license

Naming A Business: Is Your Name on the Door?

Many entrepreneurs use their surname in their business name. Is this the best long-term strategy? Learn the pros and cons.

If you’re like most start ups, you started your business by yourself with no employees to help. You probably started with not much more than an idea you were passionate about and the drive to see it through. So it’s not surprising that so many owners are naming their businesses after themselves. After all, in the beginning you and your business are one and the same.

After a while, if you’re successful, you start to hire employees and you regret having your last name in your business name — especially if you want to sell your company in the future. Do not lose hope, some of the world’s most valuable companies have their founder’s family name right there in the company name:

  • Goldman Sachs
  • Hewlett-Packard
  • Wells Fargo
  • JPMorgan Chase
  • Procter & Gamble
  • Johnson & Johnson

If your name is on the door, your customers will consider you synonymous with the business—unless you give them something else to latch on to.

“Owners with their name on the door have to work hard to carve out a unique identity for the business which is distinct from their personal identity,” says Ted Matthews, author of Brand: It Ain’t the Logo. “Owners need to document their brand foundation of the company and make sure every employee knows what makes up the foundation of the company brand and how that is distinct from the personality of the owner.”

Robert, James and Edward Johnson could have focused the Johnson & Johnson brand on their own personalities; instead, they branded new products like Band-Aid. Their successors went on to further separate the founders from the brand by launching Listerine and Tylenol. By branding their products, the Johnsons and their successors were able to separate their company identity from that of their founders while not abandoning the family name.

Even though their names are on the door, Bill Hewlett and Dave Packard worked hard to define their company brand as something more than the aggregate of the two owners’ personalities. They decided to make HP, the company, stand for innovation. Today, HP no longer needs Bill and Dave at the helm for people to see HP as a valuable company.

Even when naming your business for yourself, you can build a valuable, sellable company. Just make sure your brand stands for something other than you.

BONUS: Be sure to listen to John Warrillow’s accompanying podcasts “Make Your Business Attractive to Acquirers” and “Don’t Give Your Employees Equity” for additional business exit strategies!

Total
0
Shares
Leave a Reply
Related Posts
Read More

The Ultimate Guide to Continuity Planning for Your Small Business

Businesses face a variety of potential emergencies and threats that can disrupt their operations.   From natural disasters to cybersecurity attacks, it’s pivotal to safeguard your business in case something happens.    Enter: Business continuity...
funding
Read More

The Best Funding Options for Minority Entrepreneurs

Getting funded can be a challenge for any investor. But for minority entrepreneurs, finding and securing capital can often require going the extra mile. More entrepreneurs of color are able to complete this journey, to...
corporation
Read More

The 7 Benefits of Forming a Corporation

With 2024 still new, many entrepreneurs are about to start or have just started a new business. After all, January or, more broadly, the first quarter of any year can be a favorable time to...