Run It Forever, Sell It Tomorrow
John Warrillow “Built to Sell” is probably number 1 on my list of future business-related reading. The text is a fictional story of Alex Stapleton and his marketing company on the way to the exit. The main idea of “Built to Sell” in one line: “You should always run a company as if it will last forever, and yet you should also strive constantly to maximize its value, building in the qualities that allow it to be sold at any moment for the highest price buyers are paying for businesses like yours” (this brilliant dilemma is stated by Bo Burlingham in the foreword to the book). Key action points helping to establish “run like forever — sell tomorrow” approach could be found on the web, in 2011 John Warrillow had conversation with Tim Ferriss on topic:
1. You need to be able to teach employees or suppliers (or be able to program technology) to do most of the work. That means the delivery of your product or service can’t be dependent on you showing up.
2. To create a sellable company, you need to have something others couldn’t easily replicate, which means you need to find a quiet niche without a lot of competition.
3. The hardest yet most important part of turning your biz into a sellable company is building a recurring revenue model. When potential acquirers look at your firm, they’re going to want to understand how revenue is going to come in after you are gone.
On top of writing Warrillow has a weekly podcast (named after the book) focused on the exits. I am a huge fan of it: regardless of the industry John is always making conversation funny and insightful. One of recent episodes was on Boogie Wipes, a company found by Julie Pickens and her partner Mindee Hardin. John compares the exit done by these ladies (Pickens described her exit as “a disappointment”) with the case of Michael Dubin and his Dollar Shave Club (sold to Unilever for 1 bln last summer): direct-to consumer omni-channel model is much more attractive for the biz owner than classic selling to giant retailers like Wallmart.
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