Step #2: Know Your Role

As the owner of a privately held business, your company represents your biggest and most important asset. According to experts, the difference between a planned and an unplanned exit can be very significant.

Your Have 2 Roles

First, understand that as the owner of a privately held business, you have two key roles–CEO and shareholder.

CEO Role

As CEO (Chief Executive Officer), your job is to make the best decisions for the business.  Your job is to stick your head up above the trees and look over the forest in order to see what lays ahead for you, your employees and your company.  In order to do that effectively it is sometimes best to have a plan of delegation in place.  What is a plan of delegation?  It is a plan whereas you are able to free up your time from the day to day grind of running your business and have your managers and key employees take up the slack.  This will free up time so that an Owner of a business can actually have time to look over the landscape and make well informed decisions.  It is also a plan that can eventually help you have all of your non-CEO duties replaced by a manager thus making your business more sellable.

Shareholder Role

As shareholder, your job is to make the best decisions about your investment.  The return on your investment is the amount of money you have put into the enterprise divided into the amount of profit and salary you have taken out.  The amount put in could be the down payment you put in when you bought the business or if you started from scratch it could be the total initial investment you made in plant and equipement. Either way at some point as an owner you should strive for a return on investment of at least 19% annually.  The risk associated with have a business is greater than investing in the stock or bond markets and as such you should demand a greater return for the risk.

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Posted on Feb 7, 2014

Contact Info – David Bandars

 12110 Port Grace Blvd. #201, LaVista, NE 68128