“All this talk about multiples makes me dizzy. Multiples of revenue, multiples of EBITDA, multiples of net earnings. Which multiple should I focus on to know my business value?” Rod (not his real name) owns a profitable healthcare services business. Though just 37 years old, he has assembled an organization and methodology that no longer requires his active involvement in the business. He called me for advice after Read More
Momma Was Right, Do Your Homework Before the Test
“If I don’t handle this right, it could cost me millions and leave me bored to tears. Can you help?” I get a question like this from a business owner about once a month. The types of businesses are different, but the situation is the same...the owner has a successful business and they have been approached by a credible third party with an unsolicited, though compelling, offer to sell their company. The second Read More
The Longsufferring CFO
“I’ve been his CFO for ten years. I’m 55 years old, if I don’t see his plan for transition in the next few months, I’ll have to go find another job. Gosh, for all I’ve put into this company and the good people here, that’s the last thing I want to do. But I might not have a choice. Given the pace we’re on, I don’t see us making it much longer.” David (not his real name) has been CFO of the company for ten years and Read More
The Business Owner’s 3:00AM Wake-Up Call
Every four years Americans go to the polls to elect a president. There is one issue that seems to come up during every election, and that is how each candidate would handle the “3:00AM wake-up call.” The question centers on how the candidate would handle a crisis so severe that they’d need to be awakened in the dead of night. Truth be told, many people make their decision for whom to vote based on how they feel about Read More
The Thin Line Between Warm & Fuzzy and Hot & Messy
“My partner and I have grown apart. He isn’t the same fantastic guy he was when I offered him a full partnership in 2007. He plays favorites with the employees, he comes and goes as he pleases. His arrogance is creating a toxic environment. If we don’t separate soon, it will kill our business. Can you help?” Archie (not his real name) asked me to meet him and his wife at their home to assure full confidence in the Read More
How Selling a Business is Like Flying a Skywriting Biplane
“We have two lines of business, one has been making money for fourteen years, the other has been losing money since we started it three years ago. We’re certain this new line will be profitable next year, but we want to sell the business this year. Should we jettison the money-losing line now, or will a buyer see that we are close to turning the corner as a good thing?” Carl (not his real name) brought his company's Read More
Perry Mason Had the Right Approach
I used to love watching the TV lawyer, Perry Mason. He solved every case with a combination of smarts, luck, and guile. Each episode concluded with a shocking surprise that revealed the real criminal. Perry won every case. Each episode had a cast of characters from which the guilty party would always emerge. If there was ever a theme to how you figured out who was guilty, you’d look for motive. Which character might Read More
You Can’t Sell Your Job, Even if You Own It
“Can we stop in here? I was talking with the owner the other day, and he told me he wanted to talk with you about selling his business.” My wife, Emily (her real name), and I were out for dinner one evening. As we walked into one of our favorite restaurants in Brentwood, she told me she had visited a nearby boutique just a few days earlier. She said she started talking with the proprietor of the boutique, and he told Read More
Follow the Money, Sometimes Bad Advice
“At this pace, we’ll double revenue in four years. I’m just not sure I can maintain this pace.” Katie (not her real name) owns a very successful services company. She serves a niche that is fueling fast growth, and every new dollar of revenue is more profitable than the last. She has the essence of what’s called a scalable business. In her mid-40s, Katie seems nowhere near the age to slow down, much less retire. But Read More
The Taxman Doesn’t Always Win, and That’s Not Always Good
“I just wrote the biggest check I’ve ever written. I don’t ever want to do that again. I guess I’ll die and let my family deal with it.” Nobody likes paying taxes, especially Allen (not his real name). Though in his mid-70s and dealing with health issues, Allen isn’t ready to sell his company. He met with me, reluctantly, at the request of his son-in-law who I know from church. Allen’s family wanted him to consider Read More
