Learn from My $20,000,000 Mistake
“Begin with the end in mind.”
“And put it in writing.”
The year was 2009. I had spent 17 years building an extremely successful company, The Marena Group, and I was looking to sell it to a strategic buyer.
And, somewhere between the decision to sell and signing the contract to close the deal, I made every exit mistake.
I rushed the sale so I could move to my Next Big Thing. I violated my own highly-engineered plan and timeline. I made a big business decision during a huge emotional crisis (divorce). I ignored my badass attorney’s advice and instead let emotions crowd out the logic I spent decades building into my long-term plan—and it took just a few months and a handful of decisions to blow it up.
Serial entrepreneurs are guilty of these same things at one time or another. Sometimes we (or our advisors) catch ourselves in time. Sometimes we get lucky. And sometimes we leave $20,000,000 on the table because we couldn’t see past our irrational fears, inflated excitement for our next adventure, or our high-performer’s desire to crush limbo and move on.
Believe me, the last thing you want to do is throw your business baby out with the bathwater. Where I ended up was fantastic (understatement of the decade) but it cost me. Big time. Keep reading to learn how you—and the company you leave behind—can move on without regrets.
Onward,
Bill
P.S.
Don’t have a written exit plan? (Yes, you will exit somehow, someday. Yes, the plan needs to be in writing). I’m happy to help—or put you in touch with someone who can. Just click here.
Take a moment to think ahead.
Where will you be in ten years? Where will your company be in ten years? Are you both in the same place? Is the path from here to there thought through and mapped out? In writing?
Bo Burlingham, in his book Finish Big: How Great Entrepreneurs Exit Their Companies On Top, talks about the eight qualities of successful entrepreneurs who gracefully hand the baton while getting rewarded handsomely for their businesses.
Get a good look in the mirror. Have a clear understanding of who you are, what you want out of your business, and why you want it so badly.
Understand the difference between a viable business and a sellable one. Both can be extremely successful, but only one will pique the interest of an investor or buyer.
Take your freaking time. Build your business with the end in mind, even (and especially) when it’s years down the road to prepare for your eventual departure. A strategic plan can help avert a frantic need or urge to sell under less-than-advantageous circumstances.
Continue your success with a successful successor. While not important for everyone, those with an invested or personal interest in their company’s future should invest a great deal of time and effort to leave their business in the best of hands.
Listen to those who’ve been there. At The Lions Pride, we’ve gathered badass CEOs, founders, and entrepreneurs who are all in different phases of business growth, from start-up to scale-up to next up. By constantly learning from each other, Cohort members can glean and apply other’s experience to their own business timelines. (Want to join us? Click here.)
Whatever you do, be at peace with it. Selling your company not only impacts you, but also your employees and your investors. Invest the serious thought and time necessary for these decisions, and come to conclusions you can live with.
Choose your investors wisely. Nothing ruins a beautiful exit like waking up to read that your investors are taking your old company in a gut-wrenching direction. Your feelings on the matter won’t matter after the signature dries, so don’t be afraid to probe, uncover motivations, and come to terms as needed.
Prepare for your next chapter. As Bo says, “The owners who did best had a vision of what they would do after the sale and thus were better able to handle their metamorphosis from top banana one day to ordinary piece of fruit the next.”