You may have a gold mine and not realize it. Sure, the start-ups and high-tech companies get a lot of press and attention, but it could be years until they start generating positive cash flows. Meanwhile, your business is showing stability, annual growth, and increasing profits every year, just not on a grand scale. It’s okay to be a boring business!
Many investors and buyers cherish stability and predictability. Stability with customers, with employees, with vendors, and cash flows. What you also need to have is a history of growth and a plan for future growth. Without growth in the equation, there will be very little interest in your business. Remember, value is a function of risk and cash flows and as your risk profile decreases, value increases. However, you always have to be vigilant to risk in all its forms. The best companies have a robust risk identification process and continually assess risks relating to both outside and inside threats, such as;
- Government regulations
- Competitors
- Operations
When you combine stability with strong management, you rise to the top and become more desirable to investors and buyers. And yes, some of the best companies seem rather boring.
