The importance of instinct as a part of decision-making in business has been widely studied and debated by academics and publications in recent years. Using one’s “gut” when buying a business is not a conscious decision. In fact, intuition, by its very definition, is an unconscious thought or feeling. Business buyers often make a deliberate choice to ignore any unsubstantiated concerns that they may have. The intentional prioritization of evidence over instinct may seem wise at first; however, there are several reasons why the heart and “gut” are crucial to smart decision-making when buying a business.
Buying the Appropriate Business
The first step of buying a business is finding the appropriate business to purchase. The buyer must consider more than money or needs. Instinct or gut feelings are often driven by one’s subconscious desire to do (or not to do) something. There is a reason much has been made of the Confucius quotation, “Choose a job you love and you will never have to work a day in your life.” When buying a business, the buyer must have significant interest in the product, mission, or people of the business, or the business and its new owner will not achieve their full potential together. A natural affinity for a business’s area of interest promises a greater likelihood of success. This idea of passion for a career or company has led to substantial success for many entrepreneurs, including Steve Jobs, who said it best:
"Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on."
The Lifestyle Impact of Buying a Business
Buyers must also consider the lifestyle impact of buying a business. The possibility of a 60-mile commute may illicit a different gut reaction from the buyer depending on whether the buyer is emotionally invested in the business. The number of necessary hours spent working will either feel trivial or Herculean depending on the buyer’s level of interest in the company. Ignoring these feelings and focusing solely on projection reports will lead to resentment, bitterness, unhappiness, and an unsuccessful business venture.
The “Unknown” When Buying a Business
Finally, at its essence, instinct is a biological impulse meant to protect humans when logical reasoning does not. One’s subconscious mind is able to recognize patterns or note warning signs that one’s conscious mind may not. A persistent feeling of concern or danger typically does not sprout without a seed. Despite the fact that data may indicate great potential, a buyer’s instinct is capable of processing the unquantifiable variables that will pose a threat to the business’s ability to thrive. When buying a business, it is crucial that one acknowledges the import of these gut feelings. Failing to recognize their weight is to risk great loss in the future. As Monica Mehta writes in The Entrepreneurial Instinct, “Discovering your instinct means to stop doing what you think is best and start listening to your own inner nature.”
If you would like assistance with buying a business, please contact George & Company, located in Worcester, MA. Our own business instincts have been honed over decades of appraising, selling, and financing small to middle-market companies. It would be our pleasure to assist you in finding the business that best suits your skills and desires, while also improving your ability to acknowledge and act on your own instincts.