The Difference Between Lifestyle Businesses And Scalable Assets
Are you running a lifestyle business or a scalable asset? This is a question that every business owner should ask themselves if they’re thinking about exiting their business and getting a meaningful valuation.
A lifestyle business provides a comfortable living for the owner but has limited growth potential, scale, and a heavy reliance on the owner’s personal involvement.
On the other hand, a scalable asset has the potential to grow rapidly and generate substantial returns. It operates efficiently without the constant input of the owners, thanks to robust systems and processes in place.
To determine whether your business is a scalable asset or a lifestyle business, ask yourself the following questions:
1️⃣ Is there a clear path for expanding and scaling your business?
2️⃣ Can your business thrive without your involvement?
3️⃣ Is your business generating increasing profits and positive cash flow?
4️⃣ Who can help accelerate this journey before your exit?
If you’re unsure about the answers to these questions and your intention is to exit your business in the near future, don’t worry. There is usually time to transform your business into a fully scalable asset if you start now.
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