Bea Wolper was the person who introduced me to the term monthly nut.
“What’s your monthly nut?” was the first question she asks any entrepreneur who approached her expressing a desire to sell their company.
‘Monthly nut’ is the effective income that you need to bring home each month to maintain your present (and perceived future) lifestyle.
‘Most people don’t know what their monthly nut is,’ Bea says. ‘You’d be surprised how many of them, successful businessmen who’ve been at it for decades, don’t have a ready answer.’ So if you plan to sell your business and intend to be happy you should start with trying to achieve clarity on two financial facts
- Do you have a realistic sense of what your business is worth?
- How much money do you need and want to address your post-sale life?
This is one of the questions that I addressed in my Q&A session with Dr. Annurag Batra of BusinessWorld. The full interview is available here.
Concepts such the monthly nut, a checklist to understand your own needs and a starting budget spreadsheet are all covered in my book The Art of A Happy Exit—How Successful Entrepreneurs Sell Their Businesses.