FYE-GI | Selling Businesses

 

Michelle Seiler Tucker is the Founder and CEO of Seiler Tucker Incorporated. She holds the M&AMI (Mergers & Acquisitions Master Intermediary) title, as well as the Certified Mergers and Acquisitions Professional (CM&AP) and Certified Senior Business Analyst (CSBA). Michelle also owns many other businesses in several different industries. As a 20-year veteran in the M&A industry, she is regarded as the leading authority on buying, selling, fixing, and growing businesses. She and her firm have sold over a thousand businesses in almost every vertical and have a remarkable track record of success.

 

  • CEO Hack: (i) I start off my day with results and gratitude (ii) Focus more on my energy management and strengths (iii) Delegating the rest
  • CEO Nugget: Your network equals your net worth
  • CEO Defined: Continuous learner, one who is able to soak it up and is not afraid to hire people smarter than them

 

Website: http://www.seilertucker.com/
Book website: http://www.exitrichbook.com

Facebook: https://www.facebook.com/michele.seilertucker/ https://www.facebook.com/michelletuckerinternational/
Instagram: https://www.instagram.com/michelleseilertucker/?hl=en
Twitter: https://twitter.com/MSeilerTucker
LinkedIn: https://www.linkedin.com/in/michelleseiler/

Listen to the podcast here

 

IAM1086 – Founder Helps Entrepreneurs Sell Their Businesses

I have a very special guest on this episode. I have Michelle Seiler Tucker of Seiler Tucker Incorporated. Michelle, it’s great to have you on the show.

Thank you, Gresh. Thanks for having me.

I appreciate you for taking some time out to talk a little bit more about all the awesome things that you’re doing. Before we do that, I want to read a little bit more about Michelle so you can know about all the awesome things that she’s doing. Michelle’s the Founder and CEO of Seiler Tucker Incorporated. She holds the MAMI title, Mergers and Acquisition Mastery Intermediary, as well as a certified mergers and acquisition professional, and certified business analyst.

Michelle also owns many other businesses in several different industries, and as a veteran in the M&A industry, she is regarded as the leading authority on buying, selling, fixing and growing businesses. Her firm has sold over 1,000 businesses and almost every vertical, and has a remarkable track record of success. Michelle, it’s great to have you on the show. Are you ready to speak to the I AM CEO community?

I am. Thank you so much for having me on.

I appreciate you for taking time out. To jump straight into everything, I wanted to hear a little bit more about how you got started with your CEO story.

Many years ago, I have always been an entrepreneur. I always knew I didn’t want to work for someone because my biggest pet peeve is I don’t like to be told what to do. I don’t make a very good employee. I always knew I would be an entrepreneur. I’ve owned many different businesses in different verticals. I also transitioned into franchise. I opened up a franchise company where I did franchise sales, franchise development and franchise consulting.

I was a partner with different franchisors and so many buyers kept coming to me and asking me, “Michelle, do you have any existing businesses for sale?” I kept saying, “No.” I’m like, “Why am I saying no? I should be saying yes.” It’s the Law of Attraction. I said, “I’m going to start my M&A firm,” and that’s what I did many years ago.

When I got into mergers and acquisitions, first, I was selling small businesses and then very quickly, I transitioned into selling businesses, $10 million and up. That’s how I was able to get the titles and the acronyms that I have now, but I learned very quickly that what Steve Forbes says is true, 8 out of 10 businesses won’t sell. Eighty percent of businesses on the market will never sell. I’m like, “I’m going to starve to death if I don’t learn how to fix and grow these businesses and build them. Put them on a build-to-sell plan so I’m not going to starve to death.”

Eight out of ten businesses won't sell. 80% of businesses on the market will never sell. Share on X

That’s when I started to focus on not only selling and merging businesses, but focus on fixing them and figuring out what was wrong with them. Growing and putting them on a build-to-sell program. That’s really how I started specializing in buying, selling, fixing and growing. I do partner with business owners and I see my core competencies, expertise, and capital resources, and put them on a go-to-sell model. Plus, we buy businesses and fix them too. That’s how we specialized in buying, selling, fixing, and growing.

I appreciate you for sharing that and doing that as well too. Helping these businesses to be successful so that you can make sure you don’t go hungry is always important as well too. I love that you’ve been able to help not just do-it-yourself, but also be able to help these businesses and make sure that you get there. I know you touched on it a little bit. I wanted to drill down a little bit more here and a little bit more on how you work with your clients and what you are talking about in your book as well too, and what we can learn from you there.

It depends upon what stage they’re in, but as I said, Steve Forbes says 80% of businesses don’t sell. That’s 8 out of 10 businesses. The biggest mistake the business owners make, the number one reason for that, is that business owners don’t think about their exit. They don’t think about selling. They don’t plan their exit until they’re like, “I’ve got to sell.” They go, “I’ve got to sell because of health issues, partner disputes, divorce, death, or this pandemic.” They don’t think about selling until a catastrophic event occurs, and that’s the worst time to sell your business because you’re not going to be exiting rich at that point. You’re going to be exiting poor. You can be selling for pennies on a dollar, and that’s because your business is in a catastrophe.

When your business is in the middle of a catastrophe, it’s trending downward and it’s not doing well. The best time to sell your business is when the business is doing great and in its prime. What we do is work with our business owners to plan their exit from the beginning. As Stephen Covey says, “Start with the end in mind.” We put them on what I call the GPS Exit Model. It’s like when you want to drive somewhere, what’s the first thing you do? You look at your phone, you go to Google Maps, and you plug in your destination. If you don’t plug in your destination, what happens?

You end up everywhere.

You end up nowhere or you end up lost. That’s what happens with business owners. They don’t plan to fail. They fail to plan and they don’t have a destination. They don’t have an endgame. They don’t have the desired sales price. I always tell my clients, “Pick a number.” Let’s say you want to sell your business for $5 million. There’s a number. You can always tweak it along the way. You can adjust it. You can increase or decrease it.

FYE-GI | Selling Businesses

Selling Businesses: Business owners don’t plan to fail. They don’t have an endgame or a desired sales price. This is why it’s important to pick a specific number for profit, a specific goal for the business.

 

The next thing that the GPS Exit Model needs to know is where are you starting from. What is your current location? What is your current evaluation? Most business owners have never had their business evaluated. They have no idea what their business is worth, which is financial suicide because our business is our most valuable asset.

We go to the doctor once a year to get an annual checkup, or we should be making sure our heart is still ticking and we’re still kicking. We drive a car to a mechanic. Sometimes we take better care of our cars than we do our bodies. We take our car to the mechanic to get an annual tune-up, but we don’t take almost price possession, which is our business, to get an annual valuation checkup. You don’t do this at your local CPAs. You need to align yourself with an M&A expert because CPAs don’t know how to value synergies.

Let’s say your business is worth $1 million, and you want to sell for $5 million. The next step you need to know is, “What is my timeframe?” Let’s say you want to do it in ten years, then the next thing you need to know is, “Who are my buyers?” There are five different types of buyers. The reason why I say buyers is because so many people and business owners come to me and say, “Michelle, I already have the buyer. I only need you to represent me with this one buyer,” and I always say no. You go, “What do you mean no?”

I go no because I’ve got to go in there and do the valuation. We’ve got to price the business. We’ve got to look at it to see if it operates on all six cylinders, all the ST 6Ps, and then we’ve got to do the due diligence. We’ve got to gather all the due diligence inside and stick them in a data room. I promise you, that one buyer is probably going to fall apart. You always want to have backup buyers, number one and you can never maximize value if you only have one buyer because you can’t create competition with a party of one. Would you like to know the five different types of buyers?

Yeah, please, go for it.

Ninety percent of buyers are first-time buyers. They don’t buy multimillion-dollar companies. They buy ice cream from stores, smoothie shops, restaurants, and cleaners. Turnaround specialists are the second type of buyer. They buy distressed assets. They don’t buy multimillion-dollar companies. Private equity groups buy based on platforms and add-ons. So let’s say a private equity group wants to get into the technology. They won’t even look at a technology company unless it has at least $3 million and up in EBITDA. EBITDA is Earnings Before Interest, Taxes, Depreciation and Amortization, or another word for cashflow.

If they’re already in a technology space and they have that platform, then they’ll consider add-ons, smaller technology companies under $1 million in cashflow. The next type are strategic/competitors. They pay the highest multiple because they’re buying synergies, and they’re buying synergies account to put their current business to the next level. Your last type of sophisticated entrepreneur and they typically are industry agnostic. They just chase EBITDA.

Now that you have your plan, you’re like, “I want $5 million.” The last three types of buyers are good for my business, then you need to say, “Where is it my numbers need to be? If I want to sell for $5 million, where’s my growth? Where are my cost of goods and operating expenses? Most importantly, where’s my EBITDA need to be?” To sell for $5 million, your EBITDA is going to have to be around $1 million depending upon your synergies.

The next big thing is, “What are the synergies that buyers are looking for? What are their specific criteria? How do I build my business to meet their specific criteria?” It’s like when you open up a business and you go, “This is my widget and this is my direct target market.” It’s the same thing with your business. Your business is your product, and you want to build your product to sell to specific buyers.

Your business is your product. You want to build your product to sell to specific buyers. Share on X

What would you consider to be what I like to call your secret sauce? This could be for yourself personally, the business or a combination of both, but what do you feel sets you apart and makes you unique?

That’s a great question because I always ask my clients that. My secret sauce is, first and foremost, being in this industry for many years and having over twenty years of M&A experience, number one. Number two is my company has sold over 1,000 businesses, and we’ve worked with even more than that. I think my secret sauce is also owning multiple businesses in different industries because it gives me that competitive edge and I’m able to completely understand and am empathetic of what the business owner is going through when they decide to sell their business because I’ve sold my own businesses. It gives me a whole different perspective to be able to put myself in their shoes versus there being a lot of M&A advisors that’s never even owned the business before.

I wanted to switch gears a little bit, and I want to ask you for a CEO hack. This could be like an app or book or a habit that you have, but what’s something that makes you more effective and efficient?

I start my day off with gratitude on what I’m thankful for. I also start my day off with results. A lot of people start the day off with their to-do-list or what they need to accomplish that day. I start my day off with what I want the outcome to be. What results do I want to accomplish versus a long to-do-list? I focus more on energy management versus time management. Another big hack for me is I focus on my strengths. Only those things that only I can do, such as writing my books. I’ve written three books and I delegate the rest. I empower people to make decisions, but I always inspect what I expect. I always trust but I verify.

That might be what I would call a CEO nugget, which is a word of wisdom or piece of advice. It could be something from your book or something you would tell a client or maybe even your younger business self.

I have so many golden nuggets. My book, Exit Rich, has 23 chapters. Each chapter is called Golden Nugget Number One, Golden Nugget Number Two, and Golden Nugget Number Three. Pick up Exit Rich and get all of my golden nuggets.

We’ve got a whole mountain.

What I would tell my younger self and this is what I tell clients now is to find an expert. It’s all about relationship capital and your network equals your net worth. If you want to be successful, associate with successful people. If you want to be rich, hang out with rich people. If you want to be broke, hang out with broke people but the bottom line is, if you want to be an entrepreneur, find a great mentor and expert. Somebody who’s traveled down the path you want to travel because it will shorten your learning curve dramatically, and they will shorten your path to success dramatically. My quote for that is it’s hard to read the label from the inside of the bottle. You need an outsider’s perspective to read the warning signs and keep you out of the danger zone.

FYE-GI | Selling Businesses

Selling Businesses: If you want to be an entrepreneur, find a great mentor and expert, somebody who’s traveled down the path you want to travel. They will shorten your learning curve and your path to success dramatically.

 

I want to ask you my absolute favorite question, which is the definition of what it means to be a CEO. We’re hoping to have different “CEOs” on the show. Michelle, what does being a CEO mean to you?

I always say you can never grow the business beyond what you can grow the owner. A CEO is somebody that always has to continue to learn, has to be a sponge, has to soak it up, and has to continue to always grow because the business won’t grow past you and has to recognize their strengths as we talked about a minute ago. Recognize your weaknesses and don’t be afraid to hire people smarter than you. Many entrepreneurs are so afraid to go, “I can’t hire somebody smarter than me because I’ll look dumb. They won’t respect me.” They want to hire people just like them because like likes like. If you hire people just like you, you’re not going to grow. Your business is not going to grow. Don’t be afraid. Some of the smartest and most successful people in the world hire people smarter than them.

Michelle, I truly appreciate that definition and I appreciate your time even more. What I wanted to do was pass you the mic, so to speak just to see if there’s anything additional that you can let our readers know. Also, how best they can get ahold of you, get a copy of the book and find out about all the awesome things that you’re working on.

The biggest piece of advice I can give is your past doesn’t define you. Many entrepreneurs, individuals, and people get stuck in their past. Your past doesn’t define you and shouldn’t control your future. You’re the director, you’re the producer, and you’re the star of your movie. You write the script. You control your future. As far as how can people reach me, I would encourage everyone to go get my copy of Exit Rich and you can get that at ExitRichbook.com or you can buy that on Amazon. My main website is SeilerTucker.com. You can also follow me on Facebook at Michelle Seiler Tucker and on Instagram. You can connect with me on LinkedIn and Twitter. I’m everywhere.

FYE-GI | Selling Businesses

Selling Businesses: Your past doesn’t define you and shouldn’t control your future. You’re the director, the producer, and the star of your movie. You write the script. You control your future.

 

I appreciate that last reminder so much. I think so many times when we’re in our present spot, we can look backwards and feel like we’re stuck, or we can even get caught looking forward, but I think understanding that you have the power within you to reinvent yourself and be whatever you want to be is so empowering. I appreciate you for sharing that. Doing that with so many businesses and leaders as well too in so many ways. I appreciate your time. I hope you have a great rest of the day.

 

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