Here we consider the difference between growing your business for a future sale for a capital sum in the future versus building your business to never sell and to earn cash flow instead.
It is all the rage to seek to scale up your business with a view to selling for £millions so that you can go and sit on the beach for the rest of your days (or until you get bored). Many dismiss other business models as "lifestyle" businesses (why should building your business around your perfect "lifestyle" be deemed derogatory?!!! That's always puzzled me!).
Yet successfully selling a business for many millions can leave some entrepreneurs feeling defensive and anxious - concerned that they might never again replicate their success and afraid to risk spending their "winnings".
On the flipside, those that build cash flow businesses can start to take a step back from the day to day running of the business having built a great team and internal processes and systems. They too can sit on the beach, yet have the comfort of a regular income from the business(es) that they still own. Aka they have "cash flow".
There is no right or wrong answer here. Both business models can bring immense wealth and security. Just don't be fooled into thinking that there's only one way of doing it.
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Thanks for sharing, Steve. Wouldn't mind sitting on beach having nailed a business model in the next couple of years...
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Ha! Yes but either business model could get you to the beach 🏖 :)
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Cash flow for me. I love the residual income model and it's how I've 'lived' for almost 20 years. And if we are increasing our customer base every month and still provide massive value to our current customers, the business thrives.
Awesome topic though man, great points on both models.
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Cheers man, yes, the more I think about it and see more and more entrepreneurs adopting both models, I personally find the cash flow model more compelling. You can stack the income and dip in and out of the business as much or as little as you want - and it remains as your "cash making machine".
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