| Family Businesses Have to Define What Success Looks Like. Privately held family businesses have a lot of freedom to define success. Yet many founders and owners aren't clear about exactly what they want their company to achieve, which leads to conflicting priorities and unclear decision making. Ask yourself whether you are most interested in growth (maximizing the financial value of the business), liquidity (generating cash flow for use outside of the business), or control (retaining decision-making authority). Achieving all three goals is difficult, if not impossible, so you're better off focusing on one or two. Think carefully about why you started the company and which of the three goals are most aligned with your objectives. And don't forget to revisit your choices as things change, whether they're external factors like the economy or internal factors like a shift in senior management. What worked well in one environment can be a disaster in another. |
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| Today’s Tip |
| Family Businesses Have to Define What Success Looks Like |
| Privately held family businesses have a lot of freedom to define success. Yet many founders and owners aren't clear about exactly what they want their company to achieve, which leads to conflicting priorities and unclear decision making. Ask yourself whether you are most interested in growth (maximizing the financial value of the business), liquidity (generating cash flow for use outside of the business), or control (retaining decision-making authority). Achieving all three goals is difficult, if not impossible, so you're better off focusing on one or two. Think carefully about why you started the company and which of the three goals are most aligned with your objectives. And don't forget to revisit your choices as things change, whether they're external factors like the economy or internal factors like a shift in senior management. What worked well in one environment can be a disaster in another. |
| This tip is adapted from “Every Business Owner Should Define What Success Looks Like,” by Josh Baron and Vlad Barbieri |
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