Episode 351: Building a Business Someone Would Actually Want to Buy — Even If You Never Plan to Sell

What makes one studio worth hundreds of thousands of dollars more than another—even when both generate the exact same revenue and profit?

In this episode of the Female emPOWERed Podcast, Christa Gurka breaks down the real factors that determine the value of your boutique fitness, Pilates, or wellness business. Drawing from her own experience selling Pilates in the Grove in 2025, Christa explains why the most valuable businesses aren't necessarily built by the best instructors—they're built on systems, leadership, profitability, and predictability. 

In this episode, you'll learn:

•  Why owner dependence dramatically reduces business value 
•  The difference between owning a business and owning a job 
•  How buyers evaluate boutique fitness and wellness businesses 
•  Why recurring revenue matters more than top-line sales 
•  The role systems and SOPs play in increasing valuation 
•  How to identify the bottlenecks keeping your business dependent on you 
•  Why leadership layers and delegation are essential for long-term growth 
•  The concept of "exit without selling" and how to achieve true time freedom 
•  The hidden cost of being the person who makes every decision 

The three levers that increase business value:

1. Reduce owner dependency

If your clients, revenue, and day-to-day operations all depend on you, buyers see risk. The less your business relies on the owner, the more valuable it becomes.

2. Build recurring, documented revenue

Memberships, clear pricing, documented systems, and repeatable processes create predictability and make your business more attractive to both buyers and future leaders.

3. Create a leadership layer

A strong second-in-command and clearly defined roles allow your business to thrive—even when you're not in the room.

Key takeaway

Whether you plan to sell your business someday or keep it forever, the process is the same: build systems, develop leaders, document your operations, and remove yourself as the bottleneck.

The businesses that create true financial freedom are the ones that can operate successfully without the owner being involved in every decision. 

Resources mentioned in this episode

Elevate to Exit: christagurka.com/elevate

Fit Biz Accelerator: christagurka.com/accelerator

Operational Scorecard: christagurka.com/operationalscorecard

If this episode resonated with you, share it with another studio owner who wants to build a business that's profitable, sustainable, and valuable—whether they ever plan to sell it or not. 

Transcript

Speaker 0:51

Hey there. Welcome back to another episode of the Female Empowered Podcast. I'm your host, Christa Gurka, and today's episode is all about building a business that someone would want to buy. On March 13th of 2025, I sold Pilates in the Grove, and I will tell you the reason I was able to sell my studio for the amount I was able to sell it for was not because I was the best Pilates instructor in Miami. That's definitely not the case. It happened because years before I ever had a buyer at the table, I built a business that could run and produce and serve people without me requiring to be standing in the room at all. At the time of sale, I was going into the studio one day a week, and that was because I wanted to be in the studio one day a week. It was Wednesdays. It was my day to be in my studio. Your business could be worth six figures more than it is right now, and the only thing standing in the way is you being the one who has to show up every single day to make sure that it is still running. Most boutique studio owners have never once asked themselves what a stranger would pay for what they built. Have you ever considered that? What would someone pay for what you've built? And here's the uncomfortable truth, my friends. If the honest answer is not much, and the truth is many people think their business... everybody thinks their business is worth way more than it is, the same way everyone thinks their home is valued way more than it is. So- The value of your business has nothing to do with how good you are at Pilates or physical therapy or spinning or barre. It- but it has everything to do with how the business is built, the structure of the business. And today we're gonna talk about building a business someone would actually want to buy, even if you never ever plan to sell it. Here's why I want to talk about this today, even for those of you who have zero interest in selling, because I call it exit without selling. All right? So the whole idea is that I want you to think of it as the same way maybe we would tell a client or a patient who possibly might need knee surgery "We're gonna do this therapy. The hope is that you never have to have knee surgery," or, "We're gonna do some strengthening, and the hope is you never have to have the knee surgery. However if in the end you do, you will already be ready, and you'll be that much better going into it." So even if you have no intention of selling your business, and this is still a lifestyle business for you, which it was for me for many years, I never thought anyone would wanna buy my business, this is still an episode you want to listen to because it's the same process. It's the same process. Whether you're gonna exit or whether you want a business you can exit without selling it, building a business that is sellable and building a business that gives you sustainability and the actual life that you want and the time freedom and the financial freedom that you want are the exact same project. The systems, the leadership, the financial clarity that make a buyer want to write you a check are the same things that let you take a real vacation without checking in, get more than average full night's sleep, stop being the bottleneck in your own success. So whether you wanna sell in five years, 10 years, or never, this episode is something I want you to listen to. Like I said, a business that is sellable and well run are the same. A buyer is asking the same question underneath every other question. Does this business make money and keep making money without the owner? That is the entire test. Owners often chase revenue as the proof of a good business, top-line revenue. And while that is true, and that is a m- excuse me, a marker of a good business, buyers don't care as much about top-line revenue as nearly as much as they care about profitability, bottom line, and predictability. S- so what are we talking about? Recurring revenue, documented systems, a team that operates the business without the owner even being present, okay? This is why two studios doing the exact same revenue can be valued completely differently, which is exactly what happened to me. One is a job wearing a business costume, and the other is an actual asset. So let's say you have two businesses. Both are doing a million dollars in revenue. Both are doing... Let's say they're doing 20% profit, so they're doing $200,000 worth of profit. Studio A, the owner is teaching about 20 classes a week and is running the day-to-day of the studio. Studio B, the owner isn't teaching at all and is not running at all the day-to-day. Studio B, they have the same profit, the same revenue. Studio B is gonna be worth more because, or at least be able to sell for more, because studio A, the buyers are gonna have to replace that owner. They're gonna have to re-hire somebody to replace the revenue that owner is generating. They're gonna have to hire someone to run the day-to-day operations. So Studio A is gonna be worth less, valued less than Studio B Okay? So when we talk about private equity coming into the space, exactly the same way we talked about it in a few episodes back with the Pilates boom and private equity f- coming in with loads of cash. Okay? These firms, they're not buying businesses because the studios are the best at teaching Pilates. Honestly, th-s- they care about that, but I would say that's not even in their top five. Okay? They are buying studios that are the best at systems, recurring revenue, predictability, and profitability. All right? That is the exact lens you want to have for your business, okay? And you don't have to look at it through a private equity lens. You want to have operational predictability, you wanna have profitability, okay? And you wanna have sustainability, and none of those can be tied to you as the owner. All right? So let's talk about three levers that actually move your number. A- and when I talk about number, I'm talking about the valuation, the number you can put your house, and I'm saying house in air quotes, your business on the market for. Okay? Number one, the most important one is owner dependence. This is what we call the hub and spoke problem. When I work with my business owners that are looking to exit, this is one of the value builder drivers as, in the value builder framework that we use. The hub and spoke problem is owner dependency. If every client or more than 60% of the clients, more than 60% of the decisions, more than 60% of the dollars runs through the owner, the business is the owner. It's not necessarily an asset. That doesn't mean that you can't sell it. It just means it will be valued less. Okay? And the math backs it up. Owner-dependent businesses tend to sell roughly at a one to two times pre-tax profit. We call that EBITDA. Okay? While businesses where the owner is not required to deliver the service or operate on the day-to-day can close closer to three to four times. Okay? So like I said, let's say you have Studio A that's doing a million dollars in revenue, and they have about 20% profit. Okay? So now you're talking about they have $200,000 in profit, roughly, pre-tax profit. If studio owner A is Paying herself, let's say she's paying herself $85,000 a year, but she is teaching 20 classes a week, and she is operating the day-to-day operations. So maybe she's the manager, she does payroll, she does the vacation requests, she does all of that stuff, okay? So a buyer's gonna come in here, and there's no documented systems. They all live up here in her noggin, right? I'm sure you can all relate to that. So she has great revenue, great profit, but now what the buyers are gonna look for is if this teacher does not wanna stay on, okay, which usually is the case, she wants to leave, they're gonna say we're gonna have to spend 85 to $100,000 to replace her." So maybe on a regular, maybe she would get three times $200,000, which would be a $600,000 offer. They're gonna now look and be like we have to take 100, maybe a little more than $100,000 off of that price, because we're gonna have to hire someone to replace her to do the work." So now her business might be valued at 400 to 500,000. Now, let's take that same scenario. Studio B has the same exact thing. Let's say Studio B has a hundred... a million dollars in revenue, $200,000 in profit. The n- the teacher, the owner is paying herself $80,000 a year, but she doesn't teach any classes and she doesn't run the studio. She has a manager that she pays another $80,000 a year salary. So now she could get, her multiple could be three to four times, so it could be to 600 to 800,000, plus they'll actually add back in her salary of $80,000. Because they don't need to h- hire her. They don't need to replace her, right? So her salary is actually redundant. So you have one, Studio A is now worth 4 to 500,000, and Studio B is worth 8 to $900,000, okay? So this is the difference. You could be leaving significant six figures on the table depending on how you have your business set up, all right? I hope you were able to understand that. I know that's a lot of numbers, especially when you're listening to it. So lever one is the owner dependency. So even if you never wanna sell, you get, as the owner, getting off of the schedule, getting out of the day-to-day is the way to have sustainability in your business. It's the way to be able to take home a salary of 100, $150,000 and not sell the business and also not be responsible for its operations. All right? So that's the whole s- exit without selling. Taking $150,000 a year in salary and not having to do anything in the business is a pretty good option as well. So lever two that you can pull is recurring documented revenue Memberships beat packages. Packages beat drop-ins. A buyer wants to see revenue that is gonna keep showing up next month, whether or not a new lead comes through the door And they don't have to be annual memberships. They could be monthly memberships, okay? They don't have to be annual, but buyers, and for you and owners that want to not have to worry about feast and famine cycle of always having to get n- new leads, wanna have a really good, what we call MRR, monthly recurring revenue, right? It is... We've said this over and over again. You guys all know this. They- it's much less expensive to sell to the people that you already have than to keep getting new people, okay? So you want to have documented pricing, documented policies. Clean records matter way more than people think, okay? So your pricing cannot live in your head. Your policies cannot live in your head. They cannot live in a group text somewhere to your front desk. Your sales process for how you're gonna take new intro offers and convert them into members cannot live in your head. They need to be in documented systems digitally or in a actual handbook, okay? That you can give to someone, whether you sell or not, but you can hand it over and be like, "Here is how we do each and every thing in our business." And the people in the accelerator, the women in the accelerator, the Fit Biz Accelerator, have access to 100, now nobody needs 100 SOPs, but there's SOPs for every single thing we ever did at Pilates in the Grove, so there's 93 SOPs. Everything from opening and closing checklists for admin incident reports, social media policies sales process from intro offer to conversion difficult conversation policy, refund policy, all of that, every single thing, financial, KPIs, HR policies, onboarding all white labeled, so they can just basically take those and turn them into their own, saving you a shit ton of time and money, okay? But you have to get them out of your head. You have to get them out of your head. They have to be written down. They have to be taught, articulated to your team, and you have to hold your team accountable for performing the processes as written. And then they should be reviewed at least annually. All right? People get new payroll systems. People get new software. You have to update these things manually. All right, so that's lever number two. Now, lever number three is what I like to call a leadership layer or some sort of buffer. Who runs or makes customer service decisions when you are not there? Who onboards new clients when you are not there? Do they get onboarded the exact same way, whether you're in the building or not in the building? Who onboards new team members? Is it you, or is it somebody else? And is it done the exact same way every single time? Who handles vacation requests? Who handles payroll? Okay? If the answer to what I just said for you is, "Nobody does it. I do it," then to me, that is your most important next hire, to start to offload and delegate these outcomes to somebody else And when, if you're thinking I have tried to delegate this before and it doesn't work, it's not the same," what you might be doing is delegating tasks. It's important that you delegate the outcome, and then you have to teach the people what you're looking for, how to do it, and then hold them accountable, give them real-time feedback. Invest in your best people before you lose them, because your top performers already notice when nobody but you can make a decision. And eventually, that could become the reason they leave. People love structure. They love a good built-out organizational or accountability chart. So they know that they go to Sandy every time they have a vacation request. They go to Sandy when they have a question about their paycheck. They go to Kelly when they have a question about a client. Okay? So knowing who they should report to and what that process is exactly sets people up for success It doesn't mean that you are not part of the business anymore, but what you're doing is you're taking things that you can teach other people to do so that can get off of your plate so that you can work on the things that only you can do as the owner of the business, which is designing the customer experience, right? Future projects. Maybe it's community collaborations. You don't have to be the one that onboards new staff. You don't have to be the one that onboards new clients. You don't have to be the one that's calling new clients to be part of the conversion system. You can initially, but if you want to grow and you eventually want to be out of your business at some point, whether you sell it or not, you have to delegate these tasks to somebody else So what can you actually do this quarter? I think over the summer is a great time to do it because for most people it's a little slower. So here's what I want you to do. Look at your real numbers. Are your books clean? Do you have a shit ton of personal expenses that you're running through your P&L? Okay. Pull your trailing 12 months of profit. So what is that? Trailing 12 means like from h- now till 12 months ago. Okay? Your trailing 12 months of profit. And how much revenue did you personally generate during that time as the owner? So if you taught, I don't know, if you teach 10 classes a week and have five privates, how much revenue is that on a 12-month basis? How much of the work runs through you to get to that profit? So are you sitting in the sales and marketing seat? Are you sitting in the operations seat? Are you sitting in the manager seat? So does all of that have to go to you to get through to the profit? So you're gonna look at your profit, how much of that profit is generated by you, and then look at the revenue and how much of that revenue is generated by you. Next, you're gonna document your top three SOPs that you are going to generate this month. Anything that you do more than once in your business, you should have an, a process for it. So you just s- keep creating replicable, repeatable processes. Everyone knows what they're supposed to do, and you hold people accountable to that very specifically, okay? So what, the way that I like to think of the top three, if you were to leave for a month, what would break first in your business? Think about it. Would it be that the new clients aren't converting from intro to membership because you're the one that handles all of those touch points? Is it payroll wouldn't get done because you're the one that does payroll? Is it that inventory wouldn't be ordered because you're the one that orders inventory? So what would break immediately if you were not able to be at work for a month, okay? And then identify who on your team could hold and own the culture and the standards if you were gone a month. Who would people go to as their leader? And if the honest answer is nobody, then once again, I'm gonna say this is your quarter's most urgent hire, okay? Before you add classes, before you add clients, you have to have a, they call it sometimes a 2IC, a second in command or a second in charge, right? You have to have someone that if you were out, if something happened to you, this person would step up as leader. All right? So- That's what I want you to look at initially. I want you to look at your revenue. How much of that do you generate? Hopefully it's less than 5%. I want you to look at your profitability. Sorry, I thought, forgot what I was gonna say for a second. And how much of the operation of the business are you Producing because you're the one doing everything. I'll give you an example. We have a studio that I'm working with. She has... She is a small a private and semi-private studio, so no classes. And she's been in business for seven- 18 years now. At the time she started working with me, which was a year and a half ago, 18 months ago, I believe she had very few processes written down, written out. Okay? She had five or six people on her team. She was still teaching, and then she really was like I just wanna be out in the next three to five years." So over the 18 months that we've worked together, and again, I wanna preface this by saying she took the action and did the work that was required of her. She has since promoted one of her instructors to lead instructor. This lead instructor has now been responsible for hiring and onboarding new people, so the owner's no longer responsible for that. She promoted someone to office manager. The office manager is the one responsible for new client conversion. So anyone has a new client intro and converting them into a long-term membership. Who are they gonna work with? When are they gonna come in? Handling all sorts of running the KPIs for the owner. And in that time, so 18 months, which is why a lot of my programs are 12 months or longer because it takes time to make these good, solid, sustainable changes. She has increased the value of her business by six figures Because she has been able to actually increase her salary somewhat, but that's not the biggest thing. She's been able to decrease the owner dependency on her. So she could go away, and she's now going away for a month in September out of the country, and the business does not revolve around her revenue, and the business does not revolve around her doing, running the KPIs, making sure that staff is being taken care of, and all of that. And so this took a little while to do, but she thought that she was at a cap in her business for being in business for 18 years. She thought "There's no way that I could actually do that." Okay? And it's been great. We have another PT and Pilates practice in our group right now who, when she started working with me, she was generating 100% of the revenue personally, 100% personally, while also running the business. Now she is at less than 15% of revenue production. She has two full-time PTs and two additional Pilates instructors in addition to her. So she went from 100% of revenue generation down to less than 20%, and we're hoping to cut it to less than 10% in the fall, right? So both of these have been able to look... Because sh- she actually is not interested in selling her business, this last example, but she wants to actually move and open another business, so she wants to be able to sell without exiting. Exit without selling. She wants the business to be running so operative- operably that she can keep the profit and her salary, but not be there, not even be in the same city, okay? So staying and earning versus selling is basically, like I said, it's exiting without selling, okay? So what I want you to walk away with today is a business that is built to sell, even if you never sell it, is a business that is gonna give you your time freedom and your financial independence back, okay? Not just revenue. It pays you real money, dollars, dinero, okay, for years of real work instead of just keeping you busy. And it proves something I believe all the way down to my bones, that you do not have to choose between loving what you do and building something that is actually worth value, worth selling. You can have both, okay? But only if you build it on structure and purpose. And systems How does that sound? All right. That's what I got for you today. I want you to recognize that your client book is not necessarily worth everything if you are the one that's producing all the revenue. What you are selling is a turnkey business. So even if you're like, "I just wanna stay and collect my paycheck," you won't be able to do that unless you have systems and processes for people to run on a daily basis, so you don't even need to be present. And at the end, when you're ready to retire, you can maybe sell it to an instructor or a PT that works for you, or you... at the very least, you can get some cash without just retiring and closing the doors. All right? I hope that this episode hit home for you, right? I want to invite you into something, if this is something that interests you. If you are past the startup survival mode, if you are generating five, six, seven, eight, a million dollars in revenue, and you're starting to wonder whether this thing could run without me and how fast you can get it to run without you, and possibly even explore the opportunities of selling, this is exactly the kinda work we do inside the Elevate to Exit program, which is my bespoke one-to-one program using the Value Builder system to show you your business' real numbers, real valuation today. We help you close the owner dependency gap that are really quietly costing you lots of money, and build a plan towards the exit you want, whether that's actually selling outright, whether that's exiting without selling, whether that's three years, 10 years from now, or never at all, like I said. You can learn more about this program, and you can also book a discovery call, which to chat with me about it, at www.christagurka.com/elevate. www.christagurka.com/elevate. And for those of you that are earlier in this journey and want to start where every one of my Elevate to Exit clients started, inside the Fit Biz Accelerator, building the systems and the team and the accountability and the predictability that make a business like this possible in the first place, you can find information on that program at christagurka.com/accelerator. Okay? If you wanna learn more about where the bottlenecks sit in your business, I created this operational scorecard, and it lives free on my website. You can visit christagurka.com/operationalscorecard, and you can see... take this little, I think it's 10 questions, take this little self-assessment and see where your business, has the bottlenecks. All right? So you can find the system gaps we talked about today in 10 minutes without needing anybody in the room to explain it. So I think all of those are great resources for you. And until next time, my friends, bye for now.