This content was created by David Jenyns. This content was uploaded by David Jenyns. This is a YouTube video titled "Business Risk Mitigation Tips" featuring David Jenyns discussing how systems and processes can reduce business risk by minimizing key person dependency, making the business more valuable to potential buyers.
Systems reduce the risk for the acquirer. The person buying a business thinks, what are the risks here? For me, the risk is the business owner and the key team members leave, and then the business stops performing and functioning to the same level it is when they bought it. And a system and a process is a way of reducing that risk, that key person dependency and key person risk, because you're capturing what needs to be done, which makes it trainable, which makes it transferable, which therefore makes the business worth a lot more. Because you're reducing my risk, therefore I'm happy to pay more for it.
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