Choosing to build your business as a valuable asset versus a paycheck has a significant impact on how you invest your time and resources. An asset requires a strategic perspective and a consistent focus on management (hence the term ‘asset manager’ in the financial world). A paycheck requires putting in the time to do the job you get paid for (and for business owners, that’s one paycheck for a lot of different jobs).
Many owners fall into the trap of working so hard for a paycheck that they lose sight of their business as an asset. That is, until they want to sell and wonder why the business isn’t worth as much as they think it should be.
If you want to build an asset that pays its manager a salary, throws off a good income return and delivers a strong capital gain you need to focus on the right things to make that happen – like these ten I wrote about a while back. the sooner you take action the more value you will gain (think compounding).
As Seth Godin says with his elegant simplicity, don’t confuse building a job with building a business. Either approach is fine – as long as it is a conscious decision.
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