Why You Should Be Scaling Your Business To Exit ... Over The Next 36 Months

If there's one thing I've learned from over 20 years of buying, scaling and exiting businesses, it's this …

"You don't build serious wealth running a business ... you build serious wealth by scaling a business to achieve a life-changing exit."

So if realising true time and money freedom is important to you—if it is one of the main reasons why you started your business in the first place— then perhaps now is the time to ask the important question: Is what I'm doing in my business going to get me to my ultimate outcome? Or do I need to shift gears and try something new?

If you’re a business owner, you’ve probably had a rough couple of years—and the challenges aren’t over. While COVID-19 may be weakening its grip, talent shortages, supply chain issues, and inflation are still very much at play.

And yet, the economy is surging. Many of the business owners we talk to have all the work they can handle and strong balance sheets. So on the plus side, performance is good. On the negative, managing the business is really challenging considering there is so much uncertainty and instability in the macro-environment.

That said, there are a few things happening right now that are advantageous for business owners looking to sell their business in the near future. In fact, I would say that now is the best time I've seen in my career (and possibly this century) to be considering an exit ... especially if you are a 7 or 8-figure business owner and your ultimate goal is to exit rich.

Before I get into that, I should mention that I specifically work with business owners that are looking to scale up. Some are trying to get unstuck, realising that what got them to 7-figures won't get them to 8-figures. Others are growing nicely but they want to accelerate that growth and play a bigger game. What unites them is that they all desire their business to be a wealth creation vehicle. However, they're not going to ever realise that wealth (or freedom) because, in the beginning, they believe ...

❌ What got me here will get me there

❌ The way you grow a business is with hustle, one customer at a time

❌ Working longer and harder "in" my business will ultimately lead to success

❌ I can do it all myself

❌ Time is on my side

It’s simply not the case.

How do I know this? Over the last decade, I have been involved in over 100 acquisitions and 26 business exits during my time working with some of the largest Private Equity firms in the world. There is a proven process to building a high-value business ... and it's not about relying on hustle! If you want to learn the 5 reasons why most businesses will never get to 8-figures and therefore will never be that wealth creation vehicle for their owner ... then I have a FREE guide for you—details at the end of this article.

So why is now the best time to be scaling your business to exit? Here are some important things you should know:

1. Buyers outnumber sellers

The buyer pool for businesses is incredibly strong right now, and there are significantly more buyers than sellers. Private Equity has been driving demand and will continue to do so for the foreseeable future. This group of buyers is exceedingly well-capitalized and needs to put their investors’ dollars to work. It's actually pretty incredible ... there are over $2.6 trillion dollars sitting in Private Equity coffers undeployed. This is an eye-watering wealth transfer opportunity for business owners who can sell their business over the next 36-months.

Meanwhile, we expect to see corporate buyers ramping up their acquisitions. After a couple of years of sitting back and waiting things out, these buyers are feeling a new sense of urgency. With the tight talent market limiting organic growth, companies will be looking to acquisition as a way to expand and evolve.

In terms of making an offer, strategic buyers could offer higher values because of the synergies that can be gained from a merger. And yet, Private Equity is up against deadlines to place their money in new investments. Pit these active buyer pools against each other and the battle should be pretty good.

2. Valuations are at an all-time high

Sellers are realizing record valuations right now. According to GF Data, a company that collects data on privately held M&A transactions, multiples for Q3 2021 hit the highest level they’ve seen in their 16-year history.

You can look further into the data here:

3. Business lending is strong

Banks are looking to put their money to work in the same way buyers are. What we’re hearing from lenders is that their traditional clients are flush with cash. So instead of extending lines of credit to their established customer base, they’re out there looking for new loans to make. This presents a huge opportunity for business owners who want to leverage capital to grow faster vs. growing slowly, one customer at a time, from traditional sales and marketing efforts.

The quickest way to scale a business and build value? Acquire other businesses! Bolt everything together, and then form a group that can then be sold up the chain (to Private Equity etc). This growth strategy is called a "roll-up" and is one of the key opportunities we work with our clients on. It's also the #1 proven growth strategy of Private Equity where the firms 'buy then build' to create their own multi-million dollar exits.

4. Significantly more businesses will be put up for sale over the next decade

Most business owners I speak with, who are considering an exit, are thinking of achieving this a long way into the future ... sometimes +10 years! This is very dangerous because the pace of change around us is increasing by the day and what is considered valuable now may be disrupted in the near future.

With the uncertainties of the last two years, many sellers have been waiting on the sidelines. This has exacerbated supply and demand issues and heightened competition for quality businesses.

But now, the economy is strengthening and the market is gaining a new sense of equilibrium as we all learn to live with the lingering pandemic. As confidence increases, more business owners will enter the market.

Plus there is one more important dynamic—every day in North America there are over 10,000 people retiring as 'Baby Boomers' reach retirement age. Many of these 'boomers' own small and medium-sized businesses ... but most have no clear succession plan and are looking to exit quickly, often for low valuation multiples. As per my previous point, there is a huge opportunity to buy these businesses to add value to your own scale-up. Equally, there is more inventory going to hit the market in the coming years that will flip the supply/demand curve in favour of buyers.

Put simply, if you are planning to sell soon, it might be a good idea to act before supply increases. I anticipate the window to maximise the opportunity is the next 3-5 years. It is very possible to scale to exit within this timeframe if you already have a profitable business doing over 7-figures in revenue.

💡 Some business owners think it's too difficult to scale their business to exit. The truth is, it’s actually not that complicated. Just a few days ago I had a chat with a former client who, back in August 2021, sold his business ... and now lives on an island! His business was 16 years old at the time, he'd tried to build value previously in order to make it attractive for sale, but failed each time in achieving his ultimate goal. I was engaged to help him properly plan, structure and orchestrate an exit and within 18 months we made it happen! Craig sold his business for multiple 8-figures. None of this was rocket science. Once you know what to do and you execute a proven process, the result becomes very possible. Anyone can do it. What was particularly great about this situation was that we fast-tracked the closing of the deal so Craig could mitigate his personal capital gains tax liability. This one strategy I learned from my Private Equity days was worth multiple six figures on top of achieving a very significant capital event.

Selling your business is likely the largest financial transaction you’ll make in your life, and there are a lot of variables to consider. It’s a good idea to keep tabs on your business value as the market changes. Talk to experts who can evaluate your unique business and circumstances. Find out what the numbers look like for a sale in the near future. You may have some big decisions ahead.

In the last few weeks, I have been absolutely overwhelmed by business owners who want to learn how to scale their business fast and achieve a life-changing exit.

➡️ So much so that I decided to write a 40-page guide called: "The 5 Reasons Why Your Business Will Never Get To 8-Figures ... How To Fix It Fast!" ⬅️ 

You see, 8-figures in revenue is the magic number! Once you hit this mark, with good profit margins, you open up the possibility of a Private Equity exit ... and effectively you get your share of the $2.6 trillion dollars I mentioned earlier. Anyone can do it.

👇 If you'd like my FREE guide, please comment below with the word “EXIT” and I’ll get in touch to send you a copy. 

I hope it proves a valuable resource and shows you what is truly possible over the next few years. Remember this: you are only one deal away from being able to live life fully on your terms ... and there has never been a better time.