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Start with the End in Mind – We will all EXIT one day — by accident
or on PURPOSE … Which will you choose?
Wanda Silva
Our time together…
• Where are you today?
• Where do you want to go tomorrow?
- Visualization + Exercise
• What are option...
My Goal
 Begin to build the “brain” trust
of ideas/options for your future
- Personal and Professional
 Review the Tools...
Paper Bag Exercise
“Saying goodbye to your
company, saying goodbye to your
life, and the journey in between”
TOP 5 REGRETS OF THE DYING
1. I ...
“Saying goodbye to your
company, saying goodbye to your
life, and the journey in between”
TOP 5 REGRETS OF THE DYING (cont...
“Saying goodbye to your
company, saying goodbye to your
life, and the journey in between”
TOP 5 REGRETS OF THE DYING (cont...
WHY?
*All business owners
will EXIT –
With a Plan or
Without one!
Start With the End in Mind
“Do you want to Exit on Purpo...
DEFINE
“Exit Strategy Planning”
DOES NOT MEAN –
 The End
 Goodbye
 Death
 Sadness or
 Hospice Care
Exiting is a Proce...
Exit Strategy Planning IS...
“A process that involves the development and
execution of a series of systematic steps which ...
Exit Strategy Planning is an
Art Not a Science
Process
Series of Steps
Development of a Plan
Execution of that Plan
KE...
What are some of your
options?
• Sell all or a percentage of the company to partners,
strategic buyers, investors, competi...
How Do You Get to the
Optimal Exit?
What is the Process?
 Clarify “Life After Business” Goals
 Business Valuation Refere...
SET GOALS NOW
Based on the End Game
• What do you want your life to look like?
Merger & Acquisition Environment 2018
PEO Update
15
Mergers and Acquisitions
Environment 2018
• Slower 1st quarter after busy 2017 end
• Dollars Chasing Deals & more high end...
Valuation
Public PEO Market
• Limited Public Acquisition
– Price/Valuation Data
• Review Baird Equity Research
– Human Cap...
PEO Valuation +/- transaction
terms =
A deal / investment or sell
Example:
PEO Ebitda = $100.00
5x - all cash = $500.00
10...
PEO Valuation – Deal Terms -
Structure
 All PEO deals have an earn-out
 Value is what a buyer is willing to pay for what...
Wanda J. Silva
Silva Capital Solutions, Inc.
Office: 770-218-5496
Cell: 404-735-0960
wanda@silvacapital.com
www.silvacapit...
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Wanda Silva | Start with the End in Mind – We will all EXIT one day — by accident or on PURPOSE … Which will you choose?

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Presented by Wanda Silva – President, Silva Capital Solutions

You started your PEO for a reason, you built your PEO for a reason… where are you today, where are you going tomorrow and how will you get there? Geared to the PEO owner, executive and shareholder — this session will include audience participation and lots of fun. Coupled with a look at the 2018 PEO Merger & Acquisition environment — we will build a framework of meaningful ideas, options and alternatives for the growth and future of your PEO. Join Wanda Silva as she waves her PEO magic wand. What will the future hold? Together, let’s see where the journey takes us.

The PACE Annual Conference focuses on the sales, marketing, and technology trends that affect PEOs and the service providers that support them.

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Wanda Silva | Start with the End in Mind – We will all EXIT one day — by accident or on PURPOSE … Which will you choose?

  1. 1. Start with the End in Mind – We will all EXIT one day — by accident or on PURPOSE … Which will you choose? Wanda Silva
  2. 2. Our time together… • Where are you today? • Where do you want to go tomorrow? - Visualization + Exercise • What are options for getting there? - Exit Strategy Planning • M & A 2018
  3. 3. My Goal  Begin to build the “brain” trust of ideas/options for your future - Personal and Professional  Review the Tools and Processes to Get There
  4. 4. Paper Bag Exercise
  5. 5. “Saying goodbye to your company, saying goodbye to your life, and the journey in between” TOP 5 REGRETS OF THE DYING 1. I wish I had the courage to live a life true to myself, not the life others expected of me. - I dread going to work - I started this company to serve my clients  I love the PEO biz  now I spend 90% of my day managing the employees / managing the burden 2. I wish I hadn’t worked so hard.
  6. 6. “Saying goodbye to your company, saying goodbye to your life, and the journey in between” TOP 5 REGRETS OF THE DYING (cont.) 3. I wish I’d had the courage to express my feelings. -I’m afraid to admit that I’m ready to let go of my company – how will my spouse/ life partner/ family react? – I feel so weak 4. I wish I had stayed in touch with my friends. -I work so much, I no longer have tome to spend with my family and friends
  7. 7. “Saying goodbye to your company, saying goodbye to your life, and the journey in between” TOP 5 REGRETS OF THE DYING (cont.) 5. I wish I had let myself be happier I’ll be happy when… - my company is worth X - I retire -I can fish every week
  8. 8. WHY? *All business owners will EXIT – With a Plan or Without one! Start With the End in Mind “Do you want to Exit on Purpose or By Accident?”
  9. 9. DEFINE “Exit Strategy Planning” DOES NOT MEAN –  The End  Goodbye  Death  Sadness or  Hospice Care Exiting is a Process Not an EVENT
  10. 10. Exit Strategy Planning IS... “A process that involves the development and execution of a series of systematic steps which will allow both the “shareholders” and the “accumulated wealth” to be extracted at a defined time in the future” CREATE IT DEFINE IT EXECUTE IT
  11. 11. Exit Strategy Planning is an Art Not a Science Process Series of Steps Development of a Plan Execution of that Plan KEY To be flexible ~ OPEN and and Never get to a place where you have No choice
  12. 12. What are some of your options? • Sell all or a percentage of the company to partners, strategic buyers, investors, competitors, or the public • Recapitalization for partial liquidity • Merge to enhance value or marketability • Transfer the Business to family, management, or employees • Gift the business for personal or tax planning purposes • Liquidate or partially liquidate the business
  13. 13. How Do You Get to the Optimal Exit? What is the Process?  Clarify “Life After Business” Goals  Business Valuation Reference or Benchmark  Work with Specialists “A Team”  Prepare a Written Plan  Identify and evaluate options  Execute any positioning strategies  Get your “ducks” in a row  Achieve the Exit Strategy
  14. 14. SET GOALS NOW Based on the End Game • What do you want your life to look like?
  15. 15. Merger & Acquisition Environment 2018 PEO Update 15
  16. 16. Mergers and Acquisitions Environment 2018 • Slower 1st quarter after busy 2017 end • Dollars Chasing Deals & more high end HR Provider Acquisitions • Bigger is Better • Seller’s Market More Buyers than Sellers • Accretive Deals • Valuations Solid Average to high Multiples • Greater Complexity of Valuation/Purchase Price & Transaction Structure • Greater Risk Sharing • Assimilation/Integration with Minimal Client Loss
  17. 17. Valuation Public PEO Market • Limited Public Acquisition – Price/Valuation Data • Review Baird Equity Research – Human Capital Technology and Solutions • Review Key Banc Capital Markets – HR Software and Services • Other Recent PEO/HRO Reports • Private advisor data
  18. 18. PEO Valuation +/- transaction terms = A deal / investment or sell Example: PEO Ebitda = $100.00 5x - all cash = $500.00 10x ; 25% cash = $250.00 25% earn out = $250.00 50% equity in ”something” *The real multiple = 5x or less Exceptions  distressed / exceptional / perfect fit
  19. 19. PEO Valuation – Deal Terms - Structure  All PEO deals have an earn-out  Value is what a buyer is willing to pay for what you have to offer  Value = Market Multiple x Adjusted EBITDA  Multiple range 5-8x  Lower earnings + greater risk =  Lower value  Greater risk in what/how the transaction or investment is structured  Higher % of price in an earn-out
  20. 20. Wanda J. Silva Silva Capital Solutions, Inc. Office: 770-218-5496 Cell: 404-735-0960 wanda@silvacapital.com www.silvacapital.com 20 THANK YOU! “Be who you are, find balance, speak honestly, value those you love, and allow yourself to be happy.” The time is now!

Presented by Wanda Silva – President, Silva Capital Solutions You started your PEO for a reason, you built your PEO for a reason… where are you today, where are you going tomorrow and how will you get there? Geared to the PEO owner, executive and shareholder — this session will include audience participation and lots of fun. Coupled with a look at the 2018 PEO Merger & Acquisition environment — we will build a framework of meaningful ideas, options and alternatives for the growth and future of your PEO. Join Wanda Silva as she waves her PEO magic wand. What will the future hold? Together, let’s see where the journey takes us. The PACE Annual Conference focuses on the sales, marketing, and technology trends that affect PEOs and the service providers that support them.

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