Would you be against hiring a business broker?

Ridge14 said:

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Would you be against hiring a business broker?

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like I mentioned, I am not sure I even know what that is (I can guess) and not sure really what the pros and cons would be?

You've got me more interested helping you hit that revenue target! Do you have a website?

Username checks out.

Bag said:

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Ridge14 said:

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Would you be against hiring a business broker?

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like I mentioned, I am not sure I even know what that is (I can guess) and not sure really what the pros and cons would be?

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I've never used on myself so not sure I could recommend or advise against

I'd imagine pros are that they do a valuation of the business, market the business to potential buyers, and execute the transaction - potentially similar to a real estate agent

Cons - they are going to take a cut

Buyer ideas - look up your competition's C-level group and solicit them directly.

Also interested in your website.

https://www.40geo.com
https://amp.40geo.com

The website is due for a makeover (put it on the list)

we basically track anything that moves relative to things that are of interest to our clients, primarily boats using AIS but a whole host of other assets as well.

Is your accounting process and accounting team in good shape? Do you have an understanding of how your business will be valued? What is the key metric (revenue, ebitda, recurring revenue)?

Twe are in the process of selling a $5m business right now with an auction. If you want to find out more about the process we can talk.

I also think your business seems pretty interesting. Wouldn't mind chatting with you about that.

I work in M&A and have for ~15 years both in the advisory and investor side (private equity).

Lots of things to consider and many paths to take based on your role, desires, etc.

Feel free to PM me and we can set up call or something to discuss - always happy to help,

Generally it'll be valued on multiple of trailing cash flow.
I would probably send a note to drillinginfo/Enverus. They seem to buying everything iOT.

Fascinating business you have going. I would be tempted to hang onto that but I don't know your situation. Someone like a Project44 might be interested in this, if you know who they are....

AgLA06 said:

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Here's a question.

Why sell outright instead of hiring a general manager to continue to grow the business while you get to scale back and either enjoy the income or focus on other things? Good salary with a profit sharing on growth.

It could mean selling in 10 years for multiples of what you would sell next year. Hell, I'd love to talk to you about doing it for you.

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Good question, I guess I need to evaluate that as an option. The truth is that I have been working 60+ hours a week for 5 years and its not sustainable, so the first thing I thought was need to sell. I dont want to go the VC route because I dont want to lose control.

I have heard horror stories about VC, but it is a chicken or egg paradigm where you can only go so far trying to bootstrap the entire thing.

Comeby! said:

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Generally it'll be valued on multiple of trailing cash flow.
I would probably send a note to drillinginfo/Enverus. They seem to buying everything iOT.

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That is an option, had not thought of it, but they would def be interested in the types of analytics we are deriving from movements of vessels offshore GOM.

They might be a good client for our products as well

YouBet said:

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Fascinating business you have going. I would be tempted to hang onto that but I don't know your situation. Someone like a Project44 might be interested in this, if you know who they are....

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I am not familiar with Project44.

My situation is... exhausted lol

Husky Boy Jr. said:

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Is your accounting process and accounting team in good shape? Do you have an understanding of how your business will be valued? What is the key metric (revenue, ebitda, recurring revenue)?

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Accounting is in relatively good shape, primarily use quickbooks (insert FTX joke here).

85-90% of our revenue is recuring. We are essentially a SaaS and DaaS play, recurring revenue has been the goal from day one.

There aren't many scenarios where you sell and retain control.

I am in Entrepreneur's Organization which is a peer group for business owners with revenues above 1m. Many are in the same situation as you. One thing that has helped them is implementing Entrepreneur Operating System. Running a business isn't about working hard, it's about people and systems. EOS gives a good comprehensive set of then that can be applied to most businesses.

TechPracAggie said:

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There aren't many scenarios where you sell and retain control.

I am in Entrepreneur's Organization which is a peer group for business owners with revenues above 1m. Many are in the same situation as you. One thing that has helped them is implementing Entrepreneur Operating System. Running a business isn't about working hard, it's about people and systems. EOS gives a good comprehensive set of then that can be applied to most businesses.

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I think I was not being clear. If I sell I imagine a scenario where my team needs to stick around for a certain period of time for the transition, but I have no interest in maintaining control once sold.

I was speaking specifically around getting in bed with VC firms that essentially take control of your company, if that needs to happen IU would rather just sell and be done with it


Excellent suggestion about EOS, I will take a look. I agree w you about the working hard part, have been told that by several people that know my situation. I need to enable myself to step back, but that is much easier said than done.

Email me at username @ gmail and I can send you the contact info of an investment banker in my entrepreneur forum. She will be happy to tell you the things to think through to maximize sales price and help you understand what an exit could potentially look like.

Also buy and read this book. He is another IB that I met last year and the book has good info:

https://www.amazon.com/Reasons-Company-Investment-Grade-About/dp/1734673206/ref=sr_1_1?keywords=17+reasons+your+company+is+not+investment+grade&qid=1673462149&sprefix=17+reason%2Caps%2C267&sr=8-1

Bag said:

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Husky Boy Jr. said:

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Is your accounting process and accounting team in good shape? Do you have an understanding of how your business will be valued? What is the key metric (revenue, ebitda, recurring revenue)?

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Accounting is in relatively good shape, primarily use quickbooks (insert FTX joke here).

85-90% of our revenue is recuring. We are essentially a SaaS and DaaS play, recurring revenue has been the goal from day one.

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Went through the process of selling a SaaS business a couple of years ago and would be happy to share about my experience if it would be helpful. I sent you a connection on LinkedIn.

nm

KPLER would be an interesting exit target. They do something similar but primarily marine vessel tracking. Plenty of others in that space but most focus on vessel tracking for supply chain optimization and trading.

Glad you're finding some help already here, keep going!

I worked in M&A advisory, primarily on the accounting side. Also happy to lend in ear to talk through some things if needed.

I work in Corporate Development for a software company and can probably help provide a bit of insight into what a strategic buyer of a recurring revenue business would want to see. Shoot me a PM or email at username at gmail. Glad to talk or answer questions via email if it would be helpful for you.

ChoppinDs40 said:

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If you're working 60+ hours a week, you're gonna have to stick around too… for quite some time likely.

First rule to selling an owner/operated business and walking away is start yesterday on figuring out how to "fire yourself".

If you want to walk away, you need to make it where the business can still be successful without you.

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This is sage advice, but much easier said than done. It becomes almost like your child, a living, breathing entity. One of my goals for 23 is to take a step back, travel more.

Our biggest hurdle right now is technical debt, a term I had not even heard of when I started this.

Engine10 said:

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KPLER would be an interesting exit target. They do something similar but primarily marine vessel tracking. Plenty of others in that space but most focus on vessel tracking for supply chain optimization and trading.

Glad you're finding some help already here, keep going!

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Interesting company, they do some similar stuff as us, although appear to be more downstream focused. The majority of what we do is upstream at the moment

That company sounds like a good potential pairing to me.

Choppin hit the nail on the head. None of this conversation matters if YOU can't separate yourself from the company. You define the company, the company doesn't define you. You'll have to figure that our first.

Here's free advice probably worth what you paid from someone detached and without insider knowledge.

Taking a quick look at your website staff page, you have a COO (co-founder, but you own 100%?), a CFO, and a sales director. Which means you shouldn't be managing day to day stuff (COO) or the accounting and finance (CFO) or Sales unless you aren't staffed correctly or people are underperforming or you aren't allowing the to do so. If they're handling those roles, it should allow you to be managing corporate strategy and the path forward while performing oversite of each are. If this is the case, then its most likely just a staffing / resource issue that can be corrected fairly easily.

If that's not the case, the next question is why? Is the CEO role not a match to your personality and experience? Does your passion keep you in the weeds (GIS algorithms, etc.) and you're neglecting that role?

There's nothing wrong with that being the case (if it is). However, someone has to be fulfilling that role to fulfil your stated future goals. I've been part of and managed a couple small companies. The worst thing in the world to the company and employees is an owner who can't let control go, but also can't fulfill that role.

It looks like your address on the website is close to my office. I'd love to meet you for lunch or a drink and find out more.

AgLA06 said:

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That company sounds like a good potential pairing to me.

Choppin hit the nail on the head. None of this conversation matters if YOU can't separate yourself from the company. You define the company, the company doesn't define you. You'll have to figure that our first.

Here's free advice probably worth what you paid from someone detached and without insider knowledge.

Taking a quick look at your website staff page, you have a COO (co-founder, but you own 100%?), a CFO, and a sales director. Which means you shouldn't be managing day to day stuff (COO) or the accounting and finance (CFO) or Sales unless you aren't staffed correctly or people are underperforming or you aren't allowing the to do so. If they're handling those roles, it should allow you to be managing corporate strategy and the path forward while performing oversite of each are. If this is the case, then its most likely just a staffing / resource issue that can be corrected fairly easily.

If that's not the case, the next question is why? Is the CEO role not a match to your personality and experience? Does your passion keep you in the weeds (GIS algorithms, etc.) and you're neglecting that role?

There's nothing wrong with that being the case (if it is). However, someone has to be fulfilling that role to fulfil your stated future goals. I've been part of and managed a couple small companies. The worst thing in the world to the company and employees is an owner who can't let control go, but also can't fulfill that role.

It looks like your address on the website is close to my office. I'd love to meet you for lunch or a drink and find out more.

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Eight Row Flint is a good place to meet for a drink (across the street) or EQ Coffee on Heights within walking distance.

You can shoot me a LI invite and we can go from there

Sounds great.

AgLA06 said:

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Sounds great.

To verify an assumption, are you Keith?

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indeed