I think growing a business to sell it is a lot like dieting: there is no easy formula for instant results, and most of the hard work is done when nobody is watching.
Most everybody knows that to lose weight, you need to eat less and do more. To build a sellable company, it needs to be able to run without its owner, but do you have the discipline required to make the necessary choices?
I recently met with a 55-year-old consultant who has built a successful practice from his home. I asked him what his plans were for his business. "I just like doing the work," he responded.
Later in the conversation he made it clear he wanted to sell his consulting practice. Unfortunately, I don't think he can have both. He needs to decide if he wants a business or a job.
When building a business, you are faced with a fork in the road almost every day. You continually have to choose between instant gratification and deferred reward.
• In building my research business, I regularly indulged customer requests to get personally involved in their projects. The ego boost felt good, but once the warm and fuzzy feelings had dulled, I would kick myself because, with clients loyal to me personally, I knew I was no closer to having a sellable business.
• I often found it faster just to do the work myself rather than taking the time to explain to an employee how to do it. That attitude was great for getting things done in the short term, but it also undermined my ability to build a company I could sell.
• In the early days, I worked from home and used my business as a personal piggy bank when the more disciplined thing to do would have been to reinvest the money in employees, office space and the development of new ideas. It took me a year to figure out I was just treading water.
• Even though we had salespeople, I would occasionally indulge in the thrill of personally making a sale instead of forcing myself to go through the slow and clumsy approach of teaching an employee to do it.
As is the case with dieting, I found there was no perfect day. I would get up in the morning with the best intentions of building my company so it was not dependent on me. Some days it worked, some days it was a disaster.
Clarity of goals gives you the discipline to make the right choice over the easy choice when nobody is watching. Just as a dieter has to keep in mind the size of jeans he or she wants to fit into, you have to picture what your business will look like when it's sellable.
Always remind yourself why you want to own a business you could sell and determine what sacrifices you are willing to make to reach that goal.
Special to The Globe and Mail
John Warrillow is a writer, speaker and angel investor in a number of start-up companies. He writes a blog about building a valuable – sellable – company.