When Mike Metzger decided to start a business brokerage company in 2014, he was taking a big leap. He saw a lot of potential in the business brokerage industry, and felt that Richmond, VA would be the perfect market for his business.
At the same time, Mike knew that business brokerage was a demanding industry. What’s more, he would need to leave a six-figure position with a Fortune 250 company to start his business.
The stakes were high. But after more than 15 years in the corporate world, Mike wanted the chance to connect with small and mid-market business owners. And as a former US Navy Officer and Six Sigma Black Belt Certified Professional, Mike also saw a clear need for a better kind of business brokerage company: one built on a foundation of uncompromising discipline, statistical analysis, and high-touch client relationships.
“That’s how I distinguish and differentiate myself in the Richmond market,” Mike says. “It’s through that combination of professionalism and analytical insight.”
This approach has paid off in the years since Mike opened his office. Under his ownership, Murphy Business has become one of the most successful business brokerage firms in Richmond, VA.
Recently, we talked with Mike about what business owners should look for in a business brokerage company, why his clients appreciate the Murphy Business model, and his advice to anyone who’s getting ready to sell a business.
What to Look for in a Business Brokerage Company
“I’ve heard from people who say, ‘I’ve called three brokers already today, and you’re the only one that picked up the phone.’”
Prior to starting his own business brokerage company, Mike researched the industry in detail. He was surprised to learn how many brokers ran their firms as a side-business. He was equally surprised at how hard it was to find knowledgeable, qualified brokers in many parts of the country.
Mike felt that business owners deserved a higher standard of expertise and professionalism from their business broker, and he continues to feel that way today.
“Our goal is to position ourselves as true professionals and experts in our field, on par with a CPA or an attorney. That’s the standard we should be holding ourselves to, and that’s how business brokers should be perceived.”
When Mike started his business brokerage company, he was determined to meet these standards. He spent months learning everything he could about the industry, and when he opened his office, he made sure that his clients came first.
“Coming across as a true professional makes a big difference. And that can be as simple as just answering the phone. I’ve heard from people who say, ‘I’ve called three brokers already today, and you’re the only one who returned my call.’”
At the same time, Mike developed a network of specialists and experts to help his business brokerage company better serve business owners.
“I think of myself as not just a business broker, but as a hub of expertise. So, when people call me and I think they could benefit from other people’s services, I’ll refer them out. That helps build my credibility as a true partner.”
The Benefits of a Proven Brokerage Process
“When you take the extra effort to understand the financials and the inner workings of a business, people appreciate that.”
In addition to expertise and professionalism, Mike stresses that brokers should offer a proven process. As a certified Six Sigma Black Belt with 15+ years of statistical analysis experience, Mike knows the value of proven, analytics-driven processes. In fact, that’s one of the biggest reasons why he chose to open his business brokerage company as part of the Murphy Business network.
“I wanted the chance to use my business skills and analytical skills, and I wanted to buy into a proven system. When I looked at the industry, Murphy had a system that really appealed to me. It was logical. It was well established. It was well documented. And it’s repeatable.”
According to Mike, this system has been crucial to the success of his business brokerage company.
“A bad broker will look at a profit and loss statement, apply a 2.3 multiplier to earnings, and put you to market. But that isn’t effective. When you take the extra effort to understand the financials and the inner workings of their business, people appreciate that. It means you can be upfront and candid about the business. And it means you can be realistic about what that sale will look like. Sometimes that means telling them that you can’t sell their business.”
Mike notes that his clients also appreciate the leverage of selling through Murphy Business. As part of the Murphy network, Mike can list his clients’ businesses through national and international brokerage networks.
“With Murphy, I have the horse power to get my clients more exposure. We have access to many data sources and listing networks. It’s expensive to list on these sites – individual and small brokerages just don’t have those types of resources.”
Advice for Business Owners Preparing to Sell
“I’ve had this happen before where we get it listed… and we start getting offers, and the value has tanked.”
Since opening his business brokerage company a little over four years ago, Mike has helped countless Richmond-area entrepreneurs sell their businesses. So, we asked Mike about the most important piece of advice that he has for business owners preparing to sell their business.
“One of the most important pieces of advice that I give to all my clients is to keep running the business as if you’re going to own this forever, even when we start talking to buyers. Don’t start throttling back and dropping sales.
“I’ve had this happen before where we get it listed, and we start getting offers, and the value has tanked because the seller took their foot off the gas.”
We also asked Mike about some of the biggest issues that his business brokerage company encounters.
“Without exception, the most common challenge I see is the business owner who hasn’t been able to step away from their business. The fact that they are so integral to every facet of the company can make it really challenging for the buyer to visualize himself or herself taking over.”
Mike says that, while the process takes time, his business brokerage company has helped a number of clients address this weakness, boosting the value of the business come sale time. In other cases, Mike has used outside-the-box strategies to help his clients capture full value for their business.
“Even though someone’s really integral to a business, that doesn’t mean the business isn’t sellable. But it might take longer to find a buyer. And once you find a buyer, the transition period might be longer, or you might need to structure the deal to spread the risk between the buyer and the seller.”
For Mike, these kinds of situations underscore the importance of hiring a business brokerage company that will go the extra mile to understand your business and to be transparent about the status of your listing.
“For me, the first step is explaining that upfront before you even take the listing. Having those conversations upfront can help avoid surprises down the line. When the rubber hits the road, I can advise them on which deal structures are appropriate and help them find the right deal for their business.”
Getting ready to sell a business? Call (727) 725-7090 today to connect with your local Murphy Business brokerage company!