Do any of these sound like you?
- You have a service business and want to know how to position it to be A) Sellable and B) Sellable for the maximum amount of money possible.
- You’ve learned a lot of valuable strategies for building your business to sell on this blog and/or in the book Built to Sell, but you’d like some extra help figuring out how to apply these strategies to your unique business so you can ensure a big pay out when you’re ready to sell.
- You want to give yourself every possible advantage in building your business to attract buyers who are willing to pay top dollar for your life’s work, including learning about high level business selling strategies not found in the book Built to Sell or the blog posts on this site.
- You would like to meet, learn from, and brainstorm with other service business owners who are designing their businesses to sell for large sums of money.
If you answered “Yes” to any or all of these things, I’d like to invite you to an intimate, hands on workshop on building a sellable business that I’ll be hosting in Las Vegas January 16th and 17th.
During this workshop, you’ll get the opportunity to put your business under the microscope with me and a small group of other successful business owners. Together, we’ll uncover the steps you can take to make your business more attractive to potential buyers – whether you’re looking to sell your business in the near future, or want to start ramping up the value of your business in order to sell it down the line.
This workshop is unique compared to any other training you’ll find on the topic of selling a business in several critical ways: you’ll be able to talk with me about your unique situation one-on-one in a small group format, you’ll be able to mastermind with other successful business owners who are also building their businesses to sell, and you’ll be able to expose yourself to high level strategies rarely discussed anywhere else (including my own book).
You’ll get the advanced coaching, tools, and strategies you need to…
Escape the trap almost all service firms fall into, that leaves the owner with nothing when they walk away from their business – instead of a sizeable nest egg they can use to retire comfortably, or fund their next big idea.
Most service businesses never sell. They are started by someone with a specific skill. Maybe that person hires a few people, but the clients still want to deal with the most knowledgeable person in the company – and that’s probably you.
So when the time comes to get out, you’re left with nothing. If you’re one of the lucky ones, you get approached by another service firm who offers to “buy” your company — but you actually don’t get a check. Instead, you get a little card with a magnetic swipe that grants you access to a building where you have a job as a Vice President at a big company. You then must toil for three to five years for someone else, and if the stars align and the economy improves and if you can put up with the nonsense of big company life, you might get some money from an earn out.
I know your pain.
I’ve started four service businesses – a little marketing and design agency, a radio production company, an event business and a market research firm. Back in 2002 I got asked to lunch by a business development guy working for one of the big agencies. He wanted to “buy” my marketing agency if I was prepared to give them my clients and submit to a three year earn out with no cash up front. No thank you.
So how do you escape the service firm trap? The answer, in my experience, involves re-making your business and positioning it more like a product company. It involves “productizing” your services by naming and branding them so that they can be sold by salespeople instead of only you. It involves turning the project-to-project hamster wheel off and creating a recurring stream of revenue. It’s a hard process, but not impossible, and it is made easier by applying the techniques that I’ve chosen to teach at a workshop I’m hosting in Las Vegas this January.
If you choose to come, you’ll learn how to:
1. Put your business on auto-pilot:
One of the keys to successfully selling your service business is to systematize and automate your processes, so you can walk away from the business after the sale and it can still run smoothly and generate a profit without you. Not only will you attract more buyers and be able to sell your business for more money if you have the right systems in place, you’ll also benefit now by dramatically increasing your efficiency and results as the business owner. At the workshop, you’ll find out how to:
- Create a reliable stream of recurring revenue so you can stop charging by the hour or project and be able to see how your revenue is looking months into the future – a key factor in creating a sellable business
- Reduce your reliance on a few big clients so you can stop groveling for work and worrying they might leave one day
- “Productize” your service so you can hire salespeople to do some of the selling for you
- Eliminate the need to respond to a Request For Proposal (RFP) and get clients to start giving you work without tendering
- Increase the number and quality of your referrals so you can grow more quickly and profitably through word of mouth
- Reward and retain key employees without making them a partner – that way you retain all of the equity
2. Maximize the value of your business
Whether you want to sell your business now or in ten years, it’s nice to know you’re building a valuable asset as opposed to just walking on a tread mill. At the workshop, you’ll learn what drives up the value of your business and specific techniques to:
- Calculate the value of your company using the same methodology acquirers use so you’ll know if you’re getting low-balled
- Avoid the biggest mistake service firm owners make when getting their business ready to sell
- Structure your customer agreements to include one simple sentence that will allow you to sell your business for a premium
3. Negotiate with leverage
To get the best price (and deal terms) when you go to sell your business, you need to understand how to negotiate from a position of strength. Part of having a powerful negotiating position is being knowledgeable about the process, and it also means understanding the strategies you can use to:
- Shorten the length and importance of an “earn out” so you need not work for someone else
- Spot and interpret the second most important sentence on an offer to buy your company so you can clear more after tax cash from the sale of your business
- Get multiple competing offers for your business to drive up the price through competitive tension
I’ll lead the workshop. I’ll explain a concept and give you some exercises to help you apply each technique to your business. I’ll wander around and work directly with anyone who has a question or just wants a partner to brainstorm with. You’ll be given a booklet to write your answers in so you’ll have all of your key ideas and action items in one place at the end of the day. With just a handful of people in the room, we’ll get plenty of one-on-one time together.
In addition to getting to pick my brain, I’ll also be bringing in a Mergers and Acquisitions professional to answer your questions and share some real life examples from “in the trenches” of buying and selling companies. This M&A expert will break down the anatomy of a deal so you know exactly what to expect through every step of the business selling process when you decide it’s time to sell. You’ll also get tips and strategies for getting the best price and deal terms, straight from the mouth of someone who’s spent an extensive amount of time working both ends of a deal.
What business owners who attended this workshop thought
In late September and early October I held two workshops, one in Toronto and one in Chicago. I had planned these workshops to be a one time thing. I’m currently working on a new software company, and between that and my writing my plate is pretty full. I have no desire to start hosting workshops all the time. However, the feedback I received from those workshops was so positive, I decided to do another one this January in Las Vegas while I’m in the country on business (I spend most of my time in France).
Here are a couple comments from attendees of the Toronto and Chicago workshops…
“Even after reading the book and following the blog, there was still a tremendous amount of insight gained from both the curriculum and from hearing the perspectives of the other participants. I thought the dinner the night before the event was great too for setting the tone and allowing the participants to get to know each other leading to more candid conversations about their businesses.”
“Learned a lot. Was great sitting around a table learning how other business owner manage their issues of building a sell-able business.”
“The material was excellent, the presentation was excellent, the interactive aspect, the ability to share with peers was extremely valuable, the guest panel was also excellent.”
The one suggestion I heard repeatedly from the attendees was they wanted more. More depth. More one on one time with me. More time to brainstorm with the other attendees. So I took the single day format of the original workshops and added an extra day, with new and expanded content and more opportunities for us to work together on developing the right strategy for your business.
Turn $2,000 into $100,000
Another question you might have is, “will it be worth the $2,000 plus travel and two days out of the office?” Fair question. My response is that your business could be your most valuable asset if you set things up right. So investing a little to make it more sellable could pay off many times over.
Let’s look at some numbers: according to my reader poll, most service business owners never get an offer to buy their company. Of the lucky ones I surveyed who did get an offer, the average bid was around three times earnings. I’m confident you can increase your multiple by following the techniques I’ll teach at the workshop. Four times earnings is very do-able. Five times is not out of the question. Six, seven — even eight times earnings or more are all possible.
But I’m getting ahead of myself. Let’s be conservative and say you have a business generating $100,000 in profit before tax. At three times earnings, it’s worth $300,000. If, by applying the techniques you learn at the workshop, you can make your business worth four times earnings, then all of a sudden it’s worth $400,000. You can do the math on your own financials. Either way, I’m pretty sure the workshop will be an investment that will pay for itself many times over. And if it doesn’t, flip me an email after the session and I’ll refund your ticket price, no questions asked.
The unmistakable, glorious feeling of control
It’s a special feeling going from groveling for clients to owning a sellable company. My fellow Inc contributor, and 37signals co-founder Jason Fried went through a similar process. He started 37signals as a custom web development shop and made the switch to “productize” his service business. He described the feeling of turning a service firm into a sellable company as follows, “When you’re a consulting business, you have to say yes to big clients, who end up telling you what to do. You become beholden to the giant corporation who is paying you $60,000 for a project. I love the feeling of control I have now”.
I have negotiated a 25% discount for attendees of my workshop to also attend the Alliane of Mergers & Acqusition Advisors (AM&AA) event happening immediately following my workshop in Las Vegas. The AM&AA is the industry association of M&A folks who sell businesses for a living. By attending their event in Las Vegas, you’ll get a first hand glimpse into the world of the people who will be advising you if and when you decde to sell. It’s by no means mandatory, just an idea in case you want to tack a couple of extra days onto your Las Vegas trip. To take advantage of the deal, use the discount code “BTS” when you register for the AM&AA event and you’ll save 25%.