Value Creation: A Paradigm Shift
Many entrepreneurs start their business out with one focus in mind: growing profits and minimizing taxes. In the early stages of a small business (that often time more closely resembles a job rather than an enterprise), entrepreneurs first worry about gaining traction with revenues and secondly after-tax earnings. Even as the business grows from a “main street” business to the Lower Middle Market, this mindset of after-tax earnings is pervasive with most entrepreneurs. For a lifestyle business owner (happy with the current size of the business), this mindset may suit them well, as the perception may be there is no need to fix something that is not broken. But as your company continues to grow, so does its complexity. And as you age, the need to think about harvesting the wealth in your company becomes paramount since such a large percentage of your personal wealth is tied up in the business. This is where a value creation mindset can help you achieve your personal, financial, and business goals.