This document discusses strategies for business owners to maximize their selling price when exiting their company. It covers:
- The importance of developing an exit strategy and aligning stakeholders on timing for the sale.
- Factors that influence timing, including riding high growth to maximize value versus missing the ideal window.
- A typical 6-18 month timeline for the exit process and managing CEO fatigue.
- The role of M&A advisors in leading the sale process to increase probability of success and selling price.
Albion provides a sounding board and guidance for our entrepreneurial clients with a specific focus on the steps a business owner should take to "clean up" a business for eventual transfer to new ownership whether via gifting, internal or third party sale, or public offering.
Small to medium sized (SMB) business owners need a plan for exiting their business. Over 50% of business owners plan to exit their business in the next 10 years. Don't be left out in the cold with no one to sell your company to.
9 Business turnaround strategies designed particularly for small businesses that do not have access to some of the clout and resources larger companies can call on.
10 Creative Ways to Boost Profits & Cash FlowPROTRADE United
Inconsistent cash flow can create stress and unnecessary pressure, resulting in reactive decisions that may have you compromising your profits in order to cover debts.
Careful cash flow planning and financial strategising allows you to make smarter decisions for the future. There are many simple tools a business owner can use to create consistent, sustainable revenue with a take-home profit.
This workshop provides you with trade-specific street smart tools and skills to help improve cash flow in your business.
Albion provides a sounding board and guidance for our entrepreneurial clients with a specific focus on the steps a business owner should take to "clean up" a business for eventual transfer to new ownership whether via gifting, internal or third party sale, or public offering.
Small to medium sized (SMB) business owners need a plan for exiting their business. Over 50% of business owners plan to exit their business in the next 10 years. Don't be left out in the cold with no one to sell your company to.
9 Business turnaround strategies designed particularly for small businesses that do not have access to some of the clout and resources larger companies can call on.
10 Creative Ways to Boost Profits & Cash FlowPROTRADE United
Inconsistent cash flow can create stress and unnecessary pressure, resulting in reactive decisions that may have you compromising your profits in order to cover debts.
Careful cash flow planning and financial strategising allows you to make smarter decisions for the future. There are many simple tools a business owner can use to create consistent, sustainable revenue with a take-home profit.
This workshop provides you with trade-specific street smart tools and skills to help improve cash flow in your business.
Startup Series #1: What To Do During FormationErin McClarty
In the first of a series for startup nonprofits, small businesses and social enterprises I talk about some of the legal issues founders should think about during formation.
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This presentation discusses 7 business strategy tips to use for winning teaming arrangements. You will also gain a better understand of which contract terms carry the most risk in establishing best prices.
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6 Strategies for Consistent Profit & Cashflow PROTRADE United
Inconsistent profits and cash flow can create stress and unnecessary pressure, resulting in reactive decisions that may have you compromising your quality of work and long term results.
Careful cash flow planning and financial strategising allows you to make smarter decisions for the future. There are many simple tools a business owner can use to create consistent, sustainable revenue with a take-home profit.
How to raise capital from a Venture Capital fund, what to think about, how to approach them, what to do afterwards regardless of whether it is yes or no?
Part of the all day Venture Fast Track: http://www.thecapitalnetwork.org/programs/venture-fast-track/
Financial Projections
Join our experts in an overview discussion of financial projections. Learn the key metrics that will get investors to notice you, as well as those that will get you rejected. If you have no idea where to begin with your financial projections, this program is for you.
Experts:
- Alicia Amaral – Scalar Analytics
-Heather Onstott – LaunchCapital
bulk ieee projects in pondicherry,ieee projects in pondicherry,final year ieee projects in pondicherry
Nexgen Technology Address:
Nexgen Technology
No :66,4th cross,Venkata nagar,
Near SBI ATM,
Puducherry.
Email Id: praveen@nexgenproject.com.
www.nexgenproject.com
Mobile: 9751442511,9791938249
Telephone: 0413-2211159.
NEXGEN TECHNOLOGY as an efficient Software Training Center located at Pondicherry with IT Training on IEEE Projects in Android,IEEE IT B.Tech Student Projects, Android Projects Training with Placements Pondicherry, IEEE projects in pondicherry, final IEEE Projects in Pondicherry , MCA, BTech, BCA Projects in Pondicherry, Bulk IEEE PROJECTS IN Pondicherry.So far we have reached almost all engineering colleges located in Pondicherry and around 90km
Startup Series #1: What To Do During FormationErin McClarty
In the first of a series for startup nonprofits, small businesses and social enterprises I talk about some of the legal issues founders should think about during formation.
Subcontractor Best Practices and Rates: Plates, Rates "Competimates": Challe...SheneCommodore
This presentation discusses 7 business strategy tips to use for winning teaming arrangements. You will also gain a better understand of which contract terms carry the most risk in establishing best prices.
"Plates, Rates, and Competimates: Challenges and Choices Facing Novice Subcon...Russ Blaine
Presenting a "day in the life" of a small/novice subcontractor engaged in business with the DoD. Discussion focuses on typical challenges along with prioritization approaches, resolution advice, and available resources.
Calculate Financial Projections for Investment PresentationsThe Capital Network
Join our experts in an overview discussion of financial projections. Learn the key metrics that will get investors to notice you, as well as those that will get you rejected. If you have no idea where to begin with your financial projections, this program is for you.
What are the key reminders for start-ups and entrepreneurs as they begin to scale? Dr. G gathered a list of interesting reminders from fellow angels and venture capitalists. This presentation was aimed for an audience of start-ups.
6 Strategies for Consistent Profit & Cashflow PROTRADE United
Inconsistent profits and cash flow can create stress and unnecessary pressure, resulting in reactive decisions that may have you compromising your quality of work and long term results.
Careful cash flow planning and financial strategising allows you to make smarter decisions for the future. There are many simple tools a business owner can use to create consistent, sustainable revenue with a take-home profit.
How to raise capital from a Venture Capital fund, what to think about, how to approach them, what to do afterwards regardless of whether it is yes or no?
Part of the all day Venture Fast Track: http://www.thecapitalnetwork.org/programs/venture-fast-track/
Financial Projections
Join our experts in an overview discussion of financial projections. Learn the key metrics that will get investors to notice you, as well as those that will get you rejected. If you have no idea where to begin with your financial projections, this program is for you.
Experts:
- Alicia Amaral – Scalar Analytics
-Heather Onstott – LaunchCapital
bulk ieee projects in pondicherry,ieee projects in pondicherry,final year ieee projects in pondicherry
Nexgen Technology Address:
Nexgen Technology
No :66,4th cross,Venkata nagar,
Near SBI ATM,
Puducherry.
Email Id: praveen@nexgenproject.com.
www.nexgenproject.com
Mobile: 9751442511,9791938249
Telephone: 0413-2211159.
NEXGEN TECHNOLOGY as an efficient Software Training Center located at Pondicherry with IT Training on IEEE Projects in Android,IEEE IT B.Tech Student Projects, Android Projects Training with Placements Pondicherry, IEEE projects in pondicherry, final IEEE Projects in Pondicherry , MCA, BTech, BCA Projects in Pondicherry, Bulk IEEE PROJECTS IN Pondicherry.So far we have reached almost all engineering colleges located in Pondicherry and around 90km
Things to check in the translated document before the submissionlee shin
quality of the translation lies in the provider of the source document and the professional translators. though the translations are done effectively, there is the minimal chance of getting errors, so it is always necessary to check for the document prior to submission.
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
Our CEO Nunzio Presta participated in a panel discussion with Ceridian Canada, BDO, CIBC & Microsoft!
During the discussion some of these questions were addressed:
- Should I keep or sell my business?
- How do I quantify the value of my business and what can I do to increase the value?
- What do I need to consider from a taxation perspective?
- How do I prepare my employees for the change in ownership?
- Am I prepared for life after the sale?
Zero to 100 - Part 7: The Role of the CEODavid Skok
Zero to 100 is a learning program from David Skok. It is a detailed instruction manual for how to take your startup from zero to $100m, with a particular focus on the area of building a go-to-market machine. So many of today’s founders come from a product or technical background, and have never been involved with sales and marketing. Right after starting their venture, they are hit with the huge problem of how to build their go-to-market organization and processes. It breaks the journey down into 9 steps, and explains why it is crucial not to skip steps in this journey in the rush to get ahead. The major emphasis of the course focuses on building a repeatable, scalable and profitable growth machine. Once you have that in place, you are ready to hit the gas and scale like crazy.
To see videos of the presentations, click here: https://www.forentrepreneurs.com/matrix-growth-academy-zero-to-100-videos/
Learn how to build, scale and sell a successful business. Your true success will be based on how well you track what you're doing, and how quicly you make adjustment.
How to Prepare to Sell or Finance your CompanyTraklight.com
You work hard building up your company to either pass onto family or sell. Maybe you are preparing for your next round of funding. Maximizing your value by discovering all your assets and managing your risk is critical. Hear from experts on how to organize and position yourself for fundraising or exit. Our speakers have been there and done that with fundraising, risk management, executive leadership and outside counsel. Learn tips and tricks from case studies to affordbly spot your risks, cover your assets, and get ready for the next level.
Jacqueline Hannah from Food Co-op Initiative shares examples of why some start-up food co-ops fail. This was presented at NFCA’s New England Start-up Workshop Day at Monadnock Food Co-op on May 7, 2016.
”A dream isn’t something you see in your sleep; it’s something that doesn’t let you sleep.”
Do you dream of starting or growing a great business, but need help fleshing out the details and coming up with a business plan? If you find yourself falling into this category, you should undoubtedly seek the help of a business professional who will provide you with the expertise necessary to getting your business started on the path to success!
Get your business plan questions answered in this presentation by Kleos Africa consultant, Devon Neudorf.
Devon is a Canadian National with a great deal of experience spanning multiple industries. He has spent time working for Fortune 500 Companies in both New York City and Toronto. Some of his specialties include Business Strategy, Business Transformation and the creation of Business Plans for new Startups or subsidiaries.
Basic business advice for those converting part time gigs into "real" business ventures. Slides are a little wordier than usual; the Podcamp Philly Version will be a little more streamlined.
Estate planning and probate attorney Mike Witzke gives a basic overview of succession planning and why it is important for minority business owners to have a plan in place for their business.
Beginner's Guide: How to raise Seed and Series A Funding for Your Tech StartupsRakesh Soni
This is a short beginners' guide to learn about startup fundraising particularly Seed and Series A round.
CONTENT:
Introduction
Startup Funding 101:
What is funding and why do you need it?
Types of funding
When to raise and how much to raise
Understanding exit
Key players in fundraising
What matters to founders?
Understanding dilution
How to determine the valuation
Understanding controlling terms
How do VCs work?
Seed and Series A Funding:
Are you ready for funding?
Preparation
How to raise: processes, tips & tricks
Recommended Reading
Q&A
Business Succession Is a Process, Not a PlanSSDlaw
Join Mike Moloney of Sebaly Shillito + Dyer and Tom Gmeiner, CPA, of Brady Ware, for an in-depth discussion of the components needed to navigate the steps of a successful ownership transition.
A discussion on best practices and insights into potential deal breakers when selling a business or when looking for an investment, how to avoid them and strategies to turnaround a business to success.
Business Planning Made Easy | Retirement University Series | The Milner Group Chip Milner
If you have one conversation per month with a business owner and submit the valuation information. If your follow up skills and closing skills are just equal to the national average, you will create an additional $50,000 of revenue this year.
This was presented by Nunzio Presta, Founder & CEO of BizON, and Rochelle Clarke, Founder of Succession Strength. This was presented to a group of MBA students at Insead Business School.
The presentation goes over succession options.
BizON had the opportunity to be a promoting partner of #QBConnect by Intuit Quickbooks. While there, we sat in on a session called: "Generational shifts: How to get along with Boomers, GenXers, and Millennials." We found it so insightful especially since our marketplace deals with all 3 generations.
The deck was presented by Dr. Mary E. Donohue, CEO, Donohue Learning, Adjunct Professor, Dalhousie University, Graduate Studies, Faculty of Management.
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
Unintended consequences: important considerations for owners to prepare for t...BuyAndSellABusiness.com
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
Your family business: understanding generational perspectives to successfully...BuyAndSellABusiness.com
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
Can you afford to sell? strategies for wealth management & preservation after...BuyAndSellABusiness.com
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
BizON had the honour of sponsoring the Business Transition Forum! We would like to share some valuable information with our audience from the forum in case you did not have the opportunity to attend!
This seminar was presented by Jessica Man from CW Partners. The content was great and it presented how to valuate your business in anticipation of retiring and exiting.
BizON had the pleasure of attending and wanted to share this presentation with you. If you have any questions please do not hesitate to contact us.
This seminar was presented by Devry Smith Frank LLP, CIBC Wood Gundy and Jennifer Chasson. The content was great and it presented how to maximize the sale of your business and what legal considerations are ahead when selling your business. It also went through post transaction considerations.
BizON had the pleasure of attending and wanted to share this presentation with you. If you have any questions please do not hesitate to contact us.
Best Crypto Marketing Ideas to Lead Your Project to SuccessIntelisync
In this comprehensive slideshow presentation, we delve into the intricacies of crypto marketing, offering invaluable insights and strategies to propel your project to success in the dynamic cryptocurrency landscape. From understanding market trends to building a robust brand identity, engaging with influencers, and analyzing performance metrics, we cover all aspects essential for effective marketing in the crypto space.
Also Intelisync, our cutting-edge service designed to streamline and optimize your marketing efforts, leveraging data-driven insights and innovative strategies to drive growth and visibility for your project.
With a data-driven approach, transparent communication, and a commitment to excellence, InteliSync is your trusted partner for driving meaningful impact in the fast-paced world of Web3. Contact us today to learn more and embark on a journey to crypto marketing mastery!
Ready to elevate your Web3 project to new heights? Contact InteliSync now and unleash the full potential of your crypto venture!
What You're Going to Learn
- How These 4 Leaks Force You To Work Longer And Harder in order to grow your income… improve just one of these and the impact could be life changing.
- How to SHUT DOWN the revolving door of Income Stagnation… you know, where new sales come into your magazine while at the same time existing sponsors exit.
- How to transform your magazine business by fixing the 4 “DON’Ts”...
#1 LEADS Don’t Book
#2 PROSPECTS Don’t Show
#3 PROSPECTS Don’t Buy
#4 CLIENTS Don’t Stay
- How to identify which leak to fix first so you get the biggest bang for your income.
- Get actionable strategies you can use right away to improve your bookings, sales and retention.
Explore Sarasota Collection's exquisite and long-lasting dining table sets and chairs in Sarasota. Elevate your dining experience with our high-quality collection!
2. EXIT STRATEGY AND LIFE STRATEGY
• Deciding to sell your company is one of the biggest decisions
we make as business owners
• It will change your life in ways that are almost impossible to
imagine
• And it will often change the lives of your shareholders,
employees and their families
• And as important as this decision is,
• The truth is - we are not very good at exits
3. EXITS ARE AN UNDERUTILIZED STRATEGY
• Partly because of a lack of data, and
• Partly because entrepreneurs are incurable optimists
• We dramatically underutilize exits as part of our business
strategies and our life strategies
• The result is we have less money
• And are our families are less happy
• My goal today is to improve that
4. WHY WE AREN’T GOOD AT EXITS
• To succeed, business owners and CEOs have to learn to be good
at many aspects of business
• For many of us, the challenge of that life long learning is one of
the reasons we do what we do
• Much of what we learn as entrepreneurs is empirical – we learn
by doing, by trial and error
• That doesn’t work very well with exits
• Simply because exits don’t happen very often
5. THE DATA WE HAVE IS ANECDOTAL
• We are still decades away from having hard data on exit
strategies that will be useful to CEOs
• The knowledge we do have is largely anecdotal
• Based on observation and case studies
• One of things that I’ve learned is that only 25% of saleable
companies have successful exits
• Yes, we end up blowing our most important business decision
about 75% of the time
6. ONLY 25% SUCCESSFULLY EXIT
Timing - Rode it Over the Top
Timing - Rode it Over and
Failed Completely
Timing - missed the M&A
market
Got less than fair - accepted
an unsolicited offer
Got less than fair - corporate
structure or taxGot less than fair - missed
strategic value
Good price but bad deal
structure or terms
Good price but not aligned
with personal objectives
Good strategy, timing and
execution
The 25% that
Exit
Successfully
7. MOST OWNERS SELL BELOW MARKET
• About half of the people who succeed in selling their
companies get less than they should have
• I’ve seen companies sold for tens of millions less that the price
they should have received
• And many times the sellers don’t even realize they left millions
of dollars on the table
www.Exits.com
8. MUCH OF WHAT YOU HEAR IS WRONG
• It’s surprising how much of what you hear about exits is wrong –
dangerously wrong
• There are so many myths and misperceptions
• And so many ‘experts’
• And quite a few dirty secrets
• This workshop is about what actually works today - in our current
economy
9. COMPANIES ARE SOLD, NOT BOUGHT
• I often hear ‘companies are bought, not sold’
• People think that when ‘it’s time’ someone will knock on their door
asking to buy their company
• While that has happened, it’s almost never a good thing for the
shareholders
• It’s not just that the price will be much lower
• More importantly, the probability of success decreases because there is
usually one bidder
• Optimum exits require strategy and planning
10. THE EXIT IS JUST ANOTHER PROCESS
• Whether it’s a financing, product development, marketing
or sales goal
• The chances of success increase dramatically if you have a
good plan
• The exit strategy is the plan for the business – the entire
business
• The plan should start at the end (the goal)
11. DEVELOPING AN EXIT STRATEGY
• Where do you start?
• The first step is to develop your exit strategy
• That drives all of the other elements in your
business plan
• The exit strategy affects a surprising number of
daily business decisions
12. YOUR EXIT STRATEGY
• “Our exit strategy is to [sell the company] in about __ years for
around $ __ million.
• We plan to execute the exit by engaging a [mid market M&A
advisor] by _[date]_.”
• The optimum exit strategy depends on the:
1. Type of company
2. State of the economy
3. The M&A market
13. CHECK THE ALIGNMENT
• It’s surprising how often there is a serious
mis-alignment between key stakeholders on the exit strategy
• The only way to check is to get a ‘signoff’ on a written exit strategy
• Often requires at least one offsite planning retreat to build full
alignment
• Even after, check alignment annually
• Some now reaffirm it at every board meeting
14. EXIT STRATEGY SUMMARY
• The exit strategy is the highest level strategy in the organization
• It’s the foundation for the entire company plan
• It aligns the team on the most important goal:
1. The maximization of shareholder value
2. The optimum timing of it’s monetization
15. TIMING - OFTEN THE BIGGEST
QUESTION
• Many times in exits I have been involved with,
• The question which seems most important to the team and the
board is
• Not “How much can we get?”
• But “How soon can we complete a deal?”
16. HOW LONG IT USUALLY TAKES
• The short answer is usually 6 to 18 months
• From the time you engage the M&A professionals
• Until the cash is in the bank
• But it can often take longer if the company isn’t ready, or if the
structure needs to be cleaned up, or if the financials need
improvement
• Be wary of M&A firms that promise it faster
17. PART 1- BEFORE TALKING TO BUYERS
• About a quarter of the work includes:
1. Building alignment around exit strategy
2. Financial history and projections
3. Creating all of the sales collateral
4. Cleaning up the corporate structure
5. Preparing the due diligence
• Usually takes 1 to 5 months
18. PART 2- BUILDING THE SALES FUNNEL
• The second phase includes:
1. Research on best prospects - globally
2. Developing tactics on strategic value
3. Initial contacts to 50 – 100 companies
4. Responding to 10 - 20 interested
5. Starting due diligence with 5 - 8
6. To get to an ideal short list of 3
• Usually takes 2 to 6 months
19. PART 3 - THE BIDDING PROCESS
• The third phase is the most exciting and most intense
• Ideally three buyers will be in due diligence
• And actively negotiating, simultaneously
• The CEO will be fully engaged - and the limiting factor
• Can take up to 2 to 4 months
20. PART 4 - NEGOTIATING AND CLOSING
• Even after there is signed agreement on “the deal” and possibly a
deposit
• It can take months for the board, shareholders, M&A professionals,
lawyers and tax advisors to agree on the set of definitive agreements
• And obtain all of the approvals from boards, shareholders and
regulators
• This final phase is usually 1 to 3 months
21. WHEN TO TELL THE TEAM
• Many CEOs have difficulty determining when they should tell the rest
of the team
• Some worry about the employee anxiety
• Others think it is ‘none of their business’
• Most of the time the internal grapevine is so efficient that they
already know
• Best practice is to tell everyone fairly early
• But don’t under-estimate the impact
22. CEO DEAL FATIGUE
• It is very difficult to convey to someone who has not been through
a dozen, or so, exits
• Just how intense, and how stressful, the exit process is for the CEO
• Even the toughest CEOs can be incapacitated
• In my experience it is almost always a factor
• A good M&A advisor will explain, minimize, watch for and work
around
23. TIMELINE SUMMARY
• Once an M&A advisor has been engaged
• The exit usually takes 6 to 18 months
• Depends mostly on the company
• Most of the time is spent preparing the due diligence and sales collateral
• The next biggest time sink is scheduling
• Then waiting for lawyers
• Plan, and watch carefully for, for deal fatigue
24. IDEAL EXIT TIMING
• In an ideal situation, the company board would incorporate
this 6 to 18 month delay
• Into the company strategic and operating plans
• Look forward in time and then start the exit
• 12 to 18 months before the peak in the company’s exit value
25. IDEAL EXIT TIMING
0
1
2
3
4
5
6
0 1 2 3
InvestmentReturn(times)
Years
Optimum time
to start the exit
Complete the sale
near the peak in
value
Fastest
Growth Phase
26. “RIDING IT OVER THE TOP”
0
1
2
3
4
5
6
0 1 2 3 4 5 6 7
InvestmentReturn(times)
Years
Optimum time
to start the exit
Optimum
exit time
IRR = 124%
More typical
exit time
IRR = 15%
Fastest
Growth Phase
More typical time
to start the exit
27. THE FINANCIAL LOSS
0
1
2
3
4
5
6
0 1 2 3 4 5 6 7
InvestmentReturn(times)
Years
Optimum time
to start the exit
More typical
exit time
IRR = 15%
Fastest
Growth Phase
More typical time
to start the exit
Financial Loss
Optimum
exit time
IRR = 124%
28. PART OF YOUR LIFE YOU NEVER GET BACK
0
1
2
3
4
5
6
0 1 2 3 4 5 6 7
InvestmentReturn(times)
Years
Optimum time
to start the exit
More typical
exit time
IRR = 15%
Fastest
Growth Phase
More typical time
to start the exit
Optimum
exit time
IRR = 124%
Part of Your Life
You Never Get Back
29. THIS IS ACTUALLY OPTIMISTIC
0
1
2
3
4
5
6
0 1 2 3 4 5 6 7
InvestmentReturn(times)
Years
Optimum time
to start the exit
Optimum
exit time
IRR = 124%
More typical
exit time
IRR = 15%
Fastest
Growth Phase
More typical time
to start the exit
30. WHAT OFTEN HAPPENS
0
1
2
3
4
5
6
0 1 2 3 4 5 6 7
InvestmentReturn(times)
Years
Optimum time
to start the exit
Optimum
exit time
IRR = 124%
Common
Result
IRR = 0%
Fastest
Growth Phase
More typical time
to start the exit
31. WHY ?
• After seeing this happen over and over again
• I started to recognize a few patterns
• And realized there were logical reasons
• Why, if a company misses the ideal time to exit
• There’s a significant probability it won’t just exit for less,
• But will never exit at all
32. REASONS THIS HAPPENS
1. Over-investment by competitors
2. Competition
3. Intellectual property infringement
4. Negative momentum
5. The market cooled
6. The economy changed
7. Waves of consolidation
33. THE RIGHT SIDE OF THE WAVE
• Most CEOs are so busy operating the business it’s almost
impossible to watch closely enough
• And the early signs are not easy to see even if you are looking
• The best way to get an early indication is to watch the trends that
start the wave process
• The other is to speak to a lot of M&A advisors
• Almost all CEOs need help with this
34. AN UNSOLICITED OFFER
• One of the saddest parts of my job
• Owners often contact me all excited about a big company talking
about an unsolicited offer
• I explain that it’s rarely good news for the shareholders
• Because they’re usually not prepared
• Sometimes I see the signs of a wave of consolidation
• At that point they are dangerously late
35. SUMMARY ON EXIT TIMING
• Like many parts of life, and business, “timing is everything” with
exits
• Timing our exits better can change our lives
• And the lives of our families
• Recommendations:
1. Have someone watching your M&A market
2. Design your exit process – don’t wait for an offer
36. TYPES OF M&A BUYERS
• Active M&A buyers today include:
1. Big Companies
2. Medium Sized Companies
3. Private Equity Funds
4. Boomers (individuals, or small groups)
5. Family offices
6. VCs operating like P-E Funds – very new
7. International Buyers – small but growing
37. CASH FOR ACQUISITIONS
Cash Available for
M&A
US Companies $ 2 Trillion Most
Global Companies $ 8 Trillion Most
P-E Funds $0.4 Trillion All
Boomers (US only) $ 8 Trillion Small but
Growing
Family Offices (US) $ 1 Trillion Small but
Growing
38. HOW MANY IS $1 TRILLION?
• It’s difficult to put $1 trillion in perspective
• Most acquirers consider their ‘sweet spot’
• As somewhere around $20 million
• The median price is closer to $15 million
• Just one of these $1 trillion buys
• 50,000 acquisitions (at $20 million each)
• There are many times more buyers than sellers
39. BUYERS PRACTICALLY UNLIMITED
• For many exits under $100 million
• The number of buyers is, for practical purposes,
almost unlimited
• Often see three or four types of buyers
• Simultaneously bidding to buy the company
• Each type of buyer thinks and acts differently
• They all have lots of cash
• And there can only be one successful bidder
40. SUMMARY - A SELLERS’ MARKET
• The number of buyers and amount of cash available makes the
current M&A environment:
1. A sellers’ market
2. Fast moving and diverse
3. Talk is that prices are up 20% in a year
41. HOW MUCH WORK IS AN EXIT?
• Like so many things in work, and life, it depends
• But a good estimate for a fully marketed, competitive
transaction is about 1 to 2 man-years
• Excluding legal and accounting time
• That estimate does not include learning time
• If a very smart CEO and CFO wanted to learn enough to do a
reasonable job themselves,
• I’d triple the time estimate – at least
42. THE IDEAL EXIT TEAM
• The single most controllable factor in determining whether a
saleable company will actually be sold is the capability of the
team
• The ideal exit team is:
– The CEO
– An M&A Advisor
– A small committee of the board
– Legal and Accounting Professionals
43. THE M&A ADVISOR’S FUNCTIONS
• The M&A advisor is really ‘the sales guy’
• Whose important functions are to:
o Plan and coordinate the process
o Reduce the time to closing
o Improve the probability of success
o Protect the CEO (for as long as possible)
o Maximize the price and terms
o Do the selling and be the ‘bad guy’
44. WHY THE CEO SHOULD NOT LEAD
• There are several reasons the CEO should not lead the exit process, they:
o Rarely have the exit experience
o Needed to maximize the financial results
o Should be held in reserve for the final negotiation of price and terms
o If not the owner, can be “conflicted”
o Need a good relationship with the new owners (cannot be the ‘bad
guy’)
45. SELECTING THE M&A ADVISOR
• There is almost nothing written about selecting M&A advisors
• I believe it should be a full day course
• Relationships are always exclusive
• The most important criteria are:
– Transaction completion rate
– Track record of maximizing price
– Proximity, knowledge and compatibility
46. EVERY DEAL NEEDS A BAD GUY
• M&A transactions are usually fun
• They always involve big money
• The job of both sides is to get the best price
• At some point in almost every transaction, things will get tense - or
worse
• Every transaction needs a bad guy – a very good bad guy (who is
not the CEO)
47. M&A ADVISORS AND PROBABILITY
• The most important
criteria for selecting your
M&A advisor is
• The probability they will
succeed in completing
your sale
• Based on the 8% and my
observations it looks
something like: 0%
10%
20%
30%
40%
50%
60%
70%
Poor Average Excellent
ProbabilityofSuccess
M&A Advisor Quality
48. PRICE RECEIVED AND M&A ADVISOR FEES
-50%
0%
50%
Low Average High
PriceandFeeDifferences*
M&A Advisor Quality
Additional
Cash to
Shareholders
Reduced
Cash
*Estimated Ranges
Price Received
Fees Paid
49. MAXIMIZING EXIT VALUE
Some of the generally applicable ways to maximize the final selling
price include:
1. Increasing the growth rate
2. Structural value increases
3. Capitalizing on inefficient markets
4. Illuminating strategic value
5. Maintaining multiple bidders
6. Sales and negotiating skill
www.Exits.com
50. CAN YOU REALLY GET 50% MORE?
• I’ve seen a number of companies sold for 50% more than the
sellers expected
• I’ve helped make it happen quite a few times
• Most shareholders find it difficult to believe that a really good
M&A advisor can sell a company for 50% more
• 80 to 90% of the time, everyone signs an NDA
• So the stories very rarely get told
www.Exits.com