InKnowVision February 2014 Buy-Sell Problem Solver PPT

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Do you have business owners as clients but need more? Want to add more value but you’re finding that:

- It’s hard to differentiate your core services
- Business owners are hard to engage
- Comprehensive planning scares many prospects
- You need to increase revenue fast

View our recording to learn about InKnowVision’s Business Owner Protection Program. In this new suite of client engagement offerings, each service module will be built around helping business owners to improve their financial and business security.

The first client engagement offering is The Buy-Sell Problem Solver which includes a process to protect the business owner’s most valuable financial asset…their stake in the business!

This module comes from our experience that most buy-sells at successful companies are:
- Woefully out of date and
- Do not deal with all of the risks and exposures facing business owners


As business owners start to approach retirement, or are at an age when health concerns add additional risk, the buy-sell agreement becomes more and more critical.

The last buy-sell agreements InKnowVision reviewed all had major deficiencies:
- In one case, insurance on one of the owners had been pledged as collateral for a personal loan that had nothing to do with the business.
- In another, the agreement called for a purchase price of $750,000 on a company that was worth many millions of dollars.
- Yet another allowed a partner to leave the business and go to work with a competitor, taking much of intellectual capital with him.

Who should attend:
- Investment Advisors
- CPAs
- Attorneys
- Insurance Professionals

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InKnowVision February 2014 Buy-Sell Problem Solver PPT

  1. 1. The Buy-Sell Problem Solver A Turnkey Solution for Professionals Who Serve Business Owners (630) 596-5090 www.InKnowVision.com All Content Copyright © 2014 @InKnowVision InKnowVision, LLC InKnowVision
  2. 2. Are you finding: • • • • • Hard to differentiate Competition  harder to develop new business Business owners are very hard to engage Comprehensive planning scares clients Need to systematically increase revenues fast www.InKnowVision.com All Content Copyright © 2014
  3. 3. 1. Prospect Already Has One • • You have to wait until the incumbent dies, or until client is disappointed You have to be there when it happens 2. Prospect Doesn’t Need One Until Something Happens • • You have to be there when it happens They already have a Guy 3. Prospect Can Do It Themselves, Until It Gets Too Complex • • They rarely know when that is You have to be there when it happens 4. They Can Use You Right Now • • • Whatever’s in place now, probably needs improvement & updating Opportunity is there, but it doesn’t occur to them that they need you You have to be there when it does 5. There Are Many Professionals Who Do What You Do • There’s a lot of competition 6. The Most Desirable Prospects Get Approached All the Time • • By all kinds of Advisors and Vendors From all sides www.InKnowVision.com All Content Copyright © 2014
  4. 4. www.InKnowVision.com All Content Copyright © 2014
  5. 5. There is another proven strategy: A story is told that sometime in the 13th century, an army tried to conquer a fortified city for 10 years with no success. During the final battle, the attackers retreated in their ships and sailed away. One man was left abandoned, sitting on the base of a huge statue they had built to appease their gods. www.InKnowVision.com All Content Copyright © 2014
  6. 6. www.InKnowVision.com All Content Copyright © 2014
  7. 7. Their reality: • The business owns them • If they lost their stake in the business, they’d lose everything • Upset about paying too much in taxes • Their wealth is locked up inside of business • Worried about how to motivate key EE’s without giving away the business • They get bombarded with sales approaches daily • Too focused on growing their business to meet with you www.InKnowVision.com All Content Copyright © 2014
  8. 8. • 12M baby boomers own businesses • 70% expected to change hands between 2020-2025 • With non-boomers, 14M owners need help getting themselves and their $ out of the business in next decade • 69% of small biz owners expect that their company value will be a source of retirement income* *July 2010 Gallup pole of 604 small business owners with annual revenue<$20M Robert Avery of Cornell University, 2006 www.InKnowVision.com All Content Copyright © 2014
  9. 9. Of current business owners: • 40% plan to exit in the next 5 years • 80% plan to exit within the next 15 years • Eventually they all leave UBS Financial Services, Inc., 9/16/2010 www.InKnowVision.com All Content Copyright © 2014
  10. 10. • All eggs in 1 basket… but blind to the risk • Business is best investment… until it isn’t • OK with personal piggy bank approach… but not your suggestions • Frustrated with illiquidity… but don’t want to diversify • Letting you in to help is difficult at best www.InKnowVision.com All Content Copyright © 2014
  11. 11. • • • • Lead with your core services At least you’re getting some business Industry thinks this is normal Delayed gratification financial caretaker model • Stay close  He finally executes  You (finally) get paid www.InKnowVision.com All Content Copyright © 2014
  12. 12. • Not everybody gets a liquidity event • The “lucky few” who do, believe that now that they’ve arrived, it is a good time to upgrade their advisors www.InKnowVision.com All Content Copyright © 2014
  13. 13. • Only 20-25% of businesses for sale actually sell* • 90% of those don’t get anywhere near what they wanted/needed • Shut the doors and walk away • The “boots first” exit *Jan 2007, The Complete Guide to Business Brokerage by Tom West USB Financial Services, Inc., 9/16/2010 www.InKnowVision.com All Content Copyright © 2014
  14. 14. • Only 30% successfully transition to the next generation • 72% of private business owners have no continuity plans • 47% have no estate plans • 55% of CEO’s retiring next year have NOT chosen a successor USB Financial Services, Inc., 9/16/2010 www.InKnowVision.com All Content Copyright © 2014
  15. 15. • Even if your clients are blessed to have a liquidity event • Really good chance they won’t get what they were hoping for But that’s NOT the worst part… www.InKnowVision.com All Content Copyright © 2014
  16. 16. • • • • Once they get in the big leagues, the game changes They’ll feel bad, but… Big paydays attract the big dogs to the beauty pageant No longer about relationship…how good do you look on paper www.InKnowVision.com All Content Copyright © 2014
  17. 17. The Buy-Sell Problem Solver A Turnkey Solution For Professionals Who Serve Private Business Owners A process to protect the business owner’s most valuable financial asset… Their stake in the business! www.InKnowVision.com All Content Copyright © 2014
  18. 18. Helps owners • Protect their largest asset from creditors and lawsuits • Reduce taxes on business interest transfers and current income • Understand and leverage the financial value of their business under a variety of circumstances • Make sure the money is there when they need it www.InKnowVision.com All Content Copyright © 2014
  19. 19. Helps advisors • • • • Get more referrals Engage more business owner clients Predictably increase revenues Create more value and follow-on work www.InKnowVision.com All Content Copyright © 2014
  20. 20. 2-part system that creates leverage 1. 4-part analysis & deliverable 2. Turnkey client engagement system www.InKnowVision.com All Content Copyright © 2014
  21. 21. • The Legal Audit  To protect the business from creditors and lawsuits • The Tax Minimizer  To reduce taxes on business interest transfers and current income • The Value Identifier  To understand and leverage the financial value of the business • The Funding Review  To make sure the money is there when they need it www.InKnowVision.com All Content Copyright © 2014
  22. 22. • • • • • • Client Engagement Brochure Client Focused Process Diagram Drip marketing content Case Studies A Sample Review Data Gathering Forms All Tools Can Be Co-Branded www.InKnowVision.com All Content Copyright © 2014
  23. 23. Let’s explore each section… www.InKnowVision.com All Content Copyright © 2014
  24. 24. 1. The Legal Audit • 32-point legal review of buy-sell agreement • ID’s critical issues typically missing from traditional agreements • Detailed analysis of how to fix problems ID’d • Proactively avoids the “ticking time bomb” problem www.InKnowVision.com All Content Copyright © 2014
  25. 25. “As a business and trust and estates attorney with a number of years in practice, I have reviewed and redrafted many buy sell agreements. I have also been exposed to other buy sell review products in the marketplace. In my experience, the Buy Sell Problem Solver is a superior approach because it systematically identifies critical issues that are missing from most traditional agreements, while providing a level of detail and analysis on how to address these issues that is unmatched in the market. Not properly addressing these issues now, before there is a problem, could lead to potentially disastrous results for your business owner clients. I’m so impressed with their framework that I’m using it to enhance the buy sell agreements that I draft for my clients moving forward.” Jessica Wojtowicz Attorney www.InKnowVision.com All Content Copyright © 2014
  26. 26. 2. The Tax Minimizer • ID’s tax problems for the business • ID’s tax problems for the owners • Provides creative solutions to reduce taxes now and in the future www.InKnowVision.com All Content Copyright © 2014
  27. 27. 3. The Value Identifier • ID’s an accurate range of values for planning purposes • Highlights areas where future planning can be greatly improved • Provides opportunity for integrating personal and business planning based on value and owner goals www.InKnowVision.com All Content Copyright © 2014
  28. 28. 4. The Funding Review • • • • Is strategy missing? Out of date? Able to survive real world stress tests? Will the money end up where the owner intended? www.InKnowVision.com All Content Copyright © 2014
  29. 29. www.InKnowVision.com All Content Copyright © 2014
  30. 30. Business Value $5M Annual Free Cash $600,000 Growth of Free Cash 2% Number of Partners 2 Partner 1 Ownership 50% Partner 2 Ownership 50% Buyout Price $2.5M Installment Sale (Years) 5 Interest Non-specified in Buy Sell Decrease Free Cash (Stress Test) 20% www.InKnowVision.com All Content Copyright © 2014
  31. 31. Tax Impact To Cover Buyout 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 1 2 Pre-Tax Cost www.InKnowVision.com 3 4 After-Tax Cost All Content Copyright © 2014 5
  32. 32. Cash Available for Surviving Owner 350,000 300,000 250,000 200,000 150,000 100,000 50,000 1 2 3 4 5 (50,000) Cash Before Buy-out Cash After Buy-out www.InKnowVision.com Cash After Buy-out - Reduced Cash flow 20% All Content Copyright © 2014
  33. 33. www.InKnowVision.com All Content Copyright © 2014
  34. 34. • • • • • • Client Engagement Brochure Client Focused Process Diagram Drip marketing content Case Studies A Sample Review Data Gathering Forms All Tools Can Be Co-Branded www.InKnowVision.com All Content Copyright © 2014
  35. 35. www.InKnowVision.com All Content Copyright © 2014
  36. 36. www.InKnowVision.com All Content Copyright © 2014
  37. 37. www.InKnowVision.com All Content Copyright © 2014
  38. 38. www.InKnowVision.com All Content Copyright © 2014
  39. 39. 1. 2. 3. 4. 5. 6. Buy-Sell Value Costs Owner $15M Buyout Proceeds Withheld From Heirs Buy-Sell Agreement Creates Tax Hit – For No Reason Surviving Owner Forced to Overpay to Keep Business Buyout Triggers Loan Acceleration The Golden Goose Leaves and Takes The Eggs www.InKnowVision.com All Content Copyright © 2014
  40. 40. The Buy-Sell Problem Solver A Turnkey Solution For Professionals Who Serve Private Business Owners A process to protect the business owner’s most valuable financial asset… Their stake in the business! www.InKnowVision.com All Content Copyright © 2014
  41. 41. 2-part System that creates leverage 1. 4-part analysis & deliverable 2. Turnkey client engagement system www.InKnowVision.com All Content Copyright © 2014
  42. 42. • The Legal Audit  To protect the business from creditors and lawsuits • The Tax Minimizer  To reduce taxes on business interest transfers and current income • The Value Identifier  To understand and leverage the financial value of the business • The Funding Review  To make sure the money is there when they need it www.InKnowVision.com All Content Copyright © 2014
  43. 43. • • • • • • Client Engagement Brochure Client Focused Process Diagram Drip marketing content Case Studies A Sample Review Data Gathering Forms All Tools Can Be Co-Branded www.InKnowVision.com All Content Copyright © 2014
  44. 44. We want to help you get more business, but we need your help! 1. Give us feedback from the field to improve offer/tools 2. Share what your clients/prospects have to say 3. Commit to 1 “test” engagement www.InKnowVision.com All Content Copyright © 2014
  45. 45. • • • • No charge to be part of program (at this time) Significant discounts to our fees (for now) Zero risk (for you and your clients) Personal support in using tools to engage clients www.InKnowVision.com All Content Copyright © 2014
  46. 46. • Flat fee of $2500 per client engagement (loss leader)  4-part analysis  Turnkey/Co-branded marketing system • Zero risk money back guarantee  No fine print, no questions asked  If not 100% satisfied, we’ll refund the $2500 • 50/50 split of insurance commission (if any) www.InKnowVision.com All Content Copyright © 2014
  47. 47. If you want to be part of our test group: 1. Email Greg Maddox at greg@ikvllc.com 2. Complete our short agreement & schedule strategy session with Greg • • Greg will send you our short agreement for signature Email signed agreement back to Greg 3. Receive sample materials & complete strategy session with Greg • • • Review materials Answer questions Co-Develop engagement strategy that works for you www.InKnowVision.com All Content Copyright © 2014
  48. 48. 715 Enterprise Drive Oak Brook, IL 60523 (630) 596-5090 www.InKnowVision.com Q&A For more information contact Greg Maddox Greg@ikvllc.com 847.269.4624 Thank You! @InKnowVision InKnowVision, LLC InKnowVision Google+ All Content Copyright © 2014

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