ARE YOU THINKING ABOUT SELLING YOUR BUSINESS?
Watch the #EntrepreneurRoundtable discussion where I sat down with:
- Aaron Provencal, who grew Five Star Restoration to $19M in annual sales before he sold the business.
- Diane Prince, bootstrapped her first business and sold it for $50M, then built 5 more companies resulting in 4 more exits
- Patti Plough sold 2 of her businesses and is now an ESOP Evangelist
- I interject some lessons I learned from starting and selling 3 of my businesses
We cover hot topic questions like:
- When did you first decide you wanted to sell your business? And why?
- How long did it take you to sell?
- What were the specific challenges you faced in the process?
- What was the best advice you received as you were getting the business ready to sell?
- What did the selling process look like for you?
- Did you tell your employees in advance?
- How did you overcome if you did not have any hard assets to sell?
- How did you handle buyer concerns the business was too centered around you?
QUESTION: Join the conversation with us on LinkedIn or YouTube!
Share your comments and/or questions
- What is 1 specific challenge you think is getting in the way of SMB Owners from selling their businesses?
- What is 1 specific thing you would encourage other Business Owners to do now to get their business ready to sell?
#Entrepreneurs #ExitPlanning #SellYourBusiness #CEOMastermindGroups
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ABOUT OUR ENTREPRENEUR ROUNDTABLE GUESTS:
Aaron Provencal In 1993, joined Five Star Restoration as the first employee. It was a home-based carpet cleaning business that consisted of a husband-and-wife team. From there, the business evolved into handling water, fire and mold damage restoration projects. Aaron continued to grow the company taking the company to almost a $19 mil in revenue for 2021. Rancho Cordova, California,
Diane Prince knows the rush, and the fear, of creating a business. She has scaled from zero to million-dollar weekly sales. After bootstrapping her first business to $50 Million in 6 years and selling it to a public company, Diane built six other companies, resulting in four more exits.
Diane leverages the tools and lessons she learned in running companies over the past 25 years to support entrepreneurs with starting, scaling and selling their businesses.
For more information about business coaching, book a free consultation with DianePrince.co
Visit Diane’s blog FoundersGoHere.com for DIY help with hiring, managing, funding, mindset, and growing your business. Malibu, CA
Patti Plough is Founder and President of Excel Legacy Group.com
She is an ESOP EVANGELIST helping SMB owners looking to sell to Prepare your exit strategy . Patti is a long time entrepreneur who has sold two companies. She is also a consultant and speaker with her other business, God Mom, LLC … Key West, FL
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TRANSCRIPTION OF OUR VIDEO #Entrepreneur Roundtable Discussion:
- Please excuse any typos or word errors in the transcribed content.
@00:00 – Aaron Provencal (FiveStar Restoration)
To me, so they approached me. We had several lunch meeting. I went out and met with their executive team and got to know them a little bit.
I had a partner involved as well, so we, after talking we decided let’s put this thing to market. She was kind of interested in retiring anyway, and we didn’t want to just take the first offer that came about, so we wanted to kind of test the waters.
We ended up putting the company to market. We spoke to numerous companies that were interested type companies, but we ended up coming back to the original company that approached us, And that’s who we ended up feeling most comfortable with And that’s we ended up being acquired by boy.
@00:52 – Yoon Cannon (stage.paramountbusinesscoach.com/)
That’s like a dream, right, You don’t have to do any work Right. Got somebody knocking on your door and say I want to buy your company
Thing, wow, you really got the luck of the draw. That was great. So what? what year was that?
@01:08 – Aaron Provencal (FiveStar Restoration)
So? that was. I’ve been talking to them back in twenty nineteen. I think I first started talking with them.
It was a long process. We went to market in twenty twenty, one, kind of early in the year and ended up making a decision on the towards.
Think. It was close to August of two thousand and twenty one, And then it was about a ninety day process to close ninety days.
@01:46 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Okay, so nineteen to twenty one Gotcha in December, thirty first, two thousand and twenty one. Okay, all right, Patty, Diane, when did you first decide you want to sell your business and
@02:01 – Diane Prince
So, for me it was, I think, for me it was. It was really intentional from the beginning From the business planning and talking about my first business.
That’s one everyone else wants to hear about. That was the biggest plan. but we had it was. we were a husband and wife team then, and the goal was we’re in our S.
and we wanted to see if we could start a business. Build it? Really? No experience. could we start and build it and retire in our thirties?
That was. It was like intentional from the beginning, kind of like game.
@02:40 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Yeah, So what was the business you started Diana with your husband That you guys grew it to fifty million.
@02:48 – Diane Prince
Yeah, and that, and that’s That’s part of the story. Really is, we had to. Once we had that goal, then we had to.
So was really The goal of exit was first, and then we had to find a business That would fit that you know, because we wanted to start a business, but it had to you know, we looked at a lot of different kinds of businesses and brainstormed for several months.
And so what we did? It’s super rambar. Like very niche we work. We started a staffing business that specialized and the technical people who work inside title insurance companies.
Wow, that is niche, technical people who work in title insurance, like the people who create the policies, And and then we later expanded to Escrow mortgage.
But it was we started just and yeah, like title examiners, Really specific niche.
@03:44 – Yoon Cannon (stage.paramountbusinesscoach.com/)
No kidding. that’s interesting. I love that that’s a fifty million dollar business. I know, right kudos kudos that that’s interesting.
So you started with that in mind When I saw it, I didn’t even didn’t even occur to me to sell.
I was actually thinking I would do it for another twenty years That he was your story. What year or what yet?
When did you first decide you want to sell? And why?
@04:12 – Patti Plough – Text ESOP to 21000
Well we were. Actually, we had just completed a merger with another company. There were six of us, including my husband.
- So we’re other partners and we were approached by a P. E firm that offered us thirty percent over fair market value.
Well who wouldn’t look at that right? And but the problem was it was a roll up from another state.
We had two hundred employees and they were all at risk words with people who. the staff was given seven hours to clear everything out.
When a P E for bought the company and closed it down, and they were right down the road from our company
So I was very concerned and I was trying to put contracts in place so that to at least protect our staff for a year or two, and that’s not even realistic, it was, probably would have probably been negotiated down to six months, if that.
but it was during that process my husband and I met with a wealth management specialist and he picked up on the fact that we were more concerned about our employees losing their jobs, then we were about managing our own financial future, our own from the transaction and he said, I really think you’d be better off as an Aesop, and he said, Do you know what that is?
and he said, Well, Yes, it’s employee owned. he said, Well, you know what the benefits are, My husband and I didn’t know the benefits.
None of the partners, when I took it back to the partners, knew what the benefits were. One of them is that you’re guaranteed fair market value for your company
And when I took, told my partners they said, But Patty, we’re getting thirty percent over fair market value for a sec.
@06:08 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I think we’re losing people on a couple of questions. I like to know. it’s interesting. both Aaron and Patty.
you were approached, So when you were approached they just find you out of the blue. or did you? Did you advertise anywhere that you were considering putting your business on the market?
@06:33 – Patti Plough – Text ESOP to 21000
Well, I think after the merger we were very attractive type of sale. So we had literally emails and phone calls, probably weekly with reaching out to us.
And so we decided you know, if we’re getting all this activity, why don’t we just put Company on the market and see what it will be, or my husband and I were sixty four at the time, and so we were the oldest partner.
So we were looking at our succession planning, And that’s where the thirty percent of our fair market value came from.
Is a offer from putting it on the market. So it was because we were being approached. I would say a better word.
that approach was, we were inundated with offers from wanting to purchase our company, So obviously we wanted to get the very best.
@07:41 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I’m just out of curiosity. Going back to Aaron. Do you have Ok? I’m curious with Aaron. When you were approached.
Did you advertise that the business might be on the market somewhere?
@07:54 – Aaron Provencal (FiveStar Restoration)
We did not think about it the time You kind of plan to proceed when we met with them and expressed his interest in it.
So that’s kind of where we started looking into it. Then. a lot of consolidation in our industry lately, most of his private equity.
After doing our research, we didn’t want to go down that route. That’s why we partnered with company that we gotcha again.
@08:23 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I’ll go back to Patty. I’m hearing about fair market value. Did you go to one firm to get a valuation?
@08:34 – Patti Plough – Text ESOP to 21000
Tell me about how many valuations So, First of all, in the process, we hired a broker. When we decided to put it on the market to see what it would bear.
they did a valuation and told us what they felt that it would what we could sell it for. Okay, And that’s when a buyer came in and offered thirty
Percent over that market value and but story short, right after all, the other competitor were cut out because of that high offer, and a week after I heard about the deal about the option, the company that was doing the roll up.
once all the competition was eliminated, they reduced their offer by stating that there are certain things on the X on the balance sheet they were going to allow, and all of a sudden they reduced it down to fair market value, and I know now that there is an actual term for that, but when you sell your business for the first time you’re not experienced, there’s business owners are not experienced about selling their company, so they
Depend on others to help them assist. we’re dealing. I found out after we transition twenty. What happened with the high offer and reduce it down to fair market value?
It’s called, and it’s I guess common to eliminate all the competitors, And but what it did for us, because one of the benefits of an Aesop is they guaranteed fair market value and I said to my partners, I said We’re only going south from here if we have our first face to face meeting and they’ve lowered their purchase offer to fair market value.
It’s going south. We can guarantee it’s going lower, so number one we can take care of our ploys. Number two, we’re going to be guaranteed fair market value, and then all the other benefits are just gravy on
Of that, because there are so many other benefits and none of us knew what they were until we set out that wealth management specialist.
@11:12 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Wow, So what did your business broker think of that? What did your business broker think of was Was he on board with transitioning to know?
@11:28 – Patti Plough – Text ESOP to 21000
It was a longer process than that Right? So it was a nonstarter for us with that deal when they came back with fair market value and we just didn’t move forward with the business broker.
We just let that contract expire and then move forward with the Aesop, And how long did it take for you to implement the stop?
We found out about it About February of two thousand nineteen, and we were supposed to close December, thirty first of two thousand, nine hundred contract with the broker was almost expired.
I believe it was an eight month eight month contract and we had hired him that the July before and how many good?
@12:29 – Yoon Cannon (stage.paramountbusinesscoach.com/)
How many employees?
@12:30 – Patti Plough – Text ESOP to 21000
did you have Two hundred two hundred?
@12:36 – Yoon Cannon (stage.paramountbusinesscoach.com/)
And did you offer employees Doc ownership For all two hundred.
@12:41 – Patti Plough – Text ESOP to 21000
you have to employee. stock ownership Plans are qualified plans and they actually protect employees from themselves. Everyone has to participate That works twenty hours or more a week, or a thousand hours or more annually
@13:01 – Yoon Cannon (stage.paramountbusinesscoach.com/)
So if you have, you didn’t want to participate, it doesn’t work. You have to fifteen employees, or working that twenty hours a week, or a one thousand hours annually in order to qualify to become an Aesop Ok, so maybe I misunderstood you.
I thought you said earlier, I thought what you meant was you clarify when you said they all have to be.
they all have to participate. So if you had two hundred qualifying employees, do all two hundred employees have to participate with the program If they all qualify by their hours.
@13:39 – Patti Plough – Text ESOP to 21000
Yes, because it’s a qualified retirement plan. So they all, they all have to participate If you have anyone who said No, I don’t want to do.
No, because it’s a free gift. They don’t have to pay for it. So even though we sold our company to our ploys, it was the
Actual company itself that bought the shareholders, behalf of the employees and the employees don’t have to pay. It’s a free gift.
So who would pass? I would have to ask Is who would pass up a pretty gift. Absolutely kept their for a one k intact, and also have the retirement fund for them as well.
@14:32 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Wow, this is. I know. this is going to be a huge mind blower for a lot, founders who are also not familiar with Aesop.
I know you’ve got a time that you can share. I just want to go back to Diane story. Let’s go back to Diane.
When you saw your company, The staffing business. How long did it take for you to sell and did you have any challenges in the process
@15:01 – Diane Prince
Yeah, yeah, what happened was we had some offers early on, but we weren’t ready to sell yet. We just knew we weren’t.
We didn’t have the value quite yet. And and it was like our first offer and my business partner was like, Yeah, if they offered us a hundred thousand dollars, I’d take it one of our first, and it ended up then.
So we waited about four more years and then we hired. We went throughout the whole business. we had advisors, and one who was in particularly helpful was an investment banker, so we would go to him pretty much every quarter and say Okay, this is where we’re at like you know our goals, and then we would take different steps and hire different executives and things like that to set us up, And then finally we did.
We did go to market, But then what happened was we had a deal in place and one of our advisors, Our Cpa had told us the deal will probably fall through like normal deals fall through, I think he said, like six times before it closed
But when our first deal was going on during and there, they actually had their whole Due Diligence team from Ernst and Young.
His office was in the trade tower. We’re here in La, doing diligence And so that happened, our deal fell through and then we decided we’re going to hunker down and start growing, and we were going to acquire other businesses because it just wasn’t like right after, Not seem that you know, it didn’t seem like the time to stay on the market.
And then our first, we hired someone to help us acquire businesses, and the first call he made to a business broker said Well, I actually have a company that might be interested in you, And then we went through the process and the deal did like.
It did, probably halt like six times, but finally finally.
@16:47 – Yoon Cannon (stage.paramountbusinesscoach.com/)
so I think that’s a really important piece of information that the process halted about six times. I think that would a lot of people
And think, Oh, we’re gonna abort. But it didn’t seem to discourage you. just kept kept. kept at it.
@17:06 – Diane Prince
Well, the important thing that yes, and I think, the other thing that someone had told us that kept in my mind was if both parties want the deal to happen, the deal will happen so that you know, keeping that in mind, and also knowing, like I learned, you also do have to be able to walk away, But it’s that’s hard.
That’s a lot. You know. It’s like at the beginning when you start a company, you’re watching every penny, and then at the end when you’re selling it like you literally walk away from billions of dollars just to get it done.
You know you just want to close. But yeah, so if both parties want it to get done, it will get done That That helped me stick through the process.
@17:48 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Also the carrot at the end. So in the in your process you hired an investment. It was an investment banker you also hired.
Did you hire a business broker
@18:00 – Diane Prince
No, yeah, investment banker. you don’t need a service broker as well, and I told I’ve done it. I’ve done it by myself and I had hired an investment banker for another deal as well, And were there any other advisors that you that you hired to help help you guys on the process?
Yeah, for us, there weren’t really as many. There’s some background noise. I think there were. There weren’t really the same kind of.
I don’t know. I don’t think they had like the consultants and coaches and things back then like we do now and we.
So we. We relied heavily on our accountant. Our lawyer took a, took an advisory role, and that we had a board member who helped us, And then also the investment banker really served, served as an advisor as well, Erin, I’m curious about your story.
@18:54 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Was there anything challenging in your experience that you can share Just for people to know what might be ahead for them, Yes, so yeah, just getting a good team.
@19:06 – Aaron Provencal (FiveStar Restoration)
Underside. Cpa. You want to Mna attorney? That’s used to dealing with these transactions and guide and direct you on the process I think is important.
They hired a quality earnings team outside firm that came in to evaluate the come up with the final one, So that was a grueling process going through and getting all the information that they needed.
So that took quite a bit of time together. It’s definitely worth it at the end.
@19:45 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Nice and how did you feel after you sold? Do you feel like? are you? Do you feel free? Do you feel you feel like you miss it?
@19:55 – Aaron Provencal (FiveStar Restoration)
You know what I did? I rolled quite a bit of my equity into their Company growing company as well, so I’m still working for them, helping them grow and I’ve got a share shares their company as well.
So so it’s not like you’re retired with nothing on our agenda, so you’re still involved.
@20:22 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Okay, okay, I got so thinking about advice. Some of you know, some advice has already been shared, But is there any other advice that?
as you look back in your experience selling your businesses that you received what stood out for you that you really appreciated.
@20:47 – Diane Prince
I think that about looking at every every dollar in the transaction because you can be. it’s an emotional process.
It’s like when you sell a house, or I mean it’s You know you get. so you want it to close.
At least that was my experience. and and it helped us to have advisors been through the process to help us sort of calm down, because you know we got to the point where we just wanted to get you know whatever they wanted.
But but there was a lot of money on the table, so be willing to you know. it’s easier said than done, But be willing to walk away and also keep building your business.
Don’t take your eyes off of the business while you’re while you’re going through the process.
@21:39 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Great advice for me. I felt like it was more emotional in my experience after I sold, because I had to say goodbye to everybody on my team and they were upset.
That made me upset. Well, I was upset too, because I just love my people, but that was, I felt like I Giving up my fourth child for adoption, so it was for me. It was emotional just because of the people.
But yeah, I mean, I could see how the process specially with you know, having it halt six times could be emotional.
too. absolutely patty. Any any other additional advice that you received in your process of selling your two businesses that you can share with others?
@22:30 – Patti Plough – Text ESOP to 21000
Well you just mentioned about saying goodbye. Another benefit of it is that you can stay on and stay in control of your company and continue making a hundred percent of your shares to the So.
that gives business owners the opportunity if they’re not ready to step down and make that The opportunity to stay out in some capacity until they are ready to do that, and then they can actually step down and still remain on the board if they wish.
So I love that idea, and that was what I was planning on doing is staying at my company and my role at that time.
but then I discovered that truly, I’ve met one person now in two and a half years, that knows the benefits of Aesop’s and the only reason they knew is because they wanted to do one.
but they were quite big enough yet. But and I’ve talked to. I just got back from a conference in Las Vegas, and these are business buyers that the conference
Seventy seven business buyers, and they didn’t know what the benefits of Aesop’s were, And that’s why I stepped down and I started Excel.
I guess a group so that I can educate business owners the benefits so that they know going forward that this is an option for an exit strategy.
@24:25 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I’d love that. I mean, I’m telling you, I wished I knew what Aesop’s were. My last business I sold was in two thousand and six, and that one had thirty employees.
Yeah, just no, I never heard of it, Aaron, Diana. Maybe you both have heard of it.
@24:41 – Aaron Provencal (FiveStar Restoration)
Are you familiar with the You know, I never really interesting.
24:52 – Diane Prince
Yeah, I’ve heard of them, but I went and I didn’t. I did. I didn’t have the same sentiments, but
But we, we ended up. We did start a new business after our non compete expired with the same people.
That’s a whole other story. Lot of the same employees. That’s a whole other story. That’s a whole other piece of advice of restarting and doing something again.
@25:17 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Yeah, because you did four more exits or four exits total.
@25:21 – Diane Prince
Yeah, I mean, and it was five total, and I mean my advice on that is when you sell when you sell a business.
Also a public company, Pretty big deal for us and entrepreneurs and founders get you know. Seems like you can just do it all over again.
It’s not easy to do it all over again. and you know it’s still a gamble. so yeah, you might be more likely to succeed and we started a similar business that was successful, But it wasn’t like.
it just never was the same And so it’s you know, Appreciate what Your what you got and what your deal is, and it’s not as easy.
Just you know, I was very young. I did spend my s. retired awesome, Really fun. but entrepreneurs tend to think I can, just I can just sell this one and then do it again.
It’s not. It’s still a gamble and it’s not easy as you think.
@26:20 – Yoon Cannon (stage.paramountbusinesscoach.com/)
it might be good, good to good for people to keep that in mind Absolutely so. I’m also curious for a lot of our viewers.
Couple of things, I know what’s going on in their head. They’re not sure if their business is going to be sellable.
Anybody who’s going to want to buy my business? I don’t know. I don’t know. I don’t have any assets to sell, or the business is too centered around me.
What do you have to share? for the people who might have that floating around their brains?
@26:54 – Patti Plough – Text ESOP to 21000
I was actually given a mentor Early on in my entrepreneurial journey, that told me not to make the business all about me or focused my relationship with customers.
and so early on that is the piece of advice that I can give every business owner if if it is focused on right now, make a conscious effort to build a leadership team.
That can.
@27:39 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I mean, even with Aesop’s, We, the trustee, who represents the employee, Adding when you’re your audio in and out.
Could you repeat what you said? We? I lost. Build a leadership team. That’s where you froze out.
@27:56 – Patti Plough – Text ESOP to 21000
Ok. it’s so important to build a leader leadership team and not have the business dependent on you because if it’s only dependent
on you, the value, you will not get the value that you’re hoping for out of the company unless you have a leadership team that can take over when you’re not there.
So the business needs to be able to function 100% in your absence in order to have the maximum value when you get ready to exit.
And even with an ESSA, because I had received this advice in the 90s and I built my businesses as such, when the trustee came in, he actually came to our facility and had to meet the leadership
team, we had to prove to him that we had a team in place and that we were replaceable. Hundred percent otherwise, he would devalue the company accordingly because of that.
@29:07 – Yoon Cannon (stage.paramountbusinesscoach.com/)
So that is so important is to be the face of your company absolutely totally agree, and that’s a common thing that I try to get my clients more business owners to believe that it’s possible, because that was the first step that I took back then was I found myself working five thousand and sixty hours a week, and then my next immediate goal was let me just shave ten hours.
I just want to limit it to forty. I gotta get the business to grow with just me working forty, and then the following year it was a thirty goal and then I got it down to twenty hours a week, and then fifty six years later, getting it down to ten hours a week for the business to run without me were, at least, you know, I just work ten hours a week, and I’m
I’m always surprised how some people, when I share that as a first-media steps, some people actually say, oh, that’s too good to be true.
That’s not possible.
@30:11 – Patti Plough – Text ESOP to 21000
Well, it’s the difference between an owner manager and an owner investor. An owner investor works on their business, not in their business.
@30:24 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Absolutely. Absolutely. Diane, you talked about that it took you another four years to work on the business some more before it finally sold.
What were the specific areas that you made in improvement? What are the changes you made in that four-year timeframe?
@30:49 – Diane Prince
Yeah, we expanded our offerings. We started out just doing title insurance, then we did escrow, then we did mortgage,
so we expanded. We also brought in… We still cut illegal issues, then we broke off. We brought in a president, another executive, and we brought in cheap chief operating officer, So we added to, like Patty said, we added to our executive team, and I like, I would also add what what’s important is having a healthy client.
I mean, that’s incredibly important, like we had countrywide mortgage. Like you know, poster child of the financial crisis in two thousand.
That was our biggest client and one of our one of our companies, but we still had a healthy client mix, so it definitely affected us, but it didn’t.
It didn’t and then, also having a recurring revenue model is is extremely important because you have to have something that’s that’s valuable to sell.
Because you know, sometimes people ask that question and it’s a valid question. Some companies, if they’re more transactional and it is, I mean, we started from the very beginning.
No people didn’t even know we were married. I mean we’re twenty six years old. Our clients were You know, like you know, I mean it was we.
Just we just acted as if we were a big company and we did everything at the beginning but nobody.
really. nobody knew that.
@32:13 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Wait. this was. this was the recruiting company you’re talking about. Yeah, so the recurring revenue model for recruiting was just Yeah, I mean, we were okay.
@32:29 – Diane Prince
We didn’t do a retainer. We had we had temps, so we had thousands of people on temporary assignments. So that’s what.
Yes, if you are like and I work with. I work with several recruiting companies When you’re when you’re just doing direct hire placements.
That’s much much more transactional.
@32:43 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Very hard to sell. That’s what I was going to wait. Wait, what is a recurring revenue mile? I really, I would really like to know the magic model for recruiting.
Yeah, I mean, you are billing for our billing for a million dollars week.
@32:57 – Diane Prince
We had thousands of people on temporary assignment, so that You know when we saw those people continued on assignments, Gotcha gotcha.
@33:05 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I love that. All right, So you focused on adding more services to your business model and you increased your leadership.
So where were the sales revenue? That for your time frame, where was it when you started and then where was it?
@33:20 – Diane Prince
At the end of the four years we were at about so about so it took us six years in total, So two years, then we were at about five million, and then we expanded to.
that was the annual, about five million annually, And that, and I mean, our first year we did a million, and then five million, And then it.
just then it just really took off from there, especially once we add it. once we added different different. It wasn’t it wasn’t really different.
It wasn’t different offerings. It was just added different different niches.
@33:51 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Gotcha gotcha. Did you ever think about like walking away from the gambling table? For? think about holding on to your cards and waiting and
And expanding it more, and trying to double it that ever.
@34:05 – Diane Prince
Yeah. Yeah, yeah, and I mean, we were sort of regretful a little bit after we sold it realized we could.
you know. I mean, yeah, but it was. I don’t know. you know. you make the decisions. Yeah, it was.
it was a good deal and it was a nice time that we had young kids and had another baby.
After that time with your babies.
@34:30 – Yoon Cannon (stage.paramountbusinesscoach.com/)
It sounds like flipping homes the way that you just really transformed the business and went and sold it. That’s awesome.
So what are some other objections that you think entrepreneurs may have in their process of trying to sell their business objections?
@34:51 – Diane Prince
Mental blocks, you know, I have one thing is one thing that I think is really important where I sold in other businesses after I had been retired
While I ended up taking over a business and selling, and it was that I really relied on the power of networking, And that’s one thing that I hear some entrepreneurs say that You know I don’t want to.
I don’t want to network on it like really putting yourself out there, Because then you can if you meet people who could be strategic buyers.
I think that that’s incredibly valuable because you know using an investment banker works if you’re multimillions, But if you’re not, you know, if you’re selling a million dollar business, you might not want to use a broker.
You know, I’ve done it on my own. I’ve helped my contacts.
@35:35 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Yeah, I did that I called my competitors. Do you want to expand your locations? Awesome? Any other objections or negative, limited beliefs that you may have come across Aaron or Patty from other owners, who just aren’t sure if they’re going to be able to sell their business
@36:01 – Patti Plough – Text ESOP to 21000
I think there’s a couple things that I have discovered is that either they feel their business is worth so much more than it truly is, So it really pays to have a professional do a valuation, somebody that is credible instead of just guessing.
And I just just ran into an individual that their business was probably worth a couple hundred thousand. And when he was asked, you know, Do you have any idea what your sale price?
What you? you know, your sale price would be. And he said two million, But there’s a big difference, and because, really, What I found out with business owners, they really don’t know
I mean they, first of all, very few, think about their exit strategy, and if they, if they do what I have seen is that they value it much more than what it’s worth on the open market.
And so there’s a. There’s a big void there, and I think business owners. it would help to become educated on what the true value of their company is.
You know if they put it up for sale, And that’s when the valuation company comes in and know the multiples in your industry as well.
I mean there are some multiples that are ten x, and that can, and know what add backs. Can you know?
you can put back to increase, like if for every And Europe, like, like when we sold it to the, But we were a multiple.
That was times eight for every. like, for instance, the owner salaries times eight. That’s how much value was added to the company, And that’s why a lot of the other owners decided to retire because they wanted to get the most value for the company, So I think education what the true value is would be very helpful to a lot of business owners.
@38:35 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Great advice. Love that, absolutely agree. You know, get get a formal valuation and even try to couple different just to compare, Because it’s so objective and some industries right, I’m curious with your story.
What’s it been like for you? Now you’re not the owner. How’s your life changed? I mean, I know you said earlier as
Much as far as your day to day, but I mean overall, what’s your? What’s your mindset then with? Has a field not being the owner anymore.
@39:08 – Aaron Provencal (FiveStar Restoration)
You know, it’s always nice taking a few chips off the table. Having that financial really have been stressed about the company’s go on how long there’s an earnout and things like that that.
We’re working toward having comfort. Very refreshing. For sure.
@39:30 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Thank you. I love that. so I mean it just demonstrates. I think everybody around the table demonstrates the options that people have, so you can sell your company and still work in it, but you just don’t have all the headaches and the responsibilities, or you could sell your company to your employees Aesop programs, and definitely reach out to Patty to learn more about that, or you know Diane’s journey, which has
Been starting more businesses and selling them again and selling them again, and of course you help entrepreneurs be able to do, start scale and sell as well.
So the options are endless. I love this that everybody’s really still stayed in some type of business aspect, Because sometimes I find people only have one reason, or they think there’s only one reason to sell.
That’s you know to retire, But there’s many reasons. there’s many benefits in situations where selling your business could could make a big change for your life.
So I love, I loved all of you sharing your stories. I really appreciate your transparency. the nuggets, the wisdom, the advice.
So just in closing, if you could share one sentence of advice, final words of advice, Other entrepreneurs out there who are now thinking about all right, I got to focus on systematizing and
Scaling the business so I can sell. So what’s any other final words of advice?
@41:06 – Aaron Provencal (FiveStar Restoration)
It’s kind of touched on. Yeah, I mean, if you’re running the business day to day, try to get a team in place to run that day to day actions.
People that are looking to buy businesses aren’t typically looking to buy a job and they are looking to buy a job.
Your multiples can be very low, so Yeah, having that team in place will go a long way when you go to sell.
@41:35 – Yoon Cannon (stage.paramountbusinesscoach.com/)
I love how you put that they’re not looking to buy a job. I love that and that just rings true.
To say yes. You’ve got to be able to create it where you can step away, Diane. closing words here, muttered Diane.
@41:58 – Diane Prince
You don’t really know. you don’t know who is going to buy A company and it’s been from my experience.
It’s always been someone with a really specific kind of want or need that the business is filling for them, so build relationships do that through conferences networks, online forums, trade shows, build relationships with other people in your industry.
@42:22 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Love it relationships, Patty.
@42:26 – Patti Plough – Text ESOP to 21000
I think we’ve all heard about what is your Why can be applied to your exit strategy. Is your why to leave a legacy to protect your employees?
Look for business exit strategy ideas that meet that goal. Whatever, whatever your why is in your exit strategy, pursue that first and then plan accordingly
@43:00 – Yoon Cannon (stage.paramountbusinesscoach.com/)
Love it what you’re why Network. Don’t forget people don’t want to buy a job. Really really well put, thank you so much.
all of you, Diane, Aaron and Patty. this is been an awesome discussion and I’m sure people are going to want to know more.
so I want to invite everybody to share your comments below. We’d love to know. what are the nuggets that you took away?
What are the? want to know? What questions do you have that we didn’t cover Because we can do a part.
So what questions do you have? What are your specific challenges? As far as your process of wanting to sell your business at some point, please share that in the comments below.
So thanks for joining us today. The topic again was how we sold our businesses. This was featuring the stories of three amazing entrepreneurs from different sectors, which I love the variety, and definitely reach out to Patty, Aaron or Diane
And continue the conversation. So thanks again, everybody.
@44:30 – Patti Plough – Text ESOP to 21000
Thank you so much.
@44:32 – Yoon Cannon (stage.paramountbusinesscoach.com/)
it was my pleasure coming on your show. Great to have all thanks so much
