Updated: Jan 2
Legacy is the most important aspect of your business, but the least thought about by most business owners. Why is legacy so important? In this post, I will show you the value in becoming intentional about your business legacy.
There are eight critical mechanical components of business. There are seven levels of core energy. I’m creating a series of posts called Business Mechanics & Mindset. You can read about these topics in more detail in my book entitled, “Business Mechanics & Mindset: How Your Thoughts Create or Sabotage Your Business Success”. Today’s post is the seventh of this series entitled Core Energy™ Legacy.
Before I go too far, I’ve created another post that you may want to read before you read this one. It is entitled “What is Core Energy?”. It explains the seven levels of Core Energy™ in detail that will be mentioned in this entire series.
If you want to watch a video of this exact same topic, go here: https://youtu.be/eMS7t3DXu4c
(Core Energy™ is a registered trademark of iPEC and all Core Energy™ concepts described in this blog post are derived from iPEC’s Core Energy Coaching™ program.)
Business as life is “temporal”. This means that it’s here for a moment and will fade away. You may grow your business and sell it. You may leave it to your family or your employees. You may support the livelihoods of your family and your employees. You may leave your customers better off with your products and services. You may revolutionize your industry. In any case, there will be some legacy that you leave behind with your business. Most business owners fail to see their legacy because they’re ultra-focused on surviving, making payroll or trying to gain new customers in the present.
In my business coaching practice, I’ve discovered that there are four key considerations around business legacy: 1) legacy mindset; 2) selling your business; 3) death & disability; and 4) personal involvement.
Legacy mindset can best be characterized by thinking about the distant future of your business, or the culture you want to construct. Let’s consider how Core Energy™ plays a role in how you think about your legacy as a business owner.
Level 1 – Victim – At victim thinking, you will be constantly thinking about exiting. If your business is doing poorly, you will be strongly considering filing for bankruptcy and calling it quits. If your business has done well in the past, you’ll consider closing the doors, and keeping what you’ve accumulated in your business bank account.
Level 2 – Conflict – You rarely think about legacy. You are focused on the daily effort to either survive or beat your competition.
Level 3 – Acceptance – You are apathetic about long-term impact of your business. If you die, you die. Let others worry about the consequences. If a buyer offers you a lot of money for your business, great! If not, no big deal.
Level 4 – Compassion – At this level you are concerned about how your employees and customers will get along if you were to exit your business in some way.
Level 5 – Opportunity – You will be actively planning to create win/win exit scenarios for yourself and your employees.
Selling Your Business
It’s inevitable. You will exit your business. Planning for this exit means the legacy of wealth and purpose of your company will survive. Most small business owners understand that their most viable exit strategy is to sell their company.
Level 1 – Victim – Your plan is to quit. You can’t see what value your company would have to a potential buyer.
Level 2 – Conflict – While exiting your business is not top of mind. If you sell your company selling will seem like a competitive game to you. You are trying to cash out for the best win for yourself. You’ll hide flaws from a potential buyer. This often ends poorly when the buyer discovers your dishonesty, and the deal falls through. In some ways, conflict mindset business owners do differentiate themselves from their competition. This differentiation is a benefit when eventually selling the company if it’s legitimate, and not contrived.
Level 3 – Acceptance – Selling a company is more of a reaction. If someone makes an offer to buy your company, you’ll compare their offer to your expected profitability and either reject or accept the offer. Very little thought will be given to the survivability of your employees, customers, or your business purpose. Acceptance mindset business owners will rarely seek out buyers. The buyers will need to come to them with an offer.
Level 4 – Compassion – You will think primarily what a sale of your business will do for your customers and your employees. In many cases, compassion mindset business owners want to sell their company to their employees thinking that it’s a value to them. While this is a compassionate intention, it is not always true that your employees view business ownership as a good thing. The considerations often present for a compassion mindset business owner are improved benefit programs for employees; improved products and services to customers; better wages for employees, and better prices for customers.
Level 5 – Opportunity – The truly great thing about selling your company to the right buyer is the synergies that develop out of the acquisition of your company by the buyer. This opportunity often results when your company has some niche that the buying company can dramatically expand through its financial resources, distribution networks or other resources that could take you decades to duplicate on your own.