Weekly Recap

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E219: Unlocking True Business Value: Strategies and Insights for Mid-Market Sales w/ Trever Acers

About the Guest(s):

Trever Acers is an investment banking and valuation expert with over two decades of experience in the industry. He is part of Objective Investment Banking and Valuation, where he has been a key player for 15 years. Acers’ career began in strategy consulting, leading him through roles in technology, private equity, and ultimately landing him in investment banking. His expertise lies in representing sellers in the mid-market range, specifically dealing with companies valued between $20 million to $250 million.

Episode Summary:

In this episode of the How2Exit Podcast, host Ronald Skelton welcomes Trever Acers to discuss the intricacies of mid-market evaluations and the strategies for successful mergers and acquisitions. Acers, with his extensive background, shares insights on preparing businesses for sale and the importance of understanding a company's true value.

Beginning with Acers' journey from strategy consulting to investment banking, the conversation delves into the art of optimizing a business for the mid-market sale process. Acers emphasizes the need for businesses to be "buttoned up" and prepared for rigorous buyer scrutiny. With a focus on tailored strategies for business owners, he elucidates on the diverse industry experience required for a successful sale.

Key insights from the episode include how businesses can position themselves to be attractive to buyers and the importance of being strategic about company earnings and valuations. Acers advocates for an approach that aligns the seller's objectives with the process, ensuring not just a successful sale, but also a fulfilling one for all parties involved.

Key Takeaways:

• Valuation Prioritization: Acers highlights the significance of understanding and strategically presenting company valuations, focusing on synergies and future earnings potential for acquirers.

• Industry-Specific Expertise: The necessity of having departmentalized industry expertise within an investment firm is crucial to describe, value, and interact with potential buyers effectively.

• Aggressive Disqualification: Business owners must critically assess potential buyers early to avoid unnecessary costs and focus on those who are serious contenders.

• Deal Catalysts: Partnerships and relationships with other companies often act as catalysts for acquisitions, especially when there is an established rapport and understanding of potential synergies.

• Pre-Exit Strategic Actions: Business owners should consider engaging experts 2-3 years prior to a planned exit to strategize and significantly improve their outcomes.

Notable Quotes:

• "The only time we pursue sale is when it's like, wow, sale makes so much more sense than these other options because of all the unique factors that make us business owners, all the objectives that we have." – Trever Acers

• "You know, even in our, in our small business world, I always tell people if it's got more than two partners, I probably don't even want to chat with them." – Ronald Skelton

• "Humans perceive that if they perceive there's less risk there if they're familiar with you. And by less risk, that means they're willing to pay more." – Trever Acers

Article:

Navigating Mid-Market M&A: Strategies for Success in Business Transitions

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E218: Nathan Lenahan Discusses Hiring Operators for Small Businesses

About the Guest(s):

Nathan Lenahan is an experienced entrepreneur and former military professional. After serving in the army for six years, including multiple tours in Iraq, Nathan pursued a career in real estate investing and obtained an MBA from the University of Texas at Austin. He has since started and sold multiple companies, including a property management company and a tech-enabled real estate brokerage. Nathan is currently the owner of Bart's Heating and Air, an HVAC company, and the founder of Smooth Operators, a recruiting service that helps small and medium-sized businesses find skilled operators. With his extensive experience in hiring and acquisitions, Nathan is passionate about helping business owners find the right talent to drive growth and success.

Episode Summary:

In this episode, Nathan Lenahan discusses his journey from the military to entrepreneurship and shares his expertise in mergers and acquisitions. He highlights the importance of understanding the different phases of a business and hiring the right operators to drive growth. Nathan also introduces his recruiting service, Smooth Operators, which focuses on connecting business owners with skilled operators in the blue-collar industries. He emphasizes the significance of clear communication, setting expectations, and building trust in the hiring process. Nathan provides valuable insights into the challenges and strategies involved in acquiring and growing businesses, offering practical advice for both buyers and sellers.

Key Takeaways:

• Hiring the right operator is crucial for the success of a business acquisition. Understanding the owner's needs, preparing the role for success, and aligning incentives are essential factors to consider.

• Identifying the right operator involves assessing their experience, skills, and mindset. Different operators excel in different phases of a business, such as startup, growth, or maintenance. Matching their strengths with the company's needs is key.

• Building trust and open communication with operators is vital. Clear expectations, ongoing feedback, and a supportive work environment contribute to a successful partnership.

• The staffing industry offers opportunities for growth and acquisition. Nathan's company, Smooth Operators, focuses on connecting business owners with skilled operators in blue-collar industries, such as HVAC, plumbing, and electrical.

• When acquiring businesses, it is important to have a clear growth strategy. Organic growth through expanding services or geography, as well as strategic acquisitions, can help achieve growth targets.

Notable Quotes:

• "If you're not willing to operate the business yourself, don't buy it." - Nathan Lenahan

• "Behavior follows incentive. Make sure you align incentives with the desired behavior." - Nathan Lenahan

• "Knowing who you are makes it easier to attract who you want." - Nathan Lenahan

Article:

How to Successfully Acquire and Operate Small Businesses: Insights from Nathan Lenahan

FROM THE Editor:

Disclaimer: This newsletter is provided for informational & educational purposes only, and should not be relied upon as legal, business, investment, or tax advice. We are not attorneys, tax, or financial advisors and not qualified to give any such advice.  

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