Many toy with the idea of buying a business for themselves; but it’s such a risk most never take the chance. Here are 10 rules that will guide anyone to making better choices.

1 YOU are the most important consideration
It’s a mistake to first value a business as a financial investment. Most importantly it's a career investment. Your life to date has given you valuable skills and experiences. Use Reflection exercises to understand your Personal Business skills first; then seek an opportunity that will utilize them. Lesson 8 (free preview available) of the online Fit for Life workshop is a great starting point. Also the book Business Model YOU.

2 Discover your preferences 
In addition to skills, your business performance is affected by preferences. Clarify the business preferences that make a difference to you. You can download the Franchise Business Model worksheet which is further explained in the online workshop Lesson 11 (free preview available) as a guide for this. Be comfortable with your risk and sales orientations as discussed in this lesson before buying a business.

3 Search in specific business categories and geography
If you don’t know what you’re looking for, it will be extremely hard to find. Online businesses for sale directories estimate that 90% of the people registering for their services are unable to purchase a business. Most of these failures are those going there to find easy, secure sources of income. They aren’t obvious. What you can find are opportunities that may or may not fit YOU. The directories are organized by business category and geography, so having a set of these criteria to focus your search gives you a reasonable chance of finding those opportunities. Even if you use a business broker, they can do little to help you without focus from you.

4 Creatively research your financial situation
A profitable business or franchise, with good books and records, can be partially financed; however, each opportunity will have a downpayment. You may be surprised at the financing opportunities available to you with a little research. The SBA offers a number of programs, plus there are alternatives to SBA loans that are often even more attractive. Combine your risk preference with your potential financial capabilities to set the financial scope of your search. This can also be added to your search criteria.

5 Have a personal contribution for your business
A business brings resources to a market. In most cases, the owner makes a significant contribution to one of these two areas. If your potential contribution is resource management, look for opportunities with established sales assets. Look for an established brand, location, or sales network. If your contribution is sales and market management, look for established resources like a desired product line or service that appeals to you. The same logic applies to finding the right franchised business to buy.

6 Utilize Key Partners
No one is successful by themselves. Even the Lone Ranger had Tonto. Learn to develop and use Key Partners as soon as possible. These are going to be the people in your life that will help you through difficult decisions. If looking at franchises, ask other franchisees how much support is received from the franchisor? If looking at independent businesses, look for people who will be able to add to your expertise. They can be the former owner, key employees, vendors, and professionals such as financial advisors and business consultants. If married, take time to communicate wholly with your spouse. They may or may not be able to help on any given specific; but they can help you understand YOU; and you will be a big part of the business.

7 Be able to Model any target business
When you find an interesting business to buy, be able to quickly answer the question, so what makes this business work? Financial statements will not tell the story. It’s a Value Proposition that has to make sense to you and that you can easily explain. The Business Model canvas is a proven tool here. Use it or anything similar. You are going to be be buying that Value Proposition, not its cash flow.

8 Understand the cash flows
Most business opportunities are priced on cash flow. The problem is that cash flow is a concept, not something physical that can be easily measured. That allows for a lot of “creativity” in its calculation.  In general, wherever there is a reason to add to profit for cash flow, there is also a reason to subtract from it. For example, if cash sales are not completely reported on tax returns, then suspect that there are cash expenses that may also be missing. If depreciation is added-back to profits, then also be sure to subtract also capital replacement costs. If interest is added-back, then debt service should be subtracted, etc. After  first understanding your reasons to buy a business, then work on understanding the financials to establish reasonable pricing. If you are not comfortable calculating cash flows, find a key partner to help you in this area.

9 Respect the seller
Almost every independent business on the public market is there because the owner has burn-out. This could be from age, sickness, changing personal opportunities, or changes in the business. However, this doesn’t mean they don’t value their business. It’s an extension of themselves as much as a child might be. Deals happen when the owner sees in the buyer someone who can take care of their child as well as pay reasonable value for it. Franchisors are expanding their operations and are looking for team players who can help them. They are looking for someone who can compliment their system as well as afford to participate as an owner. In either case, both sides must first respect each other enough to make any financial considerations worthwhile.

10 Begin with the End in Mind
Do you want to be the one selling this business in the future due to burn-out yourself, or would you rather have used it to achieved the financial goals necessary to move to the next stage of your life? Start with clear ideas for your exit plan. A business is more than a cash flow; it’s a stage of life and will best serve you when seen in that light. Having some idea of what should come next and when you want it to happen will guide you in making better business decisions.

Personal Business Models have opened the door for individuals to reinvent themselves in a systematic way. The individual is Resource Constrained, so the process starts with YOU, as opposed to the Market. 

This idea of reinventing while still being limited is not just applicable to individuals. It applies equally to the organization that doesn't need to start-up something new, yet still needs reinvention to turn-around its situation. This will overview 5 short YouTube videos, collectively named the Lean Turn-Around series, that describe this approach to working with Business models. They conclude with a new importance to the role of Key Partners in Personal Business Models.

For those not already familiar with the Business Models canvas, there is a 2 minute introduction to the canvas here and another fast introduction to Personal Business models here. These videos were produced assuming the viewers are already familiar with the book Business Model YOU. The video windows here are small. If you click on the YouTube logo in the lower right corner, they will expand on that site.

How can we act on a reinvented Personal Business Model?  Key Partner Discovery is a safe and powerful catalyst to boost your career plans.

Getting a Personal Business Model off the ground

The ACT section of Business Model YOU has sound advice on using Customer Discovery as a place to start. It's very reasonable to take a newly developed Business Model to the streets and test if it's something that 1) people really want, and 2) they are willing to purchase. There are countless examples of ideas the flew past the first test only to fail the second.

However, Cold calling, which is often what Customer Discovery really becomes for an individual, is distasteful or even overwhelmingly threatening. It can easily stop an individual's ACT phase dead in its tracks.

Customer Discover is not the only way we can "get out of the building" and test a model. Look to the other side of the Business Model Canvas to Key Partners. Working with Key Partners is much less threatening and often more rewarding than going directly after customers.

Take a moment to watch this video by the author of Business Model YOU discussing the development of the book. Ask yourself, does this seem to be an example of Customer Discovery or Key Partner Discovery? The process of building out from Key Partners is natural for the individual.

What makes a Key Partner?

For organizations, Key Partners are sought where Key Resources and Key Activities they DO NOT HAVE can be outsourced. For individuals, Key Partners are frequently those who compliment the Key Resources and  Activities that they DO HAVE.  It's a far more vital role. In a Personal Business Model (PBM), it's very possible for Key Partners to develop into Channels; and then for the Channel's Customer's to develop back into more Key Partners. Almost any established individual practitioner will tell you most business now comes from "referrals." This is known as a positive feedback loop in Systems Dynamics.

The ability to provide positive feedback in any form is a prized attribute of a Key Partner and one to be sought right away in launching a reinvented PBM. Unlike sales prospects, partner prospects are eager to find sources of feedback that will help their business models as well as yours. In a sense, this is recommending Networking as an alternative to Cold Calling; however, those who understand canvas thinking have a unique advantage in this area over a group of people who just pass leads along. Your understanding of how the canvas pieces fit together help you better recognize the Key Partner potential in others.

Key Partner YOU

More importantly, it helps you recognize the Key Partner potential in yourself. Who has Value Propositions that are complimented by yours? Who can benefit from the insights produced by your value story? Not everyone has learned to think like that. Start to gather ideas about the kind of Key Partner YOU make by reviewing your answers in the  "Personality and Environment" exercise. Then look again at the "Get Out!" exercise in Section 4 of Business Model YOU substituting Partner Discovery for Customer Discovery. It becomes less threatening and more exhilarating. 

Career reinvention is just a fact of life in today's changing world and we can expect to need to reprocess any career multiple times. Our personal Key Partners make this more achievable and rewarding. The take-away - it never hurts to become a better partner now.

As a business broker, I frequently discuss valuation with interested small business sellers. The discussion often starts like this:

"Tell me about your products(services)?
We have an established reputation for being the best source for what we do in the area.
How is your pricing?
We are competitively priced,not too high and not too low."


Do you see the problem? If a premium Value is really being given the customer, why doesn't that result in a premium Revenue Stream?

This isn't just a problem with a business organization. As individual employees, professionals, or contractors are we providing a real premium value or only enough for a competitive revenue stream? 

The Personal Business Model canvas developed in Business Model YOU not only helps individuals reinvent themselves, it serves as a map for developing the premium aspects of their value. Competitive pricing is the natural result of a focus on primarily the Value Proposition and the Customer Segments. To be worth a premium, further separate YOU from the competition (Professional Branding) by considering your other 7 canvas areas.

1 - Key Partners
No one works in total isolation. When people look to you as the "point man" for those you work with, they see greater value in everything you do. You get to there by clearly defining that team on the canvas, and then finding ways to promote your partners (even is that doesn't immediately help you). Being able to promote a Key Partner's value increases your own.

2 - Key Activities
We tend to focus on developing those activities which meet our goals; however, people will pay a premium if what you give them helps meets THEIR goals. Would the nature of your Key Activities change if you knew your customer's goals and how to achieve them?

3 - Key Resources
This is the cornerstone of the Personal Business model. Have you identified personal resources you own that are not being used in your model? Finding ways to offer these to your customers increases your value to them, even if it isn't directly related to a main Value Proposition. Do you know about a cheap and easy way to keep up with necessary records? I bet there are potential customers who would love to know how you do it (and love YOU for sharing that).

4 - Cost Structure
Competitive pricing is a result of supply and demand. Non-competitive pricing can happen when either value is high or costs are low. Technology and/or organization often drives down costs and there seems to be no end to the possibilities of using them to reduce costs. When reducing costs leads to additional sales, the premium is in the volume rather than the price.

5 - Customer Relationships
Your relationships are more than just between you and the people who pay you. There is a community that encompasses what is done. Participating in that community is what increases the value of your personal stock in the minds of others in it. Community activity may not result in a direct sale; however, it is very hard for it to not result in increasing your premium value to others.

6 - Channels
We are in an information age and that is changing everything in business. There is a need in every community for participants to band together and share how that effects them and what to do about it. There is always a place to increase value through helping to teach new skills to those seeking them. The fact you teach in any capacity increases your credibility an exposure.

7 - Revenue Streams
Most of us believe a Sale ends when the Revenues are finally collected. Once we realize the single most important source of new business is referrals, it becomes clear that a sale isn't really over until the customer stops making referrals. With this in mind, consider what happens after funds are collected and value is delivered? What could compliment the value transaction 7, 30, 60, 90, or even 180 days later? Anyone who delivers value from this perspective deserves a premium.

The Personal Business Model is a source for continual improvement as well as reinvention. I look forward to more future conversations like:


"How is your pricing?
People understand how valuable we really are to them."

Tired of fighting the same battles to keep your business afloat? One solution is to just let us sell your business.  A better possibility is to generate more cash flow with less effort with Professional Branding.

The new Personal Business Model YOU Workshops at UTA are now being offered as Professional Branding, changed from last term when they were called Career Reinvention. Just another example of the pivoting process that's involved with the implementation of any Business Model. In interviews with those interested in the first workshops, we found a much greater interest from individuals wanting to be more successful in their current careers than those who are looking for another career where they can be more successful. So while the Workshops are equally applicable to both, we have shifted the focus a bit.

There are two mistakes most of us make when first introduced to Business Models and Canvas Thinking. The Workshops covers these (and more) with specific application to your career. 

The first issue is confusing Key Activities with Value Propositions. It's easy to think that our customers value those things that we do so well. The truth is our customers value what helps them do the things they need to get done. An example might be a plumber who feels their master's license is their Value Proposition. The customer's problem may be leaking water, so perhaps 24 hours service will mean much more to them. We need to see our value from our customer's Point of View.

This is easier said than done for career professionals. The Business Model YOU strategy is to start here and to develop what it is we are, so we know what it is we can offer. The same mistake made in the opposite direction is to try and build a career around something you know customers want but is not at all suited for You. Professional Branding requires understanding what makes You valuable, and then communicating it well.

That bring us to the second major mistake most of us make as we develop our Personal Business Models. We confuse Key Activities with Customer Relationships. After a Business Model is completed we need to Act on it. I am open to anyone to disagree with this; but that has to mean Marketing the Model. No matter what other Key Activities are need for Value Proposition fulfillment, Marketing has to also be added to Key Activities and you need to be successful at it for the model to make money. If your model is for yourself as an employee, you still need to market your abilities to either a new employer for a new job, or your boss to enhance your current job. For Professionals, marketing needs to be done to reach new prospects. Every Business Model effort must conclude with Marketing in some form if it is to be meaningful.

So why isn't that Customer Relationships? CRM software vendors and consultants have confused us into thinking that Customer Relationship is about how we want to relate to our customers. That is not the issue. It's how do our customer want to relate to us? While I have Zero Interest in being a part of my plumber's internet community (no matter how many water saving tips may be found there), I do want to be able to quickly find a competent, reasonably priced plumber when water is found where it's not supposed to be. If that's the case, our plumber may find that money spent advertising on Angie's List might be more valuable than mailing out newsletters. On the other hand, I belong to a local health club and I do read their newsletters. I want to relate to them much differently and they get that.

Your Brand is not your name, logo, or company colors. It's how your customers perceive you. To do Professional Branding effectively, it makes good sense to first know what makes you valuable to others and then know how they want to find-out about that. That becomes your "message". Then all that's left is how to send it. There are many books and consultants who can offer you great advice on the mechanics of marketing; but nothing will define your message more clearly than a well constructed Personal Business Model. 

Here is the bonus. At the UTA Professional Branding Workshop we develop your Personal Business Model and in doing so re-engage you with a career that may have been burning-out. Communicating your value to others in ways they want to hear becomes almost intoxicating. You will reinvent "Your Career, for Fun and Profit".

Developing Key Partners for a Personal Business Model (PBM) can be much more important than doing this in an organizational Business Model. This is an area where Personal Business Model workshops add to the materials in the current edition of Business Model You. For those who can't get to a workshop, we can try to expand on Personal Key Partners here.

We often look at Key Partners as "filling in the gaps" necessary to provide an organization's Value Proposition when the Key Resources and/or Activities are missing something. It's also a great place to go for reinventing to make it more scalable. Since Personal Models are based more on your Key Resources (your Interests, Skills, Personality, and Assets) and individuals can rarely have scalable models, recognizing your Key Partners is a much different task. A task with great potential if done well.

C.S. Lewis wrote an insightful book, The 4 Loves, about relationships from the perspective of 4 different Greek words that all can be translated into English as "love". These also make a useful framework for finding our Key Partners in Personal Business Models.  We'll use that here by looking at each "love" as a potential source for model partners.  That will give us the 4 types of Key Partners.

Community Partners - Greek storge
You may have personal business Key Partners because you have something in common with them.

Business Model You recommends you "Get Out!" and test your reinvented personal business model with "family, friends, neighbors, colleagues, church or professional association members, and others in your personal network." These are all examples of Community Partners. They are those acquaintances you have formed because you have something in common with them.

The Internet and its social media technologies have also developed unprecedented international "communities of interest". Our workshop philosophy is to use your Value Propositions and Purpose Statements to crystallize a Personal Brand. This Brand becomes the foundation for the differentiation of your professional services. As a Brand, it's much easier for your community partners to understand and share it. You can "Get Out" both physically and digitally to your Community Partners. While organization's may not need or have Key Partners, every person and therefore every Personal Business Model, should have at least Community Partners.

This blog is an example of reaching out to my own Community partners. My topics are not necessarily aimed at people who might be potential clients. They are an expression of my interests in the area of executive careers and I share those with people on both the right and left side of my Business Model. Reread the quote above in italics. Those are not necessarily potential customers; however, they are all potential Key Partners. You may find it personally much easier to get started reinventing with your Key Partners rather than with your potential customers. Who are they?

As an example, I am currently brokering a painting contracting business. The business started with residential clients only and the owner developed channels focused on them. The business is now enjoying an influx of commercial customers. Guess where they are coming from? Business owners who were pleased with the way their homes were painted? No! The owner developed a strong relationship with his paint supplier, who is now recommending him to businesses who call them ask for help in choosing a good painting company. PBM Key Partners frequently become customers and/or channels if treated well as Key Partners. Include them in your model.

Activity Partners - Greek phileo
You may have personal business key partners because you have something in common that makes YOU better. 

These are your friends. Not only do you have something in common, you enjoy specific activities with them. I am currently thinking a commercial organization generally never has more than Community Partners but individuals have much more relationship depth and therefore the potential for more types of Key Partners. These deeper relationships can reveal an individual's multiple roles and the resulting need for multiple canvases.

Activity Key Partners can help you develop or reinvent your Personal Business Model. Not only that, they can truly enjoy doing it. Reread the story of The Musician in Business Model You with attention to the relationship between the artist and her manager. They both loved working in music and that created the synergy empowering her model's reinvention. He is an Activity Partner.

Activity Partners will help you with your Value Proposition just like all of your Community Partners but they will also co-develop it with you by helping with the entire model. Is it also possible that exposure to helping someone else with their Personal Business Model may facilitate the creation of an Activity Key Partner? It will be interesting to follow people who attend Personal Business Model workshops and determine if this happens. Will sharing your PBM development also develop your friendships?

Life Partners - Greek eros
You may have personal business key partners because you find something in each other that makes YOU better.

These Key Partners are lovers. You don't share just values with them (Community Partners) or even models with them (Activity Partners), you share your life with them.  Their fundamental position in your life demands intense consideration in the development of a PBM, often to the point of requiring Multiple Canvases to accommodate them. You define yourself in terms of giving to a Life Partner. It's a demand that can exceed a requirement for additional cash flow and frequently conflicts with traditional business model goals.

To ignore these Key Partners in your business model is to invite its failure. At least that's what happened to me. I was running a successful distributorship when my primary supplier contacted me with the choice of either taking over their entire operations or risk the possibility of them going out of business. I felt I had no choice; but the results were flying back and forth weekly between the 2 locations trying to fit 2 weeks of work into each week and then spending every weekend catching-up on paperwork. I made more money than at any point in my life and also lost contact with my wife and children, When that realization hit me (very painfully), it was easy to see I had a choice and I took it. Over time, the bedrock of my Life Partner relationship was restored and I was able to reinvent new business models that now allow me to keep those Key Partner commitments.

This may be a reason I have a passion for business models. It's easy to destroy everything of real value in your life if you can't see a bigger picture. No sad stories like mine are required if you're smart. The PBM reinvention of the The Skier in Business Model You describes a much happier transition with a focus on Life Partner.

Purpose Partners - Greek agape
You may have personal business key partners because you have something in YOU that makes others better.

This is the Greek word that can be translated God's love, Sacrificial love, or perhaps Universal love. I never expected the Business Model YOU project to arrive at the concept of a Personal Purpose; but that's exactly what happened. It appears each of us has unique Key Resources and that seems to be indicative of a unique Personal Purpose. When that Purpose becomes a passion, it produces unmatched resolve (and results).

When "on purpose" you start to meet just the right people. Some of those have the same Purpose. These become your Purpose Partners. While we generally only find Community Partners in a commercial organization, Purpose Partners are often in organizations, especially NGO's, created to promote the common purpose of its members.

Small business owners and professionals often get started with a great deal of passion and energy related to their Purpose, only to see organizational needs erode it all away over time.

Personal Business Models have a very special use here. We can use them to reconnect those who originally found a way to fulfill their Purpose but are now burnt-out, back to that important Purpose. This is both personally inspiring and leads to greater service for the customers they truly need to serve.

For those looking at Retirement at any age, a Purpose-driven PBM can fill the void in life that was once occupied by an active career. Finding the right Purpose Partners might be the key to launching that new direction. For those in this position, Encore Careers is a great place to get ideas.

Examine the Key Partners section on The Green Advocate in the book for an interesting example of how dramatically this section of a business model can change when you start to consider Purpose Partners. It's also a useful example of how to reinvent yourself in one of those Encore Careers.

Summary
Key Partners play a much more complex and vital role in Personal Business Models than organizational models. When developing a PBM it's useful to make an additional effort to expand on possible Key Partners. A 4 Loves analysis is one method that directs our attention to significant relationships we may have otherwise missed. Who are your:

• Community Partners,
• Activity Partners,
• Life Partners,
• Purpose Partners?