Business Owner Type

What Type of Business Owner Are You?

Every business owner probably went into business for different reasons. Some wanted to be their own boss; some might have wanted to create something and grow it while others might have inherited the business from a famiy member or even married into the business. Whatever the reason, many business owners run their business based on their business owner “type” meaning, their leadership skillset  and what they eventually want to get out of the business. Most of us came into this business without a lot of formal leadership training and nearly all of us are trying to figure out what we want to from the business down the road.For this reason, understanding your ownership type is a good indicator of where you are taking the business and what you will eventually get from your business.

Getting what you want from the business you started is what we refer to at Bering McKinley as Business Destination Planning

Getting to your final, preferred business destination requires dedicated focus and purposeful actions on your part as much as 5, 10 and even 20 years in advance. Starting your planning process is a combination of:

  • Understanding what type of business owner, you are; hence the type of business you have built
  • Being clear about what you want from the business
  • Knowing what the business worth in order to get your desired payout
  • Aligning yourself with accountable partners to help you get there

Choose a Business Owner Type that Best Fits You

Organic Grow with Intent to Maintain

business owner type

 

If you are this type of business owner, you probably started your business based on an unplanned opportunity. Maybe you had a group of customers who wanted to work with you or you might be a relative of the original owner. You have built your business through word of mouth and you are proud of the quality of services you have achieved over the years. As a business owner, you might be very involved in day-to-day sales and you have a hand in most sales presentations. You play a part in most decisions that are made, and you consult your team on nearly every aspect of the business including HR, sales, operations, and finance. Your General & Administrative costs can be as high as they need to be to cover your compensation as an owner and to take care of the team that is faithfully invested in your business. You are accustomed to the lifestyle the business affords you, and your goal is to maintain or pass the revenue goals you have achieved in the past.

At a glance, this might reflect your current business background & style:

  • Started based on opportunity
  • Exceedingly proud of word of mouth
  • Highly engaged owner
  • Low sales expenses
  • High ODS
  • High owner compensation
  • Likely to peak at $1M

Unlike the organic growth owner, you went into business on-purpose, with intent to do so. You love what you do, and your skill set combined with your entrepreneurial tendencies drive you to sell and set new goals for growth. You are heavily involved in sales and you may be regarded as the best salesperson in the organization. You enjoy the lifestyle the business affords and to purposefully continue to grow, you are willing to invest in marketing and a sales team. You are a visionary and your desire to build may outpace your ability to get there. You may forgo some of the financial perks of ownership because you re-investment back into the business. Your real intent is continuing to grow the organization you have built and manage.

At a glance, this might reflect your current business background & style:

  • Owner/Entrepreneur
  • Investment in marketing
  • Sales focus with owner led sales
  • Modest sales expenses
  • Modest G & A expenses
  • Modest owner compensation
  • Desire to build may outpace ability
  • Likely not to exceed $3M

Calculated Growth with the Intent to Maintain

business owner type

Organic Grow with Intent to Sell

business owner type

You might have become an owner by chance or through an unplanned opportunity, but you took that opportunity and you intend on growing something you can sell. You know that to grow you will need a sales team, and you are committed to investing greatly in sales and processes that can be documented for efficiency and profitability. You rely on financial reporting to provide clear benchmarks as indicators of growth and movement. You might not have the experience or longevity in the field today to sell your business without making mistakes, but you are determined to do it anyways. In time you will move from being organic to calculated growth, possibly acquiring other businesses and partners along the way.

At a glance, this might reflect your current business background & style:

  • Entrepreneur  tendency
  • Strong focus on growing recurring revenue
  • Deeply committed to sales investment
  • Process driven
  • Very benchmark focused
  • Strong financial reporting

Very similar to the organic growth with intent to sell, you are an entrepreneur. In fact, you might be regarded as a serial entrepreneur. Your involvement in the business is more limited as you see yourself as an advisor with a salary based on your percentage of ownership within the business. Like the organic growth/intent to sell owner, you also rely heavily on financial reporting to drive decision making at the executive layer, and you rely on a seasoned sales team to perform year over year.  With predictable revenue and established targets and processes, selling the business at a profit is how you plan to grow your wealth over time.

At a glance, this might reflect your current business background & style:

  • Strong entrepreneur
  • Limited ownership engagement
  • Higher sales expenses than benchmark
  • Sales team in place year after year
  • Slightly exaggerated G & A
  • No ODS
  • Slightly reduced net profit

Calculated Growth with the Intent to Sell

business owner type

 

Purposeful Business Outcomes Require Purposeful Action

Understanding the type of business owner you are is relevant for helping you take deliberate actions to build and achieve the type of business outcome you desire.

Bering McKinley specializes in helping IT Solution Provider build businesses that fulfill their lifestyle and retirement goals. We recognize that most MSPs are not ready to be considered for a sale or have not taken steps to ensure a successful succession plan is in place. That is why our services go beyond peer group training to include Business Destination Consulting, providing actionable plans based on your managerial “type”, the value of your business and your retirement or wealth accumulation goals. Start by working with a team that can help you build a game plan to help you reach your business destination goals when the time is right for you.

Schedule a meeting to meet with Josh Peterson to discuss what you want from your business and how to design a plan to help you get there. Starting the conversation now is the best way to plan for your future. No obligations; no sales pitch. Just a healthy conversation around what you want to achieve from the business you are building today.

BUSINESS Destination PLANNING