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Presentation from the Fordyce Forum 2011, presented by Michael Gionta
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How to Get “Big Bucks” for Your Recruiting Firm …..
…When It’s Time to Leave!
Michael Gionta TheRecruiterU.com
Why Should You Listen to Me?
Ú BIG Disclaimer! I’m NOT a: – Lawyer – Accountant – Business Broker…. Seek Professional Advice.
I Did Transition out of Most of My Business in 2010.
© TheRecruiterU.com
Know This First: What’s Next?
Ú Full Retirement NOT All it’s Cracked up to be!
Ú Lifestyle
Ú What are You Doing, What Role are You Playing?
© TheRecruiterU.com
How Big Does the “Pile” Need to Be?
Ú Your “Number”?
Ú Evaluate Different Scenarios – Partial Employment – Full Retirement
What I Learned that SHOCKED ME!
The Way to Grow a GREAT
Business is To Set It Up As If You Wanted to Sell It!
© TheRecruiterU.com
Key Elements That Maximize Value
Ú 5 Biggest Assets to a Potential Buyer 1. Clients look for DEPTH vs. Tenure 2. Employee Tenure 3. Quality of Database 4. Operational Systems/Metrics 5. Goodwill
© TheRecruiterU.com
Maximize Your Value Starting NOW
Ú Annual Business Plan – Better Planned = Higher Valuation!
Ú Employment Agreements – Offer Letters – Non-Competes/Non-Disclosures
Ú Value Added Services – RPO – Temporary Staffing – Consulting
© TheRecruiterU.com
Maximize Your Value Starting NOW!
Ú Begin to “Wean” off Your Desk – Start Delegating Marketing and Recruiting – Build a real Business
• Become the “Guru” • Leverage What You Do Best & Train Others How
to do EVERYTHING Else! • Others CAN do It Just as Well as You, Sometimes
BETTER! © TheRecruiterU.com
Maximize Your Value Starting NOW!
Ú Have Documented Systems For: – Hiring – Training – Career Path – Database Management – Leadership Development
Ú Have “Curb Appeal” for Your Office – Attractive to Employees – Services Near by (i.e. Lunch, Shopping, etc)
© TheRecruiterU.com
Maximize Your Value Starting NOW!
Ú Most People DON’T Know/Do This:
Ú Track and KNOW Key Operational Metrics! – P&L’s going back 5 Years – Revenue Predictability Metrics Opposing Attorneys will GRILL you On This!
© TheRecruiterU.com
Succession Planning
Ú Again, What is Your Time Frame? Ú Increase Your Visibility
– In the Recruiting Industry– Write and/or Speak – In Your Community
Ú Potential Buyers – Family Members – Employee(s) – Outsider
© TheRecruiterU.com
Succession Planning
Ú Develop MULTIPLE Potential Scenarios – Identify Internal Buyers – Identify External Buyers
Ú Regardless of Scenario… You NEED: – Leadership/Management Development
Program • Sell in Interview Process • Create Career Path
Succession Planning
Documentation of “Institutional Knowledge” • Forms (JO, CDS, Ref Chk, etc.) • Fee Agreements • Planning Tools
© TheRecruiterU.com
Valuation
Ú Factors Used to Calculate Business Value (In addition to everything so far) – Cash Flow – History of Increasing Sales and Profits
• Will look back 3 to 5 years • Keep DETAILED Financial Records
– Tangible Assets
© TheRecruiterU.com
Valuation
Ú The MORE the Owner Self Finances The Higher the Valuation AND the Easier the Sale. – Downside:
• What if New Owner Defaults? • What if New Owner wants to Renegotiate? • Do you want the Business Back?
© TheRecruiterU.com
The Deal
Ú Before You Spend too Much, Get Buyer’s Financing Approved
Ú Plan on 6 to 12 months for Transition Ú If Buyer is from Another Recruiting Firm,
Visit THEIR Business Ú Speak with Financial Planner about Using
Pension Program as Buyout Vehicle for Employees
Summary
Ú Define What is NEXT in Your Life. Ú Whether You Want to Sell or Not, Grow your
Business with the Mindset to Sell Your Business to Build a Great Business
Ú Measure and Document Everything in Small, Manageable Amounts Over Time.
Ú Systems, Systems, Systems!!!
© TheRecruiterU.com
www.TheRecruiterU.com
Ú Free Audio Series at www.TheRecruiterU.com
Ú If you want to Learn More about Systematizing Your Business so It Runs without you… Complete Form or email [email protected]
© TheRecruiterU.com