You get rated before you fly the bigger plane

Your first company runs. For three years it ran on your nights and weekends, and now it gets through most days without you at your desk. You have been looking at what comes next. A second company in a different industry. A small fund with a few people you trust. A seat on a bank’s advisory board. Someone at a dinner last week asked whether you would consider a public role.

You feel ready. You have made payroll in bad months and learned what you did not know. The confidence is real, and it came from the first company.

Why can’t I just move up to the bigger business?

Because a bigger business has different size, speed, money flow and rules, and the confidence you have was earned on the one you ran. A second industry, a fund, a foundation, a public role: each is a different shape. Few of them hand out a rating. People still ride behind you either way, your family, your team, your customers, your suppliers. When you take on a business you strap it to your back.

Here is why I tie that to aviation. I started out in a Piper Warrior. Fine airplane, forgiving airplane, around 110 knots on a good day. Like every new pilot, I got ambitious early and pointed at another plane on the field. The answer came back: John, that’s a high-performance airplane. You’ll have to do a little extra and prove you can, and then we’ll sign you off for it. For the big iron it is a type rating. For that plane it was an endorsement. The principle is the same. You prove, with an instructor beside you, that you can think at the new speed before anyone rides behind you.

I did not take it as an insult. Proving is the qualification, and it is why the skies are safe. In the Warrior, the airplane gives you time, and you can be a step behind and catch up. In a high-performance airplane the decisions, the consequences and the ground all arrive faster. Business has no checkride, so you have to build your own.

What does the new aircraft actually require?

Start with the market. A new aircraft has different weather, so make sure there is money where you want to land.

Take a man who built a four-location physical therapy group in the Houston area. It runs well. He is looking at a medical-device distributor. He knows his own market: referrals, insurers, the clinics. The distributor’s market is a different language. Hospitals buy through group contracts. Inventory has to be financed. Compliance rules govern what can be sold and how. The decisions come faster and the dollars attached are larger. What he knows from the clinics is useful, and little of it is rated for this airspace.

In his first company he could say who the flagship was and how long a payment took to land. In the second he could not yet say either one.

Who can rate me?

Not a business coach, and not the workshop circuit. The people who rate you for the next aircraft are those already flying at that level, along with the finance, legal and investment people who work beside them.

Someone once asked what I would ask Warren Buffett if I met him. The others in the conversation had great questions about strategy and picking companies. Mine was different. I wanted to know who does his taxes, who his CFO is, and whether I could borrow his attorneys, his IP people and his equity group. No questions for Warren, just his people.

People laugh and then go quiet, because they see it. An hour with the icon gets you a story. A working relationship with the icon’s bench gets you rated. The people around him fly at that altitude every working day. They know the airspace, the weather, the regulations and the failure modes.

The tool from the book is the type-rating plan, and you can use it freely. It is one page:

• the aircraft you want to fly, and what makes it different from this one
• your borrow list: whose CFO-level mind, whose attorneys, whose IP people, whose equity group
• your instructors: the operators and investors who already fly that class
• your rating checklist: what you would need to demonstrate before you are rated
• your loop: how the profits of this business route back through your network to fund the next mission

Sometimes the next aircraft is the one you already own, flown better. Not every rating is for something bigger.

What can I do this week?

Give it ninety minutes, once your current business runs well without you.

Write the one-page plan. Fill the borrow list with names where you have them and with the rooms where you will find them where you do not. Then book one conversation, this month, with one person who already flies the aircraft you want. Ask what they would change in your plan, and write down what they say.

Owners who repeat the same crash are rarely short on nerve. In my experience they skipped the checkride.