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  • [G&A] Growth & Acquisitions: Mike Moyer; Some suck at M&A; SMB's Grow with AI; M&A Rebound; Capital Raise Secrets; 4 M&A Q's; Creative Finance for Acquisitions

[G&A] Growth & Acquisitions: Mike Moyer; Some suck at M&A; SMB's Grow with AI; M&A Rebound; Capital Raise Secrets; 4 M&A Q's; Creative Finance for Acquisitions

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In the News

In my years helping companies evaluate, acquire and merge with other companies, I’ve noticed something: Most companies struggle with mergers and acquisitions. It’s not easy to combine two fully formed professional entities, each with its own leadership, staff, processes, customers and values. Mergers and acquisitions are two things that are—simply put—easy to be bad at.

A lot can go wrong when two companies are joined in holy merger matrimony, leading to wasted capital, missed deadlines and operational inefficiencies that can make your merger less profitable and more confusing than necessary. When working on your next deal, watch out for these five common M&A pitfalls. Read more here…

Fueled by companies in the chase for advances in technology and artificial intelligence, stocks on the Standard & Poor’s 500 rocketed up 24% last year. The contrast combined with regulatory uncertainty and macroeconomic and geopolitical shifts prompted analysts at McKinsey & Company to repeat a question uttered at a recent conference: “Is M&A dead?”

Their response to the rhetorical query resounded: “Our answer is: certainly not.” Writing in a Feb. 20 report for the New York-based consulting giant, the analysts reported that many industry leaders had projected that “opportunities would open up precipitously” this year. Read more here…

The M&A landscape has been quite tumultuous over the past year or so. With high interest rates, major geopolitical tensions, global economic uncertainty and a general lack of confidence in the economy, investors and banks are more cautious than ever, and the M&A market is seeing less action.

While investors and companies alike are eager for an upswing, deal-makers can still secure strong, lucrative opportunities by implementing the right strategy and asking the right questions. Read more here…

The year 2023 can aptly be summed up as a year of exploration, with the remarkable debut and early applications of generative artificial intelligence (AI). As this technology continues to rapidly advance, 2024 marks a significant turning point for people and businesses alike, moving beyond the concept of AI and its influence to determining how they can adopt it for the long haul in impactful ways.

For small and medium-sized businesses (SMBs) specifically, this means assessing the technology’s true impact—and SMB owners have already begun to scratch the surface. According to a recent Visa survey, 90% of Generation Z and millennial SMB owners, 91% of Generation X SMB owners, and 70% of baby boomer SMB owners are aware of AI and have gained an understanding of its potential business applications. Read more here…

Diversification is an effective business strategy for building resilience and ensuring long-term growth. Diversifying your business involves expanding into new markets, offering new products or services, and exploring different revenue streams. By spreading risk and maximizing opportunities, diversification can safeguard your business against economic downturns, industry shifts, and other unforeseen challenges. “Diversification is the only free lunch,” as Nobel Prize laureate Harry Markowitz is quoted as saying. Read more here…

Organizations are under constant pressure to innovate. Embracing innovation allows companies to develop new products, services, and processes, crucial for maintaining a competitive edge. As companies strive to meet the demands of their customers and anticipate industry disruptions, embracing GenAI and hyperautomation becomes imperative for maintaining relevance and achieving sustainable growth in this dynamic business environment. Read more here…

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The Short take: an intriguing journey of Cosmin, mentored by the host, on acquiring a business without upfront capital. Cosmin embarked on this adventure filled with ambition and self-improvement, seeking a practical application for his energy and skills. Initially attracted to the concept of buying businesses as a means to make a significant impact, Cosmin’s venture began with the exploration of various business ideas, leading him to the realization that direct acquisition was his path forward. Despite early setbacks with his first potential acquisition and overcoming initial nervousness and inexperience, his resilience and adaptability shone through.

Key Takeaways

  1. Mentorship and Persistence: The journey underscores the value of mentorship and persistence. Cosmin’s experience with mentorship provided him with crucial insights into negotiation, presentation of offers, and the overall process of buying a business, transforming his approach from tentative to confident.

  2. The Importance of Preparation and Mindset: Preparation and the right mindset are pivotal. Despite initial fears and a lack of immediate success, Cosmin’s dedication to self-improvement and his willingness to step out of his comfort zone were key to navigating the complexities of acquisitions.

The Short Take:

Ronald Skelton interviews Mike Moyer, the author of "Slicing Pie," a groundbreaking book that offers a fair and logical approach to equity splits in startups. Mike shares his origin story as an entrepreneur and explains how his personal experiences with unfair equity splits led him to develop the Slicing Pie model. He breaks down the concept of Slicing Pie and highlights its key differences from traditional equity distribution methods.

Key Takeaways:

  1. The Slicing Pie model offers a fair and logical approach to equity splits in startups, based on the bets made by each individual.

  2. Equity splits should reflect the proportionate contributions of each team member, whether in the form of time, money, or other resources.

The Short Take:

Kevin Bibelhausene and host Andrew Frasier discuss the intricacies and strategies behind acquiring businesses, specifically focusing on raising capital for such endeavors. Kevin Bibelhausene shares his journey from a corporate career to entrepreneurship, emphasizing the allure of acquiring established businesses as a lower-risk entry into business ownership.

Key Takeaways:

  1. Path to Entrepreneurship Through Acquisition: highlighting that acquiring established businesses is a viable and often less risky path to business ownership.

  2. Criteria for Acquisition Targets: Targeting essential, stable businesses for acquisition. Consistent profitability, a long operational history, and a lack of dependence on any single customer or supplier characterize these businesses. Such attributes make a business more attractive to buyers and financiers alike, due to the lower perceived risk

The Short Take:

The Real Estate investor and entrepreneur Pace Morby delves into the innovative world of creative financing with guest Julia, who has successfully navigated the acquisition of a Med Spa in Arizona using no initial capital. Through a comprehensive discussion, the episode unpacks the mechanisms of creative financing, highlighting the potential for entrepreneurs to leverage existing resources and strategic partnerships to acquire and scale businesses.

Key Takeaways

  1. Leveraging Creative Financing: The essence of acquiring a business with minimal to no upfront capital lies in creative financing strategies, including sweat equity and strategic partnerships.

  2. The Value of Mentorship and Community: Julia credits her confidence and success to the guidance of mentors and the support of the community she found through networking events and real estate gatherings.

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Founding Member Shout-Out

Shout out to our founding member, with over 30 years in M&A, this company offers a Resource Center helping you buy good businesses. Very underpriced - get it now before they finish upgrading the site and very likely up the pricing.  visit: https://www.diomo.com/

In the Knowledge 

The information in the following articles is important for any business, particularly for new acquisitions. Add them to your Knowledge Bank.

As we move into 2024, two trends are reshaping how businesses engage with their customers. The first is the shrinking gap between awareness and purchasing, which is evident in the skyrocketing popularity of social commerce, which merges social media discovery with e-commerce. The second is the growing consensus nationwide that businesses should contribute to the well-being of their local communities. This expectation transcends traditional notions of corporate responsibility and asks companies to take the lead in building strong local economies and more resilient communities.

Both trends present opportunities for businesses to generate competitive advantages and growth opportunities, and why an organization's social platforms should be a strategic priority in the year ahead. Read more here…

Randi Gladstone, Sr Strategy Consultant at Bluecore, explores the transformative shift in martech RFP processes. Marketers now prioritize customer-centricity, abandoning channel-centric approaches to meet evolving needs and achieve business success.

An interesting thing has happened in martech over the past five years – technologies have emerged that don’t fit neatly into channels or specific silos. Take the example of point of sale (POS) systems. Even just a few years ago, a state-of-the-art POS system was designed for the in-store checkout experience, full stop. Read more here…

As Caleb and I laughed our way home, I realized that Sam had just made me want to return to the store to have another great experience like that. His ability to connect with me, the customer, created a positive impression that would last a long time and be valuable for the business over time. Sam was genuinely interested in his customers and was a definite asset for that Canadian Tire outlet.

As business owners, we’re often too caught up in our own little worlds to really engage with our customers – to create an experience like Sam created for us. Sam, in his curiosity about me the customer, had made me want to experience more of that business. Read more here…

Hey, friends, we could use your help to grow “Growth & Acquisitions” and bring it to more people so we can continue to serve you and others. If you like something we shared this week, please share it on X (formerly known as Twitter) or LinkedIn and tag us when you do. Let’s get people talking.

In the BIG Guys Corner … (middle market and above) 

Indeed, the headline figure of US$37 billion recorded over the 12-month period is significantly more than the US$21 billion witnessed in 2022. The amount was boosted by several Q4 deals, including Better Collective’s US$188 million takeover of digital sports media platform Playmaker Capital, as well as major funding rounds from the likes of Urban Sports Club (US$100 million) and Strikerz Inc (US$40 million). Read more here…

President Joe Biden said Thursday he is against the proposed sale of US Steel to Japan's Nippon Steel, as election year considerations appeared to outweigh the risk of angering key ally Japan.

Biden's intervention in the planned $14.1 billion acquisition comes less than a month before he hosts Japan's Prime Minister Fumio Kishida for a state visit to the White House aimed at boosting ties and countering an increasingly assertive China. Read more here…

Alternative asset and private equity investor KKR announced that it will launch a takeover offer to acquire German renewable energy platform Encavis in a transaction valuing the equity of the company at €2.8 billion (USD$3 billion), in a move aimed at supporting the growth and development of Encavis’ project pipeline to benefit from opportunities driven by national and international clean energy expansion plans.

Encavis said that its Management Board and the Supervisory Board expressly support the offer, and will recommend its acceptance to shareholders. Germany-based family company Viessmann Group will invest as shareholder in a KKR-led consortium, and existing Encavis shareholder ABACON and other shareholders have agreed to sell around 18% and roll over around 13% of Encavis shares, with ABACON remaining an indirect shareholder in the company. Read more here…

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In the Sosh … who to follow this week

I COACH. I BUILD. I WRITE. I SPEAK.

I COACH. I help top leaders, public figures, and athletes get unstuck while they're pursuing difficult goals. (Find out more at toddherman.me)

I BUILD. I take the experience of being on the 'field of play' with top performers and build world-class programs, training, and businesses, to make it easier for others. (Find out more at upcoach.com or 90dayyear.com )

I WRITE. To make it even easier for others, I write books. (The Alter Ego Effect, WSJ Bestseller & translated into 13+ languages. And, My Super Me, a children's book. Find out more at alteregoeffect.com )

I SPEAK. I speak on stages around the world on the topics of Mindset, Performance, and Personal Leadership. (1100 + stages since 1997.)

Connect with him on LinkedIn

In the calendar … 

A twice-monthly networking meeting where acquisitions entrepreneurs come together online to build teams, share ideas and resources, and help each other succeed. The first and Third Tuesday of each month. Check it out...

This prestigious annual M&A conference assembles corporate development leaders, in-house M&A counsel, and private equity investors to discuss current challenges impacting complex transactions and learn about innovative methods to improve deal performance. Check it out…

At DealMAX (formerly InterGrowth), the entire middle market community converges under one roof for three days of efficient dealmaking, idea-sharing, and maximizing the growth potential of their networks and M&A success. Check it out…

An ultimate resource for valuable insights on acquiring, investing, building, and selling profitable businesses. M&A Launchpad is the host of both the M&A Launchpad Conference and Podcast. Join our next event on May 11th, 2024. Check it out…

Presented by MASource.org. Check it out.

Capital Camp is an upcoming event scheduled for May 21-23, 2024, in Columbia, Missouri. The event is described as a gathering for "curious, kind, and thoughtful investors, capital providers, entrepreneurs, and executives" who are pushing boundaries and breaking new ground.

The event spans three days and three nights, offering serious investing conversations in a relaxed setting—think shorts and sandals rather than suits and ties. Attendees can expect interactive programming, a variety of outdoor activities, and an endless supply of food, drink, and entertainment.

The event has received high praise from past attendees, with many describing it as the most valuable and best investing conference they've ever attended. Check it out…

AI & Big Data Expo North America – Conference & Exhibition June 5-6 - SANTA CLARA CONVENTION CENTER, CA

Discovering the intelligent future through AI & Big Data. AI & Big Data Expo is the leading event for Enterprise AI, Machine Learning, Security, Ethical AI, Deep Learning, Data Ecosystems, and NLP. Check it out…

Through a dynamic mix of lectures, case studies, class discussions, hands-on learning, and visits from guest speakers, this program provides critical insights and powerful tools for the successful formulation and execution of an M&A strategy — one that creates true value for your organization. Check it out…

The Kayo Women’s M&A Summit unites 300 women leaders in mergers & acquisitions, private equity deal-making and capital markets. Over the course of two days, attendees can expect to generate deal opportunities through peer-to-peer networking, educational content, and a supportive community atmosphere in the private equity hub of Boston. Check it out…

YOUR SPONSORSHIP GOES HERE

(Reach out to Gia or Ron and show us some love).

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Connect with Gia Cilento - Editor & Co-Founder — LinkedIn X (Twitter)

Connect with Ronald Skelton, Co-Founder —  LinkedIn X (Twitter)fyjmb n≥µ˜  mn ,b

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