For many, January is a time of rebirth and resolutions. It’s a month to reflect on last year’s achievements and to set business goals for the year ahead.

If you have resolved to make your company more valuable in 2023, you may want to think hard about how your customers pay.

If you have resolved to make your company more valuable in 2022, you may want to think hard about how your customers pay.

Doctors in the developing world measure their progress not by the aggregate number of children who die in childbirth, but by the infant mortality rate – a ratio of the number of births to deaths… Acquirers also like tracking ratios, and the more ratios you can provide a potential buyer, the more comfortable they will become with the idea of buying your business. 

How many people can one person manage? Harvard Business Review estimates the ideal range for an experienced manager is between five and nine direct reports. Inc. pegs the sweet spot at seven.

It can be tempting to offer shares in your company to finance its growth. These days, there are plenty of investors chasing promising new companies and, in today’s tight labour market, employees are getting more brazen in their demands for equity-based compensation. However, using equity as a form of currency dilutes your position and may not be necessary with a pinch of creativity

Specializing in one product or service allows you to focus on delivering that thing better than everyone else. It enables you to hire (or train) specialists in your field, improving the quality of your work, which leads to happier customers. And satisfied customers buy again and refer their friends.

Some owners focus on growing their profits, while others are obsessed with sales goals. Have you ever considered making it your primary goal to set up your business so that it can thrive and grow without you?

If you find yourself in a position where your customers always insist on speaking with you directly instead of your employees, then you might want to consider shifting your structure so you can improve the value of your business.

Recurring revenue makes your company more predictable, extends the lifetime value of a customer and ultimately makes your business more valuable. If you’re unsure how to create these automatic sales, a simple service contract can be the place to start.

When was the last time you calculated the percentage of your net worth tied to your company’s value? When you started your business, its value was probably negligible. Unless you purchased or inherited your company, it wasn’t worth much when you opened your doors, but over time, the proportion of your assets tied to your business may have crept up.

Before Jeff Bezos & Co. blew up traditional distribution channels, there was some value in being the local guy or gal. Being the local product retailer was a good business and being a regional distributor of a popular line could make you a mint. Those days are almost over.

Survey a group of founders about the personality traits that made them successful, and they will be quick to use words like determination, sacrifice, and hard work. Others will show more humility and chalk their success up to personality traits like curiosity. Still others will credit dumb luck.

If you’re trying to figure out what your business might be worth, it’s helpful to consider what acquirers are paying for companies like yours these days.

Have you ever noticed that you get some of your best ideas in the shower? Every morning, you’re stuck there for a few minutes doing something you’ve done since you were a child. Your mind knows it has a couple of minutes to think.

When David Perry started his video game company, he filled a dartboard in his office with the names of companies he thought would want to buy his company, Gaikai, one day. Why would a startup business with no revenue or employees be thinking about potential acquirers so early?

Here are some questions you can expect to be asked when you’re in the hot seat.

What’s your greatest strength as a CEO? Sales? Marketing? Operations? Whatever you do well, know that it might become your Achilles’ heel. As owners, we tend to invest in areas where we know we’re weak. We know we have limited resources, so we spend what we have on backstopping the places where we’re most vulnerable.

Much is made of analyzing the personality traits of successful entrepreneurs. Some appear outgoing. Others are introverts. Some lean right, others left. Some are flashy. Others are monk-like with their money. Their diversity can lead one to the conclusion that there are no common personality traits among successful founders.

As a business owner, you’re likely proud of the results you’ve achieved in the past, but when it comes to the value of your business, your future is critical. That’s why your growth potential is one of eight factors that drive the value of your business.