In Fire yourself, double your valuation, I showed how to double your valuation by firing yourself.
Today? Let’s talk about the second multiplier: profit.
Because you can remove yourself from operations all you want—but if your profit margins suck, your business is still worth less than you think.
Here’s what I see (and what I’ve done myself):
Most business owners are hemorrhaging cash on projects that will never matter.
I’ve been guilty of all of it:
- Someday/maybe projects that sit in the budget for years
- Starting new initiatives without clear direction or end dates
- Paying people to do work that has nothing to do with getting customers
- Software features no one asked for and no one will use
- … the list goes on
Here’s what sucks:
Every dollar you spend on these things is a dollar that’s NOT showing up in your profit—which means it’s destroying your valuation.
Remember the math from last time?
- Owner-operated: ~2.2x profit
- Professionally managed: ~4.8x profit
- Private equity targets: ~12x profit
That multiple is applied to PROFIT. Not revenue. Not busy work. Not “someday” projects.
Want to increase your valuation without growing revenue?
Stop funding mediocrity:
- Cut every expense that doesn’t directly serve customers
- Kill projects without clear completion dates
- Audit where your team spends time vs. where customers get value
More profit = higher valuation. It’s that simple.
What’s the one expense you’ve been avoiding cutting?