Justification for Your Next Vacation

A recent survey by The Value Builder Score found companies that would perform well without their owner for a period of three months are 50 percent more likely to get an offer to be acquired when compared to more owner-dependent businesses.

 

There is no better justification for taking a blissful, uninterrupted holiday than to see how your company performs in your absence. The better your company runs on autopilot, the more valuable it will be when you’re ready to sell.

 

To gauge your company’s ability to handle your absence, start by taking a vacation. Leave your computer at home and switch off your mobile. Upon your return, you’ll probably discover that your employees got resourceful and found answers to a lot of the questions they would have asked you if you had been just down the hall. That’s a good thing and a sign you should start planning an even longer vacation.

 

You’ll also likely come back to an inbox full of issues that need your personal attention. Instead of busily finding answers to each problem in a frenzied attempt to clean up your inbox, slow down and look at each issue through the lens of a possible problem with your people, systems or authorizations.

 

People

 

Start with your people and answer the following questions:

  • Why did this problem end up on my desk?
  • Who else is qualified to answer this question and why was that person not consulted?
  • If nobody else is qualified, who can be trained to answer this question in the future?

 

Systems

 

Next, look at your systems and procedures. Could the issue have been dealt with if you had a system or a set of rules in place? The best systems are hardwired and do not require human interpretation; but if you’re not able to lock down a technical fix, then at least give employees a set of rules to follow in the future.

 

Authorizations

 

You may be a bottleneck in your own company if you’re trying to control spending too much. Employees may know what to do but do not have any means of paying for the fix they know you would want.

 

For example, you could put a customer service rule in place that gives your front line staff the authority to make a customer happy in any way they see fit provided it could be done for under $100.

 

You might allow an employee to spend a specific amount with a specific supplier each month without coming to you first. Or you might give an employee an annual budget, an amount they can spend without seeking your approval.

 

Given the fires that may need to be extinguished after the fact, taking a holiday may seem more of a hassle than it’s worth. But if you transform the aftermath of a vacation into systems and training that allow employees to act on their own, you’ll find the vacation is worth what you paid for it many times over: your company will increase in value as it becomes less dependent on you personally.

Get Free Business Valuation

or

Schedule Free Consultation

Recent articles for you

How to Double Your Chances of a Premium Acquisition Offer

By Kim Santos • April 21, 2025
Value Builder Analytics, drawing on proprietary data from over 80,000 business owners, found that companies that can run without the owner for at least three months are twice as likely to receive an acquisition offer above 6x EBITDA. The concept is simple. The execution? Not so much. Take Kristie Shifflette for example. She was an early master franchisee with Orangetheory Fitness, a one-hour, coach-led workout that uses heart rate zones to boost calorie burn during and after exercise. When she opened her first location, she did it all—marketing, hiring, payroll, and even handling construction headaches. It worked but only because she was working constantly. As she expanded, things started to break. With two locations, she was stretched. At three, it became clear: The model only worked when Kristie was the model. She knew she needed to change. Kristie stopped focusing on being in the business and started focusing on building the business. From Operator to Owner Kristie started documenting everything. From pre-sale processes to day-to-day studio operations, Kristie developed detailed playbooks that codified exactly how her Orangetheory locations should run—without her. She created a compensation structure for studio managers that gave them ownership over their results: modest base salaries paired with meaningful bonuses tied to net member growth and total revenue. Top-performing managers could double their pay, and they were treated like mini-CEOs with full responsibility for their studio’s performance. By the time she sold her business, Kristie had built a company with 13 locations generating well north of $10 million in annual revenue. Some of her top-performing studios, like the Chapel Hill location, were bringing in revenue of $2 million a year, with EBITDA margins around 40%.  Kristie’s story includes an important lesson: Make yourself less essential, and your business becomes more valuable. If you’re still the one opening the door in the morning and locking up at night—literally or metaphorically—it’s worth asking: What would break if I stepped away for 90 days? Start there. Whether it’s building a playbook, empowering your team, or simply learning to let go, taking even one step toward reducing your involvement makes your company not just more valuable but more enjoyable to own.

Why Imperfections in Your Business Don’t Make It Unsellable

By Kim Santos • April 14, 2025
For business owners considering their endgame, learning what makes a company valuable can feel overwhelming. Buyers prioritize factors like recurring revenue, a differentiated product or service, and a leadership team that operates independently from the owner. If a business doesn’t check every box, it can seem as though selling is perpetually just out of reach. But perfection is not a prerequisite for a sale. While improving the key drivers of value is important, an imperfect business can still be highly desirable to the right buyer. In fact, some acquirers actively look for businesses with fixable flaws because they see an opportunity to increase value. Blake Hutchison on Why Imperfections Can Be to an Acquirer’s Advantage Blake Hutchison, CEO of Flippa, has witnessed thousands of business acquisitions. Flippa is an online marketplace where business owners can buy and sell companies, particularly small to mid-sized digital businesses. The platform connects sellers with buyers looking for opportunities to grow or optimize an acquisition. In a recent Built to Sell Radio interview, Hutchison explained that many business owners assume their company won’t attract buyers because it has shortcomings. In reality, most acquirers aren’t looking for perfection—they’re looking for potential. Many buyers have a strategic advantage, whether it’s a strong distribution network, operational expertise, or access to capital, that allows them to take an imperfect business and make it more valuable. A prime example of this is the acquisition of PetCoach. How PetCoach Turned an Imperfection into a Selling Point PetCoach, co-founded by Brock Weatherup, was a two-sided marketplace designed to connect pet owners with veterinarians. The challenge for any marketplace business is keeping both sides in balance—generating enough demand from pet owners while ensuring there are enough veterinarians to meet that demand. PetCoach had built a strong product, but it lacked a broad distribution channel to acquire pet owners at scale. Without a solution, growth would remain limited. Instead of seeing this as a dealbreaker, Weatherup positioned it as an opportunity for the right buyer. That buyer was Petco. With more than 1,500 locations across the U.S., Mexico, and Puerto Rico, Petco had access to millions of pet owners. By acquiring PetCoach, Petco could instantly expand its offerings while solving PetCoach’s biggest challenge. Weatherup didn’t need to fix the scalability issue before selling. He needed to find an acquirer for whom the business’s weakness was actually a competitive advantage. Your Business Has Value—Even if It’s Not Perfect This doesn’t mean business owners should ignore the fundamentals of value creation. Strengthening factors like recurring revenue, customer retention, and operational efficiency will always increase a company’s attractiveness. However, not every issue needs to be resolved before an exit. Instead of viewing imperfections as obstacles, business owners should consider how an acquirer might perceive them: A company struggling with customer acquisition may be a great fit for a buyer with an established customer base. A business with inefficient operations might attract an acquirer with expertise in streamlining processes. A company overly dependent on its owner could be appealing to a buyer with a strong leadership team ready to step in. As Blake Hutchison explains, acquirers are often looking for businesses where they can add value. The key is to position the company in a way that highlights its strengths while framing its imperfections as untapped potential. The right acquirer won’t see weaknesses as dealbreakers—they’ll see them as opportunities.

Is Your Industry Next for a Roll-Up? Here’s How to Tell—and What to Do

By Kim Santos • April 7, 2025
The garage door industry isn’t the most obvious place for a business empire. Yet in just a few years, Guild has emerged as a dominant force, consolidating a fragmented market into a scalable platform worth millions. If you’re a business owner in a fragmented industry, Guild’s story raises two pressing questions: Could my industry be next for a roll-up, and if it is, should I lead the charge or sell to someone else? The roll-up model—acquiring and integrating small businesses in a fragmented market to create economies of scale—isn’t new, but its reach has expanded. From veterinary clinics to plumbing companies, private equity firms are creating billion-dollar platforms from businesses once considered too small to attract institutional capital. Roll-ups are like waves. Catch one early, and you can ride it to a lucrative exit. Private equity firms often pay a premium to consolidate a market, and the scarcity of scaled businesses drives multiples higher. Wait too long, however, and the wave dissipates. You’re left competing with a PE-backed giant with better pricing, marketing budgets, and scale. Timing is everything. How to Know if Your Industry Is Ripe for a Roll-Up When Guild co-founders Jordan Dubin, Joe Delaney, and Sean Slavzic set out to create a roll-up platform, they didn’t stumble into garage doors—they chose it methodically. Their approach offers a roadmap for owners wondering if their market is next. Fragmentation The more small, independent businesses in your market, the easier it is to consolidate. In the garage door industry, 92% of operators were small, local businesses—an ideal setup for Guild. Market Size A fragmented market needs to be large enough to justify consolidation. Guild found a $14 billion residential garage door market with plenty of room to scale. Growth Potential Growing markets attract investors. Garage doors were growing at 7–8% annually, compared to 3–4% for more saturated sectors like HVAC. Precedent Transactions A notable sale in your industry can validate its attractiveness. The sale of A1 Garage Doors to CoreTech at 21 times EBITDA signaled strong demand for scaled players. Scalability Industries with standardized, repeatable processes are easier to integrate and scale. Garage door companies focus on repairs and installations, making them well suited for roll-ups. Timing By the time Guild entered, private equity had already saturated HVAC and plumbing, leaving fewer opportunities. Garage doors offered Guild the chance to be a first mover and capture value early. Should You Sell or Lead the Roll-Up? If your industry meets these criteria, you’re likely at a crossroads. Do you sell to a roll-up or lead one yourself? Both options have merit, but the best choice depends on your goals and appetite for growth. Selling to a Roll-Up Selling offers liquidity and the chance to step back. To maximize your exit: Focus on EBITDA. Build systems. Make your business less dependent on you. Clean up financials. Transparent books boost valuation. “Private equity doesn’t want to buy a job; they want to buy an asset,” says Dubin. Failing to position your business as turnkey could mean leaving money on the table. Leading the Roll-Up If you’re not ready to sell, consider consolidating your industry. By acquiring competitors, you can scale your business, increase its value, and become the dominant player in your market. Dubin and his partners raised $35 million to launch Guild. “There’s too much money in the world and not enough good opportunities,” he says. Starting a roll-up requires capital, operational expertise, and a clear vision, but it lets you control your industry’s future instead of waiting for someone else to define it. The Wave Won’t Wait Markets ripe for roll-ups don’t stay that way forever. Once private equity enters, competition drives valuations higher and makes acquisitions less attractive. Early movers capture the lion’s share of value, whether they’re selling or leading the charge.