Start small: Don’t try to systemize everything at once. Pick one process at a time. Document it, refine it, then move on to the next.
- Involve your team: If you have employees or contractors, get them involved in creating and documenting processes. They’re in the trenches every day – use their knowledge.
- Use the right tools: Find tools that make documentation and process creation easier. There are tons out there – from simple note-taking apps to full-blown business management systems.
- Make it a habit: Every time you do a task, ask yourself: “Could I document this? Could this be systematized?” Make thinking about processes second nature.
Remember, building a sellable business is a marathon, not a sprint. It’s about consistent, intentional effort over time.
What makes a business irresistible?
Let’s put on our buyer hats for a second. If you were looking to buy a business, what would make you reach for your checkbook? Here’s what I think buyers are looking for:
- Predictable revenue: We’ve talked about this, but it bears repeating. Subscription models or long-term contracts are gold.
- Growth potential: Buyers want to see that there’s room for the business to expand. Have you tapped out your market, or is there still plenty of runway?
- Strong systems and processes: The more turnkey the operation, the better. Buyers want to know they can step in and things will keep running smoothly.
- Diverse customer base: Relying too heavily on one or two big clients is risky. A broad customer base shows stability.
- Unique value proposition: What makes your business stand out from the competition? A strong brand or unique offering can command a premium.
- Solid financials: Clean, clear financial records are a must. If your books are a mess, buyers will run for the hills.
- Good team: A strong, well-trained team that can stick around after the sale is a huge plus.
Planning for your grand finale
Even if selling your business feels like a distant dream, it’s never too early to start planning your exit strategy. Here’s how to start:
- Know your numbers: Understand what your business is worth and what metrics buyers in your industry care about.
- Build relationships: Network with potential buyers or brokers long before you’re ready to sell. These relationships take time to develop.
- Clean house: Start addressing any weak spots in your business now. The cleaner and more organized your operation, the smoother the sale process will be.
- Consider your role: Do you want to walk away entirely, or stay on in some capacity after the sale? This can affect the type of buyers you attract.
- Get professional help: When the time comes, don’t go it alone. Lawyers, accountants, and business brokers can be worth their weight in gold.
Embracing the build-to-sell philosophy
Here’s the thing about building a business with the intention of selling it: it changes how you think. You start to see your business as a product in itself. You become more objective, more strategic.
You stop making decisions based on what’s easiest or most comfortable for you, and start thinking about what adds the most value to the business. It’s liberating, in a way. Your business becomes less of an extension of yourself and more of a separate entity that you’re cultivating and growing.
And here’s the beautiful irony: by building a business that you could sell, you often end up with a business you don’t want to sell. Because now you’ve got a well-oiled machine that runs without your constant attention. You’ve got freedom, scalability, and options.
Your business, your masterpiece
Building a business with the intention of selling it isn’t about creating something disposable. It’s about creating a masterpiece – something so well-crafted, so valuable, that others can’t help but want a piece of it.
It’s about taking your vision, your ideas, your hard work, and turning them into something bigger than yourself. Something that can continue to grow and thrive, with or without you at the helm.
So whether you end up selling or not, approach your business like it’s your magnum opus. Document, systemize, optimize. Build something that’s bigger than you, that can outlast you.
Because in the end, isn’t that what we all want? To create something of lasting value? To know that our hard work and sleepless nights meant something?
So go ahead. Build your business like it’s the most valuable product you’ll ever create. Because, in the end, it just might be.