CFA Next Step Client Presentation

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CFA Next Step Client Presentation

  1. 1. A journey begins…
  2. 3. The journey continues…
  3. 4. <ul><li>is a systematic, team-driven program which guides business owners through the process of extracting themselves and their wealth from the business.  </li></ul><ul><li>The program focuses on </li></ul><ul><ul><ul><ul><li>the business owner, </li></ul></ul></ul></ul><ul><ul><ul><ul><li>a complete and optimal solution, </li></ul></ul></ul></ul><ul><ul><ul><ul><li>and a team effort. </li></ul></ul></ul></ul>
  4. 5. Overview <ul><li>Owner’s Goals & Objectives </li></ul><ul><li>CFA NextStep Benefits To Advisor </li></ul><ul><li>Challenges </li></ul><ul><li>Defining Exit Planning </li></ul><ul><li>A Multi-disciplinary Team </li></ul><ul><li>A Systematic 5-step Process </li></ul><ul><li>Business Valuation and Marketability Report </li></ul><ul><li>Wealth Management Plan </li></ul><ul><li>Global Concierge </li></ul><ul><li>Business Exit Plan </li></ul><ul><li>Positioning Strategies </li></ul><ul><ul><li>Tax Strategies </li></ul></ul><ul><li>Exit Strategies </li></ul><ul><ul><li>Tax Strategies </li></ul></ul><ul><li>Execution Of Business Sale Strategy </li></ul><ul><li>Exit Planning Benefits </li></ul><ul><li>CFA NextStep Marketing </li></ul><ul><li>Fees </li></ul><ul><li>Q&A </li></ul>
  5. 6. Owner’s Goals and Objectives <ul><li>Optimal Allocation of Wealth </li></ul><ul><ul><li>Reallocation of Business Wealth </li></ul></ul><ul><li>Extraction of Business Owner </li></ul><ul><li>Business Owner’s Goals </li></ul><ul><ul><li>Protection of Family & Others </li></ul></ul><ul><ul><li>Legacy Goals </li></ul></ul><ul><ul><li>Lifestyle & Life-after-Business Goals </li></ul></ul><ul><ul><li>Estate Planning Goals </li></ul></ul>
  6. 7. Challenges <ul><li>Restricted Credit Markets </li></ul><ul><li>Boomer Retirement Era </li></ul><ul><ul><li>10 million US Businesses for Sale </li></ul></ul><ul><ul><li>25% - 35% will sell </li></ul></ul><ul><li>Mistakes Business Owners Make </li></ul><ul><ul><li>Unplanned, No Positioning </li></ul></ul><ul><ul><li>Reactive, Single Buyer </li></ul></ul><ul><ul><li>Un(der)-represented </li></ul></ul><ul><ul><li>Market-Insensitive Expectations </li></ul></ul><ul><ul><li>Price Focused (vs. Terms & Structure) </li></ul></ul>
  7. 8. Defining Exit Planning <ul><li>Personal Strategic Direction </li></ul><ul><li>Positioning Strategies </li></ul><ul><ul><li>Optimizing the Expected Wealth Transfer </li></ul></ul><ul><li>Exit Strategies </li></ul><ul><ul><li>Synchronizing Extraction of Owner and Wealth </li></ul></ul>
  8. 9. A Multi-disciplinary Team
  9. 10. A Systematic 5-step Process
  10. 11. Business Valuation & Marketability <ul><li>Determining the Expected Wealth Transfer </li></ul><ul><li>Identifying Factors with key influences on Value </li></ul><ul><li>Identifying Factors with negative influence on Marketability </li></ul>
  11. 12. Wealth Management Plan <ul><li>Identifying and Quantifying Owner’s Goals </li></ul><ul><ul><li>Protection of Family & Others </li></ul></ul><ul><ul><li>Legacy Goals </li></ul></ul><ul><ul><li>Lifestyle & Life-after-Business Goals </li></ul></ul><ul><ul><li>Estate Planning Goals </li></ul></ul><ul><li>Tax Strategies </li></ul><ul><ul><li>Current and Future Cash Flow Planning </li></ul></ul>
  12. 13. Wealth Management Plan (Cont.) <ul><li>Establishing Investment Strategy and Asset Allocations </li></ul><ul><li>Determining the Targeted Wealth Transfer </li></ul><ul><li>Family Governance </li></ul><ul><ul><li>Most Valuable Assets Not Measured by Dollars </li></ul></ul><ul><ul><li>Intellectual Capital, Social Capital, Political Capital </li></ul></ul><ul><ul><li>Successful Generational Wealth Transfer </li></ul></ul><ul><ul><li>Multi-generational Wealth Education </li></ul></ul>
  13. 14. Global Concierge <ul><li>Dedicated Unit within MSSB </li></ul><ul><li>Completely Customizable – from Mundane to Exotic </li></ul><ul><li>Tickets, Travel </li></ul><ul><li>Personal Security, Art & Aircraft, Multiple Residences, School Prep </li></ul>
  14. 15. Business Exit Plan <ul><li>Reconciling Expected vs. Targeted Wealth Transfer </li></ul>
  15. 16. Positioning Strategies <ul><li>Corporate Value Enhancement </li></ul><ul><ul><li>Corporate Structure and Governance </li></ul></ul><ul><ul><li>Strategic M&A </li></ul></ul><ul><li>Business Value Enhancement </li></ul><ul><ul><li>Risk (Certainty) and Return (Growth) </li></ul></ul><ul><ul><li>Management </li></ul></ul><ul><ul><li>Market Position </li></ul></ul><ul><li>Business Marketability Enhancement </li></ul><ul><ul><li>Transparency </li></ul></ul><ul><ul><li>Validation </li></ul></ul>
  16. 17. Positioning Strategies (Cont.) <ul><li>Multi-Step Liquidation </li></ul><ul><ul><li>Recapitalization </li></ul></ul><ul><ul><li>Options and Warrants </li></ul></ul><ul><ul><li>M&A, Consolidations and Roll-ups </li></ul></ul><ul><li>Tax Strategies </li></ul><ul><ul><li>Double Tax </li></ul></ul><ul><ul><li>Tax Deferral </li></ul></ul><ul><ul><li>Tax Attributes (NOLs) </li></ul></ul><ul><ul><li>Capital Gains </li></ul></ul>
  17. 18. Exit Strategies <ul><li>Sell </li></ul><ul><ul><li>Competitors </li></ul></ul><ul><ul><li>Partners </li></ul></ul><ul><ul><li>Strategic Buyer </li></ul></ul><ul><ul><li>Financial Buyer </li></ul></ul><ul><ul><li>International Buyer </li></ul></ul><ul><ul><li>Going Public </li></ul></ul><ul><li>Recapitalize </li></ul><ul><ul><li>Owner Liquidity </li></ul></ul><ul><ul><li>Business Capital Raise </li></ul></ul>
  18. 19. Exit Strategies (Cont…) <ul><li>Merge </li></ul><ul><ul><li>Acquisition or Merger </li></ul></ul><ul><ul><li>Consolidation or Roll-up </li></ul></ul><ul><li>Transfer </li></ul><ul><ul><li>Family </li></ul></ul><ul><ul><li>Management </li></ul></ul><ul><ul><li>Employees (including ESOPs) </li></ul></ul><ul><li>Gift </li></ul><ul><ul><li>Charitable Remainder Trust </li></ul></ul><ul><li>Liquidate </li></ul><ul><li>Hold </li></ul>
  19. 20. Execution Of Business Sale Strategy <ul><li>Organization </li></ul><ul><ul><li>Team </li></ul></ul><ul><li>Action Plan </li></ul><ul><ul><li>Positioning Strategies (including audits and studies) </li></ul></ul><ul><li>Business Marketing Documents </li></ul><ul><li>Research and Outreach </li></ul><ul><li>Data Exchange and Negotiations </li></ul><ul><li>Letter of Intent </li></ul><ul><li>Due Diligence </li></ul><ul><li>Close </li></ul>
  20. 21. Exit Planning Benefits <ul><li>Higher Probability of Success </li></ul><ul><ul><li>Goal Focused </li></ul></ul><ul><ul><li>Planned and Managed </li></ul></ul><ul><li>Optimal Result </li></ul><ul><ul><li>Intermediation and Negotiation </li></ul></ul><ul><ul><li>Expedited Mission </li></ul></ul><ul><ul><li>Reduced Tax Burden </li></ul></ul>
  21. 22. Contact George Washington Smith, Principal Corporate Finance Associates Phoenix Office 555.555.0000 [email_address]

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