Starting a business takes more than working capital to make it successful. Selling one also requires more planning and forethought to maximize the situation. After 25 years leading, I decided it was time to move on to other ventures. Here are a few tips I learned from selling my last company.
Compatibility Issues With A Local & Regional Labor Force
We were pretty good with knowing what skills and attitudes were needed to perform a particular role. The challenge was finding people who had those skills. In our area, the level of B2b skill sets were just not as prevalent so we took chances with people who we thought had potential.
Matching up the local labor force to your business can be daunting. We experimented and failed several times. I think we failed some good people because either our culture wasn’t stable enough or our internal team in a rapidly changing environment was unable to bring them up to par quick enough. Not everyone can work in that kind of dynamic culture.
What Happens After the Onboarding Process?
Starting new people in the company requires an in-depth onboarding process. Even though we provided a lot of training to get them accumulated, once they were let loose we expected them to fly on their own. In most cases that happened naturally, but not all of them.
When the employee quits challenging their own skills this was normally a recipe for failure. They were often left on their own because we gravitated towards those who were like us in spirit and efforts.
In hindsight, I can recall a few that with just a bit more attention, would have performed much better. In a few others they were left on their own and what skills they had eroded as their confidence dwindled. We should have set them free much earlier because we hired the wrong person for the role.
Security Risks: Managing the Rumor Mill
Growing a high-performance company requires high-performance people. A key to growing this kind of company is having these spirited people aligned to the mission and vision. Once the vision changes, this typically starts a chain reaction of events. Changing compensation packages, adding new services, or selling the company are examples.
Through the experiences helping business owners buy and sell their companies, I knew that once you start to upset what has been a long-standing profitable and fun working relationship, this changes people’s motivations.
I was deep into the final stages of negotiations to sell the company and began to socialize the idea with a couple of key people. It was time to understand who would come along or go a different way.
Floating the ideas out there is a stepping stone process to let people sift through their personal and career motivations and see what their behaviors tell you.
My core people who were with me for decades were supportive and helpful. I misjudged the character of a couple of other people, and that was disappointing. In hindsight, it became apparent that in one instance, the poor character and integrity level were there all along; I just didn’t see them in the same light. There had been signs in the past that I ignored and shouldn’t have—shame on me.
The “need to know rule” applies. Be careful about telling any internal or external person that makes a living from the company about the intended plans to sell or merge until you properly evaluate the risks. Use outside people for sounding boards or other trusted mentors that truly have you or the company’s best interests at heart.
After I read what I wrote, I realized I could have written about 40 lessons from all the experiences I’ve had. I guess that might be another article. Hopefully, something I said helps you along on your journey of life and business development. Enjoy!