Category: Decision Making

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…

Continue Reading→

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…

Continue Reading→

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…

Continue Reading→

Buying & Selling a Company, Decision Making

The Closing: Monday to Thursday is OK. Skip Fridays

Gregory Pearl

A closing is where all the legal documents are signed and money changes hands in a business sale (transaction). It is often a good idea to have a pre-closing meeting a week or so before to make sure there are no major issues that will prevent the actual closing from happening. So that everything will go smoothly. Both the buyer and the seller should be represented by the principals, people who authority to make decisions on the spot. That means any changes will not be held up because of a lack of authority. Have your support staff there to make…

Continue Reading→

Buying & Selling a Company, Decision Making, Exit Planning

Times Are Good Now. But What Happens When They Are Not?

Gregory Pearl

The current economic climate is strong, with M&A activity being strong also. But what happens when the economic environment is difficult?  Challenging? Many business owners are thinking of selling in the next few years. What can they expect? Looking back at the activity in the last recession, which was a hum-dinger, gives us a clue. Despite the difficulty of the extremely challenging environment the last time around, business sales still happened. Activity was slower, deals were harder to close.  But still, it did happen. Whatever the economy, some baby boomers will want to retire. Some younger people will want to…

Continue Reading→

Alternative Investments, Decision Making

Technology Trends in the Investment Management Industry

Gregory Pearl

Alteris LLC tracks trends in our client’s industries.  We work with firms in the Investment Management or Asset Management industry and therefore track trends there. Many firms in the Investment/Asset Management industry are experiencing substantial pressure on their margins and profitability. A factor pressuring cost reductions is consolidation among firms in the investment/asset management industry.  This started before the pandemic and continues.   Some industry observers expect that up to 20% of the mutual fund firms that are independent today will be acquired or go out of business in the next five years.   This consolidation will largely impact smaller firms. The…

Continue Reading→

Decision Making

Survivor Bias is Everywhere

Gregory Pearl

Survivorship Bias is one of the most deceptive and common traps in decision making. It’s normal to examine the life stories of very successful people.  Not only is it interesting by itself, but maybe we think that there is something to learn about success from them. If they are successful, maybe we can imitate them? The concept of survivorship bias is easy to understand but maybe not intuitive.  Still, when a person does understand, it seems to be almost everywhere.  That’s because it is. There are so many examples. It’s very common in advertising.  Weight loss programs and diets feature…

Continue Reading→