I had the pleasure of interviewing Veronica Kirin, serial entrepreneur and Entrepreneur Coach. She is the author of the recently released book, “Stories of Elders: What the Greatest Generation Knows about Technology that You Don’t”, the development of which was the impetus for Kirin scaling and selling her tech company in early 2018. She teaches other entrepreneurs how to scale through her workshop, “How I Scaled and Sold my Six-Figure Business Without Losing My Friends (or my shit)”, across the country at conferences and via webinars.
Thank you so much for doing this with us! Can you tell us a story about what brought you to this specific career path?
Yes, of course. I started my first business in 2010 without expert support. That continued for some time. I eventually found a mentor for my tech company (which I started in 2012), but he passed away suddenly and I was left without guidance and a company that was in need of scaling. I stayed stuck doing way too much work for not enough income, not knowing how to scale or grow. Someone eventually gave me the book “Built to Sell” around 2015 which helped me make sense of what was happening in my company, see the broken systems, and build the kind of company that would attract a wonderful team and reduce my workload. By 2017 I had gone from 60-hour weeks to working 10 hours a week and able to take time off to travel Europe without harm to my business. That is the company I eventually sold to make space for my new book and to coach other entrepreneurs on scaling their businesses (or starting scaled).
Can you tell us a story about how you were able to build a business from scratch, scale, and sell it to a bigger firm?
I actually hired a business broker to find the right buyer for my businesses. It felt very similar to selling a house, but with way more due diligence and collaborative meetings. What made my company attractive was the switch I had made from project based work to recurring revenue. That change came as I built systems when then made hiring a team and managing clients easy, which was also attractive to the new buyers. Again referring to the analogy of selling a house, the more “turn-key” your business is, the better. If the new buyer can land in your business and take over with very little mentoring and overlap with you, they’re going to be far more likely to pay the big bucks.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
I still find it hilarious that I charged $300 for the first website I built. It’s such a stark contrast to the work my company was doing just before I sold. Charging too little is extremely common, and I often work with my clients on charging their worth. Sadly, I didn’t have a ‘me’ to help me back then!
Can you share with our readers the “6 Things You Need To Know If You Want To Build, Scale and Prepare Your Business For a Lucrative Exit”. Please give a story or example for each.
- Systemize everything. There is no need to reinvent the wheel every time you receive new work. If you need a new system, use some of the systems you’ve already created so you’re never starting from scratch. I saw our conversions go through the roof when I systemized our proposal and onboarding process for new clients.
- Step back and determine the processes you will be using within your business. Choose which technology will help you acheive your goals, organize your clients, and track milestones, rather than falling into a random app. There are things that people will tell you you need, and then there are the things you actually need, and it’s up to you to know the difference.
- Shift from project to recurring revenue in any way possible. Every business is different, and a service-based business will look different than a product-based business, but you want to avoid one-off sales if possible.
- Begin outsourcing. If you are still doing everything for your business, you aren’t scaled and will run out of time before you complete your goals or make your ideal income. With systems built into your business you will be able to simply hand over documentation (ie. brand words, SEO research, CRM structures) and have a VA or Content Strategist take over some of your work with minimal training.
- Hire a team that can scale. Outsourcing is your training wheels for this. I’ve seen this work best when we department-ize the business so that you can make a hire that has a specific scope of work. You can groom them to become department heads as that department grows, and their ownership over the department means it will grow faster and more effectively. When you make further hires to that department you will have help with training and no concern about expanding your management work load.
- Eliminate repetitive tasks. These are things you can outsource or ask your team to manage. You want to remove yourself from the business as much as possible — it needs to function on your own. This especially includes sales and marketing. You won’t be able to let go until you see your pipeline stays full on its own.
Can you give a few examples of things to avoid when trying to build a business to sell?
It’s easy to feel like you are the only one who can do what you do. That is the false story that keeps us tethered to working in the business rather than free to develop the business (or take time off). Each step you take in scaling should be toward stepping out of the business.
What are some of the differences in approach for building a service based business versus a product based business with an intent of selling the business at a lucrative price?
Products can fetch a higher sell point if they are patented. Intellectual property will always have a higher baseline sell point. Service based companies will find that relying on their proven systems and recurring revenue management to serve as their attraction.
How does one go about the process of finding a buyer?
As I mentioned, I used a business broker, which I highly recommend for any sale above five figures. They told me what documents I required from my CPA and Lawyer, did the leg work of finding prospective buyers and setting up meetings. It took the guess-work out of the process and ensured that my business sold to someone who would truly take care of and grow the business I built.
How can one decide if it is better to build a business in order to exit, or if it is better to stick around for the long term and let the company bring in residual income or go public?
It all depends on what you want to do with your time. I loved my tech company, but I realized that it was holding me back, distracting me from my then developing book. It felt like an anchor, even though I was only working 10 hours a week on the company. It also would have taken a larger growth push to finally work my way completely out of it, and my heart wasn’t in it. It was better for me to sell and coach other entrepreneurs in order to breathe life into my new book. If you have a company that you love that feeds your energy, rather than pulls from it, then you may want to retain it and slowly reduce your hours and grow your residual income through scaling.
Can you share a few ways that are used to determine a good selling price for the business?
I’m not a business broker, but this is what I was told: The ability for the business to run without you is a major factor. From there there are multiples based on yearly revenue, intellectual property, and projections that calculate a selling price.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Freeing others to take the leap into their dreams.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
“She’s going to dream up the world she wants to live in / she’s going to dream out loud.” -U2
It has inspired me to do exactly what I just said — feel free to live in my dreams and see them come to fruition.
How can our readers follow you on social media?
Find me on all socials using the handle @vmkirin