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Last Update: Sunday March 29, 2020

Key Idea: Take Charge of Your Exit

Bob Orenstein hired a general business broker and Tracy Myers hired a broker who specializes in for-profit schools.

Key Question:

A: 

Professional business brokers and they will help you get the best price.
 
Q: As you build value in your company, how do you prepare to someday liquidate that value for your personal benefit?

A: As your company is growing, it may very well be too early to develop an exit strategy. The right move might be to sell to an employee whom you haven't even hired yet! The important thing, from Day One, is to prepare yourself and your company for the execution of the eventual strategy.

Each of us comes to our business with certain expertise and with an inadequate skill set in some of the other areas necessary to operate a successful business. We "fill the gaps" with employees, consultants, and by learning, expanding our own skill set. Most likely, you'll need all three when the time comes to exit.

Take the time now to educate yourself about succession planning. Learn the difference between price, cost, and value. Read books, attend lectures, visit with business brokers at Chamber luncheons, etc. Be confident that someday, you'll need this knowledge.

Think about it

What are you doing now to get ready to sell your business or to be ready to sell when someone comes knocking on your door?

Clip from: Sell To A Public Company

La Jolla and Dallas: Every day the press reports, especially The Wall Street Journal and Forbes, about how big business acquires small businesses in order to grow.

If you are running a good business and have market share in your industry segment, you should consider preparing for that call or knock on the door, "Can I buy your business?"   In most every episode of this show we explore how and why the founder of a business gets started and how they get over the hurdles. This week we look at how they received a very large check for the fruits of their labor.

Today, we spend time with Tracy Myers and Gary Cantor, the founders of Advertising Arts College, and Bob Orenstein, founder of International Wine Accessories (IWA). Both have completed all eight steps within the business cycle, and they define what it means to "Exit At the Top." You met Bob a couple of years ago when we did his story about starting IWA from the extra bedroom of his townhouse.

Both stories are important.

Gary and Tracy's story is for all of us who are not even thinking about selling, then there comes a knock on the door.  Bob's story is for the rest of us who know that we have created a substantial asset. Bob, however, knew that his "time" was coming. Bob was strategic and spent several years getting ready for the day, and then it took over four years to consummate a deal.

To say the least, every one of us should have an exit strategy.

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International Wine Accessories, Inc. (IWA)

Robert Orenstein, founder

10246 Miller Road
Dallas, TX 75238
2143496097

Visit our web site: http://www.iwawine.com/

Office: 2143496097

Business Classification:
Home products

Year Founded: 1988

Take Charge of Your Exit

HATTIE: Tracy, what do you think The Art Institute bought?
 
TRACY: I think The Art Institute bought a lot of things. Number one, we were a successful business. The business made money every year, and it made more money with each consecutive year we were in business, and we were in business since 1981.

But I think we had a reputation that was so good and so sterling really. And it was a conscious decision my partner and I made when we started the school not to take shortcuts, to really care, to be honest about everything all the time, because when you own a school and you're dealing in federal funds, Title IV funds for student loans and grants, you are audited constantly.

And we met with them, and we started the ball rolling, we started dialoguing. And I realized that, wow, this is a little bit more than I understand. And that's when I sought out a school broker, someone who buys and sells schools, private post-secondary for-profit institutions, and I was so lucky to have found this particular firm, and they did a beautiful job.
 
 

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