Warrillow organizes the teachings into a 14 chapter story making it an enjoyable read. He offers tips (see below) that are very pragmatic. This book is recommended for anyone looking to strengthen or sell their company but further research should be done if you’re looking to sell your company. The book is simple making it an easy read, but it also simplifies the complex steps of selling a business.
Chapter 1: A Company in Chaos
Chapter 2: A Worthless Business?
- Tip 1: Don’t generalize; specialize. If you focus on doing one thing well and hire specialists in that area, the quality of your work will improve and you will stand out among your competitors.
- Tip 2: Relying too heaily on one client is risky and will turn off potential buyers. Make sure that no one client makes up more than 15 percent of your revenue.
Chapter 3: Putting the Process into Practice
- Tip 3: Owning a process makes it easier to pitch and puts you in control. Be clear about what you’re selling, and potential customers will be more likely to buy your product.
- Tip 4: Don’t become synonymous with your company. If buyers aren’t confident that your business can run without you in charge, they won’t make their best offer.
- Tip 5: Avoid the cash suck. Once you’ve standardized your service, charge up front or use progress billing to create a positive cash flow cycle.
Chapter 4: Pressure from Within
- Tip 6: Don’t be afraid to say no to projects. Prove that you’re serious about specialization by turning down work that falls outside your area of expertise. The more people you say no to, the more referrals you’ll get to people who need your product or service.
Chapter 5: The Test
- Tip 7: Take some time to figure out how many pipeline prospects will likely lead to sales. This number will become essential when you go to sell because it allows the buyer to estimate the size of the market opportunity.
- Tip 8: Two sales reps are always better than one. Often competitive types, sales reps will try to outdo each other. And having two on staff will prove to a buyer that you have a scalable sales model, not just one good sales rep.
Chapter 6: The Candidates
- Tip 9: Hire people who are good at selling products, not services. These people will be better able to figure out how your product can meet a client’s needs rather than agreeing to customize your offering to fit what the client wants.
Chapter 7: Growing Pains
- Tip 10: Ignore your profit-and-loss statement in the year you make the switch to a standardized offering even if it means you and your employees will have to forgo a bonus that year. As long as your cash flow remains consistent and strong, you’ll be back in the black in no time.
- Tip 11: You need at least two years of financial statements reflecting your use of the standardized offering model before you sell your company.
Chapter 8: The Number
- Build a management team and offer them a long-term incentive plan that rewards their personal performance and loyalty.
Chapter 9: Gaining Momentum
- Tip 13: Find an adviser for whom you will be neither their largest nor their smallest client. Make sure they know your industry.
- Tip 14: Avoid an adviser who offers to broker a discussion with a single client. You want to ensure there is competition for your business and avoid being used as a pawn for your adviser to curry favor with his or her best client.
Chapter 10: A Blank Check for Growth
- Tip 15: Think big. Write a three-year business plan that paints a picture of what is possible for your business. Remember, the company that acquires you will have more resources for you to accelerate your growth.
- Tip 16: If you want to be a sellable, product oriented business, you need to use the language of one. Change words like “clients” to “customers” and “firm” to “business.” Rid your website and customer facing communications of any references that reveal you used to be a generic services business.
Chapter 11: Telling Management
- Tip 17: Don’t issue stock options to retain key employees after an acquisition. Instead, use a simple stay bonus that offers the members of your management team a cash reward if you sell your company. Pay the reward in two or more installments only to those who stay so that you ensure your key staff stays on through the transition.
Chapter 12: The Question Chapter 13: A Sellable Company Chapter 14: The Finish Line
Step 1: Isolate a product or service with the potential to scale
Step 2: Create a positive cash flow cycle
Step 3: Hire a sales team
Step 4: Stop selling everything else
Step 5: Launch a long-term incentive plan for managers
Step 6: Find a broker
Step 7: Tell your management team
Step 8: Convert offers to a binding deal