Discover the nuanced paths in entrepreneurship – 'Built to Sell' for strategic exits or 'Built to Last' for enduring legacies. Find your business's true north.
As a small business owner, the journey of entrepreneurship is often marked by defining moments and strategic decisions. In my own experience, having exited one business and currently managing two others, one for sustenance other for scale, I've come to appreciate the subtle yet profound differences between a business that is "Built to Sell" and one that is "Built to Last," drawing inspiration from the insightful books bearing those titles.
Built to Sell authored by John Warrillow, shows you how to become a successful entrepreneur by explaining the steps necessary to grow a small service company and one day sell it. The book unveils a strategic roadmap, demonstrating how considering the idea of selling your business, particularly in its early stages, can serve as a powerful tool. It's not just about financial gain; it's about decreasing stress, reclaiming precious time, and potentially emerging from the process wealthier – all while preparing your company for a successful sale.
Built to Last is authored by Jim Collins and Jerry Porras examines what lies behind the extraordinary success of 18 visionary companies and which principles and ideas they’ve used to thrive for a century. The writings of the book are based on thorough research and are aimed at focusing on the enterprise as an entity that lasts for longer than its founders or leaders.
The purpose of writing this blog is that as an entrepreneur we ought to have our end game in mind before getting started. The way you build your business and the daily decisions you take can be guided more appropriately if you have this clarity – Are you building a business for legacy or sales?
So let’s get started!
The Sale-Oriented Journey:
In the fast-paced world of business, the concept of building a business for the primary purpose of selling it has gained significant attention. This approach, outlined in John Warrillow's "Built to Sell," emphasizes creating a business with a clear exit strategy in mind. It's about identifying your company's unique value proposition, systematizing operations, and ensuring that the business can thrive independently of its founder.
I vividly recall the journey of selling my first business. The meticulous process of streamlining operations, elevating process integration, and creating a turnkey model was both challenging and rewarding. Up until three years into the bootstrapped business, I was all into growing it and taking it to the next level but fourth year I started to see the cracks where I realized two things:
The business is not aligned with my life purpose, I do not visualize myself doing this for the next 10 years
It has gotten extremely operations heavy and I am losing my passion to drive it further.
So now what showed up was – that I needed to find the right buyer and exit successfully. It took another year for me to convert the business into something which could run without me and that’s when I was able to make the shift. While the financial rewards were undeniable, I couldn't help but wonder if there was more to the entrepreneurial journey than just a lucrative sale.
The prime focus areas of this end goal are:
Having an exit strategy
Making yourself easily replaceable
Having a product-led business
Having a robust sales engine where customer acquisition is almost automatic
Business models need to be such that they have a longer customer lifetime value like subscriptions/memberships/products
The Legacy-Building Path:
This pondering led me to another invaluable read, "Built to Last" by Jim Collins and Jerry Porras. This book delves into the characteristics of enduring and impactful companies – those that transcend time and leave a lasting legacy. Unlike the "Built to Sell" model, "Built to Last" encourages entrepreneurs to envision a business that stands the test of time, contributing to the community, industry, and the lives of its employees.
When you set out to build a business that lasts longer than you, the focus is more on the purpose, culture, and ideologies that drive the organization.
The prime focus areas for this end goal are:
The Founder is irrelevant. The idea is irrelevant. What matters the most is our core values and purpose
Profits come after service and people
Focus is on creating a business that transcends time
The company is more like a cult where you either belong or you don’t
A Personal Reflection:
Navigating these two contrasting paths, I've realized that the journey of entrepreneurship is not one-size-fits-all. It's about aligning your business goals with your aspirations. While a sale may provide financial freedom, building a legacy brings a different kind of fulfillment – a sense of purpose that extends beyond monetary gains.
What's Your End Game?
For fellow small business owners, particularly women navigating the entrepreneurial landscape, it's essential to pause and reflect on your end game. Are you building a business for a strategic exit, or are you crafting a legacy that transcends generations, or at least for the next 10 years? Both paths have their merits, but understanding your aspirations will shape the trajectory of your entrepreneurial journey.
Conclusion:
In the face-off between "Built to Sell" and "Built to Last," there's no right or wrong answer. The key lies in aligning your business strategy with your vision. As you navigate the intricate world of entrepreneurship, let the dichotomy between sale and legacy serve as a compass. Consider not only what your business can provide for you today but also the impact it can have long into the future.
In the end, whether you're strategizing for an eventual sale or envisioning a legacy, the most important question remains – what do you want your business to be remembered for? As small business owners, we have the power to shape our destinies and leave a mark on the world. So, as you embark on this entrepreneurial odyssey, remember to ask yourself: Is your business Built to Sell, Built to Last, or perhaps a harmonious blend of both? The answer might just redefine your journey and inspire others to do the same.