A Fastlane Question for MJ and others.

[DavidofMN]

Group,

If you develop a Fastlane business, do you have to sell? In other words, is the liquidation event mandatory for the Fastlane business to be considered a success? Could someone hold on too long and have the business/economy/market turn or disappear? Just curious.

David

 

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[DeletedUser2]

if you build it, and can keep it going in an evergreen market. great.
one of the reasons of the exit is to
1. get a lump sum of cash that you can position yourself in a much more passive way
2. reduce risk of exactly what you mentioned, holding to long.
3. change up your asset classes so your not so weighted in 1 biz. (yours)
4. to stop and enjoy some things you want to.

now you dont have to exit, you could enjoy the cashflow for a while. here is why MJ did and exit rather than keeping it.

He determined that he either had to grow and hire people, or let it shrink over time. or sell now. h
he sold.

good move if you dont want to take on the next level of growth.

however if you get to a good size, enjoying the fruits of a fastlane biz, you will realize nothing ever stays static. meaning, some competitor out there, or some young stud will eye your market, and start moving in on you. then you either grow, or sell.

at somepoint tho, you may want to not be in that rat race for too long, and decide to exit.

hope that helps.

 

[Lusches]

Did you read the story on page 126-127 in the millionaire fastlane ?
Theres a story about someone who hold his business too long.

 

[NHS]

"You got to know when to hold em, know when to fold em."

We had a huge DVD manufacturing plant. We kept growing and growing. DVD sales were going down, prices were going up. It was getting really scary near the end.

Know what saved us? Phillips came in a sued the shit out of us. The best thing that could have ever happened to us. They liquidated the business and we got the hell out of there. This was about 6 months before the economy took a nose dive. So had they not sued us we would have been worse off.

I was able to walk away from it. Had we sold 2 years earlier I would have got a few million and I could be enjoying my big house on the hill instead of my little apartment by the water. Just another life lesson.

However my fiance wants a daycare center and it's gonna be another year but if she wants to run it for 30 years she will be fine. Same goes for some of my online stores. I have no reason to sell unless they grow by leaps and bounds. They provide a nice flow of cash with little work on my part.

 

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[MJ DeMarco]

If you develop a Fastlane business, do you have to sell?

Absolutely not. But there are always reasons why you might ...

1) Market changes
2) Personal situation (What's your number? Will selling help reach it?)
3) Bordem (Big factor for me, I wanted another challenge.)
4) Taxes?

here is why MJ did and exit rather than keeping it. He determined that he either had to grow and hire people, or let it shrink over time. or sell now. He sold.

Wow, exactly.

you will realize nothing ever stays static.

True.

Could someone hold on too long and have the business/economy/market turn or disappear?

Yes -- this was another factor in my own sale ... I perceived the revenue model as unsustainable. Also, had I held longer, the recession probably would have eroded a good % of my business.

 

[DavidofMN]

Perfect. Thanks everyone.

 

[SThiess]

The only constant in life is change !!!!

 

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[Knowledge Kick]

The key is to have better foresight than others. Sometimes it will be in your best interest to sell, sometimes it won't.

If you can sell your company at it's peak then that's great.

However, there are stories at the other side of the spectrum as well. The founder of Victoria's Secret, for instance, committed suicide because he sold his business too early. Even though he sold for millions, someone else had better foresight than him and realized it was worth many many more millions.

So it isn't a black or white question, there are many shades of grey. Just know as much about your company and your industry as possible so you can seem clairvoyant over time.

 

[Inphinity]

I would agree, you don't *have* to sell, but at least consider it as an option. Sure, you might sell and then the new owners grow the company even more, but this is where the aforementioned foresight comes in. If you get to the stage where someone is offering $xx million to buy out your company, it's really a consideration of "Does $xx million allow me to live how I want / move on to the next stage of my life I want to go to, or do I feel I can better serve my interests by growing the company myself - assuming I have a plan for growth".

 

[CEBenz]

I would agree, you don't *have* to sell, but at least consider it as an option. Sure, you might sell and then the new owners grow the company even more, but this is where the aforementioned foresight comes in. If you get to the stage where someone is offering $xx million to buy out your company, it's really a consideration of "Does $xx million allow me to live how I want / move on to the next stage of my life I want to go to, or do I feel I can better serve my interests by growing the company myself - assuming I have a plan for growth".

Inphinity,

Very very well put. I suspect, once some of the people on here have measurable success in their ventures, it'll become more of a hobby and pastime. Sure they may take time off between ventures, but lets face it, the start up can be the most fun part.

 

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