My First Million
The best business ideas come from noticing what's working and doing it better, faster, or for a different audience.
Sell a business while retaining the most valuable strategic asset for ongoing revenue
Business owners who have identified a core competency that transcends their current business model
5-10 yearsWhat Success Looks Like
Successfully exit main business at high valuation while retaining strategic asset that generates ongoing revenue and serves multiple customers
Steps to Execute
Identify core competency that created competitive advantage
Structure core competency as separate legal entity
Negotiate exit deal that excludes strategic asset
Create licensing agreements for ongoing relationship
Scale retained asset to serve multiple customers
Checklist
Inputs Needed
- Clear identification of strategic asset
- Legal structure for asset separation
- Negotiation leverage with buyer
- Market demand for strategic asset as service
Outputs
- High exit valuation for main business
- Ongoing revenue from retained asset
- Diversified customer base for strategic asset
- Option to scale retained asset business
Example
“Muscle Milk sold brand and distribution for $450M but kept the flavor technology company, now licensing flavors to multiple food and beverage companies.”
Related Knowledge
Timeline Forcing Analysis
A method of analyzing successful companies by drawing out year-by-year timelines to reveal the 'forgotten grinding years' between start and breakthrough.
Too Hard Pile Decision Making
A decision-making framework where you categorize opportunities into 'obviously good', 'obviously bad', and 'too hard to judge' - then only act on the obviously good ones.
Small Batch Iteration Advantage
A competitive advantage gained by testing products in much smaller batches than competitors, enabling faster feedback loops and more iterations.
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Build a multi-generational family business where family members work together and live in proximity
Family members living in same neighborhood, all working in family business, kids playing together, successful exit while