Many of small business owners eventually find themselves at a crossroads and have to give serious thought about winding their way out of the business they built. This can be for many reasons including strategic objectives, retirement, or just plain ennui. Sometimes running a business for many years can lead to questioning the business model itself, or just the simple realization that the learning curve has gone flat and it’s just not so much fun anymore. I was speaking last night to a woman who started a successful business over 15 years ago, but felt trapped in it and was struggling hard to extract herself and at the same time leave the business to a grown child who was not quite ready to take it over. She was torn between her desire to leave a legacy to her daughter and her desire to move on to something new.
There are as many ways to exit your business as their are reasons for doing so, and the advice I offered my friend is that she define her personal goals, look closely at her options, consider how she should define “value,” and give careful thought to what was next for her. I recommended that she look carefully at how her exit could provide a springboard while at the same time fulfilling her objective of helping her daughter.
Realizing that there are many business owners weighing similar decisions, I thought it would be helpful to list out some of these thoughts, so here are 5 important points to consider as you make your way towards that metaphorical “exit sign” over the next door in your life.
1. Define goals.
Take the time to ask yourself, “what’s next?” It is critical to understand what you want to do after your exit as this will (and should) strongly influence the way you want to exit. Just like when you started the business, a careful examination and understanding of your goals should be the first order of business.
2. Determine strategy.
Goals drive strategy in exits just as they do in business, and careful strategic planning and execution are just as critical with an exit as they are to managing your business. You I’ll need to ask yourself “how” and consider the various strategic options available to you. Will your exit be a sale or and hand-off? Will it be an IPO or a liquidation of hard assets? As you answer that key question you’ll want to consider whether you’ll do this yourself or work with an advisor and the legal implications that your choice will determine. Understanding what you want from the exit can help you to determine the road to get there.
3. Execute well.
The tactics you choose to execute your strategy are just as important as they were when you were first building the company. Plan out your exit campaign much as you would plan and execute a great marketing campaign.
4. Understand value.
Valuation is a tricky business and there are many ways of determining the value of your business: multiples of revenue, margins, or EBITDA; market-based or income approaches; asset approaches, discounted cash flows, or CAPM, WACC or a handful of others. Some businesses are fortunate to exit via an IPO, while others are, frankly, better off being liquidated; indeed, many founders discover that they can extract greater value by breaking up their precious baby and selling off the parts. At the end of the day, however, there is only one valuation that counts: how much someone is willing to pay and how much you are willing to accept.
Every day on the crowdSPRING Twitter account and on my own Twitter account, I post links to posts or videos I enjoyed reading or viewing. These posts and videos are about logo design, web design, startups, entrepreneurship, small business, leadership, social media, marketing, and more! Here are some of the links that I’ve liked and shared this past week!
The image above is one of a number of fun and creative truck wraps. More creative and truck wraps in the Design section below.
I have the pleasure of moving on June 1st. I also happen to be a horrible procrastinator. Granted, I always manage to pull things off and have them done well, but there have been a few occasions I’ve wondered why I do this to myself. Such is the case with my packing situation. Or, rather, lack of packing situation.
Recognizing how common this kind of pattern is, Dr. Pete of 30GO30 decided he wanted to launch the site after turning 40 and reflecting on the long list of things he just hadn’t managed to make time for. As a Ph.D in Cognitive Psychology, he understood what it took to get people motivated. So, he came up with a simple challenge: work on one thing 30 minutes a day, for 30 days. The catch is, it has to be something you’ve been meaning to work on for awhile. The website and blog chronicles his own struggles, as well as provides support for those accepting the challenge.
After using the method this weekend to tackle my packing debacle, I might be a bit of a convert. I even got my room mate involved and we’re pretty pleased with the dent we made. Now we just need a strategy on how to get rid of junk that we’ve overly-sentimentalized.
Dr. Pete answered a few questions:
How would you explain what you do to somebody’s grandmother?
To be honest, I think grandmothers might get my core concept better than the rest of us. We’ve become so enamored with technology and shortcuts that we’ve forgotten the value of plain, old-fashioned elbow grease. Some things take time and commitment, and there’s NOT an app for that. My blog is about tough love, which I think many grandmas do very well.
What are some specific challenges you faced/are facing?
My first boss built our company out of pocket, and I’ve always admired the pay-as-you-go mentality. I’m not afraid to spend money when I need to or to pay for quality, but 30GO30 was a project where I wanted to support it out of pocket and build it organically as much as possible. Naturally, that means carefully choosing what I spend real money on.
Periodically I check in on the good people in our nation’s capital to see what they are up to and what they have been doing lately for (to?) us and our businesses. Our Congress has the ability to impact what we do every day and how we do it. The profitability of our companies, the welfare of our workers, and our ability to run our businesses effectively is directly dependent on their ability to pass law, provide oversight, and set priorities.
There are currently several pieces of legislation proposed or pending in Congress that you should be aware of, which have the potential to affect us in ways small and large – here are 5 currently proposed laws and short summaries for each. Use your own judgement about whether they will have a positive or negative impact and be sure to contact your elected representative to let them know how you feel! (AND be sure to leave a comment here to let us know, too!)
H.R. 585: Small Business Size Standard Flexibility Act of 2011 (Introduced 2/9/2011)
This change to the Small Business Act allows the SBA to change or specify the definition of what constitutes a small business, based on the size of that business. Potential impact: the SBA could adjust the definition such that businesses which are then deemed as too large, could no longer quality for certain programs, such as loans, tax incentives, etc. While this limitation would mean that many businesses would no longer be eligible for these programs, it could also provide savings within the program and limit it to businesses that most need the support.
H.R. 448: Small Business Innovation Enhancement Act of 2011(Introduced 1/26/2011)
This law will increase the SBA budget for awards to business via the Small Business Innovation Research (SBIR) programs over the next 5 years. Potential impact: more dollars could flow to small business to pursue research and innovation, but the additional dollars would have a budgetary impact in a time of large deficits.
S. 128/H.R. 1770: Small Business Paperwork Relief Act of 2011 (Introduced 1/25/2011)
This amendment to the Paperwork Reduction Act specifically disallows the imposition of fines for first-time paperwork violations be small businesses, unless a direct threat of criminal activity or “harm to the public interest” is determined. As long as a business corrects the violation within 6 months of being notified. Potential impact: small business would gain relief from certain fines for errors in their paperwork, but does limit agencies from the rapid enforcement of regulations.
S. 257: Small Business Broadband and Emerging Information Technology Enhancement Act of 2011 (Introduced 2/2/2011)
This law will require the SAB to assign an employee to specifically oversee all programs related to broadband and emerging information technology (BEIT). The SBA will also be required to train SBA employees in BEIT and to assist small businesses in the use of broadband and information technology. Potential impact: small businesses would have much greater support from the Federal Government in the areas of technology and internet access, but with an added layer of bureaucracy within the SBA.
Every day on the crowdSPRING Twitter account and on my own Twitter account, I post links to posts or videos I enjoyed reading or viewing. These posts and videos are about logo design, web design, startups, entrepreneurship, small business, leadership, social media, marketing, and more! Here are some of the links that I’ve liked and shared this past week!
The image above is one of a number of fun and creative advertisements. More creative and fun ads in the Social Media and Marketing section below.
Not long ago my girlfriend came home from a long night of waiting tables and, as per our usual after-work conversation, began to walk me through the horrors of the service industry. “I was just in the weeds,” she finally sighed.
“Well there’s your problem right there,” I replied. “I mean honestly, drug abuse on the job…”
“IN the weeds, you goon. I was IN the weeds.”
“In the what now?”
I pride myself on keeping a lexicon of slang, antiquated and otherwise readily at my disposal. This one, however, was new to me. So about 10 minutes of explanation and no less than 4 diagrams later, I finally got it. I think Yahoo! Answers actually does a nice summation:
“Diners’ wait-staff would get hopelessly behind and overwhelmed by orders, causing them to struggle as if they were walking through remarkably high weeds.”
Huh. How incredibly appropriate. And it’s safe to say we’ve all been there. Well, not waiting tables in a diner, per se, but we’ve all been in the weeds. I certainly have. Support tickets piles up, voice mailboxes get filled to capacity, twitter um, tweets.
There’s a millions different ways for people to get your attention and a million different ways for you to reply. Some folks will only speak on the phone. Others only through email. There are folks on cS who strictly go through our private messaging system. I had a dude hit me up on facebook once. And part of my responsibility is to juggle the queries from each medium, review each request and reply in kind.
And that’s just my grind. As a designer, I can only imagine what it’s like to walk in your shoes: different clients all concerned about their various needs, revisions, deadlines, et al. Actually, I’ve had the folks at cS laboratories recreate an average day in the life of y’all. Behold!
So yeah, it’s easy to get in the weeds. How in the world to you get out? Yahoo! Answers, you got anything?
“..drinking lots of cranberry juice, get a detox kit from GNC or wherever (which are pretty expensive), and take lots of vitamin-B to speed up your metabolism.”
Not helpful Y! Answers. Not helpful in the slightest. Now go sit in the corner and think about what you’ve done.
Okay, well here’s my trick for getting out of the bottomless mire of metaphors for getting overwhelmed on the job: Turn off the monitor. Turn off the phone. And walk away.
Seems simple right? It’s not. Pressing the reset button takes equal parts zen, skill and steeled determination (unless you’re a Nintendo, in which case you just hit the reset button). But 9 times out of 10 it works and you’re back in the game, clear head and all.
But that’s just me. How do you guys get out of the weeds?
As entrepreneurs and founders of businesses we have a great many balls in the air at any given time. The average day finds many of us actively managing a team, communicating with investors, raising funding, performing HR chores, recruiting, keeping the books, executing marketing plans, performing customer service, and taking out the trash. To accomplish all of this, we struggle mightily to stay efficient and to increase our own productivity, all the while struggling to find the personal capacity to do it all and to do it all well.
Keeping focus is the critical component in our days and our ability to do so can impact not just on how much work we can get done on a given day, but can also seriously effect the ultimate success or failure of our business.
One of the ways that I have learned to manage my own capacity, and maintain my own focus in the face of mighty of all manner of interruption, disturbance, interference, and hindrance is with a simple tool: the checklist. It is as low tech as low-tech gets: a piece of paper (in my case a Moleskin notebook) and a pen is all it takes to manage your own time, improve your efficiency, and increase your capacity. Here are 5 thoughts on why a checklist works and some tips for their use.
1. Efficiency has an ebb and a flow.
Face it: some days you are just better than others. We all have days when we are rocketing along, firing all cylinders and hitting one home run after the next. These are the great days when we can accomplish just about any task we have set for ourselves and these are the days that matter. Of course there will be the less-than-great days and these are the ones that require you to focus all the harder to maintain your productivity. On bad days I am even more dependent on the simple unadorned checklist I use to keep me focused, force me to be task-oriented, and drive me through in spite of that low-tide of efficiency.
2. Distractions abound.
Business (and life in general) is full of distractions, great and small and the humble checklist helps me to keep my priorities well ordered. Email, for instance, is one of the greatest enemies of productivity; plenty of studies have shown that reading and answering your emails in the course of the day can make it very difficult to shift focus back to other tasks. I find myself looking to the checklist after a round of emailing to help me get my mind back onto the other tasks that I have set for myself that day.
3. (Lack of) memory is the enemy.
I don’t know about you, but I sometimes just plain forget things. That call I need to make; the email I need to send, or the checks I need to sign. Put them down on your list as they occur to you – a good trick is to maintain a separate list of little stuff; chores such as phone calls, emails, and simple undertakings. Your “big” list is composed of higher level activities and should include just 2-3 items per day; these are things that require deeper thinking, such as strategic planning, analysis, and writing and may often require hours of your time, as opposed to the little chores which will take you mere minutes.
One of the biggest criticisms social media faces is that it cuts off users from the real world and creates a false, virtual world of interactions. This view seems especially true if you’re my 50-year-old, slowly-starting-to-turn-crotchety father.
But, social media platforms provide a unique opportunity to create easy connections between people that otherwise might not have found each other. Realizing this, NeverLabs was born.
NeverLabs aims to create a web platform that unites people in a similar location and with similar interests… but in the real world. For instance, if a person located to a new city and wanted to meet some buds to hang out with, NeverLabs would pull information from existing Facebook profiles and Twitter handles to find people to connect with. This platform will focus on cities, towns and even smaller locales. It’s the perfect answer to that old, stodgy social media criticism.
The gang over at NeverLabs took some time off from developing a new internet sensation and answered some questions I had:
How would you explain what you do to somebody’s grandmother?
Very slowly, using simple language, and probably with a lot of hand gestures! All kidding aside, though? What we’re doing is way more intuitive than it is complicated. We take the tools and platforms that so many of their grandkids are already using (like mobile devices, Facebook and Twitter), and build ways for people to meet up in the real world based on location, interest, and availability. Or, in other words, we’re fostering relationships in real life by making the Facebooks and Twitters of the world the pathway, instead of the destination.
What are some industry specific challenges you faced?
“Technology” – name for us another industry which just so happens to ALSO be a challenge and we’ll give you a dollar! You gotta love it though, the fast-pace and knowing that what we’re building today is merely the cutting edge of what we’ll be working on 12 months from now is, simultaneously, an enormous challenge and incredibly encouraging to restless minds like ours.
Every day on the crowdSPRING Twitter account and on my own Twitter account, I post links to posts or videos I enjoyed reading or viewing. These posts and videos are about logo design, web design, startups, entrepreneurship, small business, leadership, social media, marketing, and more! Here are some of the links that I’ve liked and shared this past week!
The image above is an energy drink bottle design. More creative and fun bottle designs in the Industrial Design section below.
We’re thrilled to be part of a new web/TV reality series – Trep Life – giving audiences a unique, 360-degree view of what it takes to succeed as an entrepreneur.
Each episode will focus on one company or organization. The first episode was about our friends Matt Maloney and Mike Evans from Grub Hub – a terrific place to find every restaurant that will deliver to you. Subsequent episodes featured Lara Miller, a designer and Executive Director of the Chicago Fashion Incubator, serial entrepreneur Howard Tullman, and Redbox Founder Mark Rechler.
The current episode features Network After Work. Watch below:
crowdSPRING is the world's #1 marketplace for entrepreneurs, small businesses, nonprofits and agencies who need custom logo design, web design, a new company name or other writing and design services. Over 110,000 designers and writers work on crowdSPRING. We are trusted by more than 27,000 happy clients around the world.
Many of small business owners eventually find themselves at a crossroads and have to give serious thought about winding their way out of the business they built. This can be for many reasons including strategic objectives, retirement, or just plain ennui. Sometimes running a business for many years can lead to questioning the business model itself, or just the simple realization that the learning curve has gone flat and it’s just not so much fun anymore. I was speaking last night to a woman who started a successful business over 15 years ago, but felt trapped in it and was struggling hard to extract herself and at the same time leave the business to a grown child who was not quite ready to take it over. She was torn between her desire to leave a legacy to her daughter and her desire to move on to something new.
Periodically I check in on the good people in our nation’s capital to see what they are up to and what they have been doing lately for (to?) us and our businesses. Our Congress has the ability to impact what we do every day and how we do it. The profitability of our companies, the welfare of our workers, and our ability to run our businesses effectively is directly dependent on their ability to pass law, provide oversight, and set priorities.
As entrepreneurs and founders of businesses we have a great many balls in the air at any given time. The average day finds many of us actively managing a team, communicating with investors, raising funding, performing HR chores, recruiting, keeping the books, executing marketing plans, performing customer service, and taking out the trash. To accomplish all of this, we struggle mightily to stay efficient and to increase our own productivity, all the while struggling to find the personal capacity to do it all and to do it all well.
