In a study conducted with over 20,000 businesses, it was found that 40% of businesses are actually sharing this one thing: business owners are the primary Rainmakers.
What is a “Rainmaker”? A Rainmaker is a revenue driver for the business. Most businesses actually have their business owners as the primary rainmaker. While this sounds very promising, relying on business owners as the primary rainmakers can actually be, at one point, unhealthy for your business.
After that initial growth spurt from the business owners being the primary rainmakers, hitting a plateau is a common occurrence. Once that ceiling is hit, businesses find themselves in a stagnant state, and some may even start to decline.
What is a Rainmaker?
A rainmaker is someone who brings in and generates income and profit for a business. Most businesses in its early stages rely on business owners to be the primary rainmaker. This is because business owners know the business best from its products/services, operations, people, market, and all the way to the clients.
While not all businesses heavily rely on business owners as the primary profit generator, a whopping 40% do. Almost half of businesses rely on the owners/founders as the primary rainmaker.
What Categories Make a Business Owner the Rainmaker?
There are two questions we ask business owners to evaluate if they are the main rainmakers for their businesses:
1. How much of the company’s revenue are you personally generating?
2. Do you know all the names of your customers?
Based on these questions, we can easily tell whether a business owner is a rainmaker or not. If the answer to the first question is 75% or above, this would mean that the business owner is the core of the economic performance of the business. This isn’t uncommon though as business owners tend to know their product and services very well so naturally, they can pitch it the best.
For the second question, if the business owner knows all the names of their customers, then this displays the business owner’s exceptional skills at developing and maintaining customer relationships.
The Rainmaker’s Dilemma
You might wonder “why is it not good to have a business owner be the rainmaker”. If the business is getting profit, even if it’s being driven by the business owner, why is it then a “dilemma”?
Through analysing businesses that stagnated at one point, we found one common feature they all shared: It’s relying on business owners as the primary driver for revenue. Sure, in order to guarantee the health of a business, it’s important to have someone bring in the revenue and in the early stages, a business owner that can drive revenue will help the business evolve (because of the profit it drives and brings).
At some point however, business owners find themselves stuck with profits and revenues not moving at all. This is a deadly position to be in, especially for a business who’s already packed quite the momentum.
If your goal is to increase company value, addressing the “rainmaker’s dilemma” is crucial. If more than 75% of the businesses’ economic activity heavily relies on the business owner, the business owner’s absence would mean the company would not survive (and this, ultimately, affects the company value).
Thankfully, the rainmaker’s dilemma is not driven by the lack of expertise but rather the lack of time. Since time is finite, the more a business grows, the less it gets and to a business owner who’s the primary rainmaker for a business, this means that less and less is being done while it consumes the time. By addressing this problem and recognising the dilemma, you are one step ahead of solving this problem and possibly avoiding it in the future.
How to Address and Solve the Rainmaker’s Dilemma
The solution to this dilemma is shifting and evolving from a rainmaker to an “architect”. Don’t worry, you don’t have to run it back and get a degree in architecture! “Architect” is a term used to describe business owners who designs, implements, and develops sales processes and marketing structures that work even when the business owner is absent.
We go back to the two questions from our value builder questionnaire:
1. How much of your company’s revenue do you (business owner) generate?
2. Do you know all your customers by name?
An architect drives 0% of the revenue of the company. Instead of pouring energy into trying to do the sales, an architect instead creates a structured sales plan that engages all team members to actively drive revenue and sales for the business.
On the second question, instead of a business owner busy trying to maintain and create new clients, an architect shifts the mindset of micromanaging this aspect of the business to instead designing an escalation plan, staff training, and implementing latest technology that simplifies the processes and makes customer relationship management a lot more controllable.
In this ebook, you can take away the following:
- What are the defining characteristics of a Rainmaker
- Common problems rainmakers
- Quantitative evidence that analyses the relationship of Rainmakers and company value
- Negative impacts Rainmakers have on receiving an acquisition offer
9 strategies on how you can transform and transition from a “Rainmaker” to an “Architect”
If you feel like you are the primary rainmaker as a business owner but want to shift to an “architect”, you are more than welcome to consult with us! Please click here if you want to book a call and see how you can transform from a rainmaker to an architect.
