Summary:
Sonny and Jim take you through Sonny’s M&A journey from where he started his business at 25 years old to when he sold in 2011. This podcast is packed with lessons learned and things done right. Join Sonny and Jim on this journey.
Main Questions Asked:
- What led to the decision to launch your own business?
- Did you have an exit in mind?
- How long did you own the business before you sold it?
- What made you decide to sell your business?
- Were you thinking about selling when this company called to buy your business?
- What was the process you went through to determine your valuation?
- Did you have a number in mind?
- Did you have any advisor or broker?
- What do you think you did right and what would you like to do over?
- What have you learned about what to do next?
- What advice do you give to people?
Key Points made:
- I started my company when I was 25 years old. (:30)
- If you want to set your own hours and have financial freedom, you need to start your own company. (1:20)
- There is a lot less liability when you are 25 years old as compared to when you are 45 years old. (2:03)
- I only had in mind making some money and not skipping a paycheck. (2:24)
- I was thinking about how to get cash into the business and into my pocket. (2:45)
- Someone had referred a company to us, so it was a cold call buyer. (4:55)
- I wanted to make sure our clients were happy and I took it home with me. (6:00)
- We based our valuation on cash flow and recurring revenue and then was it enough for us to exit the business. (6:30)
- We did this a few times and the first couple of times we did not have a selling number but the final time, we knew what we wanted to ask for our business. (7:55)
- We had the top 5 things that we needed to sell. (8:15)
- Knowing what you want is important. (8:35)
- We did not have an M&A advisor but we had a really good lawyer. (9:13)
- We were prepared and knew what we wanted, so that was right, I didn’t know what to do after I sold the business, that was wrong. (10:20)
- I recommend to people to think about your “what’s next” issue during the selling process. (11:40)
- Begin with the end in mind. (12:30)
- A lot of what I say, isn’t original, you have to do what you love, what you are passionate about, sometimes the money isn’t always there. (14:00)
- You need to build your business profitably. (15:50)
Resources Mentioned:
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Tennessee Valley Group
Jim Cumbee established Tennessee Valley Group to help business owners fulfill their dreams for life after business ownership.
It’s a mission that his 30+ year career history had prepared him well for—in addition to being an attorney, transition mediator and business broker, Jim has been a buyer, seller, and entrepreneur. His broad range of experience gives him unique insight into how business buyers and sellers can achieve their goals.
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