Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.
Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.
Performance cookies are used to understand and analyse the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Advertisement cookies are used to provide visitors with customised advertisements based on the pages you visited previously and to analyse the effectiveness of the ad campaigns.
This job is riddled with hard conversations. Recently we talked with a business owner who was making decent money the last few years and this year the train came off the tracks. He blamed all kinds of macro-economic factors, but the reality is that he didn’t adjust his business strategy to accommodate changing market conditions and now he’s in a real pickle.
Hoping things would get better, he hired expensive consultants, a high-base salary salesperson, and embarked on a brand-new, “Hail-Mary” strategy that exhausted his war chest. Everyone was very happy to take his money and do their best, but no results materialized. He maxed out his line of credit with his bank and fed the monster nearly $1 million of his personal funds to keep things afloat. Still no results.
So why was he calling us? He wanted to spend more money value the business so he can shop for private equity investors. Now, these are not conversations we like having, but someone has to stop the madness at some point and provide a reality check. We told him, no: we won’t take your money right now for a business valuation. You can’t afford it. Go talk to your bank; be completely transparent and ask for their advice. You can talk with potential investors if you’d like to try it, but you are not in an attractive position or a strong negotiating position right now. IF you find that you truly need a business valuation for either debt or equity injections, call us back and we’ll help you out…but we’re not going to take your money when we know the news is bleak, all while you’ll be bleeding cash. Stop the bleeding.
Some people who are offering to “help” you, are not interested in your business’ health, they are only interested in generating a fee. Hope is not a strategy and private equity isn’t your escape route. Strong business fundamentals will win every time: Watch the market, adjust when necessary, don’t throw good money after bad, and know when to stop feeding the monster. Or as Kenny Rodgers sang: “Know when to hold ‘em, know when to fold ‘em, know when to walk away, know when to run…”
As for our team here at Murphy Business of Cape, you can count on us to have the hard conversations with kindness and respect, and we won’t take your money when we know you shouldn’t pay it. We want to be part of your solution and not part of your problem. Whether you are looking for a business valuation or help with a buy/sell transaction, contact us today for a confidential conversation about your business.
