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Being Your Own Boss is Overrated, You Might Be a Bad Boss

After thinking about this for a long time, I’m ready to get serious about buying a business.” During a recent phone call, Brian (not his real name) told me he has read my blog for over two years and had been inspired to consider life as an entrepreneur.

I’ve never intended to inspire anyone toward life as an entrepreneur,” I told Brian. “In fact, it’s a very hard life in many ways. I just try to help entrepreneurs think strategically about their future.” I didn’t want Brian to think I was cheerleading people to leave secure jobs for entrepreneurship. It’s not for everybody.

But Brian seemed committed to the idea of leaving corporate life, he just needed to find the right opportunity. He said he wants a business that can support his lifestyle, which means about $300,000 a year, pre-tax. His “want list” also includes no extreme seasonal variation, a stable growth pattern, minimal ongoing capex requirements, and a trained team that will stay after the seller was gone.

Brian went on to tell me he had read several books about how to buy a business, including chapter 14 in my book, “Home Run, a Pro’s Guide to Selling a Business.” I asked him about his capital sources, and he quickly replied, “I have money available from my in-law’s estate settlement, so I don’t need to piece together an investment team. What do you have? I’m ready to go.”

Brian’s enthusiasm was impressive, but something in my heart told me he wasn’t ready. This became clear to me as we talked about his motivation to leave his nice position at a locally prominent accounting firm. He said, “I enjoy accounting, but I’ve grown tired of people telling me what to do. I want to set my own agenda.”

Honest to goodness, I’ve heard that phrase dozens of times over the years. Every entrepreneur wannabe I have ever met (and believe me, I’ve met a lot) say the exact same thing. They somehow think that “being my own boss” is preferable to having a boss. But based on my experience in corporate life, then as an entrepreneur, and now guiding others through the process of buying and selling a business, I can say with absolute certainty that “being my own boss” is highly overrated. First, making all the decisions all the time can wear you down. Second, there’s no guarantee that your corporate boss is a worse boss of you than you are. Finally, if something goes wrong in the relationship with your boss, you have no HR department to whom you can go.

My point being, when I talk to aspiring business buyers, especially those coming from corporate life, I want to hear a better motivation than “being my own boss.” I want to hear them express themselves strategically. I want to hear them explain how they see the deployment of personal equity in a business to be more productive than investing in other investment channels. Said this way, I want to hear them think like a businessperson.

To be sure, I am not the final arbiter on who should or should not buy a business, but I have tons of experience seeing it done incorrectly. It’s now part of my life’s ambition to help men and women make smart decisions about their careers and capital. And more times than not, “being my own boss” isn’t the right motivation.

JIM CUMBEE is President of Tennessee Valley Group, Inc. a retainer-based business brokerage and transition mediation firm in Franklin, TN. Cumbee is an attorney and has an MBA from Harvard Business School. Jim is the author of Home Run, A Pro’s Guide to Selling a Business. . He has a wide range of corporate and entrepreneurial experiences that make him one of the most sought-after business transition advisors in the state of Tennessee. The principles above are true, but the story, names and fact patterns are changed to preserve the parties’ identities.

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Tennessee Valley Group

Jim Cumbee established Tennessee Valley Group to help business owners fulfill their dreams for life after business ownership. It’s a mission that his 30+ year career history had prepared him well for—in addition to being an attorney, transition mediator and business broker, Jim has been a buyer, seller, and entrepreneur. His broad range of experience gives him unique insight into how business buyers and sellers can achieve their goals.

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