Greta Thunberg, she is a 16-year-old Swedish student credited with raising global awareness of the risks posed by climate change, and holding politicians to account for their lack of action. She has spoke to the UN, European Commission, UK Parliament, and many others. Her activities started the student strike for climate change. She is criticized by many, but not too many for logical reasons. We need to understand why is gaining traction to understand the youth. In addition, businesses need to plan for climate change regardless of the cause.
To the shock and horror of many in the business community, top CEOs from the Business Roundtable stated two weeks ago that Shareholder Value is not Everything. These CEOs, including the leaders of Apple and JPMorgan Chase, argued that companies must also invest in employees and deliver value to customers. I argue that this is a step in the right direction and by not focusing on Shareholder Value, companies can create more Shareholder Value.
World War II started 80 years ago today with the German invasion of Poland. It ended six years later with over 70 million dead. I would argue hubris was a significant contributor to World War II and its outcome. There are many examples of hubris in the business world as well. To survive we need systems that will prevent us from that arrogance.
In the last week, we have seen two examples of failed leadership out of the same industry – the airline industry. Leadership is about building a culture within an organization that can deal with the unexpected as the unexpected is the one thing that is certain. That is not what was going on at Delta and United.
Your business always needs to "Sell Ready" as life is uncertain. Being "Sell Ready" requires lots of work and planning, but is worth it. I believe "Sell Ready" companies sell for more than their value!
I was recently talking with a friend who was giving a workshop to boards of directors on the risk within their businesses. This topic made me think of all the companies that I had worked with over the years and what was the biggest risk they faced but was not realized it within the organization. Upon reflection of all of 2 minutes, I came to the conclusion that that it was Excel!
We have all heard Alan Lakein's quote "Failing to plan is planning to fail". However, the problem today is that many middle market entrepreneurs sell their businesses without proper planning for the sale event and thus leave millions on the table.
I recently saw an article on saying "Reverse Mergers are more Popular than Ever." The author was extolling the virtues of such transactions for MicroCap Stocks. However, this solution I rarely find delivers as promised, in many cases is more of a poison chalice.
Having represented many clients with selling their businesses, raising capital or entering into joint ventures, the issue of Non-Disclosure Agreements ("NDA") always arises. The primary focus of clients is on ensuring that the NDA is as strong as possible and often such that no reasonable party would agree to it. Thus, I find my job is to help them understand what is commercially reasonable, and more importantly to work with them to understand who is the other party executing the NDA.
Many privately owned businesses don’t have Boards of Directors since they don’t have outside shareholders there is no need to. However, having a Board of Advisors has been shown to result in a 3x greater growth in sales and profits than companies without them.
A couple of weeks ago I was hosted by CEO Exclusive Radio and was asked, among other things, about what buyers look for in a management team. So, if you're a CEO/Owner getting ready to sell your business here are 4 key points.
If you are going to sell your business, sell now. At the ACG Capital Connection in Atlanta two weeks ago the common theme from the Private Equity Groups I spoke to was that multiples are back at 2007 levels. They were lamenting the fact that they didn’t have more portfolio companies ready to sell.
On Tuesday night I went roller blading with a skating group I have just rejoined as I had been told Tuesdays was an easy skate. Unfortunately most of the people on the skate were training for a long road skate, and so decided to make the evening an hour and half of hill work. 13 miles later and totally exhausted I skated up to my car which had my bike rack attached to the trunk. I opened the trunk, sat down, took off my skates and pads, stood up and closed the trunk. The rack hit me in the head and left a mark.
The concept of precision verses accuracy was first brought home to me back in the depths of time while I doing Physics "A" Level in high school and calculating measurement errors in experiments. From this I learned that no matter how precise one's measurements were, there an inherent error in the tool which was used to measure the results. Taking into account that lack of precision provided more accurate results, which is what we sought.
Through my work I have dealt with thousands of Excel, and for those that remember Lotus, financial models and I have to say that most of them are bad. I would like to summarize five of my least favorite things about the "bad" models I have had the unfortunate experience to deal with during my career. All of these issues, except the last one, are sufficient enough for me to walk away from the work or opportunity as they indicate that I am likely to find more problems in the finance area or business.
The last piece in my series “Lessons I Learned from Sports that Apply to Business” covers a game that I love and only wish my ability was matched by my passion – Squash. I have played the game for longer than I care to admit, but fortunately my understanding of the game has improved with time. The key points from squash that apply to business are, in my opinion are: (i) dominate the “T”; (ii) keep the other person on the defensive; (iii) not every stroke is a winning one; and (iv) when stuck in a war of attrition, change the game!
I have loved skiing ever since I first started 40 years ago. When I first started I thought the aim was to go straight down the mountain as fast as you could; however, a broken leg soon cured that misconception. Still today I see many people bragging about how they skied down this difficult run or the other, but having seen them on the slopes I realize that they are getting down with little style or ability, and gravity is the main contributor. While they have survived, the chance of doing this repeatedly is small. In business as in skiing, the key is to be able to do the successful things repeatedly.