“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
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
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
Things Can Go Wrong in the Wild West
“I researched these guys before the first call. They seemed legit, and I could tell they weren’t on a fishing expedition. They knew a ton about my industry, the players, and opportunities. You think they might be a real buyer for my company?” I felt sorry for Angie. She looked tired, and running this company was nothing she had bargained for. But when her husband went AWOL on the family and business, she had no 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
Does Your Company Need an Advisory Board?
“My advisory board is encouraging me to take a serious look at this offer. I need your help to do that, when can we meet?” So began my relationship with Mark (not his real name). When we met face-to-face, I learned Mark’s story of taking over the business upon his father's passing in 2006. “We’ve been more successful than I ever imagined, I know Dad would be proud of what we’ve done. But selling what he started, it Read More
Four Syndromes Every Business Owner Should Fear
“Everybody knows it’s time he should sell, but he can’t seem to let go.” Bruce (not his real name) is the head of marketing for a company owned by Philip (not his real name). Bruce called for my advice on structuring an employee-led buyout. He admitted it was a long shot even though Philip is in his late-70s. It seems Philip had heretofore not been willing to even entertain the idea of selling. But Bruce and his 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
What I Had to Unlearn From Harvard Business School
A few weeks ago I was visiting the campus of Harvard Business School. I was there to participate in the second-year MBA class, Entrepreneurship through Acquisition. I had written the case study being discussed that day. Incidentally, the case study was about an actual client of mine, and he was even brave enough to come to the class with me. Though I graduated from HBS over three decades ago, I still feel at home Read More
