Time is the irreplaceable asset. Money can be gained, lost and regained. But time, once it has past, is gone forever. I wrote about this earlier this year in the context of how owners go about determining what will give them a sense of satisfaction. I’d like to go back to this theme in the more specific context of planning for selling a business, business succession and an owner’s personal transition from ownership.
To understand why time is so important think of an inclined plane. For any given height we want to move something up using the inclined plane, the longer the distance the less effort that is needed to get the object up. This is why highway engineers make use of switchbacks for steep climbs.
For most business owners, maximizing the value both tangible and intrinsic their business (whether it is sold or being passed on) is critical to achieving feeling successful and fulfilled. Building business value is a lot like moving an object up a height. The more time that we give ourselves, the easier the task is going to be. And the longer we wait to start this process the more difficult it becomes. In fact if we wait too long, we may not be able to increase the value enough to achieve our financial goals at all!
It is much like a catalyst. A greater time period may not be a part of the actual building of value but not enough time can subvert the tools we use to build value.
Keep this in mind. You don’t have to have all the answers. But the sooner you start working on the process, the more likely you will get the answers you need and implement them. Whether we are owners ourselves or advisers to owners, it is never to early to start thinking about the value creation process.