Wealth For Generations
Dive into the essentials of wealth management with Ian Weiner and Todd Whatley on Wealth For Generations. This podcast brings you concise, expert insights on investment strategies, retirement planning, Estate Planning and financial well-being. This dynamic team of a Certified Financial Planner and Certified Elder Law Attorney are perfect for anyone from beginners to seasoned investors, our episodes focus on empowering you with the knowledge to make informed financial and estate planning decisions. Join us for clear, friendly guidance to navigate your financial future with confidence.
Wealth For Generations
Maximizing Business Value: Expert Strategies for a Profitable Exit and Legacy Planning
Unlock the secrets to maximizing your business's value with insights from our special guest, Barbara Taylor, a renowned business consultant and broker. In this episode of Wealth for Generations, we promise to equip you with invaluable strategies for prepping your business for sale. Barbara shares her expertise on understanding your business's true worth long before you plan your exit, the importance of presenting a well-maintained business to potential buyers, and the imperative of clean financials and addressing operational risks. She also delves into practical advice on anticipating and rectifying buyer concerns to ensure a smoother, more profitable sale.
We also highlight the critical need for early and thorough planning for business succession, especially for family-owned enterprises. We'll dispel common misconceptions about internal buyers and explore the complex dynamics of multi-generational business transitions. Learn about the challenges of internal transfers like ESOPs and gain invaluable insights from Tom Deans' book, "Every Family's Business." Finally, we discuss the best timing for selling a business, the pitfalls of selling during distress, and the importance of regular business valuations. This episode is packed with expert counsel to help you secure your legacy and maximize your wealth.
www.allantaylorbrokers.com
Every Family's Business on Amazon: https://a.co/d/a64YXvL
Welcome to Wealth for Generations, the podcast where you learn to grow, protect and preserve your wealth for generations. Our hosts on today's show are Todd Whatley, a certified elder law attorney, and Ian Weiner, a certified financial planner. Join us and our expert guests as we uncover the mindsets, tools and strategies to help you maximize your wealth and impact. Let's embark on this journey to secure your legacy. Please note this podcast is for informational purposes only and is not intended as financial or legal advice. Always consult with a professional regarding your specific situation.
Speaker 2:That's right. This is the Wealth for Generations podcast, and I am one of your hosts, Ian Weiner, and I am so excited. Today we have a special guest, Barbara Taylor. She is a business consultant, business leader and business broker with tons and tons of experience building and selling her own business as well as helping others do the same, and so we're excited to talk about that process and share some ideas and best practices. Barbara, welcome to the podcast. Thanks for having me. It's exciting. Will you give us just a little bit of your background? I know there's a lot that you could talk about, but give us some kind of high-level things here so we understand the context.
Speaker 3:Sure, yeah. So I am one of the owners of Allen Taylor Company. We're a business brokerage firm that has been in Northwest Arkansas for 17 years yeah, since 2007. There are three partners at the firm myself, my husband and we have a third partner as well. We do business brokerage, so we help people sell their business. We do that all over the country, although the bulk of our clients are from the south-central US and, more specifically, we consider our backyard to be Arkansas, Missouri and Oklahoma, and so we help people sell their business when they're ready to exit through that method. We also do business valuations, because that's usually for us, that is the starting point. It's to understand what the business is worth and then start making decisions about either a number of potential exits or about whether or not to sell and if the time's right.
Speaker 2:So when folks come to you and a lot of folks that are either building their business or thinking about selling at some point it might be their first time doing that, and so I want to talk about some of the things that may not occur to them during that process, and a big part of it is the valuation. Do you find that people routinely have their business valued, or is this sometimes, when they're getting ready to sell, the first time that they do that?
Speaker 3:Yeah, that's a great question. So the reality is that most business owners don't think about having the business valued until something triggers that need. And there are many, many reasons why you might have to have the business valued. Maybe you're funding a buy-sell agreement, maybe you're getting a buy-sell agreement, maybe you're getting some additional capital. I mean, there can be many reasons, but certainly thinking about your exit is a point in time when it kind of finally occurs to the business owner like, oh, I wonder what it's worth. So that tends to be.
Speaker 3:You know, it's one of the many aspects of selling your business or exiting in any way, that you should be thinking about it well before. Then. There's really no downside to having your business valued at any point in time, but it's better to do it in advance of selling, if that's your preferred exit strategy, because the valuation is going to, possibly for the first time, show you how a buyer is going to think about your business, and a lot of times it will uncover things, whether they're financial or operational, that you would want to maybe fix before you sell operational that you would want to maybe fix before you sell.
Speaker 2:So you're saying that not every investor is going to look at the business the same way the business owner does, with rose-colored glasses all the way around, exactly right, yeah, and sometimes it's hard to tell someone that their baby is a little bit ugly, to use that phrase. But it's important to have clarity when you're starting this process, because changing some things during that process can be a difference of hundreds of thousands or even millions of dollars.
Speaker 3:Yeah for sure, absolutely. You know you want to. If you're going to sell your business, you want to go out onto the marketplace putting your best foot forward. You want to. You know, make sure the books are clean and everything looks good. You might want to, you know, perhaps like improve some of your marketing, or you know it's a time to really make the business shine and improve it and also understand what buyers are really going to be focusing on. So the books.
Speaker 3:It's always going to come down to the financials at some point so you really want to focus on making sure all that looks good. Depending on the size of your business, you might want to have your books audited or possibly reviewed before you sell, but there are other things that might not occur to the business owner, things that appear to be a risk to a buyer, that the business owner has just gotten used to, or they don't think about it as a risk.
Speaker 3:So like customer concentration is a good example where you might have high customer concentration and you're like, well, it's just always been that way, I have this, you've got great relationships with a few key customers.
Speaker 3:Yeah and it's like what's the big deal? It's worked for me for years, but a buyer's not going to feel that way. So, like there are just areas like that where the business owner feels like it's really not a lot of, there's not a lot of risk there, or it's not that big of a deal and a buyer is just not going to see it that way, and they will use that as a reason to basically probably tell you that the business isn't worth what you think it is, whereas if you had eliminated that problem beforehand like I don't, there is no one customer that accounts for more than 10% of annual sales then you've taken away that concern.
Speaker 2:It makes it a much simpler process. When you're almost getting ready to pre-sell it, You're going okay, how would someone look at this and how do we remove all of those issues from the table so that there's very little there and it's much clearer and more transparent for everybody? Do you find that folks that work through that valuation and really kind of looking at the business as a buyer, do you find that they're able to sell faster and have a better experience there?
Speaker 3:Oh yeah, absolutely. I mean it also prevents what you don't want to happen is getting to some point in the sale process and having the business not be sellable. Like you know, you get to some point in due diligence or whatever it is, and deals start falling apart. So it prevents that and then yeah, I mean it does you can sell the business a lot faster.
Speaker 2:I mean, it's never happened. Every business owner thinks it will happen tomorrow, right, and oh, this will be done in 30 days.
Speaker 3:It's never. I always tell people six to 12 months approximately, just because there's a lot more involved.
Speaker 2:That's with expertise that has done it before you know on your side.
Speaker 3:Yeah, I mean hopefully six months, but you never know what's going to happen. So you know, from the time you sign an agreement with a firm like mine to the day you've closed the deal, about six months Could be shorter, could be longer, but you know we've had business owners that we've worked with for years prior to a sale, and I can think of two in particular One we worked with for about three years, another we worked with for about seven years and it started with evaluation and every year we would kind of revisit that whole exercise. And both of those businesses sold quickly. And I remember one business owner saying you know everybody prepares you for you know it's going to be hard to sell your business and this was easy. And I'm like it was easy because we spent three years like preparing for this work yeah, so it definitely makes it faster.
Speaker 3:Smoother. You're preventing the thing you you don't want to happen, which is um getting to some point where you're unable to close a deal with a buyer.
Speaker 2:Yeah, that's, and I'm curious what you're seeing a little bit more recently. Are you seeing more say in the past five years? Are you seeing more interest in the businesses that you work with? Are there more people that are trying to buy businesses now and sell, or does it seem pretty normal? There's a lot of this talk about and we discussed earlier. This conversation has been happening for a long time about this silver wave, or silver tsunami of the folks that are either getting ready to retire at that retirement age, trying to transition that. Have you seen an uptick recently? Has it been steady kind of in the last five, seven years? I'm just curious your perspective on that.
Speaker 3:Well, we've been doing this for 17 years and there's always more high-quality buyers out there than high-quality small businesses for sale. I mean, that to me just seems to never change. You know, I can't necessarily say why that is. And yeah, I've been waiting for the silver tsunami for like 15 years.
Speaker 2:And I think we're going to continue to wait for it forever, because it's not, as that's such a simple way to say what's going to happen when it's very complex to transition assets, whether you're selling them or transitioning them to the next generation and most people don't plan for it. It just kind of happens as happenstance.
Speaker 3:Yeah, and it does require a lot of planning. No matter what you decide to do with your business, you know selling is one possible exit. But a lot of owners just have these assumptions like, oh you, oh, someday I'll be ready to exit and then my kids will take over, or I'm sure my managers will buy me out or I'll sell it to somebody. And there are these preconceived notions where you really, especially with those internal buyers, like other family members, partners, managers you really want to vet that out as a possibility sooner rather than later. Because again, people have these assumptions that I had one recently where they thought for sure the manager was going to buy them out. But what happens a lot of times is when you start getting into the details of it, you realize that that's really not the buyer. Or when that person realizes what it means to be an owner rather than an employee, they're like I don't think.
Speaker 3:I want this as bad as I thought I did, and even with kids too, there's a lot of when you're talking about multigenerational businesses. There can be a lot of assumptions made there and there's a lot of feelings involved and a lot of emotions. And a lot of times the kids don't want to take over the business and maybe they haven't been clear about that because they don't want to hurt mom and dad's feelings. Or maybe the business owner doesn't want to their kids to take it over because they don't think they're the right owners for the future and you're just sort of kicking the can down the road. So all this stuff takes planning and there's kind of no such thing as planning too early for your potential exit. And again, some of these internal transfers can take years, like if you're doing an ESOP, that can take you know, those are super easy, like you just.
Speaker 3:Yeah, we won't talk about.
Speaker 2:ESOP that can take. You know, those are super easy, Like you. Just, yeah, we won't talk about ESOP.
Speaker 3:That's not my area of expertise, but some of these, these exit strategies outside of selling. It can take years to accomplish and you have to bring in a lot of different types of advisors to help and and whatnot. Selling, selling to an external buyer tends to be the quickest and the most lucrative, but if you're planning a different type of exit again, like family transition and succession planning, like I've heard people say 10 years.
Speaker 2:Yeah, I think that's not unreasonable, because there's not only the financial and just the structural component of the business, but there's so much relational challenge and dynamic there too. You know, I mean you're, you're related to these people, and so you have to be able to transition not only the business but the values and the relationships and continue that through. That's just not something you can expect to happen overnight.
Speaker 3:Yeah, I'd like to recommend a book to any of your listeners who and clients who own a family business. Um, there's an author by the name of Tom Deans who wrote a book called every family's business and it's just the best book out there for for family business owners to um, or family businesses to to think about either a sale or an exit or whatever. I can't recommend it highly enough. And he says family businesses are easy to start, difficult to manage and nearly impossible to exit, so they definitely have their own challenges.
Speaker 2:I feel that, as I'm in the midst of a couple of smaller family businesses here and some of the fun and the challenge there, and so I really love talking about the planning aspect of this, because this is what we beg people to do is plan early and often and more early. And so you know we talked briefly, but I really want to underscore this about. You know, there's really no bad time to get evaluation and to start thinking about this, and even you know the folks that will listen to this, that are, you know, on the earlier side of their ownership journey. My encouragement is to begin to think about some of those things. You know don't be only focused on a potential legacy. You have to still build the business, but think about what you'd like to happen and how you'd like it to happen, because it's easier to take those steps earlier and build it for that than hope that it happens at the last minute.
Speaker 3:Yeah, it's much easier to achieve whatever your goal is if you've put a bunch of planning and preparation into it. But it's also kind of a good form of insurance, so you never really know what's going to happen. As a business owner, you may get an unsolicited offer. If you've had the business value, you will know is this a good offer or not.
Speaker 2:Is that?
Speaker 3:reasonable. It could be that you know people frequently associate selling a business with some sort of bad thing happening, which you know. Hopefully it doesn't have to be that way. I mean you will leave your business. Nobody's immortal. You're going to leave no matter what. But you know it's best to leave on your own terms and, yes, it's good to make sure that the business you know the value of the business and it's in sellable shape in case something bad happens. But something good might happen again, like the unsolicited offer.
Speaker 3:Or we had a client once where her daughter basically became famous and I won't say who it is, but she moved to Hollywood and her mother's like I want to sell my business because I want to be able to not have be tied down to this responsibility and I want to be able to be on the West Coast or whatever. Her daughter was quite young at the time and that's an interesting reason to sell your business. You don't know, it's not necessarily triggered by something bad, like illness or what have you. It can be triggered by something unexpected. That's good. So, regardless, if you know what your business is worth and you have, I would say, an updated valuation every year or two and you understand the qualities of the business that make it sellable and hopefully, if you've put some work into it and make sure that it is sellable, you're ready for that you know buyer who?
Speaker 3:shows up at the door or whatever.
Speaker 2:You know you're just ready and what? I have not been involved in nearly as many of these transactions as you have, obviously, but you know when it is a health or a lastminute thing we're not getting top dollar typically.
Speaker 3:No, I mean one of my partners says I can't tell you when the exact right time is to sell the business, but I can tell you when the wrong time is. And certainly it's difficult when you get into those types of situations of distress.
Speaker 2:I would call it it's funny in a lot of ways. Even very good investors and owners are similar in this. We all know that you should buy low and sell high, and somehow always the emotional thing the most. The thing that tends to happen is people end up doing the opposite without good counsel. And I think it's, and I want to talk about that in the example of business ownership, because I bet you see that a lot where people are like, well, sales are declining, so it's time to sell, it's like wait, wait, wait, wait. That's the wrong way to approach it.
Speaker 3:Yeah, exactly right. Usually the the the good time to sell. I'm not going to necessarily the best time to sell, but you know the the best time to sell. I'm not going to necessarily the best time to sell, but you know the the best time to sell is frequently the point in time when the business owner isn't thinking about selling it at all. I mean, they probably know intuitively that the business is at peak value. You've had three to five years of growth and you know it's highly profitable. And and but the the thinking goes like, why would I sell now? Things are great, and then just what you said, like, well, ok, so if you're going to wait for things to stagnate or God forbid, decline, you know, maybe, maybe you'll still be able to sell. I mean, now it's a maybe, but you're certainly not going to get the same valuation.
Speaker 2:It's pretty rare that I would be comfortable advising a client to take on a turnaround situation.
Speaker 3:Unless you're adept at it. I mean, there are people who are good at that, but that is not the uh that's.
Speaker 2:That's a pretty few and far between group of folks, you know.
Speaker 3:Yeah, and you're. You're really cutting down the buyer pool when you're in that selling in that type of situation.
Speaker 2:It's just it's so interesting to me these things would seem intuitive, but when it's your business, when you're in it all the time and it's close to you, it's hard to sometimes see those those things. And so you know these aren't terribly complicated things, but I hope folks will really listen. Okay, get evaluation, do it before you. You absolutely have to make that, make that a practice. It's just good business to know what the business is worth and what you could capitalize the business with. If you need whether you need debt or equity or you want to sell it it's good to know what the terms are. When you're forced to do anything, you tend to not get as good of terms Right as a practice. You know to avoid that plan early and often.
Speaker 3:Yeah, you're definitely not in a strong position if you're having to rush or whatever it is, and you know it's another way to look at your business. There are a lot of business owners who are very thoughtful about the health of their business and they track certain metrics and keep dashboards and things like that. But this is another way to look at the health of your business have it valued, understand, look at it through the lens of a buyer. You know now how does your business look. To me it's just, it's a good management tool period and you can make all it can frequently bring, bring some decision making to the forefront. That a lot of times owners know they've sort of been, you know, avoiding or whatever, but it's just it's. I've. I've heard so many people after evaluation just be like, oh, you know, this was really just a valuable experience and there are frequently some aha moments. But again, I just I consider it a management tool.
Speaker 2:It's just good business to be paying attention to this, you know, and sometimes it's hard to get folks to start that process because they're they're just focusing on on surviving in some ways. You know there's always a fire to put out, and if there's not a fire, there's about to be two around the corner, and so sometimes it can be hard to start that process. How involved is that process? How long does it take? I know we're speaking a little bit in generalities here, but I want to give folks an idea of what is it actually going to take in terms of workload for somebody to have a valuation done if they're working with you guys.
Speaker 3:Oh, the workload for the valuation is quite easy with you guys. Oh, the workload for the valuation is quite easy. Typically you're going to want to have three years worth of P&Ls, balance sheets and tax returns ready to give to whoever's doing the valuation. Sometimes some of the reporting might be asked for. It just depends on your business, perhaps in the industry, but really just those financials. And then we have a questionnaire that's got about 50 questions on it and so you answer the questionnaire.
Speaker 3:And then for us, for our process, typically I look at the financials and I put them in a side-by-side order by year what's called a common-size analysis and take a look at the earnings and talk to the owner. We have a conversation either on the phone or in person about the financials. I ask a lot of questions that maybe have not been asked before, and then when I've got my piece done so you know and then when I've got my piece done, the research is done on comparable transactions and other types of formula that are used for that particular industry to value a business, and then you get a report and we can discuss it. So the workload for the business owner assuming that you keep your books up to date it's really not very much at all.
Speaker 3:It's not much at all and I always tell people I mean again, there's no bad time, but like right after tax season can be good, because like you know everything's been done, everything's been updated because you had to update it. It's fresh. Yeah, most business owners are updating things, you know, monthly or weekly anyway, but yeah, again, it's a low involvement process. It's not hard to do so. Now, if you're talking about the process of selling a business, there are parts of that process that are very involved, but the valuation is simple.
Speaker 2:It's pretty straightforward. So there's really no good reason for anybody to put it off any further. No, I can't think of any. So we're not letting anybody off the hook here. But I mean, on the other hand, that should be good news and that's kind of the point is oh, this is a good business practice. It makes sense to do it for a handful of different reasons. Why not put it off? Why not get the information that's going to help you make better decisions as you grow your business? So you know, we've cleared that out. That's a good idea. So, after evaluation, then what's the next step? So, if someone gets the valuation, they go oh, the business is worth more than I thought. You know how do you walk folks through that process and some of that decision making of you know, should we consider an internal exit and an external sale? Walk us through what that process is like with you guys.
Speaker 3:Yeah, well, I'm typically only talking to people who are thinking about an external sale. Some types of internal transfers have a different valuation attached to them. Not that you can't use the one that I do to make a determination about that. But you know, I'll speak from the perspective that I'm dealing with, which is the possibility of selling the business to an outsider or an external buyer. And usually after the valuation we have a conversation about, you know, the business owner will say, yeah, that's kind of in the neighborhood of what I thought, or it's a lot less than I thought, or it's more than I thought. You know, frequently there's a variety of possible answers there.
Speaker 3:And then, you know, timing is an issue for some business owners. They're like oh, you know, I'm going to wait until. You know, it could be age related, it could be who knows what. But a lot of business owners will be like, you know, I thought I'd sell in about three years, but the actually the business is worth. You know, if I could get this today, maybe I would accelerate that timeline, you know.
Speaker 3:So we talk a little bit about timing and sometimes we have conversations about what's detracting from the value of the business, and then the business owner has decisions about well, do I want to spend the next one, two, three years trying to fix this so that my business is worth more, or am I just okay with?
Speaker 3:You know that frequently this is another reason not to wait is that a lot of times the valuation will uncover something that's like oh, if you would just make these changes, it would really make a difference on your P&L and in your valuation. And it'll take a year or two or whatever, and the owner's like I. You know I no longer really have the energy to do that. So again, it's another reason why you want to do this early, in case there are some things that might take a little bit of energy, maybe a little bit of investment. You know you want to be examining that and possibly tackling it when you still have energy. A lot of the problem with waiting until you're ready to sell is you really don't have a lot of gas left in the tank and, again, that's not a great time to be thinking about selling when you wish it had sold yesterday.
Speaker 2:It's important to talk about this stuff, though, because I think many owners are just they're. They're in it, they're focused on the business, and they don't always have an opportunity to step back and think about some of these things. You know, and so I really appreciate your being able to bring a lot of experience and um help bring some clarity to folks who may or may not be thinking about this, but probably should be thinking about it at least as an option. You know, we want to be able to have options. That gives us the ability to make good decisions. When we don't have options, the decisions unfortunately aren't very hard.
Speaker 3:Exactly right. And even if your hope is that you're going to exit your business another way, besides selling whether that's family succession or management buyout or whatever, or ESOP selling to an external buyer can always be plan B. If I explore these other possible exit scenarios and they don't seem feasible, for whatever reason, then I always know that I can sell it to an outsider. So you've got like you said. Now you have options. It doesn't feel good to not have any options.
Speaker 2:That's not a position of strength and power, unfortunately, right. You know we don't want to. We don't want to find ourselves in that, in that spot I'm wondering if you'll talk just a little bit about, because you don't, you can't help everybody, and so who are the types of folks who, if they're listening to this, you know are really the types of folks that you do your best work for or you enjoy working with the most even? I'll throw that in there, because I know you do this, because you love it, and so that's a big piece of it.
Speaker 3:Well, most of the business owners we work with are founders Not all of them, for sure, but many of them. The businesses usually have at least 10, 20 years under their belt. They're not newer. Usually they're at least five years old or older. We say that we're industry agnostic, which is true. We don't specialize in one particular industry with are in B2B services, light manufacturing or some trades not some residential, but a lot of commercial and industrial trades. In terms of size, most businesses that we work with have between $2 million and $20 million in annual sales, or $500,000 and $5 million in EBITDA.
Speaker 2:So that's kind of an overview of the businesses that we work with, and so if somebody is on like the upper bound there, should they still chat with you, because you've got obviously good relationships with buyers in those industries too. You, because you've got obviously good relationships with buyers in those industries too. And so that's probably. If they're like, oh well, we're a little bit above that or we're like just a tiny bit below that, is it still worth them having a conversation with you and getting some clarity on that stuff.
Speaker 3:Oh, yeah, for sure. For us, it's all about fit, and so, even if you're not exactly within these parameters, it may be that you're still a good fit for our firm. Certainly, even if you're not exactly within these parameters, it may be that you're still a good fit for our firm. Certainly, we have worked with businesses that are larger than what I've mentioned and smaller, but it depends on the circumstances, it depends on the business, it depends how quickly we think we can. Would we be able to find a lot of high-quality buyers so that you have at least three offers to choose from?
Speaker 3:So we really this is why we want to go through the valuation process too. There's just no, every business is different. I mean, you can have a franchise and every location is different in some way. So we really like to do the valuation as a way to get to know the owner and the business and their goals, and then that gives us a good idea of yeah, maybe it's a little smaller than we typically work with, or maybe it's a little larger, but it's a great fit for our firm. So we're pretty, after 18 years, 17 years, we don't really take anyone who's not a good fit anymore.
Speaker 2:I was going to say it if you weren't going to say it, but I think that's important for people to understand, though, is you want to work with a firm that is a good fit, because this is such a challenging process, and you want to really know that you have alignment in terms of working together with someone kind of in the trenches a little bit in some of this stuff, and so that's not a small thing.
Speaker 3:Yeah, and it's also, you know. Back to the valuation. The valuation is a bit of a. It's a project that we can work on together. We get to know each other and I get to know your business and have a chance to look at the financials and see how you know, how you respond to questions and how quickly are you able to respond to additional information I may need. You know, this is all sort of a trial run for potentially selling your business, and you know how do we get along.
Speaker 2:So, again, that's why the valuation is important for us too, as we're trying to determine that fit, not only the fit of the business but the owner, as well, and I think it's the final piece that I'll say on that is you know, my encouragement to folks is, if you're looking for the least expensive or the business broker that will take anybody, you may want to think again, because you get what you pay for a little bit there and you know you guys don't have to take on anybody that it's not going to be a good fit for and you'll take on someone that you know you can sell their business, and I think that's important for people to understand.
Speaker 3:Yeah, exactly right. We don't take an engagement unless we think there's like at least an 80 percent chance that we're going to be able to get the business sold, least an 80% chance that we're going to be able to get the business sold, which is, you know, pretty high when you figure that. I think the statistic I usually see is that only 20% of businesses that are taken to market ever sell. So we're the kind of the opposite of that. We want to make sure the probability of what is a difficult process is as high as we can possibly, you know, get it to be. It's never certain until the deal is done. But yeah, we're the opposite of that. We take a small number of clients every year that we're relatively certain we're going to be able to meet their goals and be successful, and we'd much rather work that way than other firms that will just take as many listings as they can and hope that a few of them sell.
Speaker 2:Yeah, that's not. That's part of the reason we're having this conversation is that's just antithetical to our process too. We you know we can't help everybody, and that's okay, but there are people that we can do really good work for and we want to help them and that that's a mutual fit process. There I want to ask too about okay, someone has a successful exit. What do you tend to see? Do you see people that start another business again pretty quickly, or do you find that that's an interesting process for folks as they're kind of rounding that corner going? I've done this for process for folks as they're kind of rounding that corner going. I've done this for in the case we were talking about 15, 20 plus years. Do you find that that's a challenging thing for folks to transition, or how does that typically go?
Speaker 3:I know every situation is different, but yeah well, it's the least challenging for people who have already they've already mapped out a plan for what they're going to do after they sell the business, and you know that can be hard. There are owners who their entire identity is wrapped up in owning the business and then it becomes very difficult emotionally to. You know, think about who am I if I don't own this business? What am I going to do? I'm going to sit around in my bathroom and be depressed, and you know that's possible, but you want to avoid that by.
Speaker 3:We've had lots of owners that they've got a plan. They know exactly what they're going to do. They're going to, you know, build the lake house. They're going to turn a hobby into a business just for fun. They're going to, you know, open that music studio and get back to guitar. Whatever. You know these, these owners are. You know these these owners are. They have something to look forward to, and so the process tends to be a lot smoother and a lot happier for them because they're moving toward something.
Speaker 2:Yeah, it's a positive thing. It's not a scary thing.
Speaker 3:Yeah, I mean it's always going to be for most owners anyway. There's going to be a certain level of sadness and and you know you're stopping doing something that you did for a long time and you're not going to have the same connections you had, and it's really important to emotionally prepare yourself for that. But it's a lot easier when you're also really looking forward to what you're going to be doing afterwards.
Speaker 2:I wonder if and this just seems natural to me, but I wonder if you see folks that are planning earlier and having valuations done before they think it's time to sell, do they tend to be the more successful ones in that, where they have something to move to, versus the folks who it's kind of like, well, it's just time and they haven't thought through the next step? Do you find that those things are somewhat correlated or does it just depend on the business owner?
Speaker 3:It just depends. I mean, certainly that business owner that's planning well in advance can almost guarantee that everything's going to be smoother and whatnot. The other category of owner that you're describing, who's just waiting till the day they wake up and feel like it's time to sell, that's you know, that's a bit of a coin toss Whereas the other owners are relatively certain that things are going to go well because they've planned, they've prepared and it goes the way they think. If you don't do the planning and preparation, then to some degree fate's going to decide whether it goes well or not.
Speaker 2:Yes, that's true. It's so funny. We always talk about planning, preparing, making sure that we're you know we're thinking some of this stuff through before we're forced to Same with selling your business. It's interesting. It's almost like these are good life principles.
Speaker 3:Yeah, the same principles apply for sure.
Speaker 2:I love it. Well, there's a lot that we've talked about and we've taken a good amount of time here. Is there anything we didn't talk about, that we should have or that I should have asked that you think folks that are either thinking about this haven't thought about it yet or are getting ready that they should know or that you want them to think about?
Speaker 3:are getting ready, that they should know or that you want them to think about. No, I think the main point is the thing that we've talked about quite a bit here, which is to put some thought and some preparation and planning into this idea of how am I going to leave my business and don't wait until the last minute. There's, I think, maybe a little bit of a misperception out there that it's kind of like real estate, Like I'll decide that I want to sell and then I'll call somebody and they put it on the market and that's it when. It's not like that at all. Really, again, like we've said here, it could take a year, two years, three years of preparing to really set your business up for a successful sale. So I don't have anything to add, except you know plan and prepare.
Speaker 2:I love it and I just. It's simple, not easy for a lot of folks.
Speaker 3:Right. And again that valuation is it's not a hard thing to do, it's a very easy first step, is it's not a hard thing to do? It's a very easy first step? And a lot of times that will sort of inform the way you're thinking about things and there's just like you said, there's there's really no reason not not to have one done and you're probably going to be glad you did.
Speaker 2:Yeah, I'm trying to think of a situation where I mean worst case scenario you find out there are some areas that you can improve and it's better to have that knowledge than not. And so there's no, I can't think of any good reason not to do it. And so how do folks get in touch with you? They listen to this, they go okay, I want to have a valuation done, or I want to start talking about selling the business. What does that process look like?
Speaker 3:The best thing to do is go to our website, which is allentaylorbrokerscom. Allen is spelled A-L-L-A-N, so allentaylorbrokerscom. We are located here in Northwest Arkansas. We're actually just moving our offices from downtown Bentonville to Rogers, but we're here in Northwest Arkansas, so we can certainly meet in person. But I would say, go to the website and you can hear more about, learn more about us, about the partners, about what we do and sort of our philosophy around things, and all our contact information is there as well.
Speaker 2:Perfect. So website Well, we will link that in the show notes and make that easy for everybody. But I really want to encourage folks if you haven't had a valuation done, get it done. Let's get that process started. It's going to give you clarity. Clarity gives you confidence and you'll feel better when that's the case. I mean, we're talking about a lot of things that are more numbers and logic-based, but really a lot of decisions get made through feelings and emotion, and so if you want to be able to make those decisions, well, having clarity about what the business is worth and what that process looks like, I think, will help you to make better decisions. So it's been lovely to have you on and chatting today. I'm sure there's a bunch of other stuff that we can talk about and we can have some follow-up episodes. Any parting thoughts as we close out here?
Speaker 3:Just that. This is a really important part of the conversations that you have with your business owner clients, and so to have these discussions with the valuation in hand, it's just going to make those discussions more productive, whether it's talking about timing. Or make those discussions more productive, whether it's talking about timing or, you know, investable assets or whatever your conversation is with them, it's just going to bring some clarity to that conversation as well.
Speaker 2:I love it. Well, I appreciate it so much. Thank you and everybody. Thanks for listening and we will talk to you soon. Thanks.
Speaker 1:Thank you for joining us on Wealth for Generations. We hope today's insights inspire and guide you in your financial journey. Remember, the path to wealth and legacy is unique for each of us and we're here to help illuminate your way. Before we part, a quick reminder this podcast does not provide financial or legal advice. The content discussed is for informational purposes only. Please consult a financial planner or legal advisor for advice specific to your situation. Visit us at wwwwealth4generationscom for more resources and don't forget to subscribe to Wealth for Generations. Until next time, keep building your legacy, one decision at a time.
Speaker 2:This material is intended for educational purposes only. Nothing in this material. Keep building your legacy one decision at a time. Thank you.