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Starting a Business? Plan Your Exit Now

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StrategyDriven Entrepreneurship Article | Starting a Business? Plan Your Exit NowWith the explosion of startups in Silicon Valley, the idea of a flashy and lucrative business exit isn’t anything new. An exit is the word people use to describe how founders (and any investors they may have) leave a business when it’s sold. It usually comes with a dollar figure attached to clarify just how much everyone made from the transaction.

When you put an exit in those terms, “plan your exit now” sounds like a recommendation to dream about the ways you’ll spend your millions. It’s not.

Every entrepreneur needs an exit strategy before opening a business – because it will dramatically define how you’ll run the business.

For instance, you may be building a business you never intend to sell. Maybe you want to pass a business on to your children or hand it off to someone else in the company when you retire. Knowing this ahead of time will inform your decisions and influence the business’s management and growth.

In contrast, you may be a startup founder. Your mission is to pursue explosive growth, so you’ll be more likely to have a “growth at any cost” mindset. Entrepreneurs in this situation want to build as much value in the business as possible, as quickly as possible, so that they can sell the business for a lot of money – and soon.

How do you know which path is best for you? Before you start and build your business, ask yourself:

  • Do you picture running your business indefinitely? Or would you like to pursue this business idea – and then move on to the next one?
  • How much of your time and money can you put into the business before your family is at serious risk?
  • How will you guard yourself against the danger of sunk costs (convincing yourself to spend more money because you’ve already invested so much to begin with)?
  • What do successful companies in your target industry typically sell for?
  • How much do you need to grow your business to reach that sale target?
  • Does your market opportunity align with the growth you need to sell the business?
  • If your business doesn’t meet your growth expectations, what will you do?

These can be difficult questions for any entrepreneur. To complicate matters, an exit, even a good one, is not necessarily as smooth or as clean as cash­ing a big check and hitting the waves on your new sailboat.

An exit may not have a Hollywood ending

In my own business life, my company FDI became triVIN via a merger, which came with its own turbu­lence. When triVIN later sold, I stayed on for a year afterward as president and was then asked to leave. Though on paper the business was no longer mine, it’s a special kind of experience to be told that your services are no longer needed when you’re the one who built the business.

Though I made gains from that exit, it wasn’t the happy Hollywood ending that many startup founders envision. The path curved and double backed on itself before it went forward into a sale, and I didn’t get to leave feeling like the hero in my story, at least not entirely.

Yet by all accounts, it was a good ending. The business, after all, didn’t fail spectacularly or drag myself and my family deep into debt. I ended with a profit—but exits could sometimes mean locking the doors on a dead business.

For Necessity Entrepreneurs – those of us who are in business to put food on the table for our families and employees – failure is not an option, but at the same time, failure is a likely reality. The key nuance here is that for the Necessity Entre­preneur, failure is an obstacle to be overcome. We dust ourselves off and bounce back.

The part of this that traps many entrepreneurs, however, is that bouncing back doesn’t necessarily mean stubbornly pursuing a failing busi­ness, dumping more and more time and capital into an idea that has shown no signs of turning a profit.

Every exit has its trade-offs

If you opt to remain privately held – as I suspect many Necessity Entrepreneurs will – you have much more freedom in how you run your business. The trade-off is that you may have less access to capital and therefore grow more humbly in the short term.

If you’re looking for a fast-cash sale, that typically means answering to investors, which can come at the expense of your people, your values, and, at times, your customers.

The path you choose is up to you. Think about it at the start of your business, then think ahead as far as you can. Challenge yourself. Pick apart your ideas. Turn them upside down and sideways to find the best path for you.

About the Author

StrategyDriven Expert Contributor | Troy R. UnderwoodTroy R. Underwood is an industry disruptor. Part technologist, part economist, and all innovator, he revolutionized the motor vehicle industry with the nation’s first electronic title system for financial institutions, which was later sold for $106 million. His healthcare venture, benefitsCONNECT, innovated healthcare benefits administration and resulted in a highly successful acquisition. His new book is How to Launch Your Side Hustle: Start and Scale a Business with Minimal Capital. Learn more at troyrunderwood.com.

The Key Factors of Global Business

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It has been a global marketplace since forever, all you needed was the vision, guts, and usually a fair bit of seed money to extend the reach of your business beyond your own borders.

StrategyDriven Entrepreneurship Article | The Key Factors of Global Business

As the internet and access to the internet are reaching a point where it’s considered a commodity, the latter two elements (guts and seed money) are becoming less and less inhibiting factors to running a global business. In fact, the rise of As A Service offerings in the market means you can build a business empire from the comfort of your home, sort of speak.

What still is needed, however, is a vision on how you will reach global domination. Here are a few key areas to think about.

Global Audience

With a product offering or service in mind, you will need to think of where your potential customers are. There is usually always a base need that can be fulfilled, but in different countries, and therefore, different cultures, the ‘how’ element of how this base need should be fulfilled can be different.

Let’s say you have a service that is completely internet-based, and consumers access it via a web browser. Say you have built it entirely on desktop resolution, and it’s flying in your home country. You identify a need for your product in India, for example, and after launch, you find less than stellar performance. This could be down to the fact that Indian people don’t have desktops but rather consume the internet (and products) via mobile devices. There is also language and tone of voice that can make a massive difference.

Global Infrastructure

Next to your consumer base, you will have to think of varying rules and regulations that might be in place locally. If you provide a physical product, for example, you will need to take into account cooldown periods and typical returns behavior.

Germany is well known for its protective legislation geared towards consumers. Most companies that conduct business in Germany experience higher returns rates that need to be considered in the company’s infrastructure. Another thing to consider is your financial infrastructure for dealing with income, tax payments, and dealing with suppliers. Find international money transfer options that keep transactional costs down and deliver speed in delivery.

Global Colleagues

And although plenty can be done with outsourced capability, it being suppliers or as a service 3rd parties, at one point expansion will come with an international workforce. Being successful here means being able to manage people from different backgrounds and cultures. There are libraries full of books that can explain the finer differences between a Japanese and a French person. That’s not to say you need to go read all these books, but a cursory knowledge of what to do and, more importantly, what not to do goes a long way in people management.

Where a Japanese colleague will not tell you something but will drop hints, a Dutch person will usually tell you something directly. Taking these things into consideration means you can communicate more effectively and therefore build your global business bigger and better than ever before.

Can A Leased Car Be Used As A Taxi?

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StrategyDriven Starting Your Business Article | Can A Leased Car Be Used As A Taxi?Although it isn’t a question we get asked too frequently, someone occasionally asks whether or not a leased car can be used as a taxi. Whether you are just beginning to drive a taxi or have been driving for years, you may be surprised by how inexpensive it is to lease a vehicle. Can you lease a car for use as a taxi?

It depends. The section below examines the different circumstances under which a leased car can or cannot be used as a taxi.

Can Leased Vehicles Be Used As Taxis?

The answer is yes, but only in certain situations.

You most likely won’t be able to find a vehicle to lease from a standard broker. Some businesses, however, specialize in vehicle leases for cars that are going to be used as taxis. In close to three years at the OSV, I only happened upon one company that had specific deals in place for private hire vehicles.

Even though it may be challenging, there are ways to make it happen. The key is to find a company that specifically offers leases on vehicles that can be used as taxis.

Can I Use A Personal Contract Purchase Vehicle As A Taxi?

These vehicles can only be used as taxis when they are leased under a special agreement from a company that deals specifically with these types of leases. What happens if you have a personal contract purchase, though?

Even though personal contract purchases and personal contract hires are similar, they differ in what happens at the end of the contract. At this time, you can choose to:

  • Buy the car for a specific predetermined amount
  • Exchange the vehicle in part for a new one
  • Return the vehicle (you still will need to pay for any condition problems or extra mileage)

Based on that, can a personal contract vehicle be used as a taxi?

Sadly, it can’t. The vehicle is technically owned by the company providing the financing until the end of the contract. At that point, you can buy the car, making you the owner. If you don’t wait until the contract is up to begin using the vehicle as a taxi, it will depreciate too quickly. There is no way for the finance company to know whether or not you will buy the vehicle when the contract is over. After the contract ends, however, if you decide to purchase the vehicle, it can then be used as a taxi.

Can You Use a Leased Vehicle As An Uber?

The popularity of Uber, a ridesharing app, has exploded over the past few years. Unfortunately, leased vehicles cannot be used when driving for Uber. There is one exception, however. Toyota has invested in Uber so that Uber drivers now have special leasing options. Although you can’t lease a vehicle from a regular company, you may be able to find one through companies that deal specifically with leasing vehicles to Uber drivers.

In the US, Uber partnering with a company to provide drivers with leased vehicles is an interesting development. Currently, however, there aren’t any signs that the same options will be made available in the UK.

Why Aren’t Leased Vehicles Allowed To Be Used As Taxis?

Cars that are used as taxis typically travel much greater distances and experience more wear and tear than standard vehicles. These are the primary factors preventing leased cars from being used as taxis.

Vehicle leases always restrict both the mileage and the amount of wear and tear the vehicle can experience during the lease period. For instance, some leased vehicles are only allowed to be driven 50,000 miles per year. Financing companies may provide further restrictions, limiting the annual mileage to anywhere from 35,000 to 45,000 miles. Taxis are driven for hours at a time, which causes the miles to quickly add up. Cars that have high mileage generally don’t retain their value. Financing companies don’t want to take the risk of owning a car that is worth very little after the end of the lease period.

A similar concept applies to the condition of the vehicle. Because taxis are driven so much, they are more likely to experience excessive wear and tear. This decreases the value of the car and may result in the need for costly repairs. If you read the lease, it usually will state “not for hire or reward”. As a result, you are not allowed to make money off of the vehicle itself.

Ultimately, financing companies don’t want to lease cars that they can’t recoup their money on at the end of the lease term.

How Can I Obtain A Lease For A Vehicle I Can Use As A Taxi?

As was already stated, most brokers don’t offer lease deals for vehicles that allow them to be used as taxis.

There are companies out there, however, that specialize in leasing vehicles to people who want to use them as taxis. You may have to dig a little bit to find these companies, however.

A good place to start is by speaking to your broker. If you don’t already have one, find an experienced broker in your area. Talk to them about whether or not they know of any companies that offer vehicle leases on cars that can be used as taxis.

Websites such as CarLoanWarehouse, ethosfinance.co.uk, and TheTaxiShop provide lease deals and financing options for taxis. We can’t comment on the quality of these companies, however, since we have never worked with them before. If you decide you want to give them a try, do careful research ahead of time so that you can make sure they are the right choice for your needs.

If you want to find a vehicle that you can lease and use as a taxi, you will need to look for a company that specifically deals with these types of leases. Everyday leasing companies and brokers generally don’t offer deals like these. That means that you will need to do quite a bit of research to find well-respected companies that handle taxi-related lease deals.

When you find a vehicle compare you taxi insurance for the best price.

How 3D visualization can be a key marketing strategy

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StrategyDriven Marketing and Sales Article | How 3D visualization can be a key marketing strategyMarketing is one of the top ways in which you can promote your business. Being able to create an effective marketing strategy can make or break your brand: a good one can bring in new customers, while a bad one can mean you’re being spoken about for all the wrong reasons.

You want to stand out from the crowd and also from your competitors, which can be tricky in itself. How can you do this? You could consider using the techniques that some of your rivals might not have, such as 3D vizualisation. This may become more common as technology evolves, so get ahead of the curve and see why you may want to use 3D visualization in your marketing strategy.

It’s a bit different

Although the novelty factor that is linked to an application will wear off over time, people will try to get the most out of it until then – and can end up with great results. This technology may still be relatively new, but more innovation will follow in time. So, start using this now and you will benefit from it in the long term.

It can help with 3D thinking

Your marketing may have been displayed as a two-dimensional interface – but now you can take this to a new level. People can now visualize your marketing in 3D, rather than just in 2D, and you will get a significant benefit from this. This could even include realistic 3D property CGI images.

You can use it in virtual tours and demonstrations

You have the chance to use new ways to engage, connect with and delight your customers by using 3D environments. With virtual tours, you have the opportunity to use immersive video experiences, especially in areas such as real estate, and other industries.

Having a 3D experience can help you put a customer inside or outside of a virtual sphere. Again, you have a great chance to demonstrate how a product can work or to show its benefits.

Use it in sales presentations

Sales teams are relying more and more on using items such as tablets and other mobile devices when presenting to customers. So, by using the capabilities of these items and 3D technology, you can help to present complex information in new ways. If you want, you also have the opportunity to make promotional games that give audiences a realistic experience of a product or service.

Avoid costly errors

In industries such as real estate, for example, you can use 3D visualization to help you to check any flaws on a model before you finalize any details. This means that you can view the result before the product is created, and any issues can be solved beforehand. You’ll be able to save money, resources and time by doing this.

You keep your clients happy

Being able to present a client with a virtual tour of their item will please them. They have the opportunity to see the interactive visual product before the structure is built. Designers can also benefit, as they can show customized building designs, and they can easily make changes at no extra cost.

Tips for Outdoor Signage

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StrategyDriven Marketing and Sales Article | Tips for Outdoor SignageVisibility

Although the design of your outdoor sign is crucial, the creativity and effort involved will go down the drain if you don’t think about visibility. The objective of it all is to make your target audience know that your product or service exists and they won’t spend a lot of time looking at your sign.

Your goal should be to stand out but not go overboard in the process as this can make your audience take a considerable amount of time to actually figure out what your business is all about. Built-up signs are a great way to achieve this. It’s highly advisable to keep your signs simple and straight to the point. They should also be appealing and placed in locations where people actually see them.

When your audience understands what your business is all about by viewing your signs, they will be more likely to walk in and make a purchase. On top of this, signs that stand out are more shareable as they are different from other signs that consumers are used to seeing.

Less Is More

Now, the actual content or message you put on your business signs should be brief and concise. Going with the ‘less is more’ way may seem like the absolutely wrong thing to do, but actually it’s not. As already mentioned, people don’t spend much time looking at signs. So, your sign needs to grab their attention with as little information as possible.

Don’t plaster a whole paragraph of text or a rainbow of colours on your sign as this can confuse your audience. Instead, use simple words and brief messages that will arouse interest in your audience.

Remove The Clutter

To add on to the previous point, it’s important that your outdoor signs only have essential information about your business/brand and product. You may be tempted to share everything about your business on the sign, but this goes against the previous point. Remember, you should keep the text on your signs simple and brief. Remove anything that may seem unnecessary. Intuit recommends that signs should have a maximum of 7 words.

Including more content only makes it difficult for your audience to read and understand the information you are conveying. Something worth trying is designing your signs with a lot of white space and some text and graphics to catch the attention of the public.

It’s totally normal to want your sign to have an assortment of beautiful images and graphics. However, you should not use too many to the extent that your signs become illegible.

Studies suggests that at least 35% of your sign should be white space. So, remember this when designing your next outdoor sign for your business.

Choose Attractive Colours

Next, you need to think about the colours you are going to feature on your sign. Colours are closely related to your business/brand identity. Your audience will see the colours in your sign before anything else. Studies note that 80% of brand recognition is done based on colours.

Placing light shaded letter on top of dark background in a popular choice for many businesses. You can also use trendy, vibrant and bright colours as they are able to draw the attention of your target audience much faster.

Use Easy-To-Read Fonts

So, using fonts like Comic Sans on your outdoor signs is not the best idea. Your choice of font can be the difference between having an ordinary sign and a sign that your audience actually loves and shares as it’s so unique from other signs out there.

Choosing the right font that matches the identity and style of your business is very important. When you pick a good font, people will not struggle to read your sign. A bad font can disappear into the background and make your sign look dull and cluttered.

Also, heavy fonts are known to blend together making letters to seem combined and wavy. Using all Caps letters in your text may seem like the appropriate thing to do to make your message loud and clear, but this is not the case. Huge letters can easily disrupt the visibility of your sign.

Some simple but attractive fonts that you can use on your outdoor signs include Display, Helvetica, Sans Serif, and Serif fonts. These fonts stand out adequately and they are easy to read when combined with images and graphics.

An important point to note is that you should not use more than 2 fonts in one outdoor sign unless it’s really necessary. Always go with 2 fonts that match your brand identity and style. You will never regret this decision.

Choose Suitable Materials

There is no need to design a perfect outdoor sign that can effectively market your business and boost sales if you are going to use a poor material. The beauty and creativity of your outdoor sign can only be appreciated if has a suitable base or canvas. Rough or uneven bases are difficult to print on, so you can expect the print output to be sub-standard.

Choose the right material will ensure you end up with the perfect outdoor sign. Some materials are considered better for specific type of signs. For instance, acrylic is suitable for indoor signs used in stores and businesses. It is definitely not the best material for outdoor signs.

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