From processing and manufacturing to production and distribution, we’ll give you the advice you need to maximize the value of your company when it comes time to sell.
Morgan & Westfield serves as a trusted partner to plumbing and HVAC businesses, mechanical and commercial contractors, and other home service enterprises looking to sell.
Building a successful business is hard. Taking it to the next level is even harder. Adam Coffey returns to M&A Talk with tips for entrepreneurs on scaling up and making success inevitable for middle-market companies. He discusses the issues that come with scaling a company, finding capital and using exit plans to fund growth, how to generate wealth for owners and employees, why a company’s culture is critical to its ultimate success, and building an equity incentive plan to retain talented employees.
“Entrepreneurs need to focus on building a successful small business before they worry about building a big business. In our lives, we need coaches, we need mentors, we need people around us who can challenge us and help us to continuously grow because once we stop growing, we stop finding new levels of success.”
Adam Coffey
In this Episode
1:30 What is Adam’s new book Empire Builder about?
4:25 Where do most entrepreneurs hit the first major growing pain in building their business?
6:58 How is unit economics defined, and what is the “30-20-10 rule”?
11:01 What reasons influence a business owner’s decision to sell their company?
14:24 What’s the key to finding, hiring, and keeping good people?
17:20 What are the benefits of implementing an equity incentive plan for employees?
21:44 What are the best recommendations for business owners who want to keep their business for another 10 to 20 years?
23:27 How important is it to offer employees equity-like incentives? What issues need to be considered?
28:04 What are the primary disadvantages of an equity-like incentive plan?
33:09 What usually happens to incentive plans when a company is sold?
36:53 What are the major reasons that entrepreneurs have difficulty scaling a company?
41:48 Where are the most logical places for middle-market business owners to look for capital?
45:36 Why is it important for lenders to know that a business is a sellable asset?
Have Questions About Selling Your Business?
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Selling your business is a big deal – let us handle the details while you run your business.
30-20-10 Rule: Adam’s economic guide to building 30% gross profit, with back-office costs at less than 20%, and achieving 10% net profit.
Asset Diversification: Spreading investments for risk reduction.
Capital Gains: Profits from asset sales.
EBITDA: Operating profit measure that includes Earnings Before Interest, Taxes, Depreciation, and Amortization.
ESOP: Employee Stock Ownership Plan
PE: Private Equity – investments in private companies.
SBA: Small Business Administration – U.S. agency supporting small businesses.
Meet Our Guest
Adam Coffey
Advisor | Author | Empire Builder
Empire builder, CEO coach, in-demand speaker, and two-time #1 bestselling author Adam Coffey builds high-performance cultures that drive transformative exponential growth. A CEO for more than two decades, he led three national private equity-backed service companies for nine PE sponsors, completing 58 acquisitions and realizing billions of dollars in successful exits. Coffey is a founding partner of CEO Advisory Guru, serving as a management consultant and independent director to PE portfolio companies, family offices, and elite executives. His specialties include growth strategy, mergers and acquisitions, new business development, and exits. A proud US Army veteran, Coffey lives in Texas with his family.