Intentional Growth #348: Breaking Through Limitations and Maximizing Business Value: Lessons from Linda Rose's Entrepreneurial Journey Starting and Selling Three Companies
Have you ever wondered how a business model impacts the scalability and valuation of a company?
Throughout my personal entrepreneurial journey, I have run businesses in distribution, traditional professional services, technology-enabled services, and software. Each business model requires different operational models that impact every aspect of the business.
How does a business model impact scalability and valuation?
Today, I interviewed Linda Rose, an entrepreneur who had three businesses, each with a different business model. Linda tells us her story of starting, growing, and selling each business and how they were each different. The revenue per employee in one of her businesses was over double that of the other successful business, and it achieved a massive valuation at the exit.
Linda is currently an M&A advisor in the technology sector and the author of Exit Your Company. She is going to walk us through how she grew and sold her companies and how she shifted her mindset to view the company through the eyes of a buyer.
Linda shares the importance of focusing on the right aspects of business, sustainable cash flow, realistic projections, and valuing businesses. Linda also shares her transformative experiences from a challenging hike that led to personal and professional growth and her current work as an M&A advisor and author.
Enjoy!
// WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast
What You Will Learn
- Linda's career journey included public accounting, technology, and starting three businesses.
- After facing challenges during the 2008-2009 recession, Linda focused on her hosting company and the importance of building recurring revenue streams.
- A backpacking trip inspired Linda to write a book and become a sell-side M&A advisor.
- Concentrating on recurring revenue streams and efficiency can lead to greater financial rewards.
- Sustainable, predictable cash flow is critical for a business's value.
- Entrepreneurs should think as buyers, focusing on the sustainability and future growth of their company.
- CPAs tend to focus on past numbers rather than forward thinking; entrepreneurs should seek forward-thinking strategies and plans.
- Linda sold her three businesses with varying valuations and deal structures, emphasizing the importance of having multiple offers to compare.
- When selling a business, consider priorities such as company culture and employee well-being.
- Building relationships with potential buyers is crucial before selling a business.
- Different types of businesses have different valuations, with recurring revenue being a significant value-add.
- Linda realized during a challenging hike that she was her own glass ceiling, which led to personal and professional growth.
- Life-threatening experiences can provide a new perspective on overcoming obstacles and pushing past self-imposed limitations.
- Entrepreneurs can prioritize building recurring revenue streams, automating processes, and focusing on efficiency to maximize profitability and long-term success.
- Business owners should work with their CPAs to develop more forward-thinking strategies and plans for their businesses.
// USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment
Bio:
Linda Rose, a leading authority on creating, growing and selling technology service companies with sustainable success, and women’s leadership topics, is an engaging, sought-after, dynamic speaker. Linda's most-recommended presentations are ideal for technology conference sessions, workshops, off-sites, leadership retreats, webinars, and women’s network events.
By sharing her personal stories as a solo women backpacker as well as practical tools and tips for breaking your own glass ceiling and creating lasting change, Linda inspires and empowers others through her powerful talks. Linda has been a featured speaker at Microsoft, Channelnomics, IAMCP, SDSU School of Business and many other prominent organizations.
Interview Quotes:
13:21 - “Coming out of the back end of this hike, I realized I needed to write a book and discuss and talk about all the places that I left money ont he table when I was selling three companies. Because how many people are going to get three chances at getting this right?” - Linda Rose
15:47 - “If you truly focus on the right things, the growth happens so much quicker.” - Linda Rose
16:13 - “Focus on what the end goal should look like and you’ll get there so much quicker.” - Linda Rose
17:03 - “Bigger is not always better.” - Linda Rose
17:43 - “Get something where you’re making money while you sleep.” - Linda Rose
21:54 - “A buyer looks at how well you’ve done in the past as an indication of how well you might do in the future… address the sustainability of the company.” - Linda Rose
25:15 - “You never want to be comonotized.” - Linda Rose
27:48 - “Marketing is the new sales. People spend more money on marketing than they do sales because people self-serve on the marketing side before they ever call you up on the phone.” - Linda Rose
40:44 - “You can anchor all you want on these guys but you can’t work the deal if you don’t have a competing offer.” - Linda Rose
50:00 - “It wasn’t a culture thing for me. It was all about ‘What’s going to end up in my pocket?’ and “Will these people have opportunities?’” - Linda Rose
54:53 - “Infrastructure doesn’t stop working. It’s a 24/7 thing.” - Linda Rose
1:03:45 - “Your entire identity is wrapped up in that business.” - Linda Rose
Links and Resources:
Linda’s book: Get Acquired For Millions
Intentional Growth™ Vision Board
Intentional Growth™ Online Training
Reach out to me if you have questions about the Intentional Growth™ Training or Fractional CFO services