by Wendy Dickinson Ascend
We explore the volatility business owners face every day. During this time of economic crisis brought on by COVID-19, everyone is looking for answers. We hope to give you ideas for your recovery plan. Catalytic Conversation offers you, the listener, the opportunity to gain insight from the experiences of others. Each guest shares with you key pivot points, “failures”, and how each navigated the many transitions of ownership.
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Publishing Since
12/19/2017
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April 7, 2021
<p>Recently I was a guest on Lauren LeMunyan's Spitfire Podcast. Lauren and I are both coaches who work with executives to become consciously profitable. The question is, how?</p> <p>Leaders who are executives and business owners have to keep up with legislation, maintain profitability to retain value within the company, and rely on people to make those things happen. As if that isn't tricky enough, those leaders have to lead people who, in 2021, are dealing with the pandemic - working remotely and isolated, while dealing with the social reckonings of the lack of equity, inclusion and diversity.</p> <p>No one wants to be part of the problem. Everyone wants to offer a solution. What is a leader today to do?</p> <p>In this interview we talk about legislation that is in the Senate for committee review that will impact M&A activity for startups. We also tie it to the questions that Victoria M. Grady poses in a recent article for leaders who want to be value added to their teams in transition. Finally, we discuss our upcoming webinar, "<a href="https://www.eventbrite.com/e/the-4-stages-of-psychological-safety-creating-an-inclusive-team-culture-tickets-147339134317">How To Create A Psychologically Safe Team</a>" on Monday, April 12th, 2021. In this webinar we will discuss:</p> <ul> <li><strong>What’s Working and What's Not in DEI Strategies</strong></li> <li><strong>The 4 Stages of Psychological Safety and What You Really Need to Pay Attention To</strong></li> <li><strong>The Next Steps to Building Your Inclusive Leadership Strategy</strong><br> <br> <a href="https://www.eventbrite.com/e/the-4-stages-of-psychological-safety-creating-an-inclusive-team-culture-tickets-147339134317">Registration </a>is free and available at consciouslyprofitable.com<br> </li> </ul>
April 2, 2021
<p><strong>Picture this - you’ve worked for years to build your business. You hope to retire in the next five or six years. You will use the money from that sale to buy the family a relaxing cruise, invest some for retirement and finally, do what you want to do with your time.</strong></p> <p><strong>Sounds lovely, doesn’t it? Unfortunately, for many who hold that dream dear, it doesn’t work out that way. It happens for a lot of reasons. Sometimes, the market conditions aren’t right. At other times, owners get in their own way.</strong></p> <p><strong>Today you have the chance to get the insider view of the transaction at the point of choosing the best fit buyer. Dan Scherotter, a broker and strategy consultant with Filament Business Advisors, has a background in the restaurant industry.</strong></p> <p><strong>Dan is a former chef and restaurant owner. Dan has a finger on the pulse of the restaurant industry. As a consultant and broker for Filament, Dan is going to discuss with me the unique aspects of selling a restaurant, asymmetrical buyers and how the past year has “laid the industry bare” structurally.</strong></p> <p><strong>First, you need to sit down and define your priorities. What do I mean?</strong></p> <ol> <li><strong>Do you know what your financial outlook is?<br> </strong></li> <li><strong>Can you afford to take an earn out or reinvest part of the proceeds of a sale?<br> </strong></li> <li><strong>What are the tax implications of the sale for you personally?<br> </strong></li> </ol> <p><strong>Many owners don’t know what they actually need to realize from the sale of their business. Sounds crazy, doesn’t it? But, it’s true. I recently heard of an owner who thought (no data, just thought it) that he/she needed to walk away with $3M to be comfortable in retirement. As it turns out, $2M was the magic number and that business sold and the owner was able to take an earn out for a larger purchase price based on forecasted earnings.</strong></p> <p><strong>Think about your other priorities:</strong></p> <ul> <li><strong>You want the company to stay in your town.<br> </strong></li> <li><strong>You want the new owner to keep all of the employees for at least a year.<br> </strong></li> <li><strong>You want to continue acting as part of the business development team.<br> </strong></li> <li><strong>You want a seat on the Board.<br> </strong></li> </ul> <p><strong>These requests are reasonable if they are presented in a professional manner and the owner has created a strong position as a valuable company. The likelihood of those priorities being accepted depend on the value of the company, and the timing of the ask. This is another incident where the right advisor is critical.</strong></p> <p><strong>Let us know what you think: Wendy Dickinson, </strong><a href="https://ascendcoachingsolutions.com/"><strong>Ascend Coaching Solutions</strong></a><strong>, 804-372-7575, wendy@ascendcoachingsolutions.com; Dan Scherotter, Filament Business Advisors, 804-728-1553 </strong><a href="mailto:dan@filamentbusinessadvisors.com"><u><strong>dan@filamentbusinessadvisors.com<br> </strong></u></a></p>
March 30, 2021
<p><strong>Today we look at the process of selling your business. You may hear of this process referred to as The Deal or the Transaction</strong>. Your deal, or transaction, is the culmination of your years of hard work, blood, sweat and tears. The amount of money you walk away with is dependent on a number of variables. I hope that your biggest takeaway for my shows this month is that preparation is your key to successfully selling your business.</p> <p>Selling your business is a process. Today, I want my guest to give you a peek at what happens behind the curtain of the deal. I want you to be ready for the business colonoscopy. I want you to be so prepared, so ready, that you don’t feel a thing!</p> <p>We’re going to talk about the things owners do that get in their own way, that they do wrong, or how they subconsciously sabotage the entire deal! This happens all too often.</p> <p><strong>KEY ISSUES: Problems You May Encounter:</strong></p> <p>In my experience, these are the obstacles that owners don’t prepare for, lead through, or navigate successfully, during the transaction.</p> <p>1. Owners don’t really know what their priorities are before they begin the transaction process. It is too late to think about the well-being of your employees once the purchase agreement is signed.</p> <p>2. Owners don’t think about who their ideal buyer is or what their attributes should be.</p> <p>3. Owners don’t really know how much their business is worth. Michael recommended the Goldilocks method - ideal price, acceptable price, minimally acceptable pricing. It is very important to get the pricing right, to attract the interest that you want.</p> <p>4. Owners have built the entire business around the owner.</p> <p><strong>What You Need To Know - THE WHAT:</strong></p> <p><strong>Folks, </strong>you need to know what other companies in your industry and in your geographic area are selling for – I encourage you to do some market research.</p> <p>If you belong to an association, ask for the names of other owners who have successfully sold their company. Get in touch with them and find out what their experience was like and what they would do differently if they could have a redo. I also recommend that you listen as closely to what isn’t said as to what is said in those conversations.</p> <p>Next, make sure you build relationships with advisors who have had experience as part of a deal team. That experience will be a huge source of strength during the transaction process.</p> <p>Almost every deal has moments where the door opens to renegotiate the purchase price, or an accounting practice is questioned, etc. you want your advisors to be calm, professional, and to add value to your position, not detract from the value of your company.</p> <p>Here are the steps that Michael outlined for your transaction:</p> <ol> <li>Get your business appraised.<br> </li> <li>Talk to your accountant.<br> </li> <li>Determine the kind of sale you will execute.<br> </li> <li>The book of information is written.<br> </li> <li>Advertising.<br> </li> <li>Attracting and educating the buyers about your company. NOTE: This is the time to get those prospective buyers to submit their personal finance documents and to sign an NDA.<br> </li> <li>Letters of Intent are submitted and the top prospects are chosen.<br> </li> <li>Due diligence begins.<br> </li> <li>Purchase and sale agreements with terms and conditions are signed. Transaction closes.</li> </ol> <p><strong>Michael Mitchell, Business Research Group, Michael@brgbrokers.com, or 1-804-381-6667. Visit Michael’s website </strong><a href="https://brgbrokers.com/"><u><strong>here</strong></u></a><strong>.<br> </strong><br> <br> </p> <p><br></p>
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We explore the volatility business owners face every day. During this time of economic crisis brought on by COVID-19, everyone is looking for answers. We hope to give you ideas for your recovery plan.
Catalytic Conversation offers you, the listener, the opportunity to gain insight from the experiences of others. Each guest shares with you key pivot points, “failures”, and how each navigated the many transitions of ownership.
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