Don’t get trapped in a limited vision
By John Howe
I slipped on a pair of prescription sunglasses while driving recently. Immediately it was apparent that something was wrong. My view was blurry and out of balance.
My first thought was fog or dirt on the lens. But in fact, one lens had fallen out on the passenger seat. My vision was out of whack because one lens was missing.
Sometimes our vision about the future is blurry because we aren’t considering the whole picture but only parts of it.
This can happen to owners who are so wrapped up in day to day that they can’t see another perspective. Some can’t see the possibilities of what is ahead but rather are influenced by fear of what they might lose through a sale: their identity, their purpose in life.
Let’s unpack these thoughts.
Over the past ten years we’ve spoken to many owners. They generally fit into two buckets:
Which defines you?
We generally represent sellers of private companies, and most companies are 20 to 30 years old. The vast majority are in their first generation of ownership. Some are in their second generation. Very few go beyond that.
It is most productive when we talk with owners who are ready to act, and who have thought about life after business. They generally have an idea of what they want to do, and are ready to let someone else take the business to the next level. They care about money, but it isn’t their sole objective.
It is tough to convince someone to act who sees no hope in letting go. But if you are of a certain age, doing nothing generally is not a good course to take.
It is sad when an owner cannot let go, either for financial or emotional reasons. When someone says they cannot afford to sell, or don’t think they’d get the value they “need”, you have to wonder. Are they really being honest with themselves, their families, their partners?
OK, we understand. After decades of running a business, it can be hard to let go and to sell.
But there are cases where owners stay too long. The company value may diminish. A sale may not even be possible.
As you think about things, make sure you are not limiting your perspective. Many have successfully transitioned and are enjoying a full life after business.
Consider this strategy: Make solid plans. Decide what you want your legacy to be. Develop goals for your time. Make sure you have assets beyond the business. Doing these things, you will have a better chance of making a good decision when it comes time to consider a sale.
BTS News
Manufacturer Sold and New Owner Expands It
BTS served as advisor in the sale of PlasTech Machining Fabrication, Inc. to DelCam Holdings in 2020...the company has grown substantially, doubling employment and adding capacity to boost future prod
How M&A Will Respond to Next Recession
The takeaway for business owners: Get back to basics. Don’t worry about hyper growth. De-risk your company as much as possible.
Perception vs Reality with Small Businesses
Sometimes the economic picture on the news seems inconsistent with what is happening for many business owners. Nearly every owner we speak to is out straight.
NH-Based Techinical Manufacturing Company Sold
Hampshire Controls has a bright future with new ownership. The company was recently sold by Diane Rush, owner and president, to Pillar Imaging and its leader Dr. Michael Pilon.
Be Ready When You Are Ready
When a business owner says it’s time to sell, I ask, “How fast do you want to be out?” The answer I hear most is, “Yesterday.” But sellers underestimate how long the process takes.
Looking at a Sale Through the Right Lens
Sometimes our vision about the future is blurry because we aren’t considering the whole picture but only parts of it.
5 Deal Points from the Trenches
Today I work with clients of Business Transition Strategies who are implementing Growth Through Acquisition strategies. Here are a few observations from working on a wide variety of projects.
Tax Changes Could Hurt Net Proceeds
Changes proposed to the capital gains tax suggest they may need to get 30% more in a transaction in the future just to net the same value they would get today.
Good Ideas From Shark Tank Deal
One of my colleagues in Cornerstone Alliance was front and center in a recent Shark Tank exercise. A business that had been sold was put in front of four potential buyer groups.
Buyer Trends in Lower Mid-Market
Other businesses are a significant market for companies being sold within the lower mid-market.
Case Studies
Precision Machining Company
Initially, liquidation was a serious consideration. It would offer a quick exit but would hurt loyal employees and disrupt the customers who had come to rely on its quality production.
Green Product Company
Our client owners could dig in for the long haul…However, this would take five years or more. Owners simply lacked the horsepower to do it.
Water Purification Company and Young Buyers
Owners decided they wanted to retire. They also wanted to be fair to the staff who had been loyal to them. Could the company be sold, the staff retained and the facility remain in use?
Magnetics Company with High Profile Customers
(T)he manufacturer would need to focus on growing EBITDA to capture interest from major strategic buyers and achieve a higher multiple of earnings.