Archive for the ‘Business Acquisition’ Category

Building Trust

Monday, November 12th, 2018

When you rush to “sign up” a prospect as a client, an adviser, an investor and so on, counterintuitively you lessen the prospects of profitable business. Why? This is the relationship business. Foregoing time taken to properly build a trusting relationship gnaws away at the benefit of doubt the other party gives you, their accuracy in helping you make smart decisions and their commitment to help you prosper (reciprocity). Take a pause, invest quality time and keep offering reciprocal value. 

Sell-Side Wealth

Monday, October 29th, 2018

I meet a great many entrepreneurs/founders in their later years embarking on ambitious ownership transitions. In my experience with such complex and ambiguous plans, we need to ensure the strategic guidance to successfully attract ideal investor(s) and convert that into a signed agreement is matched by the seller’s future understanding of their actual personal wealth needs, post-sale. The trail is littered with the remains of unrealistic and poorly informed sellers of businesses that pursued a sale without sound metrics and accountabilities. 

  1. What do you actually need financially to live in your desired lifestyle for the rest of your life?
  2. Is it realistic and supported by hard evidence?

If “Yes”, where are you today, what changes must happen, who is accountable, and in what timeframe?

If “No”, when and where are you going to acquire the hard evidence and the expertise, to help you make prudent life changes consistent with your realistic financial means? 

It is that simple if you have the courage and volition to put yourself first. 

Uncommon Market Attraction

Wednesday, September 19th, 2018

The Secret of A Seductive Rapport

When business or investor prospects are drawn to your intellect, social interaction and your communication style, the relationship moves to a depth of reciprocal trust and respect where doing business together becomes “probable”, not  “possible”. Counterintuitively, you get to that point, not by submerging business prospects in everything there is to know about you (marketing collaterals, credentials, deals) but impressively answering what the prospect wants to know.

You help yourself in advance, by visualising where you want the conversation to end up, the obstacles that might lie ahead, and natural responses to keep your conversation on track with maximum momentum.

You help yourself after the conversation, by examining what worked well and you can repeat successfully next time you meet, what didn’t work well and what you must improve when in the same situation.  

   

The “Ask”

Thursday, June 28th, 2018

 

How direct is acceptable when making the “ask” in a business or social setting? That question had me thinking watching a young huckster approach two pretty girls that he clearly had never met at London’s Masterpiece art fair last night with the line “I’d like to take you out, can I have your telephone numbers?”. That they handed them over with a nervous giggle and 30 seconds of mumbling conversation shocked my wife. In an insta-glam world of dating, perhaps that is increasingly the norm. Do we really forsake building a trusting relationship for a quick response? In business, in my experience, that only works for life insurance salesman and charlatans.

© James Berkeley 2018. All Rights Reserved.

The Twinkling Diamond

Friday, May 18th, 2018

What, precisely, are you doing to draw your ideal audience to you and to maximise their intellectual curiosity?  When you perfect those techniques, you have close to zero acquisition costs.

© James Berkeley 2018. All Rights Reserved.

 

A Vulnerable Seller

Monday, November 13th, 2017

Here is something counter-intuitive for a great many sellers of high-growth and mid-market privately-held businesses. If you want to maximise the price on exit, you need to maximise your vulnerability. Yet most sellers have spent years doing the exact opposite.

Vulnerability is largely a function of a seller’s self-worth (“I won’t allow the sale outcome to influence how I think about myself”), giving yourself permission to be vulnerable and the quality of your support system (friends, family, advisers and acquaintances). Hence any transition plan in the lead up to the start of the exit process, needs to address all three aspects, in advance, alongside:

  • Any fractured personal relationships (spouse/partner/family members)
  • Any past, present or future “private promises” made by the business to fellow shareholders, managers and family members (financial or no-financial)
  • Any private grievances (key clients, key business partners, key suppliers) or events (disputes, potential regulatory breaches etc.) that might reasonably give the buyer cause for alarm in due diligence or god forbid, post-sale.

You are rightly proud of the business that you have built. You have had proprietary control of the reins (people, capital, resources). Your control has given you power (discretionary authority) and protection (preeing eyes). The “4 P’s”. Now a buyer (strategic or financial) is being asked to make an informed judgement on the value of your business to their ideal future. What is the sum of your pride, your proprietary control, your power and your protection worth to them?

A buyer can rarely understand it (quality of your people and management, quantum of uncertainty, competitive threats) clearly without you being voluntarily vulnerable (trust). You cannot negotiate successfully without putting yourself in a position of vulnerability (willing at any point to walk away from a proposed deal), irrespective of the  consequences (financial, non-financial, business or personal). That requires a mix of internal and external attention as early as possible in the transition process. If appropriate, hiring someone, who has successfully dealt with those issues in their own business and who can help navigate you through the process. Almost certainly, not an internal figure, nor your corporate finance adviser. Someone, whose skills, behaviours and expertise are strongly aligned to your discrete personal and business needs.

© James Berkeley 2017. All Rights Reserved.

Friends Reunited

Friday, October 6th, 2017

The squirrel in the garden this morning made his usual tour of the more verdant patches of the garden but on his way home, he made a stop at a less verdant area that was once one of his favourite hunting grounds. Turning over a few empty conker nut shells, he found a couple of worms drawn to the surface by the increasing cover of autumn leaves and increasing soil moisture. It reminds me in business, how easy it is to forget the converging value that lies with past friends, past school and university acquaintances, past customers, past investors, past employees, past business partners, past media contacts and so forth, who we have ignored for a good few years. Yet circumstances change in some of theirs and our lives causing our interests to increasingly converge rather than diverge. Yet for most people that is an accidental occurrence. In a world with greater connectivity, there is no real excuse unless you are poorly disciplined. My advice, on a quarterly basis throughout the year, trawl through 2014 and prior email inboxes, client and prospect files, personal photo storage boxes or albums. Write down a list of 40 names. Over a gentle two hours, perform a maximum 3-minute google or social media search, highlighting those that are of “known” and “questionable” converging value. Make a diary note to call the top half of your list (“knowns”), and at a minimum, drop a brief four sentence “re-connecting” email to the rest.

Explain that “I’ve been remiss in keeping in touch but I heard/read/saw something of interest (new job announcement, award, an interview) and thought it might be an opportune time to talk? Recently, I have undertaken ____ assignment/project/deal/experience with ___ (high relevance to the other party)  and it reminded me of our past relationship. I would love to hear your news and what you are priorities are today and share my news.  I am in your neighbourhood visiting clients/friends on dd/mm, would you have 30 minutes or time for coffee/breakfast or lunch?”

If 50% respond, you have 20 people of interest. If you are accurate with 50% in terms of their mutual interest, you have 10 new people of short-term interest. Meet two of them a week, you have 10 valuable relationships to nurture over the next month, where you at a minimum start with some meaningful trust, past affiliation and a discernible interest in how you might be of help.

© James Berkeley 2017. All Rights Reserved.

Why Should They Care?

Thursday, January 19th, 2017

I hate being “pitched” ideas, it immediately feels like my interests (building a trusting relationship) are being subordinated to advance your interests (line your pockets). Yet we all need to attract ideal customers or investors with a memorable description of our impressive value. How else can they recall when they need your product, service or proposed investment? You need a clear crisp 1 or 2 sentence statement. It needs to embrace:

  • Legitimate immediate value
  • Impressive results from its’ application and use
  • Improved performance, not problem solving
  • Your target audience’s aspirations
  • It needs to be specific, not too general

It is not about your approach, technology or ideas. Nor is it a sales tag line.

“We have created a platform to resolve the shortcomings of wealth managers, who put their interests before their customers” is interesting but it tells me little about what is really in it for me.

Contrast this with “We dramatically improve HNW investors’ performance, security and peace of mind in complex and ambiguous situations”, which begs the immediate question “great, tell me what would you suggest in this situation?” You have given the other party a reason to care about you (their self-interest), to immediately delve into a pragmatic not conceptual discussion and to recommend you to others.

© James Berkeley 2017. All Rights Reserved.

 

Investor Accountability

Friday, December 16th, 2016

“What is the one action I have undertaken today to positively nurture our investment pipeline?”

If you want to continually stay on an upward investment curve, it comes down to simple things: individual accountability within an investment firm. Whether you are a HNW individual, a Family Office direct and co-investing, a private equity or venture capital fund manager or an adviser deploying your own and others money, it doesn’t matter.   Be intellectually honest and answer the question, before you leave your office.

© James Berkeley 2016. All Rights Reserved.

 

Acending To The Top Step

Monday, October 17th, 2016

 

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Why do so many people consciously ignore the biggest risk to getting the business or opportunity, the absence of a peer-level trusting relationship with the individual(s), whose power and influence can scupper their ability to meet their client’s objectives? If the risk is obvious, why don’t they address it BEFORE they bid for the business or seek the opportunity. Do we have an attitude deficit (we are not a peer of those people or our immediate mid-level buyer won’t let us near them) or a skills deficit (intellectual firepower, use of language, comfort in a corporate strategic discussion and so forth)?

My experience is that the procrastination says more about how the individual views themselves (self-worth, value, scarcity) and less about the reality of the situation that they are faced with. If you are not willing to invest the time, skills and resources to address the risk (establish a peer-level trusting relationship) in advance, you are probably not “worthy” of the business or opportunity in future. Harsh but true?

© James Berkeley 2016. All Rights Reserved.