Owner, Occupied
I'm really excited on so many levels, although with each excitement comes not a little trepidation and worry. After 10+ years working on entrepreneurship and small business at The Enterprise Center, it's nice to finally have the opportunity to own and operate my own venture. It's where I want to be at this stage in my life, so even though the stresses and stakes increase, it's what I am choosing with clear eyes and eager heart.
Work-wise, I'll be picking up a lot of new responsibilities. My client work continues on as before, but even in that I'm stepping things up a notch because I'll be the principal on record on more and more of my gigs, rather than director under some other principal. Added on to that will be a fair amount of working on the business itself, in terms of management and strategy and operations and finances. Plus I've got to get out there more than ever to shake the trees in search of new business. Of course, the transition itself will require a bunch of to-do's over the next several months.
Psychologically, there's something significant about going from worker to owner. Of course, I've always been invested wherever I've worked, but now the investment is as real as it gets. For one, workers get a paycheck at the end of the month, while owners have to first make sure workers get paid, which means my compensation goes from a fixed amount to anything between a really big positive number and a really big negative number. I'd be lying if I said that doesn't make me gulp hard on a daily basis.
But, as noted above, this is where I want to be right now. With the added stress and responsibility comes the added opportunity to make things happen the way I think they should happen. I look forward to the greater satisfaction I will derive from running the company well, rather than just being a good worker within the company.
Monetarily, it will be fun to have my compensation tied more closely to the success of the firm. As an owner, you get paid in three ways. First, your salary, if you're lucky to clear enough to draw one after all the bills and employees have been taken care of. Second, your share of the profits at the end of the year, if you're lucky to have helped bring in more in revenues than you spent in expenditures. And third, a gain from the sale of your share of the firm, if you grow the value of the business such that you can sell for more than you first bought for.
It's that last form of compensation that I find the most intriguing. For what value is there in a professional services firm outside of its workers? After all, we don't have any machinery, any patents, or any proprietary licenses. How will we create value in our entity such that we can sell it at the end and retire off into the sunset? As one who fancies himself a systems thinker (a "clock maker" in Jim Collins parlance), this is a delicious challenge I look forward to taking on over the next several years.
I've tried to minimize my other commitments this calendar year to give myself as much room as possible to grow into these new roles. I'm still committed to being there for my family, to helping out at church, and to pursuing a number of different civic service opportunities. But I'll likely have to give more of my scarce time and brain space to the company, especially as we all transition into figuring out how to run it. Wish me luck as I launch myself into this exciting new direction!
Comments
I sort of envy you, and I sort of want to give you business. I'm very attuned to "ventures" as well, especially of the "social" variety, although I don't really "observe" the boundaries between "public", "private for-profit", and "private not for profit".
There's one phrase that intrigued me in particular, in this last post, and I'm almost positive you can't answer this question very specifically, especially at this very early stage in your venture, but here goes:
"...sell it at the end..."
When is "The End", for Econsult Solutions, Inc.? Do you owners have some vague sense of how and when you *want* to "exit"? Is it a group thing, i.e., you are entering this "bus" together and will all exit it together, or more-or-less together, when the bus gets to the destination? Or is it, "gee, you know, it's a journey, and we guys are not sure where it's going to take us"? (I have a feeling it's not the latter, at least not in those words. :-) )
Anyway-- very very excited for you, and hoping that I (or some delegate/agent of mine) can engage your firm in the not too distant future.
"Sell at the end" is an individual decision (when do I want to retire / when can I retire / when makes sense to retire) that is obviously related to the parallel decisions my partners are making (since each of us leaving or staying plays a huge role in everyone else's decision to leave or stay).
In terms of selling, the "to whom" influences what is meant by "at the end." If, down the road, we sell to young bucks who are where we are now, then the firm goes on and we ride off into the sunset. If, however, we sell to another, bigger firm that wants to absorb us into them, then that may mean we ride off into the sunset or it may mean we keep slogging away but under new ownership. It also may mean our firm ceases to exist and is fully absorbed into the other firm, or that it continues on as its own distinct entity albeit with new ownership.
Who knows what the future will bring, or even what our preferences are, at this juncture. But the point remains: in order for the sale to generate more than we paid for it, we have to create real value. That is the challenge that I am excited to take on.
In any event, I'm more confident now than I was when I asked the question yesterday, that our paths may someday cross on an actual Econsult Solutions engagement.
Best wishes for success, to your and your partners!