1.0 Your Legacy

04/08/23 www.the-growth-lab.info 1

Beating the Odds

Your Legacy


Your Legacy

Introduction

The first of 3 presentations on our core technology – FAST and SUSTAINABLE business growth.

Your Legacy focuses on the dream, the reason you started the company. The over riding question – when you are done - what is your picture of perfection?

Summary What Is Possible – The Best

of the Best

Where Are You Going?

How Is Your Company & Industry Valued?

How Do You Compare – What Are Your Ratio's?

What Are Your Go Forward Investment Decisions?


What Is Possible...

7 of 10 New Companies Survive 2 years (70%) 5 of 10 of New Companies Survive 5 years (50%) 5% of Remaining Companies become Market

Dominators Therefore only 2.5% of All Startups Become

Market Dominators

What is Your End Game?


...the Best of the Best

How did they become the 2.5%? Based on their industry and business model –

they experienced one of 3 courses – A Distinct Growth Path to Market Domination:

4 years from 1st REINVENTION 6 years from 1st REINVENTION 12 years from 1st REINVENTION

Which is Your Course Forward?


...the Best of the Best

REINVENTION The last stage of the business growth cycle Based upon effectively managing growth from

Inception to Reinvention There is No Average Ramp Time (time from Start-

up to 1st Reinvention) Getting the First Cycle Right is Critical to Market

Domination – it is building the foundation


Where Are You Going?

Your End Game Options Your Company is just an alternative employment

strategy – Make Your Own Job You plan to Grow and Sell (or be acquired) You plan to Grow and keep it Private You plan to Grow and take it Public

What is Your End Game?


How is Your Company Valued

If you sold today, would the company be valued by: Assets, or Income, or a Combination of both?

Understanding how the company is valued provides guidance for investments. Only build value that will be recognized when executing your End Game plan!



Key Factors Understanding Industry Specific Valuation. Each

industry has a set of ratio's that allows comparisons between similar businesses.

Understanding Core Components of Valuation. Is this how the company is currently measured and managed by you?



Industry Specific Valuation – Ratio's for: Return on Sales (ROS) Return on Gross Profit (ROGP) Cash Flow Valuation (CFV) Cost Of Sales Inventory (COSI)

These 4 core ratio's allow you to benchmark your company against the industry.



Core Components of Valuation Completeness and Accuracy of Financial

Reporting History of Positive Trends Profitable Process Chain Self-Sufficient Operations

These components drive your two accounting systems – financial and managerial.


How Do You Compare...

Owner Satisfaction with Valuation Most business owners have 50 – 70% of net

worth invested in the business Only 20% are satisfied with the Business's final

sale price Average expected return from managing by

valuation = 50% increase in Net

If the first valuation happens when you decide to sell – join the unhappy 80%!


...What Are Your Ratio's?

Each Industry has a specific set of ratio's for ROS, ROGP, CFV, COSI

Where do you stand for each ratio on the industries curve of distribution?

Upper or Lower 2% Upper or Lower 14% Upper or Lower 34%

Goal 1 – Upper 34%, Ultimate Goal – Upper 2%


Your Go Forward Decision

Conduct a yearly business valuation to determine worth and standing in the industry

Manage the core metrics to increase value – make all business decisions with valuation as a standard – drive everything towards the Upper 2%

If Fast and Sustainable Growth to achieve Niche or Market Domination is your objective – Becoming the Upper 2% - view presentation #2 - The Course Forward

1.0 Your Legacy

Business

Transcript of 1.0 Your Legacy