Services

Keynote speeches and top team discussions about acquisitions are both available on a variety of topics.  If you have some ideas about what your team or audience would like, the best thing is to pick up the phone and give Robert Sher a call at 925-788-1141.

 

Some ideas are noted below:

 

Idea #1: M&A Readiness: A corporate state of mind
Most business leaders are mindful that certain things may become necessary to grow their businesses. Things like borrowing money, hiring a COO, buying a big piece of equipment, moving the business to larger quarters, and more. For many CEOs of small and mid-sized firms, the incredible opportunity of buying a business or selling the one you run today is out of sight and out of mind. Great opportunities float by and are missed. Worse still, opportunities present themselves and the business and its leader aren't ready and can't take advantage.

Critical to building a business today is having a corporate state of mind which includes M&A readiness. Why?

1. You'll keep your business in top condition, knowing that at any time in the next three years, you may sell the business. You'll pay attention not just to profits this quarter, but all the other critical factors that really make up the value of a business. Even if you never sell, your business will be much healthier.
2. You'll keep up relationships with all likely strategic buyers and sellers so that the comfort is there for those strategic buyers to turn to you first when they're ready to buy or sell. If you initiate, you'll have the best chance of having several eager strategic buyers bidding for your business at the same time, creating auction level pricing.
3. Having an M&A state of mind at all times will require you think strategically about your business on a regular basis, which will precipitate many different actions that will benefit your business over time.

Idea # 2: There should be an R in M&A
Every year, the leader of the business makes a decision. The decision is to either retain the business, sell the business, or acquire a business. In essence, if you don't sell your business, you are deciding to "buy" it yourself -- or retain it.

The decision to retain means that you feel the business is worth more to you in your hands and control than what you could get if you sold it. But how can you make such a decision unless you assess your own business in just the same way a buyer might make such an assessment?

Business leaders should annually do a market review of their business -- not the kind of valuation your CPA does, but the kind of analysis an M&A broker would do in preparation to sell your business. Three clear benefits come from this.

First, you'll be able to see how much your business' value had changed since the last valuation, allowing you to make a good decision about selling.

Second, you'll identify all the weaknesses in your business and can lay plans to fix them.

Third, as part of your competitive analysis and strategic planning, you'll start to see opportunities in your business where an acquisition might be a big step forward.
 

Idea #3: The Incremental Acquisition
Buying businesses can be addicting and exciting. Often, CEOs will look at a small deal (relative to the size of the acquirer) and move forward, thinking that it'll add incrementally to volume -- say 5%.

The truth is that small deal is not necessarily easier than big deals. The author did four acquisitions, and the fourth, an incremental deal, was the worst, and caused great disruption and headache. This story is not written about in The Feel of the Deal.

Key considerations:

• Dependency on seller personnel after the close.
• Dependency on seller performance after the close.
• Reputation of the seller.
• Legal and accounting costs.
• Integration issues with your own system.
• Desperation level of seller.

Idea #4: WHY owners sell.
One of the most fundamental issues for a buyer is to really understand and know why the seller is exiting. If the seller is exiting for "bad" reasons, it means they are trying to "dump" future foreboding events on the unsuspecting buyer. If the seller is exiting for "good" reasons, the buyer can rest more assured that the future will have no nasty surprises. The sellers often don't tell you the real reason they are selling. It has to be teased out of them.

• We discuss common good and bad reasons a business is sold.
• We discuss some tactics for "teasing" the real reasons out of the seller.
• We discuss some research (due diligence) issues that can help the buyer discover possible negative issues well before they're committed to the deal.