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"I sold my company and these are my tips for you"

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Marc Jantzen, founder and former CEO of Blue Sky Performance Improvement reveals what it's really like when selling. These slides cover managing the earn out, balancing everyday operations and deal demands and cultural challenges.

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"I sold my company and these are my tips for you"

  1. 1. Confidential© Equiteq 2016 equiteq.com Growing equity, realizing value Marc Jantzen “I sold my company and these are my tips for you” A former CEO reveals what it’s really like when selling
  2. 2. Confidential© Equiteq 2016 equiteq.com Introduction 2 My Background Price Waterhouse, Pepsico, Blue Sky The company I sold Blue Sky: Performance Improvement Consulting and Training – Sales, Customer Experience and Leadership. 30 Awards in 7 years. Virgin, Barclays, British Gas… Role 17 years - Consultant – Managing Consultant – Principle Consultant – Partner – Managing Partner – CEO & Majority Shareholder April 2013 Sold to Capita for £12m (£7.2m up front, plus potential £4.8m on 27 month earn out) 1.2x Revenue Multiple and 5.7x EBITDA multiple Left in June 2015
  3. 3. Confidential© Equiteq 2016 equiteq.com What I learnt from having sold my company 3 Take a look at the front of the queue Plan ahead The core business must come first Maximising the earn out 1 2 3 4
  4. 4. Confidential© Equiteq 2016 equiteq.com 1: Take a look at the front of the queue 4 Ask yourself What next? - look 10+ years ahead How much time off will you take? Will you need to work? What else are you truly great at? How much do you need? Is now the right time? Who can I talk to that has been through the process? Context You will have killed the golden goose You will be under restrictive covenants You will have capital not income You may want to do something new or different 1
  5. 5. Confidential© Equiteq 2016 equiteq.com Context 2: Plan ahead 5 Tips Your role: Delegate core operational duties and play a coaching / support role, not a doing role Internal Process: Introduce more formal processes and documentation that will give a buyer an air of professionalism when they scrutinise your business. Store all relevant documents where they are easily accessible and put in place a process for keeping them up to date Resources: Increase resources in finance (debt collection and reporting) Advice: Use an advisor like Equiteq that can advise you how to maximise value Family: Prepare your family for the fact that you will be working late nights and weekends. Don’t book any long holidays during key stages of the process. 2 Executing a sales process will place significant demand on your time and that of your finance team The experience is rarely straight forward and can be an emotional roller coaster for you and the people around you You have probably never been through the process before
  6. 6. Confidential© Equiteq 2016 equiteq.com 3: The core business must come first 6 Tips Focus: A decline in revenue and profit trend is the fastest way to ensure a failed sale process Strategy: An acquirer will expect to see a clear stand alone growth strategy in place and your team need to know there is a bright future Cultural Challenges: Culture comes to the fore within the senior team in two ways – your choice of buyer and how you handle the confidential nature of the process you are going through Inner Circle: Choose the people you tell about the process carefully, you will not want the message to get out to your clients, staff or competitors – agree a consistent message for when asked 3
  7. 7. Confidential© Equiteq 2016 equiteq.com Completion is merely a stepping stone not the grand finale SPA Negotiation Beware of hockey stick growth forecasts Integration is a distraction and impacts performance Run some scenario analysis on financial projections Team 4: Maximising the earn out 7 4 Mindset and emotion
  8. 8. Confidential© Equiteq 2016 equiteq.com More resources 8 A free source of information, advice and insight to help you prepare and sell your consulting firm Join at equiteq.com/equiteq-edge

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