by Dave Driscoll
Recently a prospective seller asked what mistakes I had made as a business owner, specifically relating to the sale of my business.
I settled on these three big mistakes:
• I thought I could control the timing of when I wanted to get out of the business.
• I didn’t seek advice from folks who have been there before me to understand the process.
• My ego got in the way of good decision making.
Painful, but true, realizations. These mistakes resulted in missed opportunities and ultimately decreased the value I received from my life’s work to support my Life Beyond Business.
The articles I’ve written over the years have explored these themes in one form or another, but seeing them together in this simple list makes it clear that I was my own worst enemy. As you look at the three bullet points, you see: me, me, me. If I have learned one thing in my quest to help other owners, it is that it’s not all about them. Owners need to seek perspective from other sources and form grounded ideas based upon facts and realistic expectations.
Controlling your exit
From my experience, the best opportunities come when an owner least expects it. And that usually means being unprepared to handle the emotion created when the opportunity is suddenly presented.
The second scenario is holding on too long. “Business is so good; why would I give this up?” says the owner in his late 50s or early 60s with no succession plan.
Lesson: Always be prepared so you could sell your business tomorrow.
Having all the answers
Not until I started Metro Business Advisors did the phrase “you don’t know what you don’t know” really sink in. Owners build businesses by being experts at what they do. They are constantly challenged to be the best in their market and to provide innovative products and services to their clients. That single-minded focus leaves no room to ask the needed questions that may seem like unnecessary distractions.
Owners must seek advisers who can educate them about issues that will eventually be crucial to understand. Your success in growing your business does not extend to all things business!
Lesson: Take yourself back to the insecure feeling you had when you first started your business. That’s the feeling you get when “you don’t know what you don’t know,” which should lead to doing the needed research and preparation.
Believe me, I get it! Reflecting on the previous two mistakes, combined with owning a business in one form or another for 38-plus years, I obviously know how a strong ego can develop.
As the owner, you have taken all the risk. In the early days, you made all the decisions (good and bad), measured success or failure, recalibrated and moved on. Making decisions by committee just could not work at that stage of the business cycle; you succeeded or failed on your own terms.
Lesson: The key to getting your ego in check is to switch gears and become inclusive in your decision making along the path to success. This is a very hard transition that involves making honest assessments about which tasks you are best at and delegating the rest. Measuring who within your organization you should bring into decision making is another calculated risk.
As I said, I get it; but I also understand that the owner’s ego (including mine) is frequently the cause of missing lucrative opportunities.
My advice is to be aware that your tendency to have a strong ego leads to unrealistic expectations, so seek input from trusted advisers to help provide clarity.
Dave Driscoll is president of Metro Business Advisors, a business brokerage, valuation and exit planning firm helping owners of companies with revenue up to $20 million sell their most valuable asset. Reach Dave at DDriscoll@MetroBusinessAdvisors.com or 314-303-5600. For more information, visit www.MetroBusinessAdvisors.com.
Submitted 5 years 190 days ago