In this episode of Built to Finish, host Steven Pivnik interviews Bill Thomas, the Founder and Managing Partner at Acresis. He has played a key role in the growth of high-performing companies worldwide. They discuss his journey in the advisory industry, including his experience with Equiterra, which he grew to $100 million before selling to KPMG. Bill shares insights on preparing for business exits, stressing the importance of strong financials, showcasing growth potential, and creating strategic value for acquirers.

He also highlights potential challenges, such as key account management, intellectual property issues, and maintaining forward-looking financials. Bill offers advice on keeping a business focused during the sales process and strategies for maintaining confidentiality. The conversation also touches on the emotional challenges founders face when selling their companies, emphasizing the need for a supportive team.

Takeaways:

• Solid Financials are Crucial: To maximize your exit, ensure you have rock-solid financials. This includes clear revenue streams, EBITDA, and excellent forward-looking financials. Make these the foundation upon which your exit strategy is built.
• Create Value for the Next Owner: Beyond strong financials, build a business with clear opportunities for the next owner to add value. Whether it's scaling the business further or opening new markets, leave something on the table that's attractive to buyers.
• Think About the Strategic Sizzle: Realize the importance of the story your business tells beyond just numbers. Strategic value, such as unique technologies or industry positioning, can be the sizzle that captivates potential buyers.
• Expect and Plan for Setbacks: Understand that setbacks can and will happen during the exit process. Prepare for them by diversifying your relationships within key accounts and maintaining excellent IP documentation. Anticipating bumps in the road will keep you ready to manage them effectively.
• Maintain Focus on Business Operations: Do not let the exit process distract you from running your business. The last thing you want is declining metrics during a critical negotiation period. Ensure your leadership team is robust enough to handle day-to-day operations effectively.
• Clean Up the Cap Table: Ensure your cap table is 100% accurate and fully documented, including all board minutes, investor agreements, and employee stock options. A clean cap table is non-negotiable for a smooth transaction.
• Manage Emotional Attachment: Acknowledge the emotional attachment you have to your business. Recognize that it's normal to feel this way but be prepared to make rational decisions that prioritize your financial and personal goals as well as those of your team and business.

Quote of the Show:

• "The foundation of any successful exit is solid financials; once that's in place, the real value lies in whether you've built a business with a future, leaving room for growth and opportunity for a new owner."

Links:

• LinkedIn: https://www.linkedin.com/in/bill-thomas-13982/
• Website: https://www.acresis.com/

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