How’s your workload these days? If the pandemic has forced you back into the weeds of your business, you’re not alone. Many owners are again doing tasks they haven’t done in years because they have had to lay off front-line staff or their employees have fallen ill or are caring for someone in need.
Being back in the middle of things is neither healthy for you nor your business long term. Personally, it’s a recipe for burnout, and professionally, your business will be less va
If you have resolved to make your company more valuable in 2022, you may want to think hard about how your customers pay. If you have a transaction business model where customers pay once for what they buy, expect your company’s value to be a single-digit multiple of your Earnings Before Interest Taxes, Depreciation and Amortization (EBITDA). If you have a recurring revenue model, by contrast, where customers subscribe and pay on an ongoing basis, you can expect your valuatio
As we roll into the start of a new year, you may be starting to consider your business goals for 2022. Given how 2020-21 has gone, maybe your primary ambition is to survive in 2022. Perhaps you’re going to create a recurring revenue stream or finally hire that general manager. Or maybe you’ve decided to start preparing for an exit.
Whatever your goals are, the most important thing you can do now is write down your plan to achieve them.
A Revealing Study
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CEO’s are about the thrill of the deal, achieving something no other person has, the adventure, the vision! Terms like survival, and cost cutting are something they’re willing to tolerate, but only as a means to the next opportunity to dream again. Even though the business landscape hasn’t changed much in the past few years, the attitude of the CEO has. We are tired of surviving, and ready to grow again! Even more, we refuse to live in survival mode. So, what’s next? The
Depending on your answer, you could be getting bad advice which puts more money in the IRS’s coffers (and leaves less in your pocket). Below is the crux of a typical tax preparer’s opinion regarding Engineering Based Cost Segregation Studies, which an experienced CPA would say has kept many commercial property owners from implementing this highly beneficial tax strategy which is effectively encouraged by the IRS. Here is a typical ‘tax preparer’ statement to commercial proper
What is a R & D Tax Credit and what companies are eligible? Mostly tech and manufacturing firms claim this credit, but other firms are often eligible to take it also. Architecture and Engineering Firms think they don’t qualify for the R & D Tax Credit. But they can be often wrong. Here is what is misunderstood re the R & D Tax Credit: They don't qualify for the credit because they are not "Manufacturing" Section 41 was not designed exclusively for Manufacturers, although they
Finally, 2020 is in the books. Good riddance.
If your goal is to build a more valuable company in 2021, here are some New Year’s resolutions to consider: Stop chasing revenue. A bigger company is not necessarily a more valuable one if the extra sales come from products and services that are too reliant on you to deliver them. Start surveying your customers using the Net Promoter Score methodology. It’s a fast and easy way for your customers to give you feedback, and it’s pre
Most business owners think selling their business is a sprint, but the reality is it takes a long time to sell a company. The sound of the gun sends blood flowing as you leap forward out of the blocks. Within five seconds you’re at top speed and within a dozen your eye is searching for the next hand. Then you feel the baton become weightless in your grasp and your brain tells you the pain is over. You start an easy jog and you smile, knowing that you did your best and that no
Making your business less dependent on you has a number of benefits: you can scale your company more quickly if you’re not acting as a bottleneck; you get more time to enjoy life outside of your business, and a business less dependent on its owner is much more valuable to an acquirer. Pulling yourself out of the day-to-day operations of your business is easier said than done. Here are three specific strategies for getting your company to run without you. 1. Think Like LEGO Pr
Why would two companies in the same industry, with the same financial performance, command vastly different valuations? The answer often comes down to how much each business is likely to grow in the future. The problem is that a lot of successful businesses reach a point where their growth starts to slow as the company matures. In fact, the price of doing a great job carving out a unique niche is that the specialty that made you successful can start to hold you back.
You may be eager to sell your business, and happy to have an acquirer at your doorstep, but what’s it like when an acquirer starts looking inside every inch of your business? Most professional acquirers will have a checklist of questions – both objective and subjective – that they need to be answered before getting serious about buying your company. Examples of objective questions include: When does your lease expire and what are the terms? Do you have consistent, signed, up-
Cross-selling new products and services to your existing customers may be a great marketing strategy, but if your goal is to increase the value of your business, the added revenue may do nothing for your company’s value – and may even lower it. In order to be acquired for a premium, consider committing to a product, service, or a bundle that does one thing well. Your aim should be to make that offering so irresistible, that an acquirer will stop at nothing to get their hands
The majority of businesses in America today started out as service companies. If you want to own a web design firm, you don’t need a lot of money, just a technical knack. Enterprising professionals who know how to get the media’s attention can start their own public relations firms without much more than a mobile phone. No capital required. But if you want to build a valuable company – one you can sell – you’ll want to stop presenting yourself as a service firm. Consultancies
You already know that your company’s revenue and profits play a big role in how much your business is worth. Do you also know the role cash flow plays in your valuation? Cash vs. Profits Cash flow is different than profits in that it measures the cash coming in and out of your business rather than an accounting interpretation of your profit and loss. For example, if you charge $10,000 upfront for a service that takes you three months to deliver, you recognize $3,333 of revenu
Small businesses stay small either by choice, or because they start chasing growth in the wrong places. When you strip away the layers, it all comes down to darts. Imagine a dart board with a bull’s eye and around it is a series of wider and wider circles. The bull’s eye is where the people just like you hang out. They are the people (or businesses) who feel the problem your company set out to solve. They are usually your first customers and raving fans. The further you go ou
What are your business goals for the year? If you’re like most owners, you have a profit goal you want to hit. You may also have a top line revenue number that’s important to you. While those goals are important, there is another objective that may have an even bigger payoff: building a sellable business. But what if you don’t want to sell? That’s irrelevant. Here are five reasons why building a sellable business should be your most important goal, regardless of when you plan
When you look ahead to next year, will your growth come from selling more to your existing customers or finding new customers for your existing products and services? The answer may have a profound impact on the value of your business. Take a look at the research coming from a recent analysis of owners who completed their Value Builder Score questionnaire. We looked at 5,364 businesses and found that the average company that had received an overture from an acquirer was offer
Warren Buffett famously invests in businesses that have what he calls a protective “moat” around them – one that inoculates them from the competition and allows them to control their pricing. Big companies lock out their competitors by out-slugging them in capital infrastructure investments, but smaller businesses have to be smarter about how they defend their turf. Here are four ways to deepen and widen the protective moat around your business: Get certified Is there a certi
On June 1, 2011, both Floyd’s Coffee Shops in Portland, Oregon were busier than usual. The regulars were elbowed out of the way by new customers visiting the store for the first time to redeem their coupon and get $10 worth of coffee for $3. This tempting offer was made because Floyd’s had been picked as the first-ever Google Offers “deal.” Google Offers is the company’s first baby step into the world of “social buying” style promotions where a special, limited time offer is
You've done the hard work of winning a new customer, but it's what you do in the next 90 days that determine if it'll stick around. The first 90 days of any new relationship are critical: A president has about three months to inspire the electorate and gain the political capital he needs to govern. A young team prospect has but a few months to impress his coach before being sent down to the minors. A new CEO has 90 days to learn her job before the rank and file start expectin