Edward Valaitis is a Managing Partner at Edison Avenue, a member of the CEO Council of Tampa Bay, serves on the Leadership Advisory Board at the University of Tampa, and is the proud author of his book Exit Like a Winner.
With more than 25 years of experience in building, managing, and leading high-quality professional services firms, Ed’s resume of being a skilled M&A Advisor, published author, strategy advisor to Fortune 1000 executives, and more made him an excellent community leader to interview.
Enjoy his Q&A!
What are some signs a business owner is in the position to consider selling?
When you realize the joy and passion have gone out of your work. When you realize you don’t have the energy or hunger to grow the business to the next level. When the financial performance slows or plateaus for an extended period of time. When you are no longer willing to invest a large amount of capital required for major upgrades to your equipment, software, etc. When you have a well-formed idea for a new venture that excites you. When you know you’d like to retire within three years.
What’s the best piece of advice you can share with someone who’s about to sell their company?
Retain an intermediary also known as an M&A advisor or investment banker depending upon the size and complexity of your company. An effective intermediary will have the experience, certifications, and skills to help you determine the real market value of your business, quarterback the entire exit process, and help you navigate the 101 things that can and often do go wrong in the complex journey of selling a business. It’s important to appreciate that only 30% of businesses for sale actually sell. The rule of thumb is for every dollar you invest in retaining an intermediary you’ll get 4X to 10X+ your money back. Also, your probability of actually selling the business doubles.
What’s the single biggest mistake CEOs make when selling their company?
They sign an LOI (Letter of Intent) from an unsolicited buyer who approached them. Therefore, they have not conducted a confidential “soft auction” process to attract multiple qualified buyers. This is the only way the business owner can know the true market value and have sufficient leverage with potential buyers to maximize the price and terms when selling their business. If you count on the goodwill of the buyer/investor to give you their maximum offer without leverage, then you’re in denial.
What inspired you to write your book, Exit Like a Winner?
I found myself very upset and indignant overseeing a number of business founders fail to harvest the wealth locked within their companies. Seeing a family’s financial legacy wiped out due to lack of knowledge or over-confidence of a CEO/founder was unbearable. Most entrepreneurs don’t have a pension plan so their business exit is their retirement plan and their legacy so it’s crucial that they receive the full measure of value embedded within their businesses.
What can readers expect to learn when they pick up a copy of your book?
Many things, but two primary themes. The first is to be equipped with the tools needed to improve their decision-making process so they can figure out when they should sell their business. The second is to gain a much deeper understanding of the business exit process and how to avoid mistakes. Exit Like A Winner effectively tackles the thorny issue of denial.
Entrepreneurs, by their nature, are optimists; otherwise, they wouldn’t have taken all the risks necessary to start and grow their companies. This strength carried to an extreme can become a weakness that shows up as denial. In order to make a sound personal and business decision about when and how to sell your business, it’s best to address the elephant in the room whether it be age, addictions, relationships, health, etc. The book is both an intellectual and emotional journey told in an engaging and fast-paced fashion that alternates between storytelling and advice-giving chapters. This book is a fresh alternative to the traditional business book and deals with one’s head and heart as CEOs make the most important decision of their life.
What do you love most about living and working in Tampa?
I love the people here. The majority are so friendly and constantly seeking to grow and improve mentally, physically, and spiritually. There is a zest for life that is a unique part of the Tampa Bay culture along with manatee, gasparilla, and cigars. Tampa Bay embodies the American spirit of hope for the future, meritocracy, freedom, and compassion for one’s neighbor.
Grab a copy of Ed’s book, Exit Like A Winner, The Proven Success Formula for Selling Your Business, today!