Entrepreneurs are unique and passionate people with a strong drive to achieve their vision. So what happens when an entrepreneur decides the time has arrived to sell the business and move on to pursue the next big thing? In his book Finish Big pioneering business journalist and Inc. magazine Editor at Large Bo Burlingham dives into this question, and among other topics looks at the advisors the entrepreneur should have on his/her team.
“Finish Big: How Great Entrepreneurs Exit their Companies On Top” explores the tricky territory of an entrepreneur exiting the company that he or she built from an idea into a thriving enterprise.
At this point the entrepreneur enters a strange new territory, walking away from the business and negotiating with a new owner regarding the value of his/her “baby.” The most successful entrepreneurs, in Burlingham’s eyes, “finish big” through adept handling of the sale of the business to reap financial rewards. Lack of preparation or understanding of this complex business transaction can be enormously costly to the entrepreneur.
In one chapter Burlingham explores the areas in which the business owner benefits from the help of advisors regarding the exit process. Under the heading “Who You Gonna Call?” he considers how a business owner finds the right strategic and technical advisors to engineer a successful sale.
Burlingham advocates utilizing advisors who truly understand the entrepreneur’s perspective. He tells the story of Frazier & Deeter’s Entrepreneurial Services Practice Founder, Bob Woosley. He writes:
You see the world differently if you own a company that sells something other than your specialized advice—as Bob Woosley discovered when he left his accounting firm to start a business.
Trained as a CPA, Woosley had begun his career at Pricewaterhouse and in 1982 became the first professional employee hired by Atlanta-based Frazier & Deeter. Three years later he was promoted to partner, while Frazier & Deeter went on to become one of the hundred largest accounting firms in America and recipient of numerous awards for growing fast, providing exemplary service, being well managed, and creating a great place to work.
But Woosley had the entrepreneurial bug. In 2000, he left to start a company, iLumen, with a partner. Their idea was to automate the collection, analysis, and benchmarking of financial data for businesses, with an initial target of accounting firms, which could use the technology to offer better service and develop closer ties to their clients. Later the company offered it to bankers for use with their customers and to franchisors for use with franchisees. After a successful ten-year run, Woosley stepped down as CEO, and in 2011 he returned to Frazier & Deeter to lead the firm’s entrepreneurial consulting practice and direct its strategic growth initiatives.
By then, the firm had grown, and Woosley had changed. So had the advice he offered to his entrepreneur clients. “I’m almost embarrassed about some of the advice I gave before I did iLumen,” he said. “I give much better advice today.”
As Woosley suggests, the experience of starting, running and exiting a business changes the way that anyone—including a specialist like him—views the process. But it takes a whole team to handle the many technical issues that arise, especially in stage three. Part of the lead adviser’s job is to assemble and manage that team, which will include at least a lawyer and an accountant, and maybe an insurance professional and a wealth manager or financial planner. The latter becomes especially important in stage four, after a deal has been consummated and money has changed hands.
Whether or not those other experts have entrepreneurial experience is not important as long as the lead adviser does. Then again, there are some advantages in having an ex-entrepreneur lead manager who, like Woosley, is based in a law, accounting, or wealth management firm.
In his book Burlingham makes the case that the entrepreneur needs to approach his or her exit strategy with the same focus and drive that helped build the business. A successful exit requires the navigation of new and highly complex legal and financial territories, and identifying the right advisors early on will help the entrepreneur walk away feeling that he/she did indeed “finish big.”
“Finish Big: How Great Entrepreneurs Exit their Companies On Top” by Bo Burlingham is available at Amazon.com.