Built to Sell summary

by John Warrillow · 2010 · 7 key ideas · 18-minute read

A business that depends on its owner is hard to sell, so turn your service into a standardised product that runs without you, and it becomes valuable.

Why read it

For owners of service businesses, agencies and consultancies who feel trapped by client work, and anyone who wants to build a company they could one day sell or step away from.

Built to Sell in brief

Built to Sell is told as a business fable. Alex Stapleton owns a small marketing agency that does a bit of everything for a handful of clients. Tired and stuck, he wonders about selling it, and learns that nobody wants to buy a business that depends entirely on him. His mentor Ted Gordon, a successful entrepreneur, guides him through transforming it.

The core move is productising. Alex picks one service his agency does well, logo design, and turns it into a standard product with a fixed process and price. It must be teachable to employees, valuable to customers and repeatable, so clients need it again.

Alex then reshapes the business around the product: charging up front, refusing to let any one client make up too much revenue, hiring specialists, building a sales team that doesn't depend on him and stepping back from day-to-day work. Over time, the agency becomes a business that runs without its owner.

Finally, Alex prepares to sell. With a track record under the new model, a management team in place and predictable cash flow, the business becomes attractive to buyers. Warrillow ends with a summary of lessons for owners who want a business that is valuable, whether they sell or not.

The 7 key ideas

1. If it depends on you, it can't be sold

If it needs you, it's a job, not an asset.

2. Productise one service

Teachable, valuable, repeatable.

3. No client over 15%

One big client is a risk, not a strength.

4. Get paid up front

Let customers fund the work, not your overdraft.

5. Say no to everything else

Every yes to custom work is a no to your product.

6. Build a team that sells without you

If only you can sell it, only you can own it.

7. Think like a buyer

Build it like you'll sell it, even if you never do.

Key takeaways

• Test whether your business could run for three months without you.
• Productise one service that is teachable, valuable and repeatable.
• Keep any single client below about 15% of revenue.
• Ask for payment before you deliver.
• Hire specialists and build a sales team that doesn't rely on you.
• Look at your business through a buyer's eyes and fix the weakest area first.

Our take

Built to Sell is short, readable and clear; its fable format makes the core lessons, productise, diversify, get paid up front and remove yourself, easy to remember and apply. Its limits come from the same format: the story is neat and the transformation looks smoother than it would in real life, with little sense of the setbacks, staff turnover or cash crunches involved. It focuses mainly on service businesses, and some advice, such as hiring two salespeople, may not fit very small firms. As a practical primer on making a business valuable and less owner-dependent, it holds up well.

About John Warrillow

John Warrillow is an entrepreneur who started and sold several businesses. He later created the Value Builder System, a tool for measuring how sellable a business is, and hosts the podcast Built to Sell Radio.

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