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As we round out our series on entrepreneurship through acquisition (ETA), let's talk about when the rubber meets the road: getting into the day-to-day running of your new business.
We've already discussed what ETA is and how to get started on the path to owning your own business, as well as where to begin looking and what to look for when buying a company. Now, you're ready to get your hands dirty and test your entrepreneurial grit at the helm of your new business.
The biggest hurdle in this process is ensuring a smooth ownership transition. When done strategically, this can alleviate numerous headaches and problems while keeping the business moving forward despite changes at the top.
Finally, once the transition is complete, I will offer guidance on what success in running your business could look like.
Related: Want to Start a Business? Consider Buying One Instead — Here's Why.
Prepping for day one
Before you get the keys to your new kingdom, you'll want to do a few things to prepare as your first day as owner approaches.
- Transition of power: What are your plans with the current owner, and what will the transition plan look like? It's critical to have that predetermined and agreed upon — legally, if necessary — so everything is mapped out to be smooth and seamless.
- Employee communications: Create a detailed communication plan with your new employees. Changes at the top make people nervous, so you'll want to keep in touch consistently to help them transition.
- Time mapping: How will you utilize your first 90 days to fully understand the business? The first three months of your transition will be crucial for you as a new owner. You need to know how to make that time as valuable as possible.
The first 90 days
In my experience, the first 90 days are the most challenging yet most critical part of the transition.
Before you step into the office on day one, you must have a firm plan for this time and closely adhere to it. Otherwise, things can go sideways quickly.
Your first order of business is to figure out what the previous owner's role will look like during this period. Most of the time, you want to transition them out over the first 90 days. It can be a delicate balancing act: You want to keep them around long enough to make the transition as smooth as possible, but not so long that they start to get in the way of change.
I see the latter happen all the time. Be sure you've set clear expectations with the previous owner on what you'd like their role to be during this time and how you plan to take the reins when the time comes.
This is also the time to start implementing your communication plan. Do so early and often to keep employees updated and reassured.
Be ready to ask questions and listen
The best thing you can do is come in as a new owner and listen.
If it's small enough, build relationships with each employee and stakeholder and ask them questions. Get to know them to understand what they want to see moving forward. How can you try to make this smooth and comfortable for them?
Combine all your findings with your own ideas to create a more formal and public transition plan. Once that's complete, share it with your team so everyone knows what to expect and feels their voices were heard.
Related: What You Need to Know to Buy the Right Business and Acquire Your Empire
After 90 days
You selected and purchased this business because it was strong and had a promising future. Now it's time to leave your mark on it.
Start implementing your ideas into short-term and long-term goals, ensuring your management teams clearly understand them and are on board. Continue your research, identifying potential areas for growth and innovation, even if they aren't addressed immediately. Even as you implement new changes, you should always be a student of your business and customers.
Improve operations
Before you bought the company, you had a good idea of which processes needed to be streamlined and which areas needed attention.
Now, it's time to highlight those areas and find ways to invest in new technologies and infrastructure upgrades that will allow you to make these necessary adjustments.
Don't forget the culture
It can be easy to get consumed by all the financial and technical details, and you let the business's heart and soul slip through the cracks. Never stop focusing on your people.
Always seize opportunities to reassure them that you want to build on what they helped start. Ensure the work environment is positive and fosters open communication and collaboration. One of the best ways to do this is by incorporating town hall meetings to address any concerns head-on, share your vision transparently and establish yourself as a leader.
When power shifts within a company, people are naturally concerned about how it will impact their jobs or whether things they have come to expect and appreciate will change drastically. Honoring certain traditions and respecting rituals that are meaningful to your employees, even if you could do without them, is essential.
Finally, one of the best things you can do is recognize employees for their efforts early and often. Don't heap disingenuous praise on people, but take the time to celebrate exemplary work, achievements and milestones.
Remember, your employees will be just as busy studying you and your leadership abilities as you are with their work ethic and productivity. Make sure you're leading by example and building rapport at every opportunity.
Related: I Lead a Company Built Through Decades of Acquisitions. Here's a Key to Making Them Successful
Final thoughts
To some entrepreneurs, taking someone else's business and making it theirs feels like cheating. They prefer to do it their way no matter what comes. That's entrepreneurial grit.
However, as this short series has shown, startup culture isn't the only way to build a business. Sometimes, the best companies — regardless of size — are the ones that were already built but needed someone with fresh ideas and a daring spirit to create something even better.
