This is pivotal. If you don’t know your reason for being and your core values, then neither will your customers, your team, your investors – and eventually your acquirers.
Poorly Defined Corporate Culture
Is your executive team and all staff members – including your receptionist – singing from the same song sheet?
If you’re building your business to sell it, your company culture will be a critical element of any future acquisition deal.
A clear, detailed and recognisable set of core values should be included in your Mission Statement from the outset. Every team member that joins your company should be given a copy and inducted into your corporate culture.
Doing this ensures, that, from the executive team down, all employees are in alignment and working daily towards the company’s goals. In addition, having those core values written down and prominently displayed, will guide the way you do business every day.
Your employees will reflect these core values and will be proactive in delivering on your mission statement.
Failure to Delegate - Don’t get in your own way!
This is a critical lesson for some entrepreneurs who have been used to wearing many hats when they first set up their business.
Don’t learn the hard way.
Catch yourself micro-managing your staff and executive team - and walk away.
You hired your staff to do jobs they are presumably qualified and able to do – Let them do them.
To assist with this, you should have an organisational chart, which will also help define your business structure and establish lines of control. Staff will know their areas of responsibility and will have a clearly specified reporting structure.
Your organisational chart, along with job descriptions, will also ensure you hire the right people. Without it you may struggle to hire the right people, which could prove catastrophic.
Be clear. You don’t need to intervene in every single aspect of your business - In fact, you may find, if you do, you will limit your company’s growth potential.
Free yourself to work ‘on’ your business, rather than tinkering ‘in’ it.
Which leads to the next point – Sometimes an external perspective can help you to see more clearly and enable both your business and team to flourish and grow.
Skimping on External Advice
It’s lonely at the top - Pay for good professional advice
“Good Advice Costs Money, But Bad Advice Costs More!”
Russell Bowyer, Entrepreneur
Never a truer word was spoken when referring to business or financial advice. Don’t skimp on the advice you need – Do your research and hire a mentor who already has the experience you lack. This will save you time and money in both the shorter and longer term.
If you’re still not convinced, consider this:
“If you think education is expensive, try ignorance.”
Contrary to popular belief, in business, ignorance is not bliss.
Lack of an Exit Strategy
In his book, “7 Habits of Highly Effective People”, Franklin Covey underlines the importance for entrepreneurs of beginning “with the end in mind.” – Create a strategic business plan, which includes your eventual exit strategy.
This discipline holds especially true for entrepreneurs in the fast-evolving software tech sector, where having an exit plan from the outset, can have a huge, positive impact on your eventual sale price. Conversely, without a plan in place, the negative impact can be disastrous - on your sale price at exit, but, importantly, for your ongoing revenues throughout the entire lifecycle of your business.
Cast in this light, it’s clearly a ‘no-brainer’ to make that plan! - Why would you work for decades to build your business, only to lose out on your just rewards at the final hurdle..?!
As an entrepreneur, you will encounter a full smorgasbord of daily challenges on the road to success. This article doesn’t attempt to cover the full list but to highlight those which could have the biggest impact on your business. It can act as a spring board to further discussion and refinement around your business processes, structure and end goals.
At Boss Equity, we help our clients transform their software businesses and position them ready for exit; we also guide our clients through the pitfalls of their business sale – to their ultimate pay day and reward for the years of hard graft.
As an entrepreneur in the software tech sector, you are fast-thinking, skilled and innovative and intrepid - Don’t allow a lack of knowledge in certain areas rob you of your just rewards for the years of swaet and toil.