When Family Legacy is a Boat Anchor to Business Decision Making

She could barely hold back the tears. Wanda (not her real name) was telling me how her grandfather started the business after World War II. Her dad took it over in 1974 when her grandfather was diagnosed with Parkinson’s disease. Wanda started in 2002, and her dad poured his heart and soul into training her to take over the company. Unfortunately, he had a rare heart disease and died in 2007. “I wasn’t ready to take Read More

Watch Out For That Pig-in-a-Poke Valuation

“Jim, I decided to go with the other firm. They say they can get more for my company than you think it’s worth.” This recent comment from Tracy (not her real name) was the first time in ten years I have lost an engagement because the business owner was picking another intermediary. It seems the other broker convinced Tracy that he could get her a higher price for her company. I had told Tracy the business could Read More

Beware the Too Good to Be True Offer

“Danny, their offer is 21% above your asking price and they want to close in 45 days.” Immediately after receiving the offer, I had called Danny (not his real name) to tell him the great news. After I described the basic terms, Danny said, “Jim, this is almost too good to be true, I couldn’t be more pleased with the job you have done.” I hastened to remind Danny of the adage “a deal isn’t a deal until it’s done,” Read More

Time to Sell Your Business? Trust Your Heart

“Why should I sell? The way we are growing we’ll double our value in no time!” Though we were meeting at 6:30 that morning, he didn’t need coffee. Randy (not his real name) lived a caffeinated life. He ran at a fast pace, the success of his company was evidence of that. But Randy seemed ready to slow down, maybe take some chips off the table. A few weeks earlier, I had reviewed Randy’s business and told him how much Read More

Retaining a Lawyer Just on Price, Bad Advice

“My brother-in-law knows a lawyer who charges $250 an hour. The guy you recommended charges $450 an hour. Why would I pick the lawyer you recommended when I can pay almost half the rate for the same service?” David (not his real name) had retained me to sell his company. After many discussions with several interested buyers, he settled on a company like his, though much larger, from the upper Midwest that wants to Read More

Don’t Walk That Road Alone

“I want to sell my company to them, but I don’t think I need a business broker. On the other hand, I’m pretty sure I need help getting through this. Is that what you do?” Linda (not her real name) started her business in 2005. She describes some “dark times” going through the recession of 2008-2009. But in the past five years she has flourished, and now has thirty employees and dozens of regular clients. I met Read More

Private Equity, What Kind of Offers Are in Those Expensive Briefcases?

The room was full of men and women wearing expensive suits, carrying brand-name leather briefcases and purses. You could land from Mars and guess you were at a conference of private equity professionals. I was invited, along with about fifty other investment bankers/business brokers, to meet with dozens of private equity firms from around the country to brainstorm and network over pending and future deals. Over the Read More

It’s Just an LOI, Let’s Sign It and Move On

“Hell’s bells, Jim, it’s just a non-binding LOI, please get him to sign it and let’s get on with this thing.” Bart (not his real name) was unhappy with me. My first clue was this call came in at 6:30am. “You told me our LOI was going to be signed three days ago, what’s the hold-up? I have bankers and investors waiting to hear.” I explained to Bart that my client liked the deal he had on the table and that I was Read More

Don’t Be So Smart That You Kill the Goose That Lays Your Golden Eggs

I’ve never seen a strategy so brilliantly described. Bret (not his real name) was showing me a colorful graphic of how his business worked. The graphic showed six entities revolving around the core business he started about 20 years ago. “Yeah, I’m pretty proud of how it looks,” Bret said to me. “Everybody I show it to immediately gets what I do. You think I can get a 10X deal on my company?” As he nears 60, Bret Read More

Potential is a Terrible Way to Describe a Business You Want to Sell

Though happily married for almost 33 years, I have some memories of my experiences dating. I once had a friend say “I have somebody you should meet” to which I said, “well, tell me about her.” The response was “she has potential.” I politely declined. Potential is a terrible word to use when describing a potential date, and it’s a terrible word to describe why someone should buy your business. When a business Read More