Here’s a bold statement for you: Your business is worth less than you think.
Do you know how to change that?
The host of The Deep Wealth Podcast and post-exit entrepreneur Jeffrey Feldberg reveals how to discover the true value of your business and how to unlock its potential. Learn little known strategies from the trenches that get results by listening to the podcast episode here.
The Wake-Up Call for Entrepreneurs
I recently had a conversation that stopped me in my tracks. I was in a mastermind group with successful entrepreneurs, folks who’ve built and sold big companies. You’d think they have it all figured out, right? But here’s the twist. One of them asked, “Do you know what keeps me up at night? It’s not knowing my business’s true worth.”
The group got silent, and another entrepreneur chimed in, sharing how a buyer told him his business wasn’t worth what he thought. That’s when we all realized—most business owners overestimate their business’s value. The market decides what it’s worth, not us. And if successful people can be blindsided, what about everyone else?
Why Your Business Is Worth Less
The truth is that business owners often believe their business is worth more because of its revenue, profits, or years in operation. But here’s the cold truth: It’s usually worth less. It’s not because your business isn’t good but because you might not know what buyers value most. Imagine a buyer scrutinizing every detail, from numbers to systems, to find weaknesses. If they find any hidden problems, they’ll use them to lower your offer or even walk away.
“Buyers aren’t interested in your business’s past. They care about its future potential,” emphasized one entrepreneur from a workshop. If you plan to sell your business, your aim should be to prepare and safeguard your biggest financial asset.
Dispelling Common Myths
Let’s bust some myths around business value:
- Revenue Isn’t Value: Just because your business makes money doesn’t mean it’s valuable to buyers. They care about how much of that revenue turns into profit and if it’s sustainable.
- Profit Doesn’t Equal Sellability: A profitable business can still be unsellable if it’s fragile or unpredictable. Buyers are looking for stable investments.
- Your Role in the Business: If your business depends heavily on you, it’s not a sellable asset; it’s a job. Buyers want a machine that runs itself.
Making Your Business More Valuable
Fear not! Valuation isn’t set in stone. You can make your business more attractive to buyers without working harder.
Discover Hidden Assets: Look for what makes your business unique. Maybe it’s customer data or special processes. Buyers love hidden gems that others can’t replicate.
Create Reliability: Your business should run without you. Document processes, train teams, and automate where possible. This reduces risk for buyers.
Increase Recurring Revenue: Predictable cash flow is gold. Transition to subscription models or long-term contracts to make your revenue stable.
Without Hard Work: Boosting Value
To raise your business value, focus on strategy, not more effort. Here’s how:
- Find Your Rembrandts: Uncover those hidden stores of value in your business. Whether it’s a unique market position or intellectual property, buyers will pay a premium.
- Dependence on You: Reduce how much your business needs you. Implement systems and train others to ensure smooth operations.
- Recurrence of Revenue: Aim to make your income predictable. Buyers want consistency, which gets you a better deal.
Most business owners don’t prepare for a sale until it’s too late. If you show up unprepared, you’ll leave money on the table. You get one shot to do it right, so why not make it count?
Being profitable doesn’t mean you’re sellable. If your cash flow is unpredictable or your business is too dependent on a few stars, it’s time to change things up.
Ask yourself: Will a buyer see an investment or a burden when they look at your business? If you do nothing, you could miss out on big money.
Final Thoughts: Preparing for Success
Selling your business is a once-in-a-lifetime chance. You need to prepare so you don’t leave money on the table. As one entrepreneur wisely noted, “Success in selling isn’t about working harder. It’s about working smarter.”
Your task is to ensure your business is irresistible to buyers. Don’t just hope for a good deal—prepare for the best deal. If you start now, you can craft a future where buyers compete to own your thriving, well-prepared business.
As we wrap up, I have one request: Share this wisdom. If you know a fellow business owner with their head in the sand, spread the word. The more we learn, the better deals we get, and the more we secure our financial futures.
Thank you for joining me today. Remember, your business is more than numbers—it’s your legacy. Make sure it counts.
Want the best deal when you sell? Start preparing now. The Deep Wealth Mastery program can help. It’s about smart moves, not hard work, to boost your valuation.
You’ve built something great. Don’t settle for any deal—aim for the best one. Take control, and ensure you’re prepared. Because remember, in the end, your wealth isn’t just about the money, but also the impact and legacy you leave behind.
Until next time, continue to thrive and prosper, while remaining healthy and safe.
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Today, Feldberg's passion is helping you extract your deep wealth. The 90-day Deep Wealth Mastery program helps create a solid foundation for three areas: increasing profits to enterprise value and optimizing post-exit life. Deep Wealth Mastery offers strategies and insights drawn from Feldberg's rich experience. The strategies from the trenches get results. Jeffrey's vision is to increase the social fabric of society one entrepreneur at a time.
Learn more through https://iapdw.com/prosper
