Are You Building Business Value Now For A Financially Independent Tomorrow?

Chia-Li Chien | Oct. 15, 2012

I have found, without exception, that entrepreneurs are risk takers. And I suppose I’m one of them. Over the years of working with business owners, I’ve come to the conclusion there are three categories of entrepreneurs: Technician, Manager and Business Architect:

Technician—If you are a technician, your business provides you a salary of less than $100,000 a year. (Please make a note here; I said “salary” not “revenue.”)

Manager—Typically, as a manager, you’ve managed to create a lifestyle in which the business provides you a salary of around $250,000 a year.

Business Architect—If you are a business architect, the business provides you an annual salary of greater than $250,000. There is usually also a minimum of three to five times of business value back to you as the owner.

Many privately owners aspire to become a Business Architect.

Our study indicated that 67% of the business owners are in business because they want to make more money and become financially independent. So how do you begin to create equity value in your business to reward yourself for the risk you took in starting, building and maintaining your business?

Your business equity value changes due to varying factors and triggers. You must make sure all factors are working in your favor when considering a capital expansion or even cashing out.