We are proud to highlight two exciting new clients at Growthink: iControl and Pop! Technology.

 

iControl

 

iControl is a periodical distribution and marketing company and division of The Current Companies.

iControl provides web-enabled newspaper billing consolidation services to newspaper vendors and retailers, including CVS and Barnes & Noble. With more than 8,000 active accounts, iControl is the largest provider of such services in North America by a ratio of more than 2-to-1.

Growthink will be consulting iControl on their strategic planning and business development initiatives.

For more information on our work with iControl, please view iControl's recent announcement here.

 

Pop! Technology

 

Pop! Technology is a Dallas-based creator of 'active' barcode information systems used by the food, beverage, pharmaceutical and health services sectors.

The company's technology transforms a standard barcode into an interactive barcode that provides real time information about the status and condition of their products at all points of the supply and distribution chain, from manufacture to end user.

Watch this video to learn more about how Pop's technology works.

This past May, Pop! Technology retained Growthink to assist with a $2M capital raise to expand their operations.

Here is a recent post on Pop! Technology from Texas Startup Blog.

 

 

For the new entrepreneur, there are few factors with a higher correlation to unbridled success or devastating failure than the ability to raise capital. In an economy of questionable strength, dreaming up a shiny new venture of revolutionary proportions is no longer the battle; the new challenge is finding the minds that will fuel that venture with dollars. In New York, one business-woman named Yao-Hui Huang has borrowed from popular culture to devise a sensational way to bring new ventures face-to-face with potential investors.

Admittedly, the project known as the Gauntlet is far from the first organized attempt to bring entrepreneurs and investors together. How this differs, is that it emulates the strategies of the highly successful TV show: American Idol. Similar to the show, which employs a panel of industry experts, the Gauntlet has a panel of judges with expertise in law, accounting, finance, technology, and investment.

Contestants who make it through the rigorous application process are chosen in groups of three to present at the monthly gathering. In front of the panel and an audience of over 100, entrepreneurs get seven minutes to pitch their venture along the areas of: problem, solution, market, industry, overview, operations, and financials. Presenters are then inundated with feedback from the audience and panel, and a select few go on to receive venture capital.

It is nice to see a refreshing approach to matching the right investors with the right entrepreneurs. Also, this structure provides the ability to share a business model with peers and experts while allowing the entrepreneur an attractive opportunity to refine, revisit, and hopefully improve areas of their business strategy.

Would your business plan be ready to go through the Gauntlet?

The marketing plan describes your strategy for penetrating the market, delivering your product, and retaining your customers. This video explains how to create an effective marketing plan.

 

 

As every entrepreneur knows, a great business plan is essential for effectively launching a business.  As the business grows, an effective strategic plan is required to successfully reach the business’s full potential.

But what about planning your exit strategy? 

Far too many business owners do not realize that careful strategic planning to sell your business is just as important as planning to launch and grow your business.

In addition to an independent lifestyle and personal fulfillment, a successful exit is the primary motivator for business ownership and entrepreneurship. 

(Not to mention that a successful exit tends to improve one’s lifestyle and personal fulfillment...)

Because acquisition is the most common exit for an entrepreneur / business owner, here are some tips to better prepare you to sell your business.

Don’t Wait Too Long To Sell

Many business owners wait until the last minute to try and sell their business. They wait until the business is stagnating, or they are exhausted with running the business. In fact, the best time to sell is when business is booming.

But Take Your Time – Don’t Be in Too Much of a Hurry

If you are in too much of a hurry to sell, you will probably leave a lot of money on the table. Buyers – especially sophisticated larger corporations – will likely sense your urgency and will take advantage of it in the negotiation period.

Start the Process Early

It’s a good idea to begin preparing 2-4 years BEFORE the sale. It’s much more expensive and time-consuming to rush and prepare all of the necessary financial and other information in a few months than it is to consistently record and compile records over a period of years. This record-keeping is also important for your business’s growth, since it provides more perspective on your company’s performance.

Get Your House in Order

Make sure that you have been keeping accurate financial records and that your assets are ready for sale.  This includes both tangible assets such as equipment and inventory, as well as intangible assets such as contracts, leases, patents, trademarks, etc.  Make sure that everything is assignable to the buyer and be prepared for extensive due diligence.

Try to See It From the Buyer’s Point of View

A buyer’s motivations are often different than the typical business owner’s. While the entrepreneurial business owner may get excited about innovation and creative strategies, the buyer cares much more about the potential for stable revenue streams and growth potential.  Take time to understand your potential buyer’s point of view, interests, and motivations.

Make Yourself Less Central to the Business’s Success

The buyer wants to buy a business – not you or your job.  From the buyer’s perspective, it’s better if the current owner is not important to the success of the business.  Therefore, in planning for the sale of your business, you should begin training your management team to take over critical business functions.  If all of the key decisions revolve around you (the owner), then the value of the company will be limited without the owner – and therefore, the business is less attractive to a buyer.

Meanwhile, Keep Focused on Running (and Growing) Your Business

When starting the sales process, you must keep a laser-sharp focus on your business’s operations.  It’s important that you do not get too wrapped up in either the sales process or in the romance of any particular sale offer.  As difficult as this is, it’s best to act as if any deal can fall through, even if you are in the final negotiation period, because any deal can come unraveled at the last moment.  Keep your focus on growing your business until the check has cleared and is in the bank. 

In addition, you should do your best to keep the sales process confidential so that you do not endanger relationships with any key clients, employees, or partners whose departure could threaten a transaction or the operations of your business.

Get Professional Assistance

If you are a business owner seeking to sell your business, you can benefit from outside advice and assistance.  As the old saying goes, “The attorney who represents himself has a fool for a client.”  The same applies for a business owner selling without an advisor.  Your advisor will provide you with guidance regarding valuation, due diligence, and the marketing of your business opportunity.  Without a competent advisor, you decrease your chances of selling your business at its maximum price.

Even if a Deal Comes, Be Prepared to Say No

If you have invested a lot of time and energy into the search, negotiation, and due diligence phases, you may be reluctant to reject any deal that comes across the table. However, just because you have a deal in front of you, you do not have to take it.  If the price is not attractive or if the deal is not right for another reason – and it cannot be mended – you may be wise to walk away and consider the next opportunity.

Sometimes, during the process of preparing their business for sale, business owners will find themselves at the helm of a much more profitable, attractive business.  If you have a profitable business, keep in mind that you have other options at your disposable.  In addition to selling your business, you can continue to grow organically, raise growth capital, and/or explore strategic partnerships. 

It’s important to continually evaluate your options throughout all phases of business growth to ensure that you are making the best decisions for the long term.

 

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About Growthink

Founded in 1999, Growthink is a leading middle market investment bank.  Our professional investment bankers have assisted clients in raising more than $1 billion in growth financing, as well as advising on mergers and acquisitions transactions.

 

Need assistance with your business exit strategy? 

• Consult a professional business plan consultant.

 

Looking to sell your business?

• We have considerable experience advising middle market business owners on the sale of their businesses. Contact Growthink's investment bankers today.

 

Imagine reaching all of the goals you’ve set out to achieve within the confines of a four-day work week. Sounds pretty nice, doesn’t it? Now imagine hiring significantly fewer employees than your competitors and developing products that are dramatically scaled back in comparison to what those same competitors are building down the street….and then watching your venture reach milestone after promising milestone! That’s a reality for Jason Fried and David Heinemeier Hansson, the entrepreneurs behind the company 37Signals.

With an iconoclastic view of what is needed to succeed in the fast-paced, whiz-bang world of web-based product development, 37Signals takes the old mantra “less is more” to a new level. In a recent interview with Bill Taylor, the founders shared their view that “less is less- because more is not better!” Their approach, which focuses on solving only the problem at hand by avoiding superfluous add-ons and unnecessary tweaks has not only resonated with their customers, but has created a large number of 37Signals evangelists.

Jason and David, while they are best known for their project-management software Basecamp and contact-management software Highrise, have also authored a book on the subject of success through simplicity, titled Getting Real. Inside, they tell entrepreneurs to add only the ingredients of the utmost importance when it comes to staffing, operations, and product development. They also passionately implore business owners to resist the urge to scale up, just because the opportunity to do so presents itself.

Though 37Signals is known for its frugality and prowess in the world of programming, there are strategic lessons for businesses of all types here; whether it’s scaling back the development of unessential functionality for your Web 2.0 company or modifying the operations at your coffee shop so that you don’t need to hire that extra barista. What can you do to simplify your business?

The Today Show recently featured a segment on entrepreneurship -- specifically, how many individuals are beginning to start businesses in response to a fragile economy and job market. As unemployment rises (currently up to 5.5%), many driven individuals find themselves without jobs and are forced to find creative solutions to their economic pressures.

Presented in the clip below is the story of Tracy Huges, founder of The Rum Cake Fairy Dessert Company. Tracy started the venture after being laid off from her marketing job.

The segment provides much highly useful information to new entrepreneurs, including the importance of having a good credit history, building trusting relationships with potential investors and creditors, and most importantly, carefully constructing a formal business plan. Business plans are a crucial step in the funding process, and are required documentation before pursuing capital from an SBA affiliate or micro lending institutions. While the segment places less focus on angel investors or venture capitalists, it’s important to note that such documentation is also a prerequisite for seeking equity funding as well.

Special attention is given to the personal loan management company Virgin Money (www.virginmoneyus.com). Such companies allow their users to formally structure loans between friends and family, which can be a fantastic way to manage early stage debt.