How to Make Your Business More Valuable – In Just 7 Minutes with Laurie Barkman

Resources/Links:

• Click here to ‘How to Avoid the Succession Pitfalls and Create Valuable Exit Options’: https://thebusinesstransitionsherpa.com/the-business-transition-handbook/

Summary

Is the idea of succession planning always being pushed to the side?

Before it’s too late, it’s important to assess your company’s value and ensure that you are duly rewarded for it. Whether the company is sold or not in the future, proper preparation can help you avoid succession issues and facilitate a smooth transition for your business.

Laurie Barkman, The Business Transition Sherpa(TM), works with owners from transition to transaction as a business growth and M&A Advisor. Author: “The Business Transition Handbook”. Host: “Succession Stories Podcast”

Join Laurie as she explores through the importance of succession planning and helps you develop valuable exit strategies for your business.

Check out these episode highlights:

• 01:46 – Laurie’s ideal client: Business owners in the United States who are contemplating ownership succession within the next five to seven years from the transaction standpoint.
• 02:05 – The problem Laurie helps her client solve: 100% of owners are gonna leave one day, but very few are prepared.
• 02:42 – Symptoms of the problem her clients are facing: They don’t know what to do. They don’t know what steps to take. They don’t know who to work with.
• 04:11 – Mistakes clients make before seeing Laurie: They just keep pushing it to the back burner. It’s the classic important, not urgent thing to do until it is urgent.
• 06:04 – Laurie’s Valuable Free Action [VFA]: The number one thing is to set an intention.
• 06:59 – Her Valuable Free Resource [VFR]: https://thebusinesstransitionsherpa.com/the-business-transition-handbook/
• 07:29 – Q: How did I get started in being a merger and acquisitions advisor and business transition advisor? A: I went through a transaction with a privately held company, was hired in from the outside and it was a very, very successful exit, that’s how I got started with it.

Tweetable Takeaways from this Episode:

“Set an intention for your end game, even if it's 5, 7, 10 years away; think forward to be able to look backward.” -Laurie Barkman Share on X

Transcript
(Note, this was transcribed using a transcription software and may not reflect the exact words used in the podcast)

Tom Poland 00:10
Greetings everyone! A warm welcome to another edition of Marketing The Invisible. I’m Tom Poland. As ever, beaming tee up to you from the Sunshine Coast here in Australia. Joined today by Laurie Barkman. Laurie, warm, good day from down under. Where are you hanging out?

Laurie Barkman 00:23
I’m in the United States. I’m in the city of Pittsburgh, Pennsylvania.

Tom Poland 00:27
Pittsburgh, lots of industry there, right?

Laurie Barkman 00:30
Eds and meds these days. Most well-known in the history books from Steel.

Tom Poland 00:34
Right? Pittsburgh spiel. Excellent. Alright. And I guess the local football team of the Steelers, is that right?

Laurie Barkman 00:41
That’s right.

Tom Poland 00:42
I imagine my surprise

Laurie Barkman 00:43
Revered around the world.

Tom Poland 00:45
Of course they are, yeah. See, I even knew the name of them and I’m in Noosa, Australia. Folks, Laurie, she is not a, she is the business transitional Sherpa. So she worked with owners from transition to transaction as a business growth and emergent acquisition author. So whether you one day think you want to sell your business for a lot more than you might be able to sell it for today, or where do you want to keep it as a cash cow, essentially, you have to do the same things, which is get your business ready for sale. You know, get the people in place, get the processes in place, get the profits happening. So this will be interesting to you, whether you have an idea of success and planning for your business or whether you want to just get it ready. She’s the author of Business Transition Handbook and she’s the host of Succession Stories podcast. So, Laurie, pleasure to have you on the show. Our title today is How to Make Your Business More Valuable. Our timer’s going to start now. Question number one is, who’s your ideal client?

Laurie Barkman 01:46
Business owners in the United States who are contemplating ownership succession within the next five to seven years from the transaction standpoint. But learners can be from anywhere around the world.

Tom Poland 01:58
And what’s the problem you solve for them? What’s the transformation? What’s the before and after look like for these clients?

Laurie Barkman 02:05
100% of owners are going to leave one day, but very few are prepared. I deliver a process and ultimately clarity on these big decisions. So when time’s on your side you can avoid succession pitfalls and create more valuable exit options.

Tom Poland 02:20
Everyone’s going to leave their business. Whether it’s feet first, whether it’s a check in your hand, you’re going to be exiting. So tell us about, question three is, what are the symptoms of someone who needs your help? What’s going on in their business, in their life, in their mind? How do people get a heads up and go, okay, I need to listen to this, I need to find out more about what Laurie does. What’s going on for them?

Laurie Barkman 02:42
Well, you said a key thing there, Tom, which is, it’s in their head. They’re not talking about it, it’s a very lonely space and there’s a lot of weight on their shoulders. Heavy is the head that wears the crown, right? And they don’t know what to do. They don’t know what steps to take. They don’t know who to work with. Papers sit on desks and get coffee stains on them. Sometimes owners pass away and the family’s left to pick up the pieces and it can result in doors closing and people losing their jobs.

Tom Poland 03:06
I mean, it actually creates, by fighting to address this, it’s just occurred to me. But by fighting to address the issue of succession and by fighting to get the business ready to sell, whether this is sell or not, they’re actually creating a problem for people they love because I suppose that that’s the sort of altruistic motivation is let me get this thing ready to sell so I can, it’s much more profitable and it sells for a more valuable company. But also let me do that so that the people that I love and care about aren’t unduly stressed or anxious. Tell me.

Laurie Barkman 03:38
Yeah, you’re in mourning and you have to deal with your business that you know nothing about. It’s a very difficult situation to be in.

Tom Poland 03:44
Yeah. And even more so if they have a partner business whose husband or wife might want to have a say in how it’s run now. Oh wow. Such fun. We are talking about businesses that are generally assertive about growth. So they’re going to be trying stuff. What would you say, question four is, what would you say are some of the common mistakes that business owners make when they’re preparing for succession, other than a complete failure to give it some attention?

Laurie Barkman 04:11
Yeah, that is the number one thing though. They just keep pushing it to the back burner. It’s the classic important, not urgent thing to do until it is urgent. Like we said in some earlier examples, your partner died, you got a divorce, maybe you’re sick, there’s some catalyst for change. But if you’re proactive about it, you can really see the benefits of it. And we’re running a better business. And I always say with my clients, you can’t do exit planning when you’re exiting. It’s just too late. The other thing is, the common mistake is that at least in the United States, some statistics might be shocking to know that two out of every 10 companies in the lower middle market that have an intention to sell don’t because there’s too much. A big reason is because there’s too much of a gap between the price of what the buyer wants and the seller wants. Right? And without that time to make an impact on the value of your business, you’re sort of left holding the bag and going unrewarded for all your hard work. And the other thing is, a common mistake is many owners don’t know the owner’s metric. The number one thing they should be following in the KPI or key performance indicator is the value of their business. But 90% or more business owners have no idea what their company is worth. And so when they run out of time, they run out of options.

Tom Poland 05:25
Right, selling a business is analogous to selling a house. So what we tend to do is when we sell a house to get it ready, we fix everything up and we get it really fantastic and immaculate and then we sit and go, gee, I wish I’d done that a few years ago. I could’ve been enjoying this. Selling a business is kind of similar. I think if you can have it so it’s ready to sell every day, you get to enjoy the business a whole lot more. So let’s flip this, two and a half minutes left. What would you say is the top tip that you could give someone who has procrastinated on succession planning and exit planning? What’s, it’s not going to solve the whole problem for them, but it might get them started in the right direction.

Laurie Barkman 06:04
I think the number one thing, Tom, is to set an intention. Set an intention for your end game. People get really angsty when we talk about retirement or selling or exit. It’s like, it’s almost a taboo topic, but don’t make it so. Set an intention for your end game, even if it’s 5, 7, 10 years away. Think forward to be able to look backward. And in my book, my favorite chapter is chapter six, who should own your company after you?

Tom Poland 06:31
Oh, nice.

Laurie Barkman 06:32
And there’s a lot of factors that go into that. Let yourself sort of travel forward and just think about that one question, who should own your company after you?

Tom Poland 06:41
Great top tip. And it can also be very inspirational and motivation to help you to get the energy you need to actually get the thing ready to sell. Question six, valuable free resource. Where can people find out more about your services and more about this concept of succession?

Laurie Barkman 06:59
Well, I’ve written a whole book about it, how to have a succession that avoids pitfalls and how to create more value over time. And people can get a free PDF of my book by going to thebusinesstransitionhandbook.com.

Tom Poland 07:14
Perfect, http://www.thebusinesstransitionhandbook.com, link under the video. If you’re listening on iTunes or something like that, it’s http://www.thebusinesstransitionhandbook.com. Alright, thanks for that. Last question. 50 seconds left. What’s the one question I should have asked you but didn’t?

Laurie Barkman 07:29
Well, a lot of people want to know, how did I get started in being a mergers and acquisitions advisor, business transition advisor, all this crazy stuff. And the short story is that I went through a transaction with a privately held company, third generation. I was hired in from the outside and was a very, very successful exit. My tenure at the new parent company was a little short lived than I’d like. So I’ve got some battle scars from the process. But net net, it was very positive. And I have high empathy for owners that are going through this because I know there’s a practical transactional side to all of this. It’s about money, it’s about this and that. But you know what, we’re people and there’s emotions and I kind of have this IQ and EQ that I bring to the engagement, right? So that’s how I got started with it.

Tom Poland 08:11
Laurie Barkman, thank you so much for your time and your insights.

Tom Poland 08:14
Thanks for checking out our Marketing The Invisible podcast. If you like what we’re doing here please head over to iTunes to subscribe, rate us, and leave us a review. It’s very much appreciated. And if you want to generate five fresh leads in just five hours then check out www.fivehourchallenge.com.