There are other options besides selling, even if that’s your plan in the long term. Become something of an investor. Manage the machine you built, rather than being part of it. Take a step back and think about the other options you have.
Consider being an owner
This whole selling a business thing is complicated, isn’t it? Now you know why a lot of businesses simply close. Selling a business is work. It’s usually worth it, but it isn’t easy. And yet, it’s possible to avoid a fair bit of the work we’re discussing.
Some of you have been running a business for a long time. Some have been working for / in the business, as well as owning it. Running it and working for it are not the same. If you have to get in the truck every day and go out to a job site, or open the computer and stick your face in a spreadsheet or programming tool in order for your business to get paid, you’re working for the business, even if you own it.
It doesn’t have to stay that way. If you’re not sure about the pain of stepping away, consider finding someone to take on the physical part of the job. In that mode, you’re hiring skilled people for a specific job (as opposed to “business owner”).
For now, let them do the work. Do nothing but manage that business. Once you see what it takes to manage the business day by day – while doing nothing else – then you can easily identify the skills needed to bring on a manager. Perhaps you look for a manager who is interested in owning the business, perhaps in partnership with the person you hired for the “skilled position”.
Test your team – and yourself
At some point, you should have systems and processes setup so that the skilled person is handling whatever “working for the business” work that generates revenue, and your manager is… managing. Get things to the point where you can take off for three weeks and disappear (or so they think – if you need that at first).
Because you still own the place you’ll want to have internal controls in place. These inform you and your manager that everything is where it should be, running as it should be, etc. Combined with a few metrics, you can watch the business from afar.
What metrics? Think about a few pieces of info from each department that would allow you to sleep comfortably knowing your team has everything under control. Even if you don’t see them as “departments”, they still exist. Finance and Sales exist even in the smallest of companies. You already know what metrics are important. Now consider what’s important at a distance.
Finance: What’s AR look like? What’s your free cash look like? Are any payments overdue? Are we current on tax filings?
Sales: What was revenue last week? Last month? How many bookings do we have for the next 30 / 60 days?
Even though you could get the numbers yourself, a regular report from your manager that provides these figures and advises what they’re doing about them will be useful for non-distracted time away from the business and quality sleep.
Still uncomfortable? Still can’t sleep? Maybe the wrong manager. Maybe insufficient systems or metrics. Get with the manager and get to the bottom of what’s uncomfortable and have them patch that hole.
One thing to avoid, unless there’s no choice – avoid getting back into the weeds. Guide your manager through the weeds. Have them guide their team through the weeds. Don’t get into them yourself.
You have options
For the short term, ownership can be an easier option. You can be involved with the business when they need your expertise, while stepping off for a while to determine what your future looks like. All the while, you can take a distribution from the business, even though it may be lower than what you were taking before.
You’ll still have all the equity until you decide to consider your next step, like selling the business to your manager and lead “do-er”, or selling it to someone else.
The unanticipated reward is that a business that no longer requires you to be there every day is worth more and is easier to sell. Until that day comes, it’ll be easier on your mind and your back.
Mark Riffey is an investor and advisor to small business owners. Want to learn more about Mark or ask him to write about a strategic, operations or marketing problem? See Mark’s site, contact him on LinkedIn or Twitter,or email him at [email protected].