The Entrepreneur's Dilemma

Very often entrepreneurs face many challenges like establishing their business, acquiring customers, managing employees, and many other daily problems. One of the most important things they don’t consider is planning to exit their business. Unfortunately, not understanding the true value of the business can affect the future of the company, and many times selling it becomes more challenging and time consuming.

Here is a reflection from our managing partner Al Danto on what the biggest dilemma for an entrepreneur is:

Not understanding business valuation, the keys that increase business value and the process involved in exiting a business, can cost an entrepreneur significant capital and heartache when the time comes to cash in on all the years of running a business.

As the entrepreneur starts to grow the company, they lose their focus on building an exit plan. As the burdens of administration increase, the entrepreneur begins to lose the drive and passion that made him successful in the start-up and growth phases. The joy and passion of building a company transforms into the drudgery of managing it.

The passion runs out, risk tolerance levels change and entrepreneurs start to emotionally check out from the business; consequently, business value is diminished. The same skills that created and drove the business to success are now destroying the value of the business. In order to maximize value, entrepreneurs must understand the fundamentals of business valuation and equally, if not more importantly, the emotional side. They must know when to get out and how to get out.

To understand the valuation of your business and overcome the Entrepreneur’s Dilemma, get ahead of the game by educating yourself on the valuation basics, company specific risk factors, revenue models, and many other different content.

Read Al Danto’s Ebook “An Entrepreneur’s Guide to Understanding Business Valuation”