My Business On Purpose

I've heard it said that 96% of businesses will not see their tenth birthday.

A study conducted by the Exit Planning Institute reveals 30% of those businesses that survive will make it through their 2nd generation.

Of what little remains, only 12% of the very limited 2nd generation businesses will make it through the 3rd generation.

Business is hard. Regardless of product, regardless of industry, regardless of market, leadership, and sustainability; business is hard.

A modern refrain among owners and leaders is that "nobody wants to work anymore".

Older generations look down the pathway of a younger lineage and sense a mood of apathy and lack of resolve.

We then begin to conjecture as to why "nobody wants to work anymore" and begin unwrapping and applying the band-aids of bygone solutions that worked in the past hoping desperately for the tried-and-true to spur renewed action into the future.

And then they don't.

In a culture of significant fluctuation and innovation, it is the older generation (this author being one) that will need to confess modern blind spots and inspire adjustments in our leadership to begin mobilizing a younger into their own accountability and leadership.

There are four blind spots in particular that paralyze a business in the posture of a hail-mary-like hope; fingers crossed that the next silver bullet is just around the corner.

The "Purpose" Blind Spot

Culturally, a business will pay enthusiastic lip service to the needed purpose directions of any business (written vision story, mission statement, and unique core values).

We host workshops to identify purpose and statistically take the beautifully captured binders that we have created and sit them on the shelves for years while lamenting that "we have no aim".

A common blind spot for most business falls under a common myth, "If we can nail the right brand then everything will be alright."

We confuse brand (the perception of what exists) as purpose (the reason for which a thing exists).

For a business to have clarity, arguably the number one retainage tool for both employees and customers, it must first radically commit to writing out three elements of purpose.

First, a clarifying vision story is a detailed snapshot of the future of the business in at least seven categories (term of the vision, family & freedom, financial, product, team, customer, and culture).

Second, a power-packed, less than 10-word, memorizable mission statement tells the rest of us why (not how) you are headed towards the vision you articulated.

Third, a unique set of 3 to 5 core values (not respect, integrity, excellence…those are common values) that serve as our lone filters for cordless decision-making.

The "People" Blind Spot

Global sports are obsessed with superstars. If you research the organizations that are at the top tiers of any sport you will not just find the one or two superstars that garner network highlights.

Instead, you will consistently find tens or hundreds of others who help to set the stage for the superstars to perform.

Take away the laundry person within the sports team and even Lebron James looks silly walking out on the court in smelly, unkept clothes.

The second blind spot says, "If we can just hire the right person, then everything will be alright."

Pinning your hopes on one talent has historically led to an arrogance-fueled downfall.

Counteracting the people's blind spot requires a system that trains every single person in the organization rather than one talent coming from the outside.

No one person can ever carry an organization; when it does it typically marks the beginning of the end. History is not in favor.

The "Process" Blind Spot

With the millennial sunrise of the internet, an entire new world of snake-oil sales people were hatched.

Every industry in the world is now graced with the opportunity to find new marketing specialist in their field where for just a few thousand a month you will be ushered into a hidden world of magic leads and effortless sales.

Equally as full are the graves of those marketing ideas that never formed.

The third blind spot that stimies opportunities for new business is the exasperated myth declaring, "If we can just find the silver bullet for marketing, then everything will be alright."

Marketing is not magic or aspiration. Marketing is a process.

Marketing only works when the process of finding new audiences and new customers is written, followed, tracked, reviewed, adjusted, and repeated…over and over and over again.

Marketing is more about repetition than hope.

The "Profit" Blind Spot

Finally, we've been conditioned to believe that "sales solves everything."

Without sales, there is no fuel, but without marketing, administration, and operations there is no spine to hold the weight of sales.

The fourth myth naively insists, "If we can just make more sales then everything will be alright."

Sales doesn't equal profit; healthy systems equal profit.

You want to find and retain talent? You want to grow profit without having to skyrocket revenue?

Stop subscribing to the ultimate blind spot thinking that your product is not your product.

Your PROCESS is your product.

Scott Beebe is the founder of Business On Purpose (mybusinessonpurpose.com) and speaker for the AEC industry and author of the book Let Your Business Burn: Stop Putting Out Fires, Discover Purpose, and Build a Business That Matters. Business On Purpose works with business owners to articulate purpose, people, process, and profit to liberate owners from chaos and make time for what matters most.

In about a year from now, Business On Purpose will celebrate its 10-year anniversary.

The statistics range, but it has been said 96% of businesses never see their 10th birthday.

When milestones and thresholds are crossed over questions begin peppering your inbox searching for the "secret to your success" as if there is a singular ingredient that concocted the cake that now stands in the display.

It may be worth noting that success is not a given destination and instead is a manufactured line that we cross of our own making.

Ashley and I have been married since 1998 and while we celebrate the miles we have traveled together, we know that that are another 50 years yet to explore and the path we laid in those early years is not representative of the path we actually took.

I once read a quote by Seth Godin saying, "I am an overnight success and it only took me 14 years to get here."

Father Richard Rohr remarked, "This journey is a spiral and never a straight line".

When asked to share our story and background it is crucial that we begin with, "mine is a fragmented blueprint…not a linear set of logical lines."

In the chaos of life there are curbs along the side of the road that can and will act as a rudder for the ship of your life while navigating the open seas of your daily reality. In the spirit of Anne Dillard, you have the agency for those rudders to be "willed, faked, and so brought into being."

There are four filters that we have willed and faked guiding our decision making, influencing our investment of resources, and shaping our worldview.

Generosity

Intentionality

Togetherness

Perspective

The rudder of generosity ensures that we are at least confronted with the tough decision to forego the consumption of some resources for our own pleasure and instead joyfully share those with others, with no expectation of expressed gratitude in return.

The emotional labor of intentionality works to will meaning into mundane daily activities. We can choose to wake and "make the donuts", or we can choose to feed others with whimsy and joy! Both actions are the same, proactive intentionality infuses a premeditation about what you are trying to cause brings significant motivational increase to everyone influenced.

The focus of togetherness offers a powerful alternative in a society riddled with the ammunition of isolation. Instead of more time alone, we need better time alone and observant time when we are with others. Distraction is disrupting a disjointedly disagreeable culture unnecessarily disgracing an otherwise distinguished relationship. The focus of togetherness helps to disengage the tragedy of isolation.

Finally, the overlook of perspective allows us to take in and understand the sweeping geography that surrounds us. Worldviews, faiths, convictions, doctrines, rituals, formalities, and codes all seem a little less crazy when we are able to ride the hot air ballon of perspective above the fracas and with a safe distance from the heat of emotions that whips a cultural fever.

Coolheadedness has space to breathe on the hill of perspective.

These four values (generosity, intentionality, togetherness, and perspective) have helped provide lucidity in the spiral and fragmented blueprint for the short breathe of our life. These four are the four that emerged for us and are likely different than the values that emerge for you.

Everything seems a straight line when admired from the rearview, but the spiral of your future will help uncover the boundaries of your decisions. The moment you have it figured out the line curves again.

Looking back on the spiral of your life, what principles have guided your decisions? If chaos is the prevailing principle, today is a great day to make a different choice…an intentional choice.

Join Patrice Miles, BOP Business Coach, as she interviews Conner Fennell, BOP Intern at My Business on Purpose Podcast- Tuesday Tools On Purpose.

Discover Conner's experiences, the hiring process, DISC test insights, tasks for BOP, and how this internship is shaping his goals. Don't miss this valuable internship discussion!

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

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Join Patrice Miles (BOP Business Coach) and Jessie Barber (BOP Client Connection Director) as they share essential tips on hiring interns at My Business on Purpose Podcast- Tuesday Tools On Purpose.

Learn the hiring process, overcoming obstacles, internship length, finding the right candidate, compensation, onboarding, and communication.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

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For blogs and updates, visit our site HERE ➡️ https://www.mybusinessonpurpose.com/blog/

LISTEN to the Business On Purpose Podcast HERE ➡️ https://podcasts.apple.com/us/podcast/my-business-on-purpose/id969222210

SUBSCRIBE to our YouTube channel HERE ➡️ https://www.youtube.com/channel/UCbPR8lTHY0ay4c0iqncOztg?sub_confirmation=1

Join Patrice Miles, BOP Business Coach, and Thomas Joyner, BOP Director of Coaching, as they delve into the power of "Forecasting" on the latest Tuesday Tools On Purpose episode at My Business On Purpose Podcast.

Learn to predict financial currents and navigate your business towards stability and growth.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

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For blogs and updates, visit our site HERE ➡️ https://www.mybusinessonpurpose.com/blog/

LISTEN to the Business On Purpose Podcast HERE ➡️ https://podcasts.apple.com/us/podcast/my-business-on-purpose/id969222210

SUBSCRIBE to our YouTube channel HERE ➡️ https://www.youtube.com/channel/UCbPR8lTHY0ay4c0iqncOztg?sub_confirmation=1

Join Patrice Miles, BOP Business Coach, and Jessica Vanbrunt, Co-Owner of Vanbrunt and Company, as they delve into Email Filtering strategies on the latest episode of Tuesday Tools On Purpose at My Business On Purpose Podcast.

Learn about streamlining your inbox chaos and harnessing the power of intentional email management for enhanced productivity and business success.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

SIGN UP for our Newsletter HERE ➡️ https://www.boproadmap.com/newsletter

For blogs and updates, visit our site HERE ➡️ https://www.mybusinessonpurpose.com/blog/

LISTEN to the Business On Purpose Podcast HERE ➡️ https://podcasts.apple.com/us/podcast/my-business-on-purpose/id969222210

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Join Patrice Miles, BOP Business Coach, and Nicole Grinnell, President and CEO of Bosun Solutions, as they uncover the keys to hiring success and recruiting services on the latest episode of Tuesday Tools On Purpose at My Business On Purpose Podcast.

Elevate your hiring game and transform your business landscape.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

Contact Info: Bosun Solutions [email protected] +1 916-756-5439 www.bosunsolutions.com

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Join Patrice Miles, BOP Business Coach, and Trevor Covington, LBMC Senior Marketing Manager, as they uncover the secrets behind effective marketing strategies on today's episode of Tuesday Tools On Purpose at the "My Business On Purpose" Podcast!

Dive deep into practical tips and expert insights to propel your business forward.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

SIGN UP for our Newsletter HERE ➡️ https://www.boproadmap.com/newsletter

For blogs and updates, visit our site HERE ➡️ https://www.mybusinessonpurpose.com/blog/

LISTEN to the Business On Purpose Podcast HERE ➡️ https://podcasts.apple.com/us/podcast/my-business-on-purpose/id969222210

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The number stunned me when I first heard it. 80% of a business owner's net worth is locked away in the asset of their business.

Can you imagine 80% of your retirement dollars bottled up in one stock?

The cash flow of the business can often quell the desire for an owner to diversify their assets into anything beyond the business. A business can be a high-return asset for sure… and with it, equally high risk.

A standard question for any business owner to ask is, "How much is my business worth if I wanted to sell it?"

The short answer is, "Whatever a buyer will pay for it!"

There are ways to begin to have an educated idea on what your business would actually sell for on the open market.

Here are four metrics that you will need to know when getting prepared to understand a reasonable market valuation for your business.

Before we lay out this framework be reminded that we are not financial or legal advisors and all such decisions should be consulted by financial and legal professionals.

First, all business owners must understand their wealth gap. This is the gap between what the owner will "need" to live on if the cash flow from their business ended due to a sale.

The majority of owners elect not to sell their business because of a lack of personal planning, or because they are not sure how they will continue to generate income.

You might have an owner sell a business for $5mm, and you think, "Wow!!! That's $5 million dollars!"

It's actually less than that once you consider taxes and other expenses and payoffs that usually occur in the event of a business sale.

Living off of the interest of what is left is usually not enough to cover the lifestyle of the owner prior to selling thus leaving the owner in need of an income-generating job…or starting another business, which is usually not in the desire of a recently exited owner.

The wealth gap allows an owner to reasonably look at what they will need "in the bank" in order to live out the rest of their life at the lifestyle bar they have set for themselves.

As an owner, you will simply take the annual number that you wish to live on in future years and divide it by whatever reasonable rate of return you expect to gain on your invested wealth.

You will then ask your CPA for a net worth statement not including your business. The delta between your non-business net worth and the large number on your calculator is your wealth gap.

Second, you will want to ask your CPA for a recasted set of financials showing your recasted EBITDA (earnings before interest, tax, depreciation, and ammortization).

Recasted financials will often include addbacks and adjustments. Say you are paying yourself $150,000 in salary and when you sell the business, you nor the role you play will be needed. In some cases, they will "addback" some or all of that salary to show as profit on the bottom line. This scenario would likely increase the overall value of your business.

Recasted financials are good to look at anyway and most CPA's would be willing and able to provide recasted financials.

These recasted financials would then be calculated with an "industry multiple". This multiple can theoretically "multiply" whatever number shows as your recasted EBITDA.

If you have a Recasted EBITDA of $1,000,000, and an industry multiple of 2, then a cursory value of your business would be $2,000,000, or "2x's EBITDA".

The fly in the ointment for many business owners is that the multiples of an industry or business or not controlled by owners, but instead by the private capital markets.

You can find a range of multiples for most industries on a variety of valuation databases.

The obvious question is then, "What affects my multiple and how can I be certain to be on the top end of the range of multiples for my industry?"

The Exit Planning Institute has found that 80% of the value of a business is locked away in the intangibles of the business, what they call the "4C's" or "Capitals"; human capital (people), customer capital (how broad or narrow your customer base is), structural capital (documented and trained systems and processes), and social capital (culture and brand).

Put another, more succinct way, your product is not your product…your process is your product.

The following two metrics are likely to provide the private capital markets with a more appealing valuation multiple for a business.

Your business attractiveness score, and your personal financial readiness score.

Your business attractiveness evaluates both objective and subjective business issues such as intellectual property, customer concentration, documented systems and processes, company documentation, and management issues among many other factors.

Your personal financial readiness assesses your readiness regarding written personal plans, personal financial plans, advisory team members, and transition planning among other factors.

Too many owners naively think, "Well, I'll just sell the business when I'm ready to retire." That is far too simplistic for most and not very thoughtful to the hundreds or thousands of people who will be impacted by your transition.

With a projected 80% of your potential net worth locked away in your business, you owe it to your family to think intentionally through the value and the future transition of your business. You have built something worthy of legacy that others depend on, so make time to metrically and objectively think through your next steps.

For help with understanding your business value and what life looks like post-transition, please reach out to a BOP team member at mybusinessonpurpose.com/contact.

Join Patrice Miles, BOP Business Coach, and Matt Sohl, Creative Specialist of WireCrafters as they dive into the power of YouTube Shorts on the latest episode of Tuesday Tools On Purpose at My Business On Purpose Podcast.

Discover how YouTube Shorts can transform your business' reach and branding strategy.

Are you working IN your business or ON your business? Do you have all of the foundational elements that will liberate you from the business chaos? Take the assessment to find out which areas you can grow and improve on. Take our Healthy Owner Business Assessment HERE ➡️ https://bit.ly/healthypatrice

SIGN UP for our Newsletter HERE ➡️ https://www.boproadmap.com/newsletter

For blogs and updates, visit our site HERE ➡️ https://www.mybusinessonpurpose.com/blog/

LISTEN to the Business On Purpose Podcast HERE ➡️ https://podcasts.apple.com/us/podcast/my-business-on-purpose/id969222210

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