Author: Gregory Pearl

Culture and Ethics

Elder Abuse And Financial Fraud

Gregory Pearl

A very unfortunate fact of life is that the elderly among us are often the victims of financial fraud and abuse. It is more common than many people realize. I have had personal experience with this as an elderly uncle of mine was a victim. For me, this is a very important topic. My uncle was suffering from terminal cancer and was living out his last days in hospice care at a nursing home. As a result of his condition, he suffered from a diminished mental capacity.  That was exhibited through rather difficult and contrarian personality characteristics.  I was overseeing…

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Culture and Ethics, Decision Making

Happy Employees = More Profits

Gregory Pearl

Can treating employees well increase profits? Does the so-called “Golden Rule” – treating others as you would like to be treated – pay off in the end? The answer is yes. Owners of successful privately held businesses know that a happy and contented workforce is a critical component of their success. How do happy employees contribute? Three basic ways. First, there will be lower employee turnover. This reduces new employee hiring and training expenses. It eliminates the learning curve for new employees. Second, a well-treated employee is more likely to put in the additional hours to get the job done…

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Buying & Selling a Company, Decision Making, Exit Planning

Speed Is Your Friend: Keep The Transaction Moving Forward

Gregory Pearl

There are many things that can slow down and prevent a business from being sold. But time delays are probably the most likely reason a deal will not occur. There are other possible reasons, of course, but time delays are a big one. The more time that goes by, the more likely the parties involved (read buyer) will become tired and frustrated. As time goes by, the seller is in a condition of uncertainty. Expenses will increase and other potential buyers will be missed.  Eventually, one side or the other will just give up and move on. The length of…

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Alternative Investments, Buying & Selling a Company, Exit Planning

Are Private Equity Groups for You?

Gregory Pearl

In recent decades more and more capital has flowed into the alternative investment category of private equity or Private Equity Groups (PEGs). Maybe because of this higher profile, we get asked repeatedly by business owners in the lower middle market if they can sell to a private equity group. I’ll say this right up front – most likely the answer is no. Private equity investments have traditionally been focused on large companies, the so-called middle market and especially the lower middle market have been ignored. That has changed in recent years as more capital has entered this investment category.  Seeking…

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Buying & Selling a Company, Decision Making, Exit Planning

The Bugaboo of Confidentiality

Gregory Pearl

Business owners are rightly concerned that if word gets out that their company is for sale, vendors and customers might get spooked. And the business performance will be hurt thereby hurting the company’s value. On the other hand, “you can’t sell anything if you can’t talk to anyone.” So there must be a happy medium. Where is that? But first, remember that almost always a prospective buyer will need to sign a confidentiality agreement issued by the seller. This is standard and binding on the buyer. Even with an agreement, there are steps that can be taken to help keep…

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Buying & Selling a Company, Decision Making, Exit Planning

Why Confidentiality Is Important

Gregory Pearl

Selling a business is a strange mix of advertising – communicating – that the business is for sale and keeping the whole process confidential. Confidentiality is very important. If word gets out that the business is for sale, people will start to question if they can rely on it. The whole uncertainty surrounding a sale may hurt business performance, thereby resulting in a reduction in the sales price. The conclusion: To get the maximum amount for your business in a sale – keep everything confidential. Here are some of the problems that can arise if word gets out that your…

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Buying & Selling a Company, Decision Making, Exit Planning

Walking Away After A Business Sale Can Be Difficult

Gregory Pearl

Many sellers want to sell their business and walk away. Be done with it. But most of the time there will be a transition period where the seller must stay on, after the sale. The length of time and nature of the seller’s ongoing engagement depends on a bunch of factors. This includes the nature of the business (e.g. service business), the size of the company, and the role the owner had in ongoing operations. From the buyer’s perspective, it is good to keep the seller on for a while to help with introductions to employees, vendors, customers, etc., and…

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