How to Exit Your Company on Top
Author Speaks at Boise Conference
When Bo Burlingham, author and former editor at Inc. magazine, began writing his latest book, “Finish Big: How Great Entrepreneurs Exit Their Companies on Top,” he knew practically nothing about exits.
“Most people don’t want to think about the exit,” Burlingham says. As he interviewed 150 business owners during the process of writing his book, what shocked him most was that about 50 percent of people were miserable after leaving their companies. He asked himself, “What do people who have good exits do?”
At the Finish Big Conference, an event hosted by Zions Bank in Boise, more than 60 business owners and entrepreneurs gathered to hear from Burlingham and other experts about how to properly execute a great exit strategy.
During his keynote speech, Burlingham explained that his exploration led him to identify five key elements of a good exit.
1. Owners feel that they have been treated fairly during the exit process and appropriately compensated.
2. They have a sense of accomplishment. They look back and know they have contributed something of value to the world.
3. They are at peace with what happened to the other people who helped build the business.
4. They discovered a new sense of purpose outside their business.
5. The company is going on without them and doing better than ever.
“Building a business is like a journey, and like every journey it has a beginning, middle and end,” Burlingham says. “The end is not when you’ve built the business, it’s when you exit.”
According to the author, the exit is not an event. In fact, the exit is a phase of the business similar to the startup phase, growth phase, mature phase, etc. He suggests that there are seven-and-a-half key factors that determine what kind of an exit you’ll have:
1. You know who you are, what you want and why.
2. You build a business that can be sold when and to whom you want to sell it — for an amount you consider fair.
3. You give yourself enough time to prepare — measured in years, not months.
3 ½. In choosing a successor, you give yourself enough time to fail.
4. You get help and advice from people who’ve been through an exit themselves.
5. You do right by the people who’ve shared the journey with you.
6. You analyze why potential buyers want to acquire your business and figure out what they will do with it.
7. You have a plan for the future to become fully engaged with whatever comes next.
Other speakers at the conference included Zions Bank Senior Vice President Garrett Barnes, who discussed the unique challenges that family businesses face as they consider an exit strategy.
Barnes explained that family businesses are driven by values, and that businesses that are value-driven can’t help but be successful. However, although approximately 93 percent of businesses are family owned, only 35 percent make it to the next generation and only 15 percent make it to the third generation.
He cited sibling tensions, entitlement and rapid growth as some of the difficulties that family businesses face. His advice included requiring future generations to gain education and work experience outside of the business prior to holding a leadership position within the company, formalizing individual job descriptions and developing an exit strategy tailored to the family business.