Exit Planning Step 1 - The Launch Plan
Most entrepreneurs start a new company with a business plan that lays out their vision, goals and how they will execute on them. When it is time to sell your business, you should have the same type of plan in order to meet all of your goals upon exit—you need an exit planning strategy.
What is an Exit Planning Strategy?
As defined by Richard Jackim, CoFounder of the Exit Planning Institute,
• An exit plan strategy asks and answers all the business, personal, financial, legal and tax questions involved in transitioning a privately owned business.
• It includes contingencies for illness, burnout, divorce, or death.
• Its purpose is to maximize the value of the business at the time of exit, minimize taxes, and ensure the owner is able to accomplish all his or her personal and financial goals in the process.
Exit planning is simply good business strategy.
If you are considering selling your business in the next several years, you should be asking and answering a lot of questions NOW to ensure the best possible outcome. Erin can you help do that.
STEP 1 IN EXIT PLANNING IS HAVING A LAUNCH PLAN: This includes a business, personal and financial assessment performed in conjunction with a business valuation.
In creating your Launch Plan, Erin will assess your:
*Business Attractiveness – how a 3rd party will perceive your business.
*Exit Readiness – evaluate your business’ tangible and intangible attributes that drive company value and higher multiples.
*Financial Readiness – determine how comprehensive your current personal financial plan is, confirm your net proceed expectations from your future business sale, learn if your proceed expectations are aligned with your spending needs, evaluate steps you have taken to help minimization taxes after a sale, ensure your current estate plan is up-to-date, etc.
*Personal Readiness – determine if you are clear about when you want to exit your business and why, find out if you are willing to stay on for a period of time after an acquisition and why that may be critical, discuss your personal plans post-sale and why having detailed objectives for your next phase is important.
*Business Valuation – your current financial statements will be recast to determine the adjusted EBIDTA calculation used in valuations, and to determine your business’ current range of value.
Upon completing these assessments you will receive a Prioritized Action Plan detailing the business, financial and personal actions needed in order to plan a successful business exit.
We also identify where your business compares to Best in Class companies in the industry, and identify action items you can take to protect, build and harvest your business value.
Exit Planning Step 2 - Value Acceleration
STEP 2: THE POST LAUNCH PLAN - aka VALUE ACCELERATION
You have your Prioritized Action Plan detailing what steps need to be taken to enhance company value and prepare for a successful business exit — now what? If you would like expert guidance and accountability to implement the action items on your plan, you can work with us for the next 12 months to integrate the identified areas of improvement into your business, financial and personal activities.
The highly structured Value Acceleration Program focuses on increasing the overall value of your business by concentrating on many of the intangibles that drive higher business valuations. These items typically include:
*Focusing on structural, human, social and customer capital – can include documenting policies and procedures, HR development, addressing customer concentration issues, marketing development/systemization, etc.
*Decreasing owner dependence, increasing business transferability
*Focus on recurring revenue
*Legal, financial and tax advisory team development
The Value Acceleration Program Details:
The 12-month Value Acceleration Program begins with long term business, financial and personal goal setting. Once completed, long term goals are broken into 1-year objectives, then 90 day “sprints” and 30-day milestones. We lead the one-on-one discussions with each owner, integrate family members (if appropriate) for personal and financial discussions, as well as lead separate ongoing workshops with key staff responsible for business 30 and 90 day objectives.
As you begin to build more value into your business through these activities, the multiple you will receive when you choose to sell your business will increase in tandem.
Benefits of this structured program also include:
*Clear accountability and measured results
*Long-term strategic initiatives are broken into manageable 90 day chunks (sprints)
*Getting employees and management to think like owners
*Can be used as an employee development tool
*Owner goals are at the center of the plan
The biggest benefit of building and focusing on value-adding activities is that it makes the timing of your business exit irrelevant.
Pet Industry Mergers & Acquisitions
Her work includes writing Confidential Information Memorandums for client companies, gathering business documentation for due diligence, prospect outreach during the sale process and general client management.
Pet Sitting and Dog Walking Industry Consulting
In her younger years, Erin spent seven years as a part-time pet sitter for one of the largest pet sitting and dog walking companies in the country--because she simply loved animals and wanted to make extra money to pay for a housekeeper (true story). Never imagining that this work would influence her future role as business consultant, it instead provided invaluable experience and inside perspective as she began working with her first pet sitting and dog walking company client in 2011. Since then, Erin has worked with many of the largest pet sitting and dog walking company business owners around the country in a consultative capacity.
Her clients have told her that it is her business and financial acumen, ability to focus on the big picture and continued drive for increased industry professionalism that have made her a unique advisor. Erin is known for helping her clients read their business financials and encouraging them to watch their KPIs: their key performance indicators. In the pet sitting and dog walking industry KPIs include revenue, labor costs/margins, and the number of new clients a business gets each month (among others). Erin also encourages her pet sitting industry clients to take a step back from the day-to-day issues they face, and make sure that they are setting clear goals for how they want their business to grow and evolve. Erin advises clients on pricing and profit margin issues, converting from independent contractors to employees, marketing messaging, referral programs, website design and operational issues, among other industry areas.
She is often called on for public speaking engagements, asked to do webinars, and write articles as a pet sitting/dog walking industry expert.
Erin is also a certified dog trainer, and regularly volunteers for animal-related causes. She is a former board member of the Humane Society of Dallas County, and considers herself an equal opportunity animal lover.
Pet Industry Consulting & Pet Product Licensing
Erin partners with Carol Frank of Birdseye Advisory Group to work on a variety of pet industry related projects. Work has included market research, business development, and strategic planning for clients seeking entry into the pet industry or assistance getting into new segments of the industry.
Erin and Carol also team up to work with pet product inventors who wish to find licensing partners for their inventions. Products must have patents issued or have patents pending to be considered.
Contract COO Services
Many small businesses do not have a Chief Operating Officer on staff, but after reaching certain growth milestones, could really use one to help create better structure within the company. This often creates a dilemma for a business owner, because they need better systems and expertise to solidify their company for future growth, but financially it may not make sense to hire a full-time COO. Erin Fenstermaker can provide "contract COO" services, by fulfilling the COO functions for the business, but on a part-time basis. This way the business owner gets the senior-level assistance they need, but not the long-term, more expensive commitment of a senior staff member with a hefty salary.
A contract COO will often step in and handle senior level issues in areas where the owner may not have expertise, or assist the CEO with important tasks that they simply do not have the time or bandwidth to handle. Activities may include things like: regularly reviewing business and financial reporting, evaluating business contracts, creating business policies and procedures, identifying and managing areas of business risk.