Achieve the Highest Possible Exit Outcome
Are you growing your business in a way that is maximising your chances of the best possible Exit outcome?
Exit’s Come in Different Forms
For some business owners, a successful exit might be selling for the highest possible valuation to a trade buyer.
For another owner, this might be sacrificing some degree of valuation in return for finding a safe custodian for their loyal or long-standing employees.
For another owner, an exit might be about achieving passive ownership where a Management Team runs the business and they have no or limited operational involvement and take a high annual dividend.
For another owner, an exit might be about grooming a Management Team for succession and who participate in an MBO.
Are You Growing Your Business in a Way that is Conducive to an Exit?
Growing a business but not building value is a common owner trap. For example, if a company achieves consistent double-digit growth and has strong EBITDA but a high proportion of its revenue is concentrated with one large client, or revenue isn’t recurring, or the business cannot function without its owner then it has minimal sale value.
Your Business is an Asset and You Must Build its Value
Saleability isn’t a black and white concept (you shouldn’t see the business as saleable or not saleable). Instead, consider whether the business has been developed to its highest possible valuation (or its highest level of saleability).
Exiting is About Realisation of Value
Selling a business is the biggest sale you will ever make – and often for a life-changing amount. Because of this, doesn’t it make absolute sense to maximise the saleability and valuation of the company by focussing on things that build value and can therefore increase the exit multiple overtime? If you don’t, it’s very easy for these things to pass you by as you become over preoccupied with running and growing the business.
Are you Ready to Increase Value, Create a Strong Exit Strategy and Get Peace of Mind for the Future?
Starting at least 3-5 years out from your end-point, we work closely with you to build more sale value in the business, to increase its saleability and to raise its exit multiple. Typical results include:
- Exit Milestones: appraise the various possible exit scenarios (whether Trade Sale, MBO/Succession or Passive Ownership), how compatible they are with the owner’s goals and develop a plan with clear timescales and milestones towards this.
- Value Creation Plan: that focusses on those key projects (or value creators) that will build value in the business over-time leading to a higher valuation being achieved.
- Reducing/Eliminating Owner Reliance: what are the consequences of removing the Owner? Ideally, there should be no consequences. We will help the Owner to become dispensable.
- Eliminating Other Risk Areas: such as high revenue concentration, revenue unpredictability or a lack of systems and processes.
- Identifying and Developing Potential Successors: building an incentivised Board or a Management Team or identifying potential successors for the MD (and existing Board) if one already exists.
- Developing the Capability of the Management Team: coaching/mentoring any potential successors so their value to the company is increasing and the Owner can reduce his/her operational involvement.
- Knowledge Transition: helping the Owner to transition knowledge to the Management Team with clear plans for succession set in advance.
- Keeping the Business in Growth: ensuring the business remains in consistent revenue and profit growth in the years leading up to exit.