If you’ve read a lot of the things I’ve written, you’ve heard me talk about the importance of a long-term view in building a valuable company. I believe value is shown in the long run in almost anything you do in life. That’s why it can be frustrating to weigh yourself every single day when you are trying to lose weight. Watching your weight drop (or go up) by .6 pounds can be a little frustrating. It’s how you’ll look and feel after 1 year of trying to be healthy that really matters.
Benjamin Graham, economist and author of The Intelligent Investor said, “In the short run, the market is a voting machine but in the long run, it is a weighing machine.” His point is that the value of a company is shown in the long run, not in the short-term. Essentially, the short-term votes from the market don’t really matter as you seek to determine the value of a company.
This principle of investing is simply a reflection of a principle of life: the worth of an endeavor is seen in its long-term fruit, not the immediate outcome of the plodding.
Further, the familiar quote “for whatever one sows, that will he also reap” from the Bible makes the same point. The reaping, or what you get later, is the sum of the many ‘sowings’ you invest on the trek along the way.
Weighing value in the long run for your business means balancing the ongoing need to sow and work now with a view to a future of what that value will be in the long run. This is a difficult principle to live by honestly. We do want immediate results for little to no work. Fortunately, that is not how life works. Life is weighted in its value over many years, many iterations, and many seasons. That could even be the definition of maturity: “one who has experienced many iterations and seasons of life to see the long term value of their endeavors.” Maturing means fighting the ongoing desire to see immediate outcomes when you know the weight of value is found in the long run. But it’s hard. This daily fighting and tension is what matures a business owner.
Whether we realize it or not, when we succeed I believe we are traveling through 4 phases of maturing as we seek to have the value of our endeavors weighed positively in the long run:
- Commitment – a commitment to a long-term outcome is paramount to beginning the journey of seeking great weight in our value in the long run. Making this commitment out loud, adjusting your priorities around this commitment, and letting others know your commitment takes some of the perfidious nature out of the pledge to a long-term goal. A commitment is a statement of your priorities. And reorienting your priorities around your future is the first step towards success.
- Planning – after commitment comes the boots-on-the-ground work found in planning. Planning is the courage to think you can make the future what you want it to be. It is taking hold of a period of time that is yet to exist and then commanding that future period of time what it will look like. This is truly a fearful act for many due to the heavy risk of failure in this type of undertaking. All humans fear making future plans because we might fail. The commitment of saying “I’m going to run a marathon” strikes fear into our lives. Yet, planning is where you’ll be successful. I believe planning is best done with a calendar, and filling out the future blocks of a calendar to look and say what you want them to say. Then you will have a visual representation of what you think your future holds.
- Accountability – the next step is to let others into your life see your calendar or plan, and to let them comment on your progress and ultimate goals. The longer the time period you are seeking to increase the weight of the value of the endeavor you are undertaking (like building a valuable company), the more you need accountability. Humans, entrepreneurs in particular, are highly distractible people with common conditions like ADHD (or just a lack of structure in their life). They need others to balance their tendency to sabotage their commitment. “If you want to go fast, go alone. If you want to go far, go together” is an African proverb. This has been true in my own life, and I have traveled much further with others that are committed to me than I could have on my own. Overcoming the fear of seeking accountability is a key to winning in the long run.
- Assessment – as we teach our team, a client’s insights are not found in the details. That is, looking at the enormity of many small financial details usually tends to overwhelm entrepreneurs. So our firm seeks to summarize, visualize, and eliminate data that is distracting the entrepreneur from seeing the global insights that can change their beliefs and behaviors. This is the heart of assessment. Assessment is looking at the big picture as you move through your long journey toward the final weight of value you are seeking in the long run. Scrutiny on the details along the way can get confusing and overwhelming. So it’s wise to stop periodically and assess your journey, while not frantically staring at details along the way. Assessment allows you to ask the right questions: Are you headed in the right direction? Are you headed in the same direction? Should your direction change? What do you know about your journey now after some maturity that you didn’t know 10 years ago? Is your end-point goal changing along the way as you make assessments? This assessment allows you to course-correct periodically so that you can keep marching ahead one small step at a time in the right direction.
In summary, I think it’s healthy to ask yourself if you are going through these 4 stages right now on your company-building journey. Further, it’s important to ask what you want and what it means to have what you want. Some of the phases and steps above may be fearful places for you, or you may not see fear in them at all. Either way, it’s wise to remember that the value of what you are invested in is found later, not in the now. I hope you will dare to look and own the future, leveraging the four phases above. It will keep your eye on the prize, and eliminate the distractions that get us all off track on the road to becoming great.
Jason is the Founder of Thriveal and the Chief Innovative Officer of his CPA firm, Blumer & Associates. He is the co-host of the Thrivecast and The Businessology Show and speaks and writes frequently for CPAs and creatives, his firm’s chosen niche. Jason loves to watch documentaries on just about anything. He lives in Greenville, SC with his wife and their three children.