June 06, 2023
The Optionality Newsletter
June 07, 2023
Some days I work ten hours. Some days I work one hour, then spend time with my family.
The more time I spend with entrepreneurs, the more I realize we don’t want to work less.
We want the freedom to work on what we want to work on, as much or as little as we desire.
I’ve spent the last five years building a system that allows me to remove myself from the business without impacting my income.
I want to detail how and why I did it and share what I learned along the way so you can do it much faster than I did.
How to Exit the Day-to-Day
1. Start with Why
Every business owner should want to exit the day-to-day for at least two reasons:
Detach time input from money made. (Different levels to the game)
The asset you’ve created becomes more valuable when it doesn’t depend on you.
When you step out of operations, you 10x your ability to see the future of your business.
2. Focus the Right Goal
You may have heard someone say:
"I'll build a business, hire an operator, sit back and collect passive income".
But this won't make you happy.
You’re an entrepreneur. You’re a creator.
You’re built to build.
Instead, the better end goal is to create Optionality for yourself.
This is where you build:
What you want
With who you want
When you want
This is where you want to get to.
When you have Owner Optionality, you have choices:
Sell the business.
Hold the business, but exit the day-to-day.
Continue to work on the parts of the business you enjoy the most.
When building a business that ultimately won’t need you, most people build the wrong thing first.
They start by focusing on operations, but they’re neglecting the key piece every business needs for operations to even matter:
3. Detach the Founder From Demand
If you start by setting up operations so they don’t need you, when you step away, your business will nose dive despite all of your hard work.
What most founders fail to realize is you’re not just the engine that keeps the machine running, you’re the reason why customers come in the door to begin with.
In essence, the founder is the demand.
You built a business by working like crazy to generate demand.
Now, you have to build a business that creates demand on its own.
Creating demand involves five areas:
Authority: Become the expert voice.
Attention: Build a following through valuable content.
Access: Make it easier for your client to reach their customer.
Affiliates: Have partners and customers to sell for you.
Assets: Create IP that nobody else in the market has.
Make a plan to tackle each one of the above one-by-one without you at the center to create a self-sustaining demand engine.
4. Build a Sales Machine
The founder is almost always heavily tied to sales activity. You’re the expert.
You’re probably also the main salesperson.
If you want the freedom that Optionality offers, you need an organization where everyone is selling and a brand and business that sells itself.
(Stay tuned for more on how exactly you do this. Next week, we’ll talk about how to systematize sales and demand by stepping back from the process.) For now, let’s move on to step 5.
5. Build the Team to Carry the Vision
You need to build operations around the right elements to create the business you want.
If you want Optionality, you need to build your operating system and team around what I call force multipliers.
Force multipliers are the systems and people who share your vision for growth, culture, finances, and quality.
The operation system will give you a pulse on your business’s current and future health so you (the CEO/founder) don’t dive back into the business out of fear.
The people will passionately drive towards the vision whether you’re there to oversee them or not.
The result of putting these force multipliers in place will give you the confidence you need to monitor and advise from a more removed seat without the need to get into the weeds to feel comfortable that your business will continue to grow.
6. Train the Organization to Push You Out
Most owners think they have to learn how to step away.
This is the biggest mistake I see.
Even if your team hits all the metrics you set to step away from the business, you still need to train them to push you out.
Otherwise, you’ll probably never leave.
The reality is you need to train your team to push you out.
Here’s the two key signals you’re business is ready for you to take a step back:
The organization has systems and personnel to create force multipliers and monitoring business wellbeing.
The team begins to see your energy naturally gravitating towards outside initiatives, not towards business growth and acceleration.
Work through these six phases, and you’ve reached owner optionality. Congratulations!