Why did you start your business? Or as one of the key people in my team would put it, “For what purpose does your business exist?”
Some people have clear goals in mind when they start a business. These goals often combine elements of freedom, wealth creation, and being able to help your customers to make their lives or their businesses better in some way.
But a lot of people drift into running a business and in actual reality they’ve created a job for themselves. In this scenario your business becomes the complete opposite of freedom – it’s an entity that can’t function without you and it ties you down.
Terry Gormley, who I mentioned at the start of this post, and who helps my members with the mindset needed to acquire a business, has been coaching business owners and entrepreneurs for many years. He has a unique way of asking incredibly direct questions that make you question what you’re doing with your life and your business.
With business owners he tends to start with the following question…
For what purpose does your business exist?
It’s an excellent question. You may not have thought about this in any depth when you started your business, but typically you will have been thinking along these lines:
“I want to be free to work the hours I want and take time off when I want”
“I’m sick of working for someone else – I can do a better job of this myself”
“I don’t want to be stuck earning a salary for the rest of my life – I want to put some money behind me”
And yet often, even if you’ve seen a degree of success, you almost certainly won’t have created the lifestyle you had in mind when you started out.
One of the reasons for that is that you don’t know what you don’t know. Nobody knows the realities of running a business until they actually do it. And if you don’t put a plan in place to enable your business to run without you, then it becomes difficult to extract yourself from the day to day.
Are you the captain of your ship, or are you fire fighting?
Terry likens it to the captain of a ship who has set his course, and then gets called down to the engine room to fix a problem. He knows his ship inside out and sees himself as the best person for this job. Yet while he’s away from the bridge, the ship drifts off course. He fixes the engine room issue, but returns to find that it will take several days to make up the time lost as a result of him leaving his post.
And this is how many of us run the businesses we’ve created ourselves. We should be at the helm, making sure the business stays on course, not fire fighting and getting involved with things that someone else in the team could handle.
Clearly your goal should be to get away from being so heavily involved in your business, but this can take time and a real shift in attitude to achieve.
Buying a business requires a different way of thinking
On the other hand buying a business is a completely different kettle of fish. Having already built one business from scratch, you know not to make the mistake of acquiring a job. So from day one, you’ll be looking to buy a business that can literally make you money while you sleep.
You won’t be completely uninvolved, but you certainly won’t be there day to day, taking calls from customers and fire-fighting low level issues. Your reason for buying a business is to acquire an asset and NOT to buy another job for yourself.
So you’ll be looking for businesses that already have a tier of managers in place that will run the business for you.
The business you’ve bought will be an asset
Imagine if you started looking for a business to buy today. You could have acquired one within six to twelve months. And then when you ask yourself the question, “For what purpose does this business I’ve bought exist?” you’ll have a very clear answer.
Your new business is there to create wealth for you and your family, so that you can live the lifestyle you’ve dreamed of. Whatever your goal, whether it’s a more spacious home, fabulous holidays, a relaxed retirement or a more secure future, you’ll be well on the way.
And of course, you can choose whether you want to hang onto that business, whether you want to develop an exit strategy – creating a nice windfall when you sell – and whether you want to continue to buy additional businesses.
What if you’re not ready to buy another business?
If you don’t think that buying another business is the right step for you right now, then I’d urge you to look closely at why you started your current business. Are you enjoying the lifestyle you thought you would when you first set out in business? And if not, what has to happen for you to achieve that lifestyle?
Regularly giving yourself time to think about these things is a key part of developing an investment mindset.
If you’d like to learn more about buying businesses, you can book onto a one-day workshop here.
If you have questions you can email my management team directly – firstname.lastname@example.org