When Joe Pulizzi started blogging about online content best practices in 2007, he was his company’s brand.
His blog posts soon evolved into the popular Content Marketing Institute. He wrote all the content and moderated all of CMI’s lucrative paid webinar trainings, which had $20,000-a-pop sponsors. He was a star attraction at CMI’s live event, Content Marketing World.
“It was the Joe Show,” he recalled. “I wrote the content three times a week. I was speaking, leveraging my personal brand. I had books coming out.”
From early on, though, Pulizzi was looking ahead to the day he would sell his business. In 2008, he wrote down his goal: To sell by 2015, for at least $15 million. To achieve that result, he knew he’d have to evolve how CMI operated until his personal brand was no longer key to its success. He began elevating team members to present webinars — fighting pushback from sponsors — and phased out his speaking and writing.
He hit his targets for the sale nearly on the head: CMI sold in 2016 for $14.75 million, to live-events B2B giant UBM. The operational changes that removed his personal brand from CMI’s messaging were key to the successful exit, he said. Pulizzi, the author of Content Inc. and other books on content-based business, is now busy with his next startup, The Tilt, and its live event, Creator Economy Expo.
“I had a lot of friends who started at the same time as me and went with their name for their blog,” Pulizzi said. “And they were never able to scale. You’ve got to launch products that aren’t called ‘your name.’ We were only able to sell because of our event.”
Selling your business when you are the company
Many solopreneurs start a business that revolves around their personality, skills and talents. It’s an easy way to launch, and can work well as long as you’re at the helm. But when it’s time to sell, your focus on personal branding can become a serious liability, says Barbara Taylor, a business broker who specializes in small businesses.
“When the whole brand is one person, that business can be difficult to sell,” Taylor said. “The buyer sees it as a risk. They’re thinking, ‘You’re going to be gone. What’s going to happen if the brand is built around you?’”
If there are ways to pull back on some of your responsibilities prior to sale, it’s always better to take those steps before you’re negotiating with a buyer, Taylor said. Then, you can reassure buyers that the business has already demonstrated a track record of generating revenue without your face promoting everything.
Another tip from Taylor: Consider getting a business valuation ahead of the sale that breaks out the value of your personal brand, which is also known as personal goodwill. While it can be challenging to put a number on it, doing so will help both sides understand how revenue might change after you exit, and help you make the case that the business will still have substantial value without you.
If you can’t take yourself out of the game before you sell, a common way to address the personal-branding issue is through an earn-out period or service contract, Taylor noted. That gives the new owner time to continue leveraging your personal brand while they figure out how to reposition the business to thrive without you.
“Don’t expect to get all your cash at closing,” Taylor said. “There are going to be holdbacks to make sure the business doesn’t collapse when your exit is announced.”
If you’d like an all-cash deal and to avoid a long transition period after the sale closes, then you’ll want to lessen your presence in day-to-day operations prior to sale, Taylor said. In Pulizzi’s case, the buyer wanted a three-year earn-out, and he negotiated for 16 months.
While it may be more challenging to sell a personal-brand focused business, she added, it’s certainly not impossible. Read on for the stories of two more entrepreneurs who found creative ways to sell personal-brand infused startups. A common thread: Hand-picking the right buyer who understood that their business had underlying value beyond their personal cachet.
Start now to sell later: distance your company from your personal brand
If you’re thinking about selling a company that’s built around your personal brand or think you might want to sell in the future, here are a few steps you might take:
- Start now. Don’t wait until you’re ready to sell to make these changes. The sooner you transition the company away from your own personal brand, the longer time period you’ll have to show the buyer it worked. That will both increase your valuation and make the sale transition easier.
- Revisit your company name. Is your company named after you? Rebranding is no small task, especially if you’ve been in business for years. Develop a plan to rebrand the business so it can live on without you in the future.
- Tone down photos and mentions of you. Even if your company isn’t named after you, you might have your face and name plastered all over the company’s website and other promotional materials. Showing who’s behind the company is a smart move that can help your customers trust you, especially in the early years of building a new company. Just make sure everything isn’t about or from you and you alone. This is a great opportunity to let others on your team take some of the spotlight.
- Build your team. Transfer your workload to other employees, so customers see more of them and less of you. Have your team document how they do their work, so another leader can guide them years from now.
- Be open to an earn out. If the company’s operations or marketing still relies partly on you, the seller might want to keep you around for months or even years to ensure a smooth transition. Educate yourself on the risks of getting paid out over time and how to structure an earn out in your favor.
Phasing out your personal brand: “The logo was a cartoon of me”
In 2010, Kim Brady was living in Denver, working a job she hated in payroll services, and searching for a way to move back to Orange County, Calif. After exploring many possible startup ideas and how they fit with her personal goal of not having to wear a suit, she settled on a high-end residential cleaning service. She loved to clean, and learned the business by working for another local cleaning service.
In naming her business, she turned to a nickname she’d earned in childhood due to her short stature: little bit. The company slogan: ‘Where every little bit counts.’
“The original logo had a little brown-haired woman with a sponge,” she recalled. “Me.”
Little Bit Cleaning focuses on busy professionals who want it all done and done perfectly — laundry, linens, the works. Two years in, the business had grown to eight employees and was thriving. Brady, a former soccer coach and player, was ready for the next step: transitioning the business model away from reliance on her face and personality to a company she could sell to fund her move. She moved back to California in 2017 and began operating the service remotely, to build proof that she wasn’t essential to operations.
Knowing that cleaning services that are perceived as one-woman shows and simply sell their client list tend to receive low valuations, Brady started plotting to increase her startup’s value. Her cartoon avatar vanished from the logo and all marketing materials. She also tapped her network of trusted friends to advise her as she repositioned the business for sale.
To make the business easier for a new buyer to operate, she documented every aspect of company operations early on, from accounting and CRM systems to marketing materials and creating an operations manual. She retained a business broker, who said her work removing her personal brand and creating systems took her valuation from $60,000 to $250,000.
She says the process took nine months from hiring the broker to final sale. She sold in 2020, weeks ahead of the pandemic. As it turned out, she found her match not through the broker, but in a former manager she’d known for years, who was looking to diversify his income.
“I reached out to him as a friend, literally crying, and said, ‘I’ve got to get out from under this!’” Brady said. “And he said, ‘I think I want to buy your business.’”
The clincher: She provided seller financing, essentially loaning her buyer the money to buy the business while creating a regular monthly income for herself that helped finance her cross-country move. Brady has since become a business coach focused on helping other personal-brand entrepreneurs position themselves for a better exit.
“A lot of business owners struggle with removing their ego from the business,” she said. “They want to get the credit. But my goal was to provide jobs and eventually, to create a salable asset.”
“It was all me, all the time,” yet she sold her test-prep business
A long-time tutor for college-admissions tests, Lauren Gagglioli decided in 2014 that she wanted to try her hand at turning tutoring into an online business. She’d seen big online platforms struggle to get students on board, and thought she could provide the missing ingredient: a personal touch and individual attention.
Higher Scores Test Prep essentially was Gagglioli -– she recorded all the training videos, did all the outreach to parents, and tutored many students one-on-one.
“It was all me, all the time,” she recalled ruefully. “The only thing I did right was not name it after myself.”
Gagglioli was happy with her branding and being so hands-on in the business… for a while. But changes in the test-prep industry made her start thinking of selling. Colleges began to send mixed messages about whether taking the SAT or ACT was really needed. Many claimed not to require it, but their financial-aid packages were still tied to the test scores, confusing parents, she said.
Additionally, the tests were increasingly seeing criticism for being gender- and race-biased. There were rumors the tests might be abolished altogether.
“Parents were coming to me asking if their child even needed to take the test,” she said. “I wanted to get out because the test makers are annoying. They’re just awful!”
Knowing it would be a challenge to sell a company built on her personal brand, Gagglioli looked around her network for someone who needed what she’d created. She found her buyer in 2021, in a college admissions counselor she’d met in an online business training. The buyer’s company was looking to create an online test-prep division, but hadn’t been able to get it off the ground.
“It was a quick and easy win for her, to flesh out a part of her business model that she hadn’t built out yet,” Gagglioli said. “And she doesn’t believe colleges are going to do away with the tests.”
Gagglioli was able to negotiate a short, 60-day transition in her sale, in part by creating training videos for all of the roles the new owner’s staff would fill. With that documentation, it was a fairly easy transition. While students and parents no longer see only one person through their whole journey, Gagglioli said the new team shares her philosophy on how to teach the tests, making for a cohesive experience.
“It probably just looks like I hired a support person, but it’s a wholly different organization,” she said.
We’ve updated this story, as a previous version misstated some details of Brady’s experience. You can learn more about our reporting process here.