Timeline Of Events For Selling Your Business
Extraction From Eric Gilboord Online Courses

This is an extremely optimum time frame and would require a very well prepared Seller, highly desirable company, a qualified Buyer and does not include the transition time to ease out of the company post sale. All in count on 3-5 years.

4-6 Weeks Preparation
• 2 Weeks to gather the required information. The Intermediary will work with you to gather necessary information and to gain an understanding of the business (Information gathering is mostly a Seller responsibility.)

• 2 weeks for the Intermediary to compile the necessary Teaser and Confidential Information Memorandum documents (Mostly an Intermediary responsibility.)

• 1-2 weeks to review and finalize representations (Joint responsibility of Seller and Intermediary.)

1-3 Months for Soliciting Interest from Buyers (duration is very variable)
• During this time the Intermediary will mostly be talking with prospects, answering questions, feeding more information to them.

• Much of the effort during this phase is the Intermediary working with prospects, trying to figure out who are serious and who are not, filtering and moving them along. Making sure that only serious, qualified prospective Buyers get to meet and talk with the Seller.

• The Seller may be required to provide ad-hoc ancillary reports. Mostly accounting type data or answer questions.

• The Seller will be required to meet with prospective Buyers (1:1, duration and frequency is variable and will be based on seriousness of Buyer and comfort of the Seller).

Receive a Letter of Intent (LOI) to Proceed
The prospective Buyer will issue a LOI. The Seller will be required to negotiate and accept the LOI terms (Review by Sellers' legal counsel is mandatory. ) The typical LOI would contain terms about the deal, payment schedules, vendor notes and post transaction employment / contracts, but it can have all kinds of terms and considerations that will form the basic terms of the future transaction.
         
Accepting an LOI is certainly a significant go/no go point in the process. The Seller gets to make the final determination at this stage.

2-4 Months Buyer Due Diligence Process (This is a fairly intense period of time )
• The Buyer will provide a list of expected items that they wish to review.

• The Seller will need to work diligently and expeditiously to respond and provide this information in a timely manner. Responses could be piecemeal over a few weeks. This for most sellers is the hardest part of the work required since there could be considerable asks, lots of documents to gather and create and lots of meetings to review and discuss.

• Depending on the answers to the above there could be further requests, conversations and meetings.

• The Intermediary will assist you during this period. But this is largely dependent on the information request, and what role the seller would like the Intermediary to play and what access to information would be provided to the Intermediary.

4-6 Weeks Legal Process (Time required to read & review docs)
• Legal begins once Due Diligence completes and this typically lasts a 4-6 weeks or more. The variability depends on the legal complexity and detailed Seller & Buyer review of clauses and specific wording.
• Emotions will be running high at this point, so patience is required if you really want the deal to close!

Deal Done! Total elapsed time from start to end: 8-12 months but most of the Seller effort was during the Due Diligence phase.

Exercise - Questions

What would be your ideal timeline for starting the process to completely exiting with you having no further involvement with the business?

Is it realistic?

Why is this your ideal timeline?

What about the above timeline do you think does not fit with your personal situation?

Schedule a Call or Meeting

​I was thinking about a question I often get in media interviews. Why are 60+ year old business Owners not getting ready to sell? I used to answer 'they love what they do'. Now I think the more accurate answer is they may be afraid of their imposter syndrome popping out. It's not easy to go from a pretty much know everything about your business person to a know little if anything about selling your business. An imposter. One extreme to the other. Supreme confidence to no confidence. Give or take.

So I am going to suggest that if you're an Owner who wants to quickly get up to speed on selling your business we should talk. Please click here to schedule a call.

​Eric Gilboord

PS One more thing. As entrepreneurs we all tend to feel a little bit like imposters no matter what we have accomplished in our lives. And while building the business we have all been in the 'got a massive order now what do we do seat'. So you should know it's ok.

​Talk soon.

I've worked with more than a few family businesses where blood is thicker than contribution. Tends to typically lead to a somewhat depressed staff atmosphere and lower sales/profits. 

My position with Owners is if you really want to maximize the sale of your business, admit what you know to be true and let the family member go. Or change their position. 

They know better than you do how much damage is being done to the organization by their actions or lack of action. You may be surprised when your child or sibling or other relative actually thanks you for ending their misery.

Staff will be relieved and productivity will likely rise.

A2E

Topics Covered

• Much older owners are now looking to get out.
• Next generation may have screwed up.
• Niche vs foreign commodity competition.
• Automation and leading edge technology.
• Innovation comes from established small niche businesses.
• Realizing opportunity currently under your roof.
• Sales and Marketing to go to the next level.
• Sell 70% of your businesses, work with the new owners and enjoy a huge windfall on your remaining 30%.
• Buyers are looking for unsexy below the radar companies.
• Buying platform companies.
• Protecting intergenerational wealth.
• Family businesses, ups and downs.
• Runaway bride.
• Fathers and daughters.
• Selling to your children.
• Families act the same in your business as in your home.
• Entitlement issues.
• Lots of options for Owners to exit.
• Work back from what's in the best interest of the Owner.
• You don't know what you don't know.
• Surround yourself with an experienced team.

7 Sure-Fire Ways to Beat Large Business
by Eric Gilboord from his book 'Just Tell Me More'.

1. Outmaneuver Them.  A small business is like a speedboat that can manoeuvre quickly, slow down or speed up as needed, and turn around completely in a much smaller space than a battleship (a larger business) can. A new strategy may take a large business three months to develop and implement. You could execute it in three days.

2. Offer Genuine Personal Attention.  Small businesses can offer real personal attention, greeting customers by name and having a brief conversation with them when they enter their establishments. Customer service is more than screaming, ‘‘Hello!’’ indiscriminately when someone walks into a store. I find this particular activity, conducted mostly by the larger U.S.- based chain stores, to be somewhat unsettling and in many cases, quite insincere.

3. Choose Between Help And Help Yourself.  I prefer to buy from small businesses because they’re usually more ready, willing, and able to help me. It seems that customers must choose between getting help and helping themselves. The staffs at some larger organizations tend to be busy stocking shelves. They may point out where something is but they don’t always have the time or the expertise to help customers make a purchase.

4. Educate Yourself.  Education can be an important part of the purchasing process. When many products deliver the same benefits, it is not always easy to make the right choice. In order to select the best product or service for your needs, you may require education. Small businesses tend to be better suited at offering assistance and are the best choice for one-time requests or requests for unusual or rare products and services.

5. Tailor Your Products.  A small business has the ability to tailor its product or service selection to its specific customers. The most popular products your specific customer desires can be stocked in depth. This feature can be a disadvantage to large businesses as they carry a wide range of products offering little choice within a specific product group. Don’t forget to promote this advantage. Your business may represent one section of one aisle in a big box store. You don’t need to worry about the rest as you are not in those businesses.

6. Train Your Staff.  Make sure you don’t make the same mistakes that some large businesses make. Don’t fall into the trap of being too busy to provide good service. Unfortunately, several large businesses seem to have staff to stock shelves but not to help customers and in some cases, not even to take your money. I can’t imagine any small business allowing a customer to stand in the middle of the floor with his or her money and no one to give it to.

This unfortunate experience happened to me in one of the well-established department stores. I couldn’t even pay for the one item that I came in to buy. But small businesses don’t always have good service. You must train your staff.

Your larger competitors probably have training programs. Your advantage is the ability to have an informal, on the spot training session for your staff. Augment any formal group training with small amounts of input when needed. If you notice something wrong or there’s a situation where you can improve your service, the changes can be made almost immediately, unlike your larger competitors, who may have to take months to develop a more formal, structured training program.

7. Don’t Compete On Price Alone.  Some small businesses charge a little more than a larger competitor but that’s OK. Some segments of your target group are willing to pay a little more in order to receive better service. It’s up to you to provide it and to make sure that customers know they are receiving added value. Some customers will always look for the lowest price. They will shop around, use your time and expertise, then go to your larger competitors to make the purchase.

It’s your job to recognize these people and to educate them about the advantages of doing business with you. Customers are not mind readers. These ideas apply to many business categories such as retail, manufacturing, and industrial or professional services. No matter what business you are in, act like a speedboat and outmaneuver the battleship. Go out and run circles around big businesses.

You Never Seriously Thought About Selling The Business. Until Now

​Like many of our Clients you may have gone south for the holiday break. You caught up with winter friends. Some sold their businesses a while ago, some sold recently and this is their first "I don't have to go back" season and others are like you, still thinking about it. Until now.

You've been promising your spouse and children that transitioning was just around the corner. Or swearing up and down that you'd die with your boots on. Until now.

Boomer aged business Owners are a breed unto themselves. You've worked hard all your life building a company that has for the most part provided you and your family with a pretty good lifestyle. No complaints and no real regrets. Until now.

Selling the business was never required or even considered for financing vacations, cottages, winter homes, the kids education, some side investments, hobbies and any of the many surprises life throws at us. Until now.

The plan was to, at some point, transition out of the business and take it easier, however you define that. No pressure to prepare the business for sale first or serious thought about how much it would bring on the open market. You heard stories of Sellers getting 6, 7 or 10 X ebitda or auctions to buy your company. Fewer Sellers to compete with and more Buyers every day. It all sounded great. Until now.

The reality now is you need to sell the company to finance your retirement. You have no idea how long you or your spouse will live. Therefore no real way of knowing how much you need. Regardless of what you require, Buyers rarely pay 'what you need', unless the business is worth it. Just kidding. They don't care what you need, they pay what the business is worth. Until now.

Let's do the math. 65% of all established businesses in Canada and the US are owned by Boomers - Owners born between 1946-1964 the oldest boomer Owner is 74 and the youngest is 56. Owners are rapidly backing themselves into a corner. Many businesses never sell. You thought you had plenty of time. You assumed or hoped you would get what the business was worth. Until now.

It was a Sellers market, as many Owners have not started the process or sold yet. To put it into real terms 90-95% have not sold and 80+% don't even have a transition plan for selling their business or a team to help sell it. So to be clear, you were in the driver's seat if you had a well run, solid and profitable business with a big future and a great team running it without your participation. You planned and prepared for transition and a successful sale was in your future. Until now.

While you may be many steps above the other Sellers you may have waited a little too long. Buyers are now taking charge. They know you need to sell because of age, lack of enthusiasm, other interests, no successor etc etc. etc. They also know your fellow boomer aged Owners need to sell. As a Seller, you are running out of runway and have no choice but to take action. Today it has become a Buyers market. They are smart, savvy and experienced Buyers. They know way more about this than you do. Or your long time corporate Lawyer or Accountant who never sold a business. Think trading baseball cards with your older sibling.

Next Step - Get Advice, You Can't Do This Alone

One of the most valuable lessons I've learned from studying successful people is that no matter how famous or how rich they are, somewhere in their lives is a coach, a mentor, or an adviser. Successful people accept they will make mistakes and lots of them. They also seek out help to reduce and overcome the inevitable failures. It's part of the process.

The first thing a new President does is establish their advisory group. This applies to presidents of companies or countries. You can't possibly know what to do in every circumstance, particularly if these are new to you. Smart, successful people surround themselves with even smarter associates. Getting guidance is an important element in your future success. Take the first step and get advice.

From my heart, Eric Gilboord
eric@warrenbdc.com

Eric Gilboord is a lifelong entrepreneur, Author, Public Speaker and the CEO WarrenBDC, a company that  specializes in working with boomer aged business owners or those wishing to acquire their companies.

Eric is focused on solving a big problem. Sixty-five percent of all businesses in Canada and the United States are owned by baby boomers. Anyone born between 1946 and 1964. So this is a pretty big audience. Eighty percent of those owners do not have a plan in place or know how to transition. Most are counting on the sale of their company to fund their retirement, and in a lot of cases the value of the business is less that the owner needs for the desired retirement lifestyle.

In this episode Eric:

• Says Naysayers uninformed opinions are based upon their own life experiences
• Points out that the most important sale a business owner makes (the sale of the business) is the one they are worst prepared for
• Explains how he works with business owners to find unrealised potential
• States that the demand for businesses with predictable cash flow is strong
• Talks about some of the options business owners have when planning to exit
• Notes that after cashing out many entrepreneurs are choosing to buy another business rather than investing in financial markets

Interviewed by Tim Alison

Direct link to interview page: 
http://screwthenaysayers.com/ep-181-the-most-important-sale-any-business-owner-will-make-eric-gilboord/

Also listen to the interview with Eric here:
iTunes: https://apple.co/2LkWSPV
Screw the Naysayers Episode Page: https://screwthenaysayers.com/podcast
Google Play Music: https://bit.ly/2NBgqMv
Spotify: https://spoti.fi/2MF5T6g
Stitcher: https://bit.ly/2uYCsRC
Podbean: https://screwthenaysayers.podbean.com/e/181-Eric-Gilboord/

During the sales process there are two documents;

a) The Teaser - a short (1 page) doc, that gives highlights and is intended to solicit a prospect into asking for more information. This document is shared publicly so is written in a non-identifiable way.

Someone will then express interest and request more information. At that time they will enter into an NDA between our Client and themselves. Once that is signed we would share with them the CIM document.

b) The Confidential Information Memorandum (CIM) is a document into which we gather all the relevant information about the business, including its products, services, financials and markets.
The CIM is ONLY SHARED WITH Prospects that have signed the NDA, and that you have no other objection to sharing information with.

Typically the CIM would contain sections about the business to include;
1) Business Overview and Key Investment Highlights
2) Products and Services
3) Market Potentials and Variables
4) Sales & Marketing Efforts
5) Management Team BIOs
6) Financial Results and Projections
7) Risk Factors (Sometimes omitted) and Successes & Awards
8) Investment Thesis (why this is an attractive opportunity)
9) Anything else that might make this business unique and desirable.

The CIM is NOT a legally binding contract or offer for sale, rather it is a marketing document intended to make your business look attractive to potential investors.

An Investor or Buyer would use the CIM to determine whether they wanted to take the study further and to start compiling their valuation etc. They would likely start engaging and either meeting or asking more questions and from there make some sort of offer subject to diligence and legally acceptable terms to you. 

Included in the WarrenBDC fee is the necessary consultation and document preparation efforts to create these documents, and then to share and solicit this information with prospective buyers.

The final say in the document is ultimately our Clients to make, so at each stage once we have created the documents they are run by you for approval, before being distributed.

Cheers, Colin Ruskin
WarrenBDC

​Excerpt from 'Just Tell Me More - Marketing Tips in 10 Minute Chunks'

​Fanone International is a successful hairdressing salon owned by two brothers. For the past few years, they have talked about marketing. The brothers haven’t developed any specific marketing tools yet, but they meet regularly and plan to do some ‘‘real marketing’’ soon.

The fact that they have not yet created the standard marketing tools, such as brochures and ads, does not mean that they have not been developing and executing a marketing program. The Fanone brothers have been thinking about their business from a marketing perspective and have recognized that marketing is necessary to the success of their business. Their marketing is under way.

A few years ago, they moved the location of their salon and took full advantage of the opportunity to create a new and exciting environment for their customers. The new salon was so interesting they were featured in an industry magazine. They also participate regularly in hairdressing shows, as featured presenters, to increase recognition of their company name. They have reached a level in their profession that many competitors would do anything for. They have accepted offers from manufacturers to represent certain lines of products. And have their own line of products, sold worldwide.

The Fanone brothers were very specific about the type of employees they hired, seeking people with a good attitude toward the business and customers. The brothers want to make sure that they are building the best possible team in order to take full advantage of future, more traditional and new media marketing efforts.

A continuing discussion revolves around the demographical and psychological profile of the customers they want to attract. The atmosphere they have created in their salon is of utmost importance. 

The Fanone brothers regularly review the history of the salon and its past sales. Where did they make money and where did they give it back? What aspects of the business provide the most satisfaction? Are there cycles to the business with up and down times? Can they create promotional opportunities to smooth out the business over the year?

Are they taking advantage of the latest technologies? (Setting appointments on-line through the Internet is an interesting possibility.) Where do they want to take their salon in the future? What lessons can they learn from other salons (anywhere in the world) that are a few steps ahead of them? Can they identify and model themselves after a successful salon (or chain of salons) that is in a position in the marketplace that they want to be in?

The brothers continually review competitors’ literature to assess their position in the marketplace, promotional offers, target group identification, and product endorsements. These small business entrepreneurs want to know all they can about their immediate competition in their neighbourhood and around the world.

They participate in various hairdressing shows, making sure that they are featured onstage demonstrating the latest in hairdressing techniques in order to consistently reinforce their position as a leading edge hairdressing salon. Despite all of these activities, when they are asked whether they are conducting a marketing program, they answer that they are still preparing one.

These two hardworking, thinking entrepreneurs have recognized the importance of marketing and are determined to take full advantage of it. In fact, they are already marketing their business. Every day and through interactions with customers, suppliers, and staff, they are marketing their business because they are aware that every day and every interaction is another opportunity to fine tune their marketing efforts. When they decide to start a more traditional marketing program, they will be well prepared for it. Although these days who is to say what is traditional and what is new?

Many businesses have a best before date to transition.

​It may be best to sell before:

1. Your industry changes too much to keep up with.
2. You're too old to have a choice about transition anymore.
3. Your competitors decide to attack and drive your value down.
4. Your competitors make the move to sell first which can negatively affect your value.
5. You realize your kids have their own lives and are not taking over.
6. You finally see that your staff are never going to buy your business.
7. You are forced to accept the fact that it will take years to get ready, sell and fully transition out of the company and you haven't even started.

Or when the Owner has the realization that they don't actually have an open ended time frame to sell. Your trusted advisors have been asking you to think about selling. So has your spouse or partner. But you steadfastly held them off. Oops maybe they were right. Tic toc.

But like 80% of seasoned business owners, you've been putting it off. As you hit your 60's and 70's you slowly realize you've joined the 70% of owners who don't have a transition plan.

After having spent decades building a successful business, you've walked up to the edge of the cliff with no option to go back. It's a one way trip. You need to cross and time is running out quickly.

The likely outcome from waiting too long is that you may not be able to sell for as much as you could today or you have to sell for less than you need. If something unfortunate happens to you what have you done to your family and their future?

And yes I'm talking to you.

If you're confused, frustrated or just unsure about Moving Forward with selling your business, give me 15 minutes on the phone. I can me help bridge the gap and get you started along the transition path. No obligation other than a short conversation. You have everything to gain including a glimpse into the other side of the gap while learning about how to get there. And nothing to lose.

I really like meeting my readers. Eric Gilboord eric@warrenbdc.com

Excerpt from 'Just Tell Me More - Marketing Tips in 10 Minute Chunks'

​Tom and Joe are brothers who grew up working in the family business. Tom is conservative and, in his own words, not very creative. He chose to stay with the older, established company and continue in his parents’ footsteps, running the business as his father did for the past forty years.

He had no desire to change anything and felt that if he continued to run the company the way his parents did, he would have a nice lifestyle and hopefully be able to pass the business on to his children. Tom was not a marketing-oriented businessman. 

Every year, he followed the same marketing program, conducted seasonal sales, developed the same brochure (substituting a few new products), and worked with the same sales reps his father had employed for many years. Tom felt that if you built a good product, the customers would find you.

Joe, on the other hand, knew that there was more they could do with the business. He wasn’t sure what needed to be done, but he realized that marketing would play a large part in the future success of their business. Joe spent a lot of time out on the road, talking to customers, finding out what competitors were up to, and looking for new opportunities.

Joe often returned from sales trips and trade shows brimming with ideas. He told Tom that they needed to expand their marketing efforts to include new media and a social media program. But Tom insisted that they were doing enough marketing and had no reason to change. Sometimes when a business has been successful, the thought of new activities seems to be an unnecessary expense.

Unfortunately a business owner can wait too long, until the market requirements and competitors catch up to them and it’s then too late.

As time passed, the conflict with Tom became unbearable for Joe. He recognized the opportunities for the family business but knew that his brother would not change. Joe decided to start his own business. He knew that marketing was more than a brochure and the occasional sale. Over the years, he had learned that there are two key components to marketing:

1. Creating and using the various tools available.

2. Managing the marketing program from original strategy and design to the finished marketing materials.

Joe planned to stay in the same kind of business as his family. His first major commitment was to ensure that his business would be marketing oriented. 

He researched opportunities, became familiar with new marketing techniques, and established a long-term relationship with a marketing professional, who helped guide him and establish a team of suppliers to cover traditional, new media and social media marketing. Joe's strategy included using the best of the established methods and continually testing new marketing methods. 

Eventually, Tom’s business stagnated, sales barely kept up with expenses, and profits became a thing of the past. While Tom was suffering, Joe became more successful than even he had dreamed he could be.

Joe hired a marketing consultant. Together, they developed a solid sales and marketing strategy, embraced new technology by establishing a strong database, and conducted ongoing focused communication with staff, suppliers, customers, and prospects. They developed and updated sales tools on an ongoing basis to keep their sales force and customer service staff equipped with the latest in marketing weapons.

In time, Joe absorbed the family business into his own. Tom stayed on but acquired a new appreciation for marketing. Joe continued to manage the marketing efforts and his company grew large enough to create their own internal marketing team. Joe creates the company vision and the entire company carries out that vision.

These cases demonstrate how marketing plays a key role in the success of any small business. Ignoring the advantages that a structured, well thought-out marketing program offers could put your business in jeopardy. Make use of experts, try to benefit from their years of experience and keep up with the newest techniques.

​“Success or failure doesn’t randomly happen to you. You have a large say in when and how much.” EG

Exclusively for Owners only, to explore their transition options in a confidential safe space. This is not a networking event. Attendees will be vetted.
​
If you have questions about growing and or transitioning from your company and would like to get answers in a safe and confidential environment. Take a first step now with WarrenBDC and join us.

Attend a private by invitation only, limited seating event. Get on the list for our upcoming dates now. Our events are typically co-hosted with local trusted Advisors like Wealth Management, Financial Planners, Accountants, Insurance, Lawyers, Family Offices etc.

To learn more about hosting or attending email eric@warrenbdc.com.

COMMENTS ON ROUNDTABLE
​
Thank you Eric. Your warm and candid stories obviously come from your genuine desire to connect with your clients and your years of taking the time to care for their businesses and their families. You discussed complex issues with ease by making them relatable from the point of view of someone who may be unsure of how to go about transitioning their business either to family or to a third party. Thank you for taking the time to educate us in a warm and humorous way. You made a potentially anxiety-ridden experience an actual pleasure.

Regards, Anthony (Financial Planner Co-Host)

This is just a note to follow-up on yesterday’s lunch and dinner events. You engaged the audience so well with personal allegories that resonated with each of them. And thank you for showing such nice solidarity with Maricel, Anthony and me. Much appreciated.

I thought the “Safe Room” setting for our guests was particularly effective: we’ll set up another one soon.

Regards, Jody (Financial Planners Co-Hosts)

Not ready to leave your company just yet? There is an alternative. A way to take some chips off the table, stay involved and make a really nice bonus contribution to your retirement fund. Ease your way out while assisting the new Owners to drive the company to greater success.

A business model being used more often these days is for the Buyer to purchase 70%. The Seller retains 30% and stays on in whatever capacity they are most comfortable. Where required they provide a smooth transition to industry and customer relationships, while sharing their vision and insights for the potential of the business.

As the company increases in value the Seller will enjoy the benefits the new Owner brings to the table. At a predetermined time the remaining 30% is then sold to the new Owners or both parties together sell to another Buyer. Ideally at a much improved value. It's a win win.

There are many ways to transition a business. This is just one. It is in your best interest as the Seller to explore multiple sales opportunities available to you.

As usual, we are a phone call or email away and ready to help. Good luck.

Eric Gilboord eric@warrenbdc.com or 416-270-2466

Forward thinking business Owners (future Sellers) are doing something called a 'roll-up', otherwise known as buying up the local competition or complementary companies in order to grow. 

Smart Owners know some of these potentially selling owners are looking to get out. Wouldn't it be great to finally have that super salesperson work with you now instead of your competition? Gain competitors customers, exclusive or proprietary products, technical expertise and relationships. The list goes on. 

Whole new exciting worlds of possibilities are now open to you and your business.

Sharp Owners also know the trend is for serious Buyers to acquire profitable, larger, more substantial companies. So it makes sense to give them what they're looking for.

If you do the roll-up and integration into your company for them, the Buyer can come along a little later and buy the whole package. No muss no fuss. You get to offer Buyers a much larger and more desirable company to acquire. They get to avoid the whole messy, time consuming exercise of finding acquisitions, doing the due diligence, buying them and integrating the new company into yours. 

Oh and you get to sell a larger company for more money than you ever thought you would see in this lifetime. That is, if you do it right.

In order to do this right, you might need a little help with the whole acquisition, integration and growing part of the plan. That's where we come in.

If you're interested in learning more about how we can assist you with our Acquisition Strategies and Execution capabilities, let's talk. 

To get started or at least to find out what's involved let's have a brief introduction call. If you feel you're getting value and want to continue the conversation we can meet in person. 

Call me directly at 416-270-2466 and ask for Eric. Or email eric@warrenbdc.com

​As boomer age Canadians we've had the good fortune to grow up in what I like to think was a special place. Opportunities for education, jobs, freedom of religion and the list goes on.

Add the fact that many of us have made a good living as business owners and we have a lot to be grateful for. Whether or not you have routinely given to charities, religious organizations and those in need over the years is not important. What you do from here on is.

If you are reading this email then you either will be selling your business or you know someone who will be. After the sale an owner will likely have more time and money to contribute to organizations and individuals to make the lives of many better. Could be here in Canada or in other parts of the world. Giving back should be part of everyone's plan.

In the spirit of giving back and in order to do more and help more I would like to suggest a couple of things:

1. I've said this before and I'm saying it again. If you don't need any more money and are satisfied with what you think a sale will deliver to you in cash that's great. But it's not a good reason to just stay the course until a sale without trying to increase bottom line results.

Consider this for a moment. If you only need $2 million for your postsale life that's great, more power to you and I hope it all works out. However you built your business to make profit. If you could generate an additional $500 thousand or $1 million think about how much more good you could do with it. How many more people you could help.

2. Prepare in advance for the financial rewards you will be receiving from the sale of your company. Plan, investigate who to give to and make sure you are not surprised by unexpected tax issues that could drain your funds and negatively impact your ability to share the wealth. Plan so you can do more good.

On Wednesday July 31, 2019 in the evening, I will be attending an event, 'Charitable Giving' an Exclusive Educational Seminar. Discover more tax efficient ways to give to the charities that matter to you. It would be great to share my table with you.

Charitable giving and tax implications are not my business. Helping owners transition well and enjoy their postsale lives is.

Please consider coming, you'll do others and yourself a lot of good. Bring your spouse.

Details and registration here.

​If you have any questions please contact Maricel Ramos @: (647) 862-5280 or Maricel.Ramos@investorsgroup.com

Hope to see you there.
​Eric Gilboord

The 4 P's of success in life or business are:

1. Patience - Often times it takes years to launch a new idea and still more time to be successful at it. You have little real control over the thinking of others. Be it the world, family, friends or business associates. Some will come around to your way of thinking others will not. You know it's a great idea but 'they' may not be ready for it. The world is not on your clock.

2. Persistence - If you really believe in what you're doing you will not give up. Changing your thinking, adjusting the measurements, and revising your plan are all part of the process. Giving up is not.

3. Perspiration - If you don't do the work nobody else will. You can try paying someone else or coercing them. Unless they see the passion and real commitment from you, likely their effort will not be enough to help you be successful.
​
4. Passion - You can't be taught passion, buy it or be given it as a gift. It is so strong others can see it, hear it and almost taste and touch it in the way you present yourself and your ideas. It can't be faked or forged, true passion is very real. Genuine passion bubbles up from within. You can't contain or control it and without it your chances for success are slim.  Find something you are passionate about and start pursuing it now! It could take a while to get there. Don't forget to enjoy the journey.

Eric Gilboord, A2E
CEO WarrenBDC  
416-270-2466 

The IBBA and M&A Source Market Pulse Survey Report for the fourth quarter of 2018 has a range of interesting insights.  The survey’s purpose is to provide an “accurate understanding of market conditions for businesses being sold in Main Street (values $0-$2MM) and the Lower Middle Market (values $2MM-$50MM).  This national survey was designed as a tool for business owners and their advisors and has the support of both the Pepperdine Private Capital Markets Projects and the Pepperdine Graziadio Business School.

One of the most striking facts to leap out of the report is the fact that a full one-third of advisors fully expect the strong market to end this year.  Overall, advisors are not optimistic that the current climate will continue through 2020.  In fact, advisors are encouraging sellers to consider placing their businesses on the market now, while the market is still strong.  This is according to Craig Everett, PhD and Assistant Professor of Finance and Director of the Pepperdine Private Capital Markets Project.

One fact from the report that could be overlooked is that only a mere 8% of advisors expect the current climate to last for 48 months or more.  Additionally, only 9% believe that the current climate will last between 24 to 48 months.  Perhaps most striking of all is the fact that 60% of advisors feel that the current climate will end within the next two years.

Business owners who are considering selling should be advised that almost two-thirds of advisors now feel that there will be a significant shift in the next two years.  Considering that it can take a year or more to sell a business, business owners would be wise to consider this important fact.

The report sites Neal Isaacs, Owner of VR Business Brokers of the Triangle who states, “Deals are taking longer in due diligence as buyers work hard to validate their investment and make sure that what they’re buying is worth the premium price today’s sellers are commanding.”

So, is now the time to sell?  Many experts feel that it is possible to lose a sizable amount of value if one waits too long to sell.  Even just a few months can make a huge difference in terms of perceived value and the ultimate sales price.  Working with a professional is a key way to ensure that you are selling at the right time and secure the best possible price.
​
Copyright: Business Brokerage Press, Inc.

Some food for thought before handing your business over to a next generation family member.
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I remember meeting the Owners of a small business. He had worked hard and the company had provided his family with a comfortable life.

There were 3 sons. One worked occasionally in the business, wasn't suited to take over and never really did much with his life. A second son had other ambitions and enjoyed a very successful career in law. As for the third son, unlike his brothers, he worked in the business full time, made a living and started his own family.

So when it came time to think about transitioning and rather than selling the company to an outsider, the Owner along with his spouse made a decision based on emotion and blood. 

The third son thought it was his right to take over the company. Although under qualified and not yet possessing the maturity to succeed, the Owner turned the company over to him. With no cash investment, only sweat equity, winning by default and having day to day experience working in the business he was charged with preserving the family golden goose.

Thinking far more of his own capabilities, having no real transition plan or safeguards put in place by the Owner (his Father) and now being in charge the third son made the decisions his way. As the Owner had an ailing parent, some health issues of his own and other distractions he was not always available for counsel or oversight.

The immature third son saw this as an opportunity to put his own mark on the company and in the process promptly drove the business into the ground along with the Owners' life savings and retirement funds. Fortunately the successful son, the lawyer, had the means to take care of the parents as the other two did not.

Why did the parents turn the business over to the ultimately unsuccessful son? As I wasn't present at the family Sunday night dinners, I'll never really know. What I do know is that people make poor decisions and do stupid things for blood.

I also know that it's in my power to repeat this story as often as possible. So it doesn't happen to your family. I'm sure everyone had the best of intentions. But that only takes you so far.

Three key questions to ask before you even consider handing your company over to the next generation.

1. Do they want the business?

2. Are they qualified to run the business successfully?

3. Can they afford to buy the business from you?

And one more key question you need to ask yourself. How will this decision affect the rest of the family?

At WarrenBDC, we have developed a special group exercise to quickly gain insight into what the future of your company might look like if you make this kind of choice.
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To discuss the options and our services available to increase your odds for success please contact me today. 
Call 416-270-2466 or email eric@warrenbdc.com

Cheers, Eric
​

Stats on the state of the boomer business owner world, from the 'State of Owner Readiness' survey 2016.

1.   Boomers own 63% of private businesses.
2.   80-90% of their wealth is tied up in their business.
3.   76% plan to transition over the next 10 years. 48% in the next 5 years.
4.   12 months after selling 75% of owners 'profoundly regretted' the decision.
       (Want to know how to avoid the whole regret part?)

Have I got your interest?
 
5.   70-80% of businesses put on the market don't sell.
6.   Less than 30% of family-owned businesses survive into the second generation.
7.   67% of boomer owners are between 50 and 69 years old.

Stop for a minute and take it in. Now continue.
 
8.   75% have an annual revenue of under $5 million.
9.   85% of family owned businesses are first generation.
10. 24% say you're familiar with transition options. 44% aren't and 32% are not sure.
11. 88% have NOT established a formal transition team.

Sounding familiar?
 
12. 86% have no formal education related to transitioning your business.
13. 67% have no provisions in place if key personnel get ill or die.
14. 50% have no thoughts about your post transition life after the business.

Wow that was a mouthful. Take another minute and let it sink in.
I will guarantee you one thing. You don't know what you don't know. And that will absolutely lead to a whole lot of trouble. The challenge is who do you talk to?

Here is just one example of the misguided thinking many boomers are doing.

You think if you keep the company for a few years longer and take as much as you can out it will more than make up for what you think you could sell for today. Then, in a few years, you'll sell for whatever you can get or just close down. 

Nice plan, unfortunately, putting off selling or even just getting the company ready for transition or 'dying with your boots on' are not really exit strategies, now are they? 

What if, in the meantime, you get ill or worse? The mess you'll leave behind for family, partners, management, employees, customers and vendors will ensure they talk about you for a long time to come.

It's not all doom and gloom. There is a silver lining.

What if you could delay selling, keep taking money out, increase the value of the company and sell for more later. More than you think you could get now. 

Have your cake and eat it too. Hmm, that is worth looking into.

As a successful business owner, you're smart enough to at least consider all the other options available to you. But where do you go to find out about them? 

Excerpt from 'Moving Forward' Eric's book.

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At WarrenBDC, we may have some of the answers you're looking for.

If you want to speak with me right now, that's great. If you need to know more about us first, simply take a few minutes to look at our website www.warrenbdc.com. Get to know us a bit better and then call or email. Whatever works best for you.

Do it on your own schedule and if anything twigs for you ... feel free to give me a call at 416-270-2466 or email eric@warrenbdc.com.

Thank you for opening and reading my emails. I work hard at providing information and insights I believe are of value to you.

Cheers, Eric

Whether you want to accept it or not, change is coming. The average age of a seasoned business owner is 68. Of all established businesses in Canada and the United States, 65% are owned by these same seasoned owners. That means most founders of family businesses are facing the inevitable decisions they have put off for the last few years.

You can't wait it out or drive it away. Likely your kids will not be taking over. You may or may not require the funds from the sale of your business to finance your retirement today.  But who knows what the future has in store for you.

As I've said many times to my readers and audiences, you need to start now, making the decisions necessary for a great transition. If you don't, it may be made for you. Health issues, yours or someone close to you, can pop up unexpectedly. The marketplace may dictate what happens to your business. Competition to sell may be greater than you anticipated. The appeal of or desire to purchase your company may be less than you thought. 

And finally, statistically, selling successfully is not in your favour. Four out of five businesses that go to market DO NOT SELL. So it appears it may be time to take this whole transition thing seriously. 

Eric Gilboord
​CEO, WarrenBDC

As I get older, the thought of what happens after an Owner transitions out of the family business seems to occupy more of my thinking. I question what kind of statement they might leave to future generations by the actions taken while building the company and toward the end of their time running the family business. I've written two very different scenarios from the perspective of how a Family Business Owner might be perceived by future generations of family.

Legacy A - Something to be proud of.
Our parent/grandparent (your name here) was a successful business owner. They grew a tremendous business from nothing. All the while making sure family, staff, customers and suppliers were always well taken care of. 

We all have fond memories of many experiences enjoyed with our parents/grandparents from holiday dinners to weekends at the cottage and incredible vacations to exotic destinations. They always made sure to be with us and to participate. Work was second to family.

Charity and good deeds were part of the fabric of the company and his/her life. Integrity was a basis for all negotiations, encounters and relationships. Working their way with internal and external resources are still referred to as the benchmark for how it is done best.

They planned ahead and when it was time to transition the company, all was in order. People and processes were in place. Accounting was thorough and up to date. Contracts in place. Strategies for the future growth of the business were established and being executed. 

Regardless of who the company transitioned to, family (with or without their direct involvement), outside buyer or staff, the ship was well equipped and moving in the right direction. By the time the transition began, key management were trained and already excelling at their new responsibilities. It was a smooth and mostly stress free experience. In a business transition there will always be something to upset someone.

As descendants, we are lucky to have the choices we do today. We are financially set and equipped to follow in his/her footsteps in business and in life. To live life to its fullest, give generously and appreciate our good fortune every day. We are the proud stewards of his/her legacy, and continue to live by their example.

Legacy B - Not sure you'd be proud of this.
Our parent/grandparent (your name here) was a successful business Owner. Loving what they did and 'dying with their boots on'. They couldn't see themselves living any other way and never took the steps necessary to transition the company properly. We talked to him/her about it all the time and nothing ever happened. Everything would be taken care of tomorrow.

As for memories, he/she was always working. Never had the time to take holidays. Family time was had grudgingly. Excuses were made by us as they loved what they did. Real memories of time spent with him/her are few and far between. They could have easily spent a week here and there with us but didn't. Now it's too late.

While we admire the passion, the series of events that happened after his/her sudden and unprepared for passing have devastated our family. Legal and financial frustrations tore our family apart.

The company revolved around him/her and no one was really trained to take over. Not family or other. The business started to falter the minute word got out that he/she was no longer running things. Customers got nervous, Vendors demanded quicker payments and staff began to panic. No leader, or at least no capable, prepared true leader could step up. The dream that the children would take over was a non starter as some of us were not interested and the others not qualified.

Competitors and Buyers began to circle the company like sharks smelling blood. Our surviving parent/grandparent didn't know what to do and chose to take the first offer that came along. Some of our family, who worked in the business and a few long time employees were immediately let go. 

The cash received was nowhere near what our parent/grandparent had assured the surviving spouse would have to live on. Fortunately our family rallied and are taking care of him/her as family should. But it has been an unbelievable strain on everyone. It could have been avoided.

As for future generations sharing in the success of our family business, we have all recognized that while it would have been nice to have some financial assistance for our lives and to leave for future generations as part of our own legacy we do not always get what we expect.

We will succeed on our own and ensure we don't make the same mistakes as our parent/grandparent.

Remember, as the Owner of a Family Business, it's up to you to write the story.

You've been reading my emails for a few years now. Perhaps it's time we talked.

Free Transition Strategy Session, For You and the Business 
www.warrenbdc.com

A favour if you would.

I've created a new keynote address and am considering the various ways I can present it. Would you please fill in the 4 question survey. Event Info

Click Here for Event Survey

Cheers, Eric
7 Figure Businesses Deserve 
8 Figure Exit Strategies

​1. Know Your Target Audience. 
Understand members of your target group thoroughly, including their attitudes toward the services you offer (e.g., is the purchase of your product or service important, fun, or a necessary evil?). What motivates them, excites them, and makes them want to come back? Be honest and clear about your target group. It is not all adults or all females or all females with blue eyes. Get as close as possible to the core of your target audience and know who is really buying your product or service. Create a mental picture of your customers. See them clearly and make sure that anyone involved with your business has the same picture. 

2. Be Up-To-Date On Your Competition. 
Be completely up-to date on your competition. How are your competitors marketing? Are they spending more on marketing than you are? Are they spending less? What kind of results are they getting? Know what your competition is going to do before they do it and prepare yourself. Learn from their mistakes and their successes. 

3. Set Clear Objectives. 
Determine where you want your marketing efforts to take you. Is it your objective to maintain the business you have with minimal growth, just enough to make up for any customers who leave? Or do you want to grow your business? Do you want to develop a highly successful system that could be franchised? Or do you have a short-term plan to develop your business rapidly in order to sell it quickly and profitably? It’

4. 20% Of The Effort Equals 80% Of The Results.
Review past sales figures and understand the 80/20 rule. Typically, 20% of your customers will represent 80% of your sales; likewise, 20% of your effort will deliver 80% of the results. Check your accounting records now!

5. Create A Marketing Plan.
Have a written marketing plan. The old expression ‘‘If you don’t know where you’re going, any road will take you there.’’, has never been more true. Every day you are faced with new challenges and opportunities. If you don’t have a road map it is very easy to drift for a long time never quite succeeding.

6. Develop A Sales Plan.
Develop a realistic sales plan. Know what you want to achieve and where the sales will come from. Adhere to a defined sales process and follow up at each stage of the process. There are many books and courses that outline well-defined sales and marketing processes. Find a process you believe in and follow it loyally. Consider what you need to do in sales versus what you want to do.

7. Be Up-To-Date On Your Industry.
Be as up-to-date as you can on your industry and on your customers’ industry. Vertical industry publications will help keep you informed of trends and opportunities. They usually do an annual year-end wrap-up and make predictions for the future. If you want to know where your industry is going, this is a great place to start. (This is a really valuable tip as these publications do the research for you.) Talk to suppliers, customers, and even your competitors.

8. Identify New Technologies.
Identify new technologies that will enhance your marketing efforts. All kinds of software, online apps, email, cost-effective low-run four-colour printing, and the internet make competing with larger companies much easier.

9. Put The Customer First.
Put your client/customer needs before your own. If you put your customers first, they will notice and remember it at decision making time. It helps if you love what you do. Customers want to be with winners, and loving what you do will get you through the tough times.

10. Have A Point Of Difference.
Be clear and concise about what product or service you offer and how yours is different from your competitors’. Make sure your marketing efforts consistently reinforce these differentials.

11. Re-Evaluate Your Business.
Constantly re-evaluate your business. Every meeting, presentation, and discussion you have about your business is an opportunity to re-think what you are doing. Challenge every aspect of your business and make it better every day.

​“You’re not in this alone. Make sure to have others handling day to day marketing tasks.” EG