Any time company ownership changes, it’s a big adjustment for everyone involved. I like to think that for the team at The Digital Frontier, once the initial ‘shock’ of the news of my buying the business wore off, it was seen as good news or, at the very least, not bad.
It certainly was good news for me. As I mentioned in my last post, not only had I achieved my goal of purchasing a stable business with an excellent team from a good person, The Digital Frontier also has great potential. With best-in-class digital and large format print equipment and tons of expertise, the future knows no bounds.
Of course, capitalizing on opportunity takes work. For anyone who is thinking of buying a business, or who owns a business that is ready for ‘the next step,’ I’ll share my experience so far.
While I was confident I could run my own company, there was of course a lot I didn’t know. I spent the first couple of months absorbing information and learning the basics about the business: the different types of printing and substrates, who on the team does what and when, the clients, the vendors, invoicing, QuickBooks, taxes, accounting, taxes, payroll, taxes.
I also spent a lot of time applying for and securing various certifications that will, hopefully, get us entrée to valuable strategic partnerships. As of November 2020, The Digital Frontier is certified as a Minority/Woman Owned Business Enterprise (MWBE), Small and Emerging Business Enterprises (SBE & EBE, which are tied to annual revenues), and a Disadvantaged Business Enterprise (DBE, which is related to the personal net worth of the owner(s)).
Tip: If you can, consider hiring an assistant, or a part-time virtual one, right out of the gate after an acquisition. I was astonished by the amount of paperwork and time-consuming, 'low value' but entirely necessary tasks like switching utility accounts, gathering supporting data for and completing applications, and filling out forms.
During this time, I also learned (a bit the hard way, but fortunately relatively quickly) what else I shouldn’t do. I’ve always prided myself on being able to do anything. While that may be true, how quickly you can actually learn to do a thing matters – a lot. It turns out that my brain refused to grasp how to estimate jobs in anything resembling a timely manner. I would sit for long periods trying to do it – getting frustrated by both my mental block and the knowledge that I wasn’t working on other equally important things that I knew I would be good at.
Tip: Opportunity cost is real. Every hour you spend doing something someone else could do in a fraction of the time is an hour you’re not spending on something else that is important. Figure out what your business truly needs, what you’re best at, what you’re not good at, and who you can tap to do those things – even if you have to spend money on it.
Stopping myself from trying to learn to design solutions or estimate jobs right out of the gate was one of my best early decisions. It freed up my mind and my time to learn other elements of the business and things gradually started to fall into place.
Tip: If you’re evaluating a company for a potential stand-alone acquisition and think you won’t be able to afford to get help with things you’re not good at – at least in the beginning – consider the possibility that that particular business doesn’t meet your financial needs. My simple baseline went like this: at a minimum, the business needed to make enough money to support my family, pay the bank note without fail, and have some left over each month to invest back in the business or absorb any shocks.
Those first 2-3 months of acclimation and learning delivered a clear set of ‘wants.’ I wanted to grow, tapping into my existing network of contacts, and adding new ones; to streamline several excruciatingly manual and time-consuming processes that, when completed, would have the added benefit of automating some of that ‘pesky’ estimating work that eluded me; and to add the ability to purchase online from The Digital Frontier website.
Before I could jump in, however, it quickly became just as clear that I ‘couldn’t get there from here;’ there was an important list of prerequisite tasks that needed to happen first. These prerequisites – which I’ll discuss next time – came to define my first set of strategic/tactical priorities.