What Type Of Operator Are You?

Knowing what type of acquirer you are will dictate what type of business you should buy.

For most of you reading this, you’re going to be buying one business, and potentially stepping into the CEO seat.

If that’s not you and you’ll be hiring someone to run the business you buy, what I have to say is still relevant. Just replace “you” with “the person running your business”.

Generally, I see three types of entrepreneur.

The 0-1 Person

There’s the “startup” focused on who can start a business, wear multiple hats, cope with the ever changing environments, all while developing a product or service offering.

These are usually the types of people who are building the businesses that we like to buy.

They start something from nothing, drag it up by the skin of their teeth and pure determination, and then hit a plateau, at which point they might consider an exit.

If that’s you, then a smaller acquisition might be a better fit. Start with something that still has a lot of growth ahead of it. It might not have much revenue, many customers, and barely established product market fit.

Can you still buy something bigger and more established? Sure, if you’re used to running something bigger, or if it has an excellent team in place and you’re not going to be the one responsible for driving growth.

The 1-2 Person

The next type is my favorite, and I wish I’d honed these skills more myself.

This is the growth hacker type person who can take somebody else’s work, pour fuel onto it, and take it into the next level. They can take a $1m revenue business and grow it to a $10m business.

They use marketing, new product innovation, KPI dashboards, and systematise growth.

Stuff might break along the way, but they’ll grow beyond any serious issues and can fix them later.

This type makes an excellent CEO to run a new acquisition and restore stalled momentum in a business.

I do think it is one of the rarest people to find.

There’s a lot of people who think they’re this type, but struggle to actually execute.

The Late Stage Optimizer

The final type is the optimizer. The person who is strong in operations who comes in to a mature business to make sure everything is running smoothly.

This type is well suited to acquisition entrepreneurship when the business is more stable and established. If you have built a business and want to replace yourself, this can also be a good person to hire.

How To Level Yourself Up

You might have identified yourself as one of these three (unless there’s a fourth type!) and be wondering how you can level up.

In my experience, it depends on which stage you’re at. I see a lot of 0-1 CEOs burning out because the exhilaration of the growth wears off and they’re stuck with a business that is barely operating despite revenue moving in the right direction.

This is something that happens to a lot of ecom founders and agency owners in particular. You discover something htat works, sell the crap out of it, and end up breaking the business in hte process.

To level up out of this stage, you just need to read a few books about operations, learn how to hire and delegate effectively, and basically “grow up” as an entrepreneur.

If you’ve done this, and you want to learn to become the 1-2 entrepreneur, that’s tougher. It takes experience, trial and error, a lot of masterminding and self educating, and some advisors.

You have to find people who’ve done what you want to do, and learn as much from them as you can.

If you’re acquiring a business and want to 10x its revenue, go find people who have done just that, pay them for some time, and pick their brain as much as possible.

Be a sponge.

A lot of the challenge of entrepreneurship, at least with online businesses, is figuring out what the bloody hell you’re supposed to do next.

Trial and error and painful lessons.

Go and find people who’ve learned those lessons and just pay them to guide you through it.

Sure, that’s easier said than done, but I believe it’s the best way to reach the next phase with reliability.

Final takeaway from this post?

When you’re thinking of buying a business, don’t just ask yourself if it is a good business, but ask if it is a good business for you.