___ Concepts We Can Learn About _____ From How2Exit's Interview W/ Jamison West - Watch Here
Here is what my team and I learned from this interview: (These are notes from team members, writers, sometimes AI, and even listeners who submitted what i learned loosely edited and shared here) - If it seems a bit unrefined, you're reading our notes, so. yeah. -Ron
Concept 1: Emotional Side Of Business Exits
Exiting a business can be an emotionally taxing experience. It is a process that requires a great deal of preparation, planning, and consideration of the emotional toll it may take. It is not just a simple transaction, but a journey that can leave lasting impacts on the business owner. For this reason, it is important to understand the emotional side of business exits.
Jamison West, the author of The Emotional Side of Selling a Business, has been an entrepreneur for over 25 years. He has built Arterian, formerly JWCS, a Microsoft service provider that grew from a one-man shop to a 40-man company. He also co-founded three SaaS companies and currently serves as a fractional CEO of SmileBack and chairman of TimesZest.
West has experienced the emotional side of business exits firsthand. He has gone through the process of acquiring four other IT service companies and almost lost his business before recovering and ultimately selling it. He was invited to sit on a panel discussing the emotional side of selling and realized that there was a lack of resources available on the subject.
Exiting a business is more than just a financial transaction. It is a journey that requires a great deal of emotional preparation and understanding. The emotional side of business exits needs to be taken into account when planning the exit process. It is important to recognize the emotional toll it may take and to have a plan in place to manage it.
West's book provides insight into the emotional side of business exits. It discusses the importance of understanding the emotional journey, the challenges that may arise, and strategies to manage the emotional toll it may take. It is an invaluable resource for business owners looking to exit their business and provides a comprehensive guide to help them navigate the process.
Exiting a business is a complex process that requires a great deal of planning and preparation. It is important to understand the emotional side of business exits and to have a plan in place to manage the emotional toll it may take. Jamison West's book is an invaluable resource for business owners looking to exit their business and provides a comprehensive guide to help them navigate the process.
Concept 2: Acquisitions Are Risky Business
Acquisitions are a popular and often lucrative way to exit a business. However, as Jamison West notes, they also come with a great deal of risk. This is especially true when it comes to acquisitions of smaller businesses. It is important to understand the potential pitfalls associated with acquisitions and to plan accordingly.
The first lesson that Jamison West learned was that the first acquisition went well, but the second was a disaster. This is a common theme among business owners, who often find that the first acquisition is successful, but the second one is a complete failure. This is because the first acquisition is often done with a greater degree of caution and preparation, while the second one is often done with less caution and preparation.
Another lesson that Jamison West learned was that it is important to understand the timeline of the acquisition. Many private equity companies and strategic purchases offer five-year earnouts, but it is often difficult to keep the original proprietor actively engaged for the entire five-year period. This can lead to the proprietor leaving before the earnout is complete and not receiving the full amount that was promised. It is important to negotiate a shorter earnout if it is not possible to stay engaged for the full five-year period.
Finally, Jamison West learned that it is important to understand the emotional side of acquisitions. When an individual's identity is tied to the business, it can be difficult to let go and redefine themselves after the sale. It is important to recognize this and to have a plan in place to manage the emotional toll that the acquisition may take.
In conclusion, acquisitions are a popular and often lucrative way to exit a business, but they come with a great deal of risk. It is important to understand the potential pitfalls associated with acquisitions, to understand the timeline of the acquisition, and to recognize the emotional toll that the acquisition may take. With the right preparation and planning, acquisitions can be a successful way to exit a business.
Concept 3: Culture Is Key To Success
Culture is key to success, especially when it comes to acquisitions. Acquiring a new business is a complex process, and it is important to ensure that the culture of the two businesses are compatible. When businesses are not aligned in terms of culture, it can lead to confusion, disruption, and ultimately, failure.
When considering an acquisition, it is important to take the time to understand the culture of the two businesses. This can be done by talking to employees, customers, and vendors of both businesses to get a sense of their values and how they operate. It is also important to understand the financials of the two businesses and to ensure that they are compatible.
Once the acquisition is complete, it is important to ensure that the culture of the two businesses is maintained. This can be done by ensuring that the employees of both businesses are given the opportunity to get to know each other and to understand how the two businesses operate. It is also important to ensure that the employees of the acquired business are given the opportunity to learn the culture of the new business.
It is also important to ensure that the customers of the two businesses are integrated properly. This can be done by providing them with the same level of service and by ensuring that their needs are met.
Finally, it is important to ensure that the culture of the two businesses is maintained even after the acquisition is complete. This can be done by providing employees with the opportunity to build relationships with their new colleagues and to understand how the two businesses operate. It is also important to ensure that the customers of the two businesses are integrated properly and that their needs are met.
Culture is key to success when it comes to acquisitions. It is important to take the time to understand the culture of the two businesses, to ensure that the employees and customers of the two businesses are integrated properly, and to ensure that the culture of the two businesses is maintained even after the acquisition is complete. With the right preparation and planning, acquisitions can be a successful way to exit a business.
Concept 4: Culture Trumps Skill Level
When it comes to the success of a business, culture trumps skill level. This is because culture is the foundation of a successful business. It is the set of values, beliefs, and behaviors that guide the way a business operates. This includes how employees interact with each other, how they interact with customers, and how they handle challenging situations. When a business has a strong culture, it can be more successful because it creates an environment where employees are motivated, customers are satisfied, and the business is able to grow and succeed.
A good example of this is the story of a former business executive who was hired to clean up the culture at a business. He was tasked with creating a culture guide that outlined the emotional and behavioral expectations of the team. After reading the guide to the staff, some people left, but the right people stayed. The executive also had to deal with a disruptive systems engineer. He was brilliant, but his behavior was disruptive and he had to be let go. The executive realized that it was better to have two employees of lower skill level that were less disruptive than one employee of higher skill level who was disruptive.
The lesson here is that culture trumps skill level. It is important to take the time to understand the culture of a business and to ensure that it is maintained even after acquisitions. When a business has a strong culture, it can be more successful because it creates an environment where employees are motivated, customers are satisfied, and the business is able to grow and succeed.
Concept 5: Plan For Unexpected Business Opportunities
In this podcast, the speaker talks about how his business almost sunk due to an unforeseen financial issue. He was able to turn things around and make the business profitable again, but he was exhausted from trying to wear both the visionary CEO and operational manager hats. It was then that he started to think about the possibility of an acquisition.
He was not prepared for the emotional side of the process, and this is where the lesson lies. It is important to plan for unexpected business opportunities, as they can be a great way to grow and succeed. It is also important to understand the culture of the business and to ensure that it is maintained even after an acquisition.
The speaker also talks about how he was able to get his name out there and have conversations with potential buyers. This is a great example of how networking can be beneficial in business. It is important to get your name out there and to have conversations with potential buyers. This way, you can be the first person they think of when they are considering an acquisition.
In conclusion, it is important to plan for unexpected business opportunities and to understand the culture of the business. It is also important to network and get your name out there so that potential buyers know who you are and what you can offer. By doing these things, you can be more successful and have more opportunities to grow and succeed.
Concept 6: Design The Perfect Exit
When it comes to exiting a business, it is important to have a plan in place. It is important to consider the legacy of the business, the people involved, and the customers. It is also important to consider the financial aspect of the sale and to make sure that you are getting the best deal possible.
The perfect exit is different for everyone, but there are some things that are common among successful exits. It is important to have a plan and to think about the long-term goals of the business. It is also important to network and get your name out there so that potential buyers know who you are and what you can offer. Additionally, it is important to consider the legacy of the business, the people involved, and the customers. Finally, it is important to consider the financial aspect of the sale and to make sure that you are getting the best deal possible.
Patrick Lencioni, author of the book “The Exit”, has interviewed over 200 plus businesses and has found that money is rarely the number one concern of an entrepreneur. Instead, the top priorities are usually the legacy of the business, the people involved, and the customers. By considering these three things, it is possible to create a perfect exit plan.
The perfect exit plan should be tailored to the individual's needs and goals. It should also take into account the culture of the business, the people involved, and the customers. Additionally, it is important to consider the financial aspect of the sale and to make sure that you are getting the best deal possible.
By following these steps, it is possible to create a perfect exit plan that will ensure a successful transition out of the business. It is important to plan ahead and to think about the long-term goals of the business. Additionally, it is important to network and get your name out there so that potential buyers know who you are and what you can offer. By doing these things, you can be more successful and have more opportunities to grow and succeed.
Concept 7: Find The Right Buyer
When it comes to finding the right buyer, it is important to look for someone who is aligned with your industry, has a similar culture, and uses similar tools and processes. Additionally, it is important to make sure that the buyer is able to provide enough money for you to be able to sustain yourself and your family and to be able to go on and create something new. It is important to consider the money that is guaranteed and the money that is at risk. Additionally, it is important to consider the performance bonuses and earn out options that are available.
It is also important to make sure that the buyer is a good fit and that the transition will be smooth. This means considering the impact that the transition will have on your employees and making sure that they are taken care of. Additionally, it is important to make sure that the legacy of the business is preserved. It is important for the founder to be able to look back and be proud of what they have created.
Overall, finding the right buyer is an important part of the exit plan. By taking the time to network, look for the right fit, and consider the long-term goals of the business, it is possible to create a successful exit plan. Additionally, it is important to make sure that the employees are taken care of and that the legacy of the business is preserved. By doing these things, it is possible to ensure a successful transition out of the business.
Concept 8: Treat Others With Integrity
Treating others with integrity is an important part of the exit plan. This means being honest and transparent with everyone involved, including potential buyers and employees. This can be a difficult task, especially when the decision to sell is based on a higher offer. In this case, it is important to consider the long-term implications of the decision and not just the short-term financial gain.
For example, in the podcast, the speaker talks about his first acquisition. He was offered a slightly higher offer, but he chose to go with the lower offer because he felt that it was the best decision for his clients, employees, and the legacy of the business. He knew the people from the other company and felt that they would be able to preserve the legacy of the business and take care of his employees. By doing this, he was able to create a successful exit plan and maintain the integrity of the business.
Overall, treating others with integrity is an important part of the exit plan. It is important to consider the long-term implications of the decision, not just the short-term financial gain. By taking the time to network, look for the right fit, and consider the long-term goals of the business, it is possible to create a successful exit plan that preserves the legacy of the business and takes care of the employees.
Concept 9: Treat People With Integrity
It is important to remember that the business world is small, and that word of mouth can spread quickly. It is important to be aware of this and to act with integrity when dealing with other business owners, customers, and vendors. Even if a deal does not end up working out, it is important to treat everyone with respect and to maintain a good reputation. This will ensure that people are more likely to work with you in the future.
It is also important to consider the impact of the decision on the employees. It is important to ensure that employees are taken care of and that the transition is smooth. This will ensure that the legacy of the business is preserved and that employees are not left in the lurch.
Overall, treating people with integrity is a key part of the exit plan. It is important to be aware of the long-term implications of the decision, to network and look for the right fit, and to consider the impact on employees. By taking these steps, it is possible to create a successful exit plan that preserves the legacy of the business and takes care of the employees.
Concept 10: Set Clear Boundaries Early
When selling a business, it is important to set clear boundaries early to ensure that the transition is successful. It is easy to get emotionally invested in the process, but it is important to remain objective and focused on the goal. This includes making decisions about investments and spending, and deciding when and how to communicate the potential sale to employees.
It is important to be aware of the financial implications of the sale and to make decisions accordingly. Investing in projects or research that may not be beneficial to the potential acquirer should be avoided, and cash should be put in the bank instead of spent on unnecessary expenses. This will help ensure that the seller will get to keep the cash in the bank if the sale goes through.
It is also important to determine when to talk to people about the potential sale. It is best to tell people before ink is on paper, but it is also important to create a culture of understanding and to create a phantom equity plan for key people. This will help ensure that the right people are taken care of and will help avoid any potential misunderstandings.
Finally, it is important to create a list of non-negotiables before getting emotionally invested. This will help ensure that the seller is not taken advantage of and that the terms of the sale remain fair.
In conclusion, setting clear boundaries early is important when selling a business. It is important to make decisions based on the financial implications, to create a culture of understanding and a phantom equity plan, and to create a list of non-negotiables. By taking these steps, it is possible to create an exit plan that is successful and preserves the legacy of the business.
Concept 11: Achieve Success Faster
Achieving success faster is a goal that many entrepreneurs strive for. With the right mindset and strategies, it is possible to reach goals more quickly and efficiently. It is important to be mindful of the decisions that are made and to be aware of the potential roadblocks that may arise. By doing so, entrepreneurs can create an exit plan that is successful and allows them to move on to their next venture.
One of the most important aspects of achieving success faster is setting clear boundaries early. When selling a business, it is important to have a clear understanding of the minimum amount that is acceptable for the sale and to make decisions based on the financial implications. This will help to ensure that the sale is successful and that the legacy of the business is preserved.
Creating a culture of understanding is also important when selling a business. It is important to create a phantom equity plan that allows the business to continue to grow and be successful. This will help to ensure that the business is able to move on to its next venture without any disruption.
Finally, it is important to create a list of non-negotiables. This list should include items such as the amount of money that is acceptable for the sale, the timeline for the sale, and the terms of the sale. By creating this list, it is possible to ensure that the sale is successful and that the legacy of the business is preserved.
By taking these steps, entrepreneurs can create an exit plan that is successful and allows them to move on to their next venture. Setting clear boundaries early, creating a culture of understanding, and creating a list of non-negotiables are all important aspects of achieving success faster. By following these steps, entrepreneurs can create an exit plan that is successful and preserves the legacy of the business.
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