Kerri, Author at This Way Out Group - Page 12 of 25

After Your Exit Transaction – What’s Next?

I am pleased and honored to contribute to the discussion going on in your head; ignite more confidence, competence and possibility thinking; inspire you to greater strategic planning and more leadership initiative; and enable any entrepreneur or CEO to exit their business by achieving every goal they set.

All of which I hope this blog is accomplishing.

If you’ve been reading this blog for any length of time, and if I’m doing my job, you’re not exactly the same business thinker you were a year ago.

You should see at least the beginnings of the expansive, non-linear, 360˚, 10,000-foot view I want you to embrace.

You should now be thinking not about what you can’t accomplish, but of what you CAN accomplish in your business and beyond and what is honestly and significantly possible to fulfill your dream on your terms, on your timeline.

I hope you have, at a minimum, the urgency of forcing yourself out of your everyday comfort zone that produces more of the same old ideas, old solutions, and tired results; and into more, extensive, three-dimensional thinking. I hope your thinking is more expansive, more creatively oriented, and you’re looking at your business, competition, and exit opportunities from a position that is brilliantly open minded, inspired, and all encompassing.

If I’ve succeeded at all introducing you to exit essentials, you’ve opened a window into a sense of much greater possibility to formulate a plan to get out on your terms, on your timeline to your reinvention.

Reinvention—Time to Reap the Rewards of Your Harvest

Before you get to that transaction table with all your advisors, transaction experts, and the buyers; you must have a plan for how you will engage your mind and fill your time for at least the next 365 days.

This is NOT just a broad-brush idea of what you’ll do next, but rather a full-fledged plan with goals, milestones, and projects to consume you. This will take time to explore and prepare. This plan must be tested and validated in the years leading up to your exit. It is essential that you lay out this plan before you complete the transaction. Here are a few places to start. You can:

• Start a new venture — Reinvest part of your new liquid wealth in building a company around a new idea
• Take an adventure — Not just a three month tour of Europe, but sail around the world, go mountain climbing on every continent, move to Belize
• Pursue an avocation — Become a teacher, artist, designer, author, translator
• Give back—Engage actively in your philanthropic interests or invest in entrepreneurs you believe in
• Immerse yourself in a hobby — Whether it’s cooking, golf, hiking, languages, wines, investments, et cetera, it must hold your interest for more than three months. Be sure it will consume you and leave you fulfilled long term, maybe another 30-40 years.

Whatever your definition of reinvention is, you must have a plan. You must write it out. You must build out the plan to consume your time, energy and passion for at least the next 365 days. And you must test that plan for two to four weeks at a time at least once a year ( a.k.a vacation from the business you are preparing to exit).

Start with a self-assessment of your ambitions, skills, interests, commitments, joys. With the wealth you have acquired, make a plan for putting it to work for you, your family, your legacy, maybe a foundation, or other philanthropic endeavor.

Evaluate how much you need to live on and how much is available for you to pursue other interests or to risk in other ventures. What do you want to do differently in this reinvention—maybe more time off, more time with family, more education, more giving back.

Every hour you invest in your reinvention plan (like a business plan for your future), three to five years before your exit, will pay dividends in satisfaction, pleasure, fulfillment and security in the decades beyond your business.

Learn to Cash Out to Cash In

When was the last time you thought about how to cash out of your business?

Is it a topic you avoid? Do you only think about it when you are at the end of your rope after a really bad day? Is it a black hole you know nothing about?

Or do you include the long-term impact/implications in every decision you make? And tie every short-term decision and strategy to where you want to end up so you can cashout?

HARVEST YOUR WEALTH gives you the foundation for all those decisions in bitesize pieces so you can start planning early, to get out on your terms and on your timeline.

It’s never too early or too late to plan your exit. But you must make a plan and start executing on it now if you intend to cash out of your business to cash in those plans for reinvention (what comes next).

Start here, http://harvest-your-wealth.com

HARVEST YOUR WEALTH is for business owners who need to start thinking about how to sell, scale or pass on a business to successors. It’s not for advisors, transaction experts or buyers and their agents. It’s for you, the business owner who has put their life, spirit and soul into the business.

It’s only when you cash out of your business, that you can begin to cash in on the future of your dreams. To pursue that reinvention, you must have a plan to get out with the maximum value you can achieve for your business.

WHAT YOUR BIRTH CERTIFICATE SAYS ABOUT YOUR EXIT PLAN


In our experience, your age has a big effect on your attitude towards your business and how you feel about one day getting out. Here’s what we have found:

Business owners between 25 and 46 years old

Twenty- and thirty-something business owners grew up in an age where job security did not exist. They watched as their parents got downsized or packaged off into early retirement, and that caused a somewhat jaded attitude towards the role of a business in society. Business owners in their 20’s and 30’s generally see their companies as means to an end and most expect to sell in the next five to ten years. Similar to their employed classmates who have a new job every three to five years; business owners in this age group often expect to start a few companies in their lifetime.

Business owners between 47 and 65 years old

Baby Boomers came of age in a time where the social contract between company and employee was sacrosanct. An employee agreed to be loyal to the company, and in return, the company agreed to provide a decent living and a pension for a few golden years.

Many of the business owners we speak with in this generation think of their company as more than a profit center. They see their business as part of a community and, by extension, themselves as a community leader. To many boomers, the idea of selling their company feels like selling out their employees and their community, which is why so many CEO’s in their fifties and sixties are torn. They know they need to sell to fund their retirement, but they agonize over where that will leave their loyal employees.

Business owners who are 65+

Older business owners grew up in a time when hobbies were impractical or discouraged. You went to work while your wife tended to the kids (today, more than half of businesses are started by women, but those were different times), you ate dinner, you watched the news and you went to bed.

With few hobbies and nothing other than work to define them, business owners in their late sixties, seventies and eighties feel lost without their business, which is why so many refuse to sell or experience depression after they do.

Of course, there will always be exceptions to general rules of thumb but we have found that – more than your industry, nationality, marital status or educational background – your birth certificate defines your exit plan.

Harvest Your Wealth perspective from Tracy Repchuk

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Client Kerri Salls has just released her book “Harvest Your Wealth: Exit Essentials for Your Business”

Plenty has been written on starting and growing a company but very little has been written on exit strategies and on how to effectively monetize that investment when you want to be able to get out.

What has been written has focused on the financial and legal side of the exit transaction or from the advisor or the buyer perspective.

Harvest Your Wealth is for you the owner/entrepreneur/seller, to give you more control and leverage getting out.

When you start your business – this needs to be on your mind.

You are the business owner. Your goal beyond income is to build your company to produce wealth.

You envision, strategize and execute to achieve the promise you made to your family and yourself when you launched your business….

Continue here:
http://tracyrepchuk.com/blog/harvest-wealth-exit-essentials-business/ 

The Business Wealth Crisis is Here

The sellers’ window is here: 2013 – 2018. You can’t afford to wait to monetize the business you’ve built. Think about what you need to do now in your business:

“the difference between greatness and mediocrity, mediocrity and millions, spectacular and pathetic performance is how well you use your time, your opportunities, your efforts, your resources and your assets.”
Jay Abraham

“A calculated, adjustable exit strategy puts business owners in the ideal position to face the unexpected, whether the event is fortuitous, from a disagreement to a death or divorce, or providential such as an off market offer for the business.
An exit strategy enables business owners to take control of the selling process and ensure superfluous problems or delays are not encountered, which can reduce the price whcih a business can fetch.”

Michaela Mcnamara

“A well developed exit strategy also allows you to maximize the value of the business by enabling you to address the drivers that impact the price of the sale and can manage the expectations of partners, colleagues and family.”
Joseph Bridger, Partner Corporate Transactions of Pitcher Partners

“A business that operates successfully and profitably without relying on the day-to-day efforts of the owner is something worth paying for.”
Paul Banister, Director of Tax for Grant Thornton Australia.

This process could take years and it does involve many components.
Just as your business can change, from the product mix, markets, marketing channels to management; so too can your exit strategy change. You need to review it and revise it as often as necessary, at least annually.

Calculate Your Business Nest Egg

Business Owner’s Nest Egg

The Business Owner’s Nest Egg Calculator is a software program which resides on the internet that allows for the organization of the entire business owner’s Nestegg to be contained in one place, the 40 page BizNestEgg report.

Business owners want help making the most important financial decision of their lives. Certified valuations can be very expensive and indeed sometimes they are needed in special instances.

But there are many other reasons to calculate the business value that do not demand the certification and the cost associated with a full certified valuation. For all those reasons, we now offer the Business Owner’s Nest Egg Calculator.

The BizNestEgg Calculator delivers:
• Fair Market Business Valuation
• Deal Structure Scenarios
• Tax Ramifications of the Sale
• Post Sale Income Analysis

The purpose of the BizNestEgg report is to answer three questions:

1. How much is the business worth?
2. How and when will the business owner get paid after the sale?
3. How does the business sale coordinate with the business owner’s other investments and how will each year look with regard to income during retirement? This third questions is where you get the know when you can transition to the reinvention of your dreams, not just someday.

Combine the BizNestEgg report with your personal one day exit planning consult report and you have a complete qualitative and quantitative analysis of your business and personal situation.

Request a confidential analysis for your business today. kerri@kerrisalls.com

Exit Strategy Stages

An exit plan to sell your business is more than a transaction. When you understand that there are five stages to the exit process and that there is a systematic way to move through the whole process without getting overwhelmed or discouraged, you can relax and simply ‘work the process’. That’s what these five exit strategy stages are all about.

Exploration/Evaluation – This where all your exit planning happens to understand the scope of work to do, the opportunities and timeline involved to achieve your exit to reinvention.

Growth Process Implementation – To maximize value of the business and build a deep foundation to make the business buyer attractive, you need to put a growth strategy into motion. If you sell the business as is, the buyers can’t see the future value to them in what you do now.

Exit Integration – The exit transaction is the culmination of all your planning, preparing the business and your team for your exit, maximizing value and determining the kind of exit you want and the terms you want to exit, along with the terms, timeline, cashflow for your reinvention.

Track & Measure for Excellence & Value – Tracking and measuring are the only way you ever know if you are getting the results you want. Tracking and measuring also help you raise the bar and add value in the intellectual property you own and the goodwill value you’ve built up in the business. Tracking and measuring is an essential toolkit you must employee, refine and promote to buyers to demonstrate your team and business excellence and the value they are worth.

HARVEST YOUR WEALTH — Exit Essentials for Your Business

ANNOUNCING

This Way Out Group LLC announces the release of HARVEST YOUR WEALTH – Exit Essentials for Your Business by exit strategist, author, speaker, and radio host, Kerri Salls to help business owners cash out of their business so they can cash in on their future.

FRAMINGHAM, MA (January 21, 2013) – This Way Out Group (http://thiswayoutgroup.com), the break-out boutique services firm providing comprehensive collaborative exit planning services announced today the release of HARVEST YOUR WEALTH – Exit Essentials for Your Business (This Way Out Press $17.97 on Amazon) by CEO and author, Kerri Salls. HARVEST YOUR WEALTH – Exit Essentials for Your Business educates and prepares business owners to monetize their business on their terms when they plan to get out, instead of simply shuttering the business and walking away. Only when an owner prepares the business for a clean, solid, and profitable exit can they expect to cash out of the business to cash in on their future. Written by expert exit strategist Kerri Salls, HARVEST YOUR WEALTH reveals the secrets the transaction experts want entrepreneurs to know before selling a business, but no one has been telling them until now.
In HARVEST YOUR WEALTH, Salls introduces the 95% of all entrepreneurs and owners who do not have an exit plan for their business to the decisions, choices, options and opportunities they need to know about years before they decide to get out of their business. She advocates for early exits, especially over the next five years for baby boomers.

Salls says, “HARVEST YOUR WEALTH gives the owner/entrepreneur more control and leverage getting out. Plenty has been written on starting and growing a company. Very little has been written on exits, on monetizing that investment to be able to get out. What has been written has focused on the financial and legal side of the exit transaction or from the advisor or the buyer’s perspective.”

Less than 10% of business owners who put their companies up for sale actually get the deal done. (2010 Survey of Brokers and Buyers by MidMarket Capital) “[Exiting small business] owners are preparing for the deal of a lifetime with possibly zero experience.” (MorganStanley SmithBarney publication, 2011) [via Blackbridge Newsletter 2011]

They think they’ll be able to sell when they want for what they want with no lead-time or preparation of the business, the team or the business owner. That’s a diet of hope and promises that will satisfy no one. Because of a lack of pre-planning, 95% of all business owners are leaving up to 50% of the value of their business on the table when they exit.

In this book, Salls focuses on the needs of owners to make their business buyer ready and buyer attractive; on exit planning from the seller’s perspective before the transaction experts, or the buyers come into the picture. The urgency for baby boomers to act now cannot be overstated.

HARVEST YOUR WEALTH provides steps, checklists, assessments, questions and exercises all business owners must consider in order to take control and achieve their goals in the business and beyond. Salls provides the resources, tools and insight to encourage entrepreneurs and business owners to, as she says, “Plan their exit from the outset.”

Salls started her career in the Peace Corps in West Africa and then spent a decade accumulating multi-million dollar corporate achievements before launching her first business in 1988. She has been active in business strategy and exit planning for 40 years.

This Way Out Group LLC [http://thiswayoutgroup.com] has been refining and applying a holistic system to assist business owners since 1999 specifically to help owners transform an income generating business into a wealth-producing machine so they can sell or scale the business on their terms on their timeline. Partnering with the business owner 2-5 years before their expected exit, we help established and hyper-growth companies prepare for and achieve their optimum exit strategy. We help owners to accelerate sales, optimize growth, and maximize value to make their business buyer ready and buyer attractive so they can get out and move on to the next venture, adventure or avocation.

HARVEST YOUR WEALTH – Exit Essentials for Your Business is available at Amazon and other outlets or at www.harvest-your-wealth.com.

TO ARRANGE INTERVIEWS OR MEDIA/SPEAKING APPEARANCES CONTACT:

Exit Options – Early Planning Offers Greater Choices

To achieve a successful exit, you must follow through and implement every plan outlined above. This stage is very straightforward but ends up being the hardest because it takes consistency, focus, commitment and dedication to the endgame while still consumed with 90-day operational plans too. It’s a lot of work. For best results, don’t try to do it all on your own.

Exit Options

There are tradeoffs for every exit strategy you consider. The chart below may be useful in exploring which options you want to consider. Each exit option can take your business to its next stage. You must evaluate how each option allows you to achieve your exit goals. It may be that there are elements of different options you want to consider or combine. Your exit can be as unique as the business you’ve built, the team that surrounds you, your core values and culture; and your leadership. As you guide the transition of the business to its next stage, you may end your involvement and get out, or define a new role to remain with the business in some capacity.

Exit
Options

Definition

Seller
Benefits

Seller
Drawbacks


Merger with another company

Your company joins with an
existing company.

You may receive cash and/or
stock, resources of the two companies are combined, and some of your
management team may be kept on.

The new owner/manager may have
different ideas of how to run the business, your existing team may not
have the control they had under your leadership, merging the two
corporate cultures may be challenging


Acquisition by another company

Your company is bought out by
another existing company.

You may receive cash and/or
stock for the sale. You may be required to stay on in some capacity for
a specified period of time for transition.

Your corporate brand and
identity may or may not be preserved. The fit may not be perfect for the
business or your team.


Sale to a Strategic Buyer

A strategic buyer who wants to
run the company buys you out.

You may receive cash immediately
or structured over a set timeline.

It can be difficult to find the
right buyer, at the right price on your schedule. Change of
ownership/leadership may be difficult for employees and management.


Sale to a Financial Buyer

A financial buyer who wants to
add your company to their portfolio of managed companies

You may receive cash immediately
or structured over a set timeline. You may be required to stay on in
some capacity for a specified period of time for transition.

Financial buyers are looking at
the numbers and how to get a good return on their investment. How they
want to do that may be difficult for employees, management and clients.
There may be a clash of culture and values.


Franchise the Company

If your business is
replicatable, this allows you or new owners to expand locally,
regionally, even internationally.

You receive cash from each
franchisee, your current management team and structure are maintained.
Franchising is an opportunity for large-scale growth

Franchising takes time. The
process can be difficult and time –consuming. Not every business is a
viable candidate for franchising


Employee Stock Ownership Plan (ESOP)

Employees shares or stock of the
company over time.

Employees are rewarded for
contributions, receive incentives for longevity and share in the profits
of the company they helped you grow.

Employees may lose their shares
if they leave the company, employees share the burden and risk if the
value of the company goes down.


Management Buyout

Some or all of the existing
management team buyout the owner. This is one version of a group buying
the company instead of an individual strategic buyer.

You may receive cash immediately
or structured over a set timeline. You may be stay on in some capacity
for a specified period of time for transition.

Managers may
not agree on how to run the business without your leadership.
Negotiating a transaction may include many more factors and conditions,
as the buyers are also the team being valued.


Initial Public Offering (IPO)

Shares of the company are sold
publically on a stock exchange.

Shares convert to cash for the
owner and any initial investors. Major shareholder control the company.
Investors expect to see a potentially high return on their investment

The company must deliver nigh growth to generate earnings and interest
for investors, IPO costs are very high, IPOs offer a very uncertain
outcome for owners or investors.


Succession

Someone inside the company,
inside the family or hired in is trained and groomed to succeed the
owner

You handpick your successor on
your terms

You are dependent on the effectiveness of your successor to ensure the
company can pay you (cash, annuity, payment schedule) and sustain the
company moving forward.


Close the Doors

Cease operations and liquidate assets

Minimize losses, quick exit.

Without any effort to monetize revenue streams or intellectual property,
you eliminate any chance to profit from the business

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