Did you know that 80% of businesses on the market will never sell? The truth is, most business owners don’t plan for the exit until it’s too late. They get “fat and happy,” believing their success will last forever, while the market trends shift right beneath their feet.

Look at Toys “R” Us—they went from an $11 billion valuation to bankruptcy in just two years. What happened? They stopped innovating. They stopped marketing. They treated their business like a permanent fixture rather than a lifecycle that demands constant evolution.

In this episode, we break down the exact human and business life cycle—from the vulnerable incubator stage to the high-stakes “adult” phase. We’ll show you how to navigate the 6 Ps—People, Products, Processes, Proprietary Assets, Patrons, and Profits—so you can build a sustainable, scalable, and sellable business. Don’t wait until you’re “dying on the vine” to plan your exit. It’s time to identify your business’s life stage and ensure you are positioned to exit rich.

—

Watch the episode here

Listen to the podcast here

From Incubator To Exit: Recognizing The Critical Stages Of Your Business Life Cycle

The Critical Mistake Of Failing To Plan Your Exit Strategy

We’re going to talk about the number one mistake business owners fail and about the life and human life cycle. The number one mistake the business owners fail is they never plan to exit. They don’t think about selling tile catastrophic events such as death, COVID, hurricanes. You name it. There’s always catastrophic events that occur. By that time, you’re too late. You need to start thinking about selling when you’re ready to sell. You need to sell when you think about selling.

When you start thinking about selling, that’s when you have to sell. Businesses don’t plan to fail. They fail to plan. It used to be, back in the day, 9% of all startups would fail within 3 to 5 years. That business landscape has changed dramatically. Now, 70% of all business owners should have been in business for ten years or longer or dying on the vine. You’ve heard of all these stories. You’ve heard of Toys “R” Us, Blockbuster, and the list goes on and on.

Why? It’s because they stopped doing AIM, always innovate and market. Startups are succeeding because they’re innovative and new technology. Startups are paying attention to what is the buyer demand and what is the current market trend. They are giving those buyers what those buyers want. That’s what you need to do as well. You know this already, 80% of businesses on the market will never sell.

We’re going to talk about something very important, the human and business life cycle. The human and business life cycle is a foundation of your business. The business life cycle is the same as ours. What happened? We’re born. We’re in an incubator. Guess what happens to a baby business? It’s in an incubator. This is a story about Toys “R” Us. Charles Lazarus started his business in 1948. It was a newborn baby. It was a furniture store, which had a 90% chance of failure. Remember, startups have a 90% chance of failure back then but not anymore, my friends.

Understanding The Human And Business Lifecycle Stages

Think about the humans who are born in the incubator. What does a newborn baby need? It’s everything and it’s constant supervision. Constant oversight. A lot of money. You can never leave a newborn baby or a newborn business alone. Never. Think about that. Think about what business you have in the incubator. The baby goes from the incubator into the infant stage. What do infant babies need? Everything. They still need constant supervision. They still need lots of money, lots of care and lots of supervision. Look at 1957. Remember, Lazarus started with the furniture store, then opened his very first store model after a supermarket.

He first used the name Toys “R” Us. Toys “R” Us was born in 1957, even though he started that furniture store back in 1948. He owned four locations that year. You go from incubator to infant, human, business. Guess what happens? You go from an infant to a toddler. Now, a toddler doesn’t need as much supervision but sometimes, people will say it needs more because a toddler is running around. They’re drawing on all the walls. They get into every single thing that they can possibly get into. You need the same thing with the business. Lots of supervision. Lots of money.

Now we’re in 1969. Toys “R” Us adopts Geoffrey the Giraffe. Remember, Geoffrey the Giraffe? The brand mascot. Toys “R” Us was starting to do good in 1974. What happened in 1969? They have Geoffrey. In 1974, bankruptcy and restructuring as they sold off all of their own profitable stores. When business owners file bankruptcy, everyone is like, “That’s a kiss of death.” It’s not. It’s chapter 11. It’s bankruptcy and restructuring. That doesn’t mean that you’re completely out of business forever. In 1978, Toys “R” Us became traded on the New York Stock Exchange under Toys, Toys “R” Us.

Now, think about that. In 1974, they filed bankruptcy. Four years later, they’re on the New York Stock Exchange. Only because you follow chapter 11, does that mean you’re out of business. We go from toddlers to teenagers. I had a toddler. It’s the same thing. It was an infant. She became a two-year-old and now she’s a teenager. I don’t know why anybody talks about the terrible twos. In my opinion, it’s a terrible teenage year. In 1983, the first Toys “R” Us clothing store opened. That Toys “R” Us and then they open up the clothing store.

In 1994, a thousand stores nationwide. In ’96, the first Babies “R” Us. I know you guys remember Toys “R” Us, Kids “R” Us and Babies “R” Us. In 1998, Walmart beat Toys “R” Us for the top toy seller. Teenagers still need a lot of supervision. You can’t leave teenagers to run rabbits, run around, and do whatever they want. What do they need? They do not need as much supervision, but they typically take a lot more money. Teenagers are always digging in our pockets and businesses are the same way. They still need that supervision, but they still need a lot of working capital.

Young adults are a great stage. It’s right after a teenager. You don’t need as much money as much supervision. The young adult business doesn’t need as much attention and supervision but it’s fragile. It’s still fragile. It still needs someone looking over it. It still needs to make sure that the owners have the right teams in place. A function on the 6 Ps. This is where 6 Ps. This is where 6 Ps should all be stabilized and a business should be running on all six cylinders.

Remember the 6 Ps? Number one is people. We got to make sure we have the right team and the right management team. Make sure we have a contract in place, non-competes. Number two, products. We have to make sure that we have multiple revenue streams and our industry products service is on the way up. Not on the way out. We have to make sure our processes are buttoned up in this young adult stage. That’s what young adults are working on.

We got to look at our proprietary assets. What are our proprietary assets? In 2001, Toys “R” Us was focusing and building those 6 Ps. Proprietary assets, branding, trademarks, patents, transferable contracts. Toys “R” Us was well established and well-branded by 2001. Remember they started in 1948. Young adults are where you are able to lay that solid foundation. What happens after young adults?

This is when you had the highest of the high, when you’re at the mountains screaming from the rooftop. When you are running on all 6 cylinders, all 6 Ps, when you have everything in place and the business is doing well. Look at 2015. Toys “R” Us beats are biggest competitor, but remember that toy store in New York? The famous one that was featured in the Home Alone movies, FAO Schwarz.

They put FAO Schwarz out of business. Permanently closing their 5th avenue store. In 2016, they were at $11 million. This is when you sell. This is the best time to sell your company. This is when you exit rich. Not when you’re in an incubator state. Not when you’re a newborn, a toddler, a teenager or a young adult. Right here, my friends. This is when you sell your company. Guess what? You think most business owners will do that?

Do you think most business owners will say, “This is our prime. I’m not getting any better than this. The markets are changing. Let’s sell.” Business owners don’t do that. They don’t think about that. They sit back fat and happy like, “We’re doing great. We’re making tons of money. We have a solid foundation.” The business is going to continue to rise. Because of death, they stop innovating and marketing.

When you don’t keep up with the market trends, when you don’t keep up with competition, or when you don’t see what’s happening around you, things could change. It’s very important to know. This is your prime. This is when you sell because nothing ever stays the same. Let’s look at what happens after your prime. What happens in adulthood? Remember, Toys “R” Us is worth over $11 billion in 2016. A senior citizen or an adult. We age. We get to that senior citizen stage.

Why Businesses Need To Always Innovate And Market

Guess what? Businesses do the same thing. We’re talking one year later in 2017. In 2016, they’re over $11 billion. They’ve knocked off FAO Schwarz. They’re rocking and rolling. In 2017, they filed for bankruptcy, on September 9th. Only two years after deepthroating FAO Schwarz. When you’re fat and happy sitting in that adult stage and thinking you got the world. by your hands and thinking you can do no wrong. Thinking your business is the best it’s ever been. Businesses rise to the top.

It takes businesses a lot longer to rise to the top. It takes businesses a lot longer to build a sustainable, scalable, sellable business, then it takes for businesses to crash as they can literally crash overnight. That’s what happened to Toys “R” Us. They literally crashed overnight. That’s why the best time to sell your business is at the adult stage. What happens after senior citizens? In 2018, Toys “R” Us closed 800 of their US stores on March 14th.

Remember, two years from their prime, from their adulthood. On August 5th, 2018, all 1,500 stores closed. They went into adulthood. In 2017, over $11 billion, but in 2018, they’re out of business. They’re dead. Geoffrey the Giraffe has quoted, “What happened to that $11 billion? What happened to that solid foundation? What happened to the over 1,500 stores in 35 countries? What happened?” We know what happened. AIM. They were fat and happy in their adulthood.

They thought, “We don’t have anything to worry about. We’re at the top of the mountain. We’ve closed our biggest competitor ever. We can keep riding this tide.” They didn’t pay attention to the market. They didn’t pay attention to market trends. They didn’t pay attention to buyer demand. They certainly didn’t pay attention to what the competition all around them was doing. Competition they didn’t even see coming such as Amazon.

Why would you go to Toys “R” Us during Christmas? The busiest holiday of the year. When you walk in there, there’s a million people it seems like and you can’t find an employee to save your life. Why would you do that? Why would you fight that problem? When you could sit back fat and happy as a consumer, go to Amazon, build that shopping cart, pay for it and have it delivered in a few days. Why would you ever fight that? Toys “R” Us never innovated. They stayed the same when those four stores back in 1957 were born.

They built and built but they never innovated. They never caught on to eCommerce. They never caught on online. They just sold products but didn’t create an experience. They didn’t pay attention to the consumer experience because if you didn’t fight traffic, going to Toys “R” Us with a bunch of other shoppers trying to buy Christmas gifts for their kids, too. Why do that? There’s no employees around to help you. The only reason you would do that is for an experience because they do something different.

They’ve invented or created something different for a customer experience. Hands-on approach with who better than maybe some of the customers. Who’s the customers? The mom and dad pay, but the real customers are other children. They didn’t innovate and market. They didn’t get on that online train. They kept doing everything the same. Rather grow or die, my friends. If you’re not innovating, you’re dying. If you’re not innovating and marketing, you’re dying.

They should have sold when they were fat and happy. They should have sold when they were worth over $11 billion. That is the kiss of death. Saving in your fat and happy stage and not selling and not innovating and continuing to market. It’s important that you keep your eye on the trend. It’s important that you innovate all the time every day. It’s not innovative and done. You always innovate and you always market. Otherwise, you’ll find yourself here and die.

What’s after death? Can we be rebirthed? I’m not getting into that conversation. However, in business, sometimes there is rebirth. Look at Toys “R” Us. In 2019, Toys “R” Us relaunched eCommerce through Target who handles fulfillment. In 2022, Toys “R” Us announced 400 pop-up locations within the Macy’s department store and then they didn’t have the brick-and-mortar anymore. They don’t have their own stand alone. They have to go off of Target’s customer base or Macy’s pop-up.

In 2024, Cotton Candy Partnership opened up some flagship stores in the Caribbean. Think about that. That’s innovation. In 2025, seven US retail locations. Mall of the Americas are flagship and military base doors. They’re trying to rebuff themselves but it’s extremely difficult. The name of the game is guess what. You sell when you’re an adult because when most businesses die, they’re dead. What business is your site?

Ask yourself, what cycle is your business in? Are you a newborn? Are you a toddler? Do you need a lot of supervision? Is your business about the die? There’s over 3.4 million businesses in the United States. Remember, 70% of those businesses that have been in business for ten years or longer are going out of business. What cycle are you at? If you’re an adult, you need to reach out, get rich and call us immediately because that’s your prime. That’s your time to sell.

Think about what cycle you’re in and what you need to do next. If you’re an incubator, you still need to exit rich. You need to think about, “How do I build that solid foundation on those 6 Ps?” You should always start from the beginning to plan your exit strategy. Ask yourself what your destination is. Do you want to sell from $21 million? Great. What are you worth now? A million? You got some work to do. What’s your timeframe? Fifteen years? Great. What’s those KPIs? What are those buyers looking for?

Transforming An Infant Stage Business Into A Sellable Asset

Build a sustainable, scalable, sellable business and you sell in your adulthood. Here’s a business that we worked with. I would say the stage they were in was infant. Incubator to infant. They’ve been in business for many years. This is a graphics company that I partnered with. In the initial evaluation, they were not sellable due to lack of employees. They had a job. Not a business. One employee, husband and wife, worked out of the garage or their house. They wanted to sell because they didn’t think that they had the bandwidth. They didn’t think that they had the business acumen. They didn’t think they could grow the company.

They had lots of things going for them. They function on three of the 6 Ps. These clients were turning down 6,000 clients a year. They did not have a business acumen to grow operating only on the 6 Ps. They didn’t have any people. They had one. When I told that one person they were going to sell their business. Guess what that one person did? What do you think they did? They quit. They had no people, no processes and no proprietary.

What they did have is a hell of a great product. They had congruent revenue streams in how they got paid. They were known for their quality. They were known for their craftsmanship. They were known for their showmanship. Why would they turn down 6,000 clients a year? It’s because they were that good. This company never had the market. They have great products. This is a niche business. They had a huge customer base but zero customer concentration. They have profits. Their business was in high demand but they were burned out.

They didn’t know how to grow the company. They just lost their one employee and I told them, “You’re not sellable. I can’t sell your business,” because again they were in that infant stage. Never even made it to toddler. What’s the solution here? I partnered with them. I invest in my money. I implemented a custom built to sell blueprint. I’m happy to tell you that this company will exit from millions. We will exit for an $8 million figure range. This company was barely holding on when they called me to sell their business.

Can we sell your business sometimes in infant, toddler, teenager state, or young adult? Yes, we can. If you get that adult stage, you better sell because you don’t want to find yourself as a Toys “R” Us. Don’t find yourself in a Toys “R” Us situation. Don’t find yourself in an infant stage situation because I work with business owners over and over again. I’ve been doing this for many years.

My core competency, my team’s core competency as Seiler Tucker is work with business owners to help them plan their GPS exit model, build a solid foundation of the 6 Ps and most importantly, build a sustainable, scalable, sellable business so you get to your adult stage and we can sell your business and help you to exit rich. Thank you for tuning into another episode of the show. I know you found it informative. Please share it with your network, your influencers and please subscribe to our show. Thank you.

Important Links

• Seiler Tucker
• Exit Rich
• Exit Rich on Facebook