Corporate Advisory

Corporate Financial Planning:

As a private business owner, corporate & personal financial planning are interconnected. Your advisory team needs to have expertise on both sides. Providing integrated financial planning advice to the owners of closely-held corporations is our core competency.

A good starting point is addressing the basics:

  • Understanding what the value of your business is to a third party is valuable information whether you plan to sell or not. Understanding what the value of your business is to your family & your lifestyle is critical information. Seems straightforward – but the lack of understanding on this issue is where we see the most mistakes made.
  • The owner’s unique objectives will drive the capital allocation strategy. These objectives will range from serial entrepreneur looking to ‘build, scale, and sell’ to the entrepreneur seeking to build a multigenerational business. The planning scenarios will be similar in some ways and very different in others.
  • Regardless of timeframe, it will be valuable to articulate answers to the following questions:
    1. What is your desired departure or transition date out of the CEO role?
    2. What is the value that you require from the business net of taxes to be economically independent
    3. Who are the individuals or entities to whom you would prefer to sell or transition the business to some day?
  • Anticipate Trouble – this is not a glass half-empty lens, but rather anticipating the trouble spots with your plan will help drive efficient execution.

Having a plan will help frame your financial decisions inside and outside the business – leading to more optionality and better outcomes.

Exit & Transition Planning:

Begin with the exit in mind. Whether you plan on running your company for the next 30-years or whether you have a clear exit date in mind, understanding your potential liquidity options is invaluable information and will help drive effective decision making.


Step One – Establishing Owner Objectives

What would you like to achieve with your exit? When? For many owners, it isn’t simply one thing. Often, it is financial security or diversification. It could be a desire to involve children or to reward key employees. Perhaps it’s to achieve the freedom to enter the next chapter of life. Whatever it is for you, it’s important that you spell out your goals.

Step Two – Financial and Mental Readiness

Do you know what it would take to be financially independent outside of your company? A thorough analysis will determine the financial resources necessary to sustain your lifestyle after exit. The results define the Value Gap between your projected assets and what’s needed to meet your goals. Additionally, you must assess your mental readiness for exit. What will you do after exit? How do you feel about being identified as someone other than the owner of your firm? The mental game is often more challenging than owners think.

Step Three – Discover Which Type of Owner You Are

Business owners typically fall into four categories based on their financial/mental readiness. Your exit options become clearer once you recognize your owner type and the corresponding transfer methods. Who do you resemble?

  • Rich and Ready To Go – Financial readiness is high, and mentally you can’t wait to start life’s next chapter.
  • Wealthy But Enjoy Work – You are financially set, but you like working and don’t want to retire.
  • Stay and Grow – You’re not financially ready, and are happy to work to build net worth and company value.
  • Get Me Out Now – Your needs require much from the business, but mentally you are headed for the exits.

Step Four – Learn Your Exit Options

If you are like most owners, you know very little about ESOPs, Private Equity Recaps, Management Buyouts, Gifting Strategies or the myriad ways to structure a Third Party Sale. An education is helpful, even if to merely discard the options that won’t apply. Given your goals and financial needs, the most likely exit paths begin to take shape in this step.

Step Five – Understand the Value of Each Option

It’s not what you make, it’s what you keep! You must run the numbers for each of the applicable exit options. You’ll learn about the range of values associated with private companies, the impact of taxes and fees on any transaction, and the cash flow results for both you and the business throughout the exit. You’ll want to know this well before executing the plan.

Step Six – Execute Your Strategy – Protect Your Wealth

You’ve chosen your option, made your plan, and now it’s time to execute. Assemble your team, plan for contingencies, and take action. You’ll learn how to help protect your wealth from estate taxes and provide for plan completion in the event of an untimely death or disability. This final step provides the written action plan for you and your advisory team to use as the roadmap for making your goals a reality.

Executive Insurance:

Risk Management is part of corporate financial planning. Whether funding a buy-sell agreement, protecting against the loss of a key executive or owner, or funding a wealth replacement trust for tax & estate planning reasons, we will work with your tax & legal advisors to ensure the correct structure and planning.

Once the planning is clearly outlined, we will then help with the due diligence and execution of any insurance need.