How to Build a Business Others Want to Buy

By Kobi Simmat

A 5-step blueprint for business brilliance

In How to Build a Business Others Want to Buy, successful entrepreneur Kobi Simmat reveals how to build a profitable, attractive business and sell it for the payday of your dreams. As a business coach and accreditation expert, Kobi built a multi-million-dollar business around knowing exactly what sets a successful business apart from its competitors. In this book, he shares the secrets he learned on that journey. You’ll discover a 5-step process that starts with an idea and ends with a respected, sustainable brand that generates enviable profits.

How to Build a Business Others Want to Buy shares templates, tips, and actionable insights that show you how to create systems for success. You’ll learn how to identify game-changing trends, and you’ll understand the 5 Ms that make or break a business: Mindset, Momentum, Management, Marketing, and Money.

• Fund and own your business, without relying on external investors
• Identify the top-15 drivers and metrics that make a business valuable
• Develop a scalable sales pipeline and recurring streams of revenue
• Attract desirable partnerships and win multi-million-dollar contracts from government and tier-one operators
• Discover best-practice tools and techniques for recruitment, coaching, and building a loyal, self-sufficient team that delivers results

Ultimately, you’ll learn how to build a business that will survive economic uncertainty and become a highly sought-after target — so you can sell it for a significant profit. How to Build a Business Others Want to Buy is a must-read for small business owners and entrepreneurs who want to grow their business the right way, with a lucrative end goal in mind.

• Language: English
• Publisher: Wiley
• Release date: Jul 27, 2023
• ISBN: 9781394194612

Book preview

Cover: How to Build a Business Others Want to Buy by Kobi Simmat

Table of Contents

COVER

TITLE PAGE

COPYRIGHT

ACKNOWLEDGEMENTS

INTRODUCTION

Who knew Australia had sheriffs?

What went wrong?

My burning mission

Is $20 million worth writing home about?

Who is this book for?

Why trust me?

How this high-school drop-out built a $20 million business

When love came calling

What do you mean, ‘we've got no clients’?

Thank you, Kevin Rudd

What even is accreditation?

PART I: MINDSET

Chapter 1: Why every 15-year-old boy needs a Karen Pini in his life

My big break

A new opportunity

The big fail

An offer too good to refuse

Chapter 2: Why most small businesses fail

Why don't technicians build big businesses?

Chapter 3: Do you get it, want it and have capacity?

The mother load

How to hire the right people

How to help your team members exploit their true potential

Chapter 4: The Book of 50 (and how it changed my life)

How did the Book of 50 get started?

Keep the bubbles straight

How to accomplish unpleasant tasks

Chapter 5: Don't wear ‘busy’ as a badge of honour

A startling betrayal

Effort vs results

Profit is the goal

Chapter 6: How to think big

Coming up with goals

Achieving your big hairy audacious goal

Chapter 7: Management by walking around (the lake)

Two walks, two sleeps: the ultimate guide to conflict resolution

PART II: MOMENTUM

Chapter 8: How to choose a business idea that will succeed

Should you follow your bliss?

Why Jim Collins is wrong

Do you want to be rich?

Would you rather have been rich (and then poor), or never been rich at all?

Sliding doors

What do you want?

How to choose a business idea

How to kick start a new side-hustle

Total cost to build a side-hustle

The results

Growth strategies for Nathan's side-hustle

Outcome of the side-hustle

The bigger picture

The secret of success

Notes

Chapter 9: Ten hot subscription side-hustle business ideas

Things to consider before you launch a subscription business

Chapter 10: The leader sets the tone

Don't bring your shit home

Don't blame others —create a solution

The power of quarterly meetings

Not getting results? It's time to focus

Chapter 11: Be stoic

Team comes first

There is no leader board of misery

Chapter 12: How to work on the business, not in it

The Eisenhower Matrix

The 30-minutes-a-day secret to building a big business

Move into the ‘owner’ zone

What's in my Quadrant 2 right now?

Do first things first

PART III: MANAGEMENT

Chapter 13: How to choose your first hire

Doing more of what you love and less of what you hate

Who should my second hire be?

Aim to own

Chapter 14: How to recruit a world-class team

The power of the intranet

So what is an intranet?

Building a world-class internship program

Saving thousands on recruitment fees

Chapter 15: How to sack someone (nicely)

Using the right approach

What to say when you need to sack someone

The cost of procrastination

Fair exchange

What about due process?

Chapter 16: How to manage an under-performing executive

Chapter 17: How to fire a customer or supplier (nicely)

Firing a client

Firing a supplier

When in doubt, do nothing

Chapter 18: The immature entrepreneur

The dopamine trap

Staying focused

Chapter 19: Why partnerships don't work

PART IV: MARKETING

Chapter 20: Get some skin in the game

Meet Gary Vee! Live in London!

How to be 300 years ahead of your competitors

How to 10× your goals

The day the world changed

Listen to your instinct

What happened?

How to get started with social media when you don't know what to do

Chapter 21: The little club that could

A five-star dining experience

Compare the pair

If you don't know what a five-star service looks like, just ask

Don't worry. They won't want it for free

Chapter 22: Beware of the Brown Cardigans

Chapter 23: How to sell anything to anyone

Why are people so afraid to sell?

The mistakes novices make when selling

From cold to sold

The SMASH sales process

When should you quit?

When should you bring up price?

What great salespeople do

How to deal with tyre kickers

You are not selling. You are being of service

PART V: MONEY

Chapter 24: The top 21 metrics business buyers look for

What buyers look for when they buy a business

What else a buyer looks for

The power of the dashboard: what we measure

Chapter 25: How to make (a lot) more money

What does value really mean?

Price vs value

Three profit drivers

A small price rise can make a big difference

Chapter 26: How to accurately value your business and get the highest sale price

Valuing your business

What method should you use to value your business?

Chapter 27: How to find a buyer for your business

Finding an interested buyer

Due diligence

Should you hire an advisor to help you?

Shit-test your assumptions

How to create your information memorandum

Chapter 28: Don't be a tight-arse with money

Chapter 29: Why I don't like being called an entrepreneur

What have I got against being called an entrepreneur?

What is my definition of an entrepreneur?

Chapter 30: Raising start-up capital

Sophisticated investors

Smart vs dumb money

Big Brother

Bootstrap or die

IT'S ONLY TOO LATE IF YOU DON'T START NOW

Don't let the past derail your future

Focus on education and implementation

Don't confuse effort with results

THE FAST-TRACK GUIDE FOR HOW TO BUILD A BUSINESS OTHERS WANT TO SELL

Timing is everything

END USER LICENSE AGREEMENT

List of Tables

Chapter 26

Table 26.1 industry multipliers for a range of sectors

List of Illustrations

Chapter 8

Figure 8.1 the Ansoff Growth Matrix

Chapter 12

Figure 12.1 the Eisenhower ‘Urgent/Important’ Matrix

Chapter 14

Figure 14.1 Best Practice's top ten qualities

Chapter 24

Figure 24.1 my sales funnel

Figure 24.2 Simmat and Associates' dashboard

Chapter 25

Figure 25.1 how drivers affect profit

Title: How to Build a Business Others Want to Buy, Kobi Simmat

First published in 2023 by John Wiley & Sons Australia, Ltd

Level 4, 600 Bourke St, Melbourne Victoria 3000, Australia

© John Wiley & Sons Australia, Ltd 2023

The moral rights of the author have been asserted

ISBN: 978-1-394-19460-5

All rights reserved. Except as permitted under the Australian Copyright Act 1968 (for example, a fair dealing for the purposes of study, research, criticism or review), no part of this book may be reproduced, stored in a retrieval system, communicated or transmitted in any form or by any means without prior written permission. All inquiries should be made to the publisher at the address above.

Cover design by Wiley

Figure 14.1: Notebook image: © Ananieva Elena/Shutterstock

Disclaimer

The material in this publication is of the nature of general comment only, and does not represent professional advice. It is not intended to provide specific guidance for particular circumstances and it should not be relied on as the basis for any decision to take action or not take action on any matter which it covers. Readers should obtain professional advice where appropriate, before making any such decision. To the maximum extent permitted by law, the author and publisher disclaim all responsibility and liability to any person, arising directly or indirectly from any person taking or not taking action based on the information in this publication.

ACKNOWLEDGEMENTS

This book is dedicated to everyone who has helped me along my journey to this incredible milestone.

To my family, Fiona and Harli, for your love and support.

To my mum and dad, Christine and Tom, for being an inspiration and instilling in me a hard work ethic.

To Andrew Mackenzie for your guidance; to Greg Jewson for keeping me grounded; to Karen Pini for giving me a start and being my other mum; to Dan Mckinnon for showing me what five star looks like.

To Bernadette Schwerdt, who has helped me to capture, then shape, all my crazy ideas into something for you to use and refer to while you build your business.

To the amazing team at Wiley who have taken this dream and made it a reality.

And to you, for trusting me to guide you with these words on your journey to success.

INTRODUCTION

I will never forget Friday, 10 March 1989. I had just got home from school and was about to go kayaking. Mum was in the kitchen cooking dinner. My brother was in the garage fixing his bike. My sister was in the lounge watching Happy Days, which was an ironic viewing choice, considering what was about to happen.

I heard footsteps crunch on our gravel driveway. It wasn't Dad. He would never be home this early. It probably wasn't a visitor either. We didn't get many of those. We lived at the bottom of a long, steep, unsealed road nestled deep inside the darkened forest of the Ku-ring-gai Chase National Park, around 30 kilometres north of Sydney. The little street we lived on was so narrow you had to do a seven-point turn just to reverse direction.

The visitors we did get were often architectural boffins from a New York design magazine or a judge from the Royal Institute of Architects having a sticky-beak at our house. Dad spent seven years designing and building it. He was one of Australia's foremost architects and specialised in creating complicated structures made from concrete, steel and glass for the rich and famous. Take a look at any of the riverfront mansions dotted along the foreshore of the Hawkesbury River—the ones with multiple levels, unusual roof lines or those perched precariously on the side of a sandstone cliff—and odds are my dad designed it.

Who knew Australia had sheriffs?

Our riverfront home was extraordinary. It spanned 11 levels, had five bedrooms, a boatshed, a pool, a pontoon, a wharf, a turret and a flagpole. From the outside it looked like a cylinder on top of a cube, on top of an oblong. Yes, it was that kind of house and he was that kind of architect. Mum and Dad were hugely social, had a wide network of friends and loved to entertain, so we spent most weekends having BBQs on our boat, swimming in the river or swanning around the yacht club.

The crunching of footsteps on the gravel grew louder. I looked out the window and saw two men walking down our driveway. One wore a dark-brown suit the colour of soil. The other wore a crisp, white shirt and black trousers with a large gold badge pinned above his shirt pocket. Strapped around his hips was a tool bag, similar to a builder's belt. It held an array of implements including a walkie-talkie, a bundle of keys and most ominously, a gun.

There was a knock at the door. I raced out, fearful that Mum would get there first. I was only 15, but I felt responsible for her—for the whole family really (the perils of being a first-born boy). Whoever it was or whatever these people wanted, I would be the first line of defence.

Mum beat me to it. She opened the door and was greeted with the six words that would change our lives.

‘Mrs Simmat? This house is repossessed.’

The man with the shiny gold badge took out a hammer from his builder's belt, fished a nail from his top pocket, and with one heavy punch, pinned a two-page letter to our front door.

He then read out the note with android efficiency:

‘By the order of the State Bank of NSW, I hereby advise you that due to financial default on the mortgage held by said bank, I, as the sheriff of the State of NSW, instruct you to vacate this house within 72 hours.’

The man in the brown suit, the bank manager, with whom my parents had been friends, stood a few steps behind the sheriff, unsmiling. He studiously avoided my mother's glare, turned on his heel and crunched back up the driveway to the car waiting at the top of the hill.

Mum and I stared at each other. Surely this was a joke, or at worst, a case of mistaken identity. Us? Lose this house? This could not be happening. Where was Dad? At work, of course. Like many momentous events in our family life, it was my mother who was left to pick up the pieces.

But this was not a mistake. This was real. Very real.

Within 72 hours, we had packed up our entire five-bedroom house; the house my dad had built from scratch with his bare hands; that we had grown up in, loved and treasured; the house that had won prestigious architectural awards and graced a dozen magazine covers; the house that formed the foundation of my life—our lives—and connected us to this wonderful river and forest.

Three days later, we were out on the pavement in front of the house, surrounded by our suitcases, waiting for the removalist truck. Our neighbours, many of whom lived in houses designed by my dad, stood at the top of our driveway, looking down on this forlorn scene.

I will never forget the look in their eyes. Pity.

I will never forget the look in my dad's eyes. Shame.

My dear, hardworking dad. My proud, upstanding mum. Both reduced to this. And us three kids, kicking the dirt, wondering what the future held for us and what this ‘new normal’ would look like.

What went wrong?

As a businessman, my father was a great architect. The troubles began when he partnered with a construction company. On paper it sounded great. He would design the dwellings; they would build them. But it was the 1980s, an era of excess, of Dallas and Dynasty, of dodgy deals, lax oversight and minimal regulation. Interest rates blew out from 7 per cent to 17 per cent. A business deal with a local council to redesign their entertainment complex went sour when the council reneged on the deal. An unethical bank manager decided he'd like to buy the house my dad built and wanted it at a bargain-basement price. It was a perfect storm.

In short, Dad's business went bust. The bank took our home and everything in it. We were left literally on the side of the street with nothing but our household effects and the clothes on our backs. Were it not for the generosity of our neighbours, we would have had to sleep where we were standing.

When the dust settled, we moved to a low-rent suburb on the wrong side of the tracks and took up residence in a little fibro shack. It was the kind of neighbourhood where burned-out cars took pride of place on the front lawn and broken windows never got repaired.

Dad tried to resurrect his business but the recession had hit hard so the demand for high-end architectural services evaporated. We went bankrupt—not in the legal sense but in every other way. Dad never really recovered from the humiliation of it all.

Am I scarred by what happened? Yes.

Am I bitter about what happened? Yes.

Am I motivated by what happened? You bet.

My burning mission

That experience broke my dad, but it emboldened me. I saw with my 15-year-old eyes what happens when powerful institutions abuse their power; when influential people with dubious morals misuse their position for their own personal gain.

That experience created a burning hunger within me that continues to burn brightly to this day. That burn was to get back what I had lost; to find a way to ensure that what happened to my dad never happened to me, or anyone else I cared about.

In that moment, standing on the side of the street, I vowed that I would:

dedicate my life to finding the secrets of business success so that I could protect myself and others from falling prey to unscrupulous operators

create an unbreakable business model that would survive a recession, a depression or any other kind of economic upheaval

educate myself on every aspect of business—finance, sales, marketing, HR, technology—so that no-one could ever pull the wool over my eyes.

I didn't know how I was going to do it, but I did know I was going to do it.

Is $20 million worth writing home about?

By Silicon Valley standards, my business success has been modest. I didn't build a $2 billion business, or even a $200 million business. But I did build a $20 million business in under 16 years from scratch. Sure, that's not a number that will have me ringing the opening bell on the New York Stock Exchange, but in most people's language, $20 million is a life-changing amount of money. It's certainly what could be crudely called, ‘fuck-off money’.

So why should you read this book and take my advice? Why wouldn't you listen to people who have made far more money than me? People like Elon Musk or Warren Buffet or Jeff Bezos? Well, you can, and you should, but their life stories and business journeys probably won't help you build a business that others want to buy. Why? Because they are all extraordinary people, with exceptional talents and incredible timing; they are the outliers, the one-percenters, the unicorns. They were always going to succeed no matter who or what stood in their way.

We are not all like that. I'm certainly not. I am not being falsely modest when I say that I am not extraordinary or unique in any way, and I am not especially talented. I did not have exquisite timing, or intelligence, or a piece of must-have software. I didn't have money, contacts or a first-class education. I wasn't passionate about a particular topic or have a spectacular business idea. I didn't have a burning desire to change the world.

I just wanted to make as much money as I could so that I could get back what I had lost. And I did that. I built a business that became the country's leading accreditation, recruitment and business coaching consultancy. In 2022, after just 16 years in business I had a valuation of $20 million and was getting offers from buyers every few months. That business is now sold and I am now on track to build a $100 million global business-coaching empire.

Along the way, I discovered some insights that I wish I had known when I started out. If I knew then what I know now, I would have got to where I am going in half the time and with half the effort. I'd like to share those insights with you so that you don't have to make the same mistakes I made and you can protect yourself from making bad decisions that could cost you your livelihood.

Who is this book for?

It's amazing how many business owners start a business without any concern for how they're going to end the business. I understand this completely. I was that person. I was the uber-technician; the ‘expert’. I did everything wrong. I didn't delegate. I had no systems. I didn't track anything. I hired the wrong people, spent time on the wrong activities and was overly reactive to things that didn't matter.

I wrote this book for my 29-year-old self; the person I was when I started out and knew nothing about anything. I wrote it for those who want to do things the right way, the first time; for those who want to start with the end in mind. Read this book and discover the secrets of how to:

build a business others want to buy

create recurring streams of subscription-based revenue

identify the top 15 drivers that make a business valuable

know exactly what metrics buyers really look for when buying a business

develop a repeatable, scalable sales pipeline that operates without your involvement

win multimillion-dollar contracts from government and Tier 1 operators

own 100 per cent of your business and fund it without external investors or partners

spot the trends for what the ‘next big thing' will be

build a loyal team that works with minimal supervision yet delivers exponential results

develop a world-class internship program that eliminates the need to hire expensive recruiters

increase your social media following to attract lucrative partnerships and collaborations

use best practice tools and techniques to hire and fire staff, coach underperforming executives and motivate your team

sell anything to anyone at any time, ethically and elegantly.

Whether you're starting out or have been in business for decades, this book outlines the principles, policies, procedures, structures, systems, templates and checklists that will empower you to build a business others want to buy.

Why trust me?

People say money can't buy happiness. That's bullshit. That's what people who don't have money say to feel better about not having money. Being poor is not fun. I've been there, done that and didn't like it. Money does not buy total happiness but it sure goes a long way to buying things that prevent sadness.

As I write this book, I am sitting here in my home in Narrabeen Beach, high up on the cliff, overlooking the ocean. My son is swimming in the pool, my wife is doing yoga on the deck and my dog is on my lap. I have a LandCruiser, five boats, a jet ski and a surf ski. I kayak every day, I rarely wear a suit, or shoes, and I do what I want, when I want. I recently won ‘volunteer of the year’ for my son's sailing school. I mentor practically anyone who asks me to do so, and spend most weekends with friends and family on my boat or at the yacht club. I have clawed back the life and lifestyle that was taken from me as a 15 year old and I am happy and content.

I don't say this to boast, or to big note. I say it because I've taken what was a very traumatic, life-changing event—watching my father lose everything he worked for—and used that horrendous experience to recreate my life.

I tell this story because I want to demonstrate that anything is possible.

I tell it because I want you to know that if you want to design a life, and enjoy it and not just endure it, then I have the formulas and the templates to help you re-invent, reinvigorate and reimagine what your life and business can be.

I have done it, and you can do it too. Just follow the recipe.

How this high-school drop-out built a $20 million business

I was not a gifted scholar. In fact, I failed high school. I even struggled to get into TAFE, and that's saying something. After I left school, I completed a hospitality course, became a chef, laboured on building sites and then eventually clawed my way into a science degree, which turned out to be as useful as the ‘g’ in lasagne.

My career really began when I was 25 and landed my first job at Hornsby