as you prepare for liquidity event

As You Prepare For Liquidity Event

As you prepare for a liquidity event, SBA Link the financial advisor is generally the hub of the wheel.  Like the hub, he or she is not “where the rubber meets the road.”  Rather, they are making the wheel turn and supporting all the spokes meet the road.

Who are the important players in a liquidity event transaction?

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At the minimum, you need an attorney familiar with getting a transaction done, a valuation expert, a personal accountant and a business broker/investment banker What’s the difference?

Your transaction people are not necessarily your lifelong friends.

Many billable hours will be spent reviewing documents and financials.  The old friend who, chances are, you have known for a long time that does your taxes, and your general counsel want a piece of those hours.  The investment advisor wants to manage the assets. Why wouldn’t they feel entitled?  They have been with you a long time.  Two analogies come to mind that apply to your accountant, your GC and your investment advisor.

Transaction experience counts.

I have a lifelong friend who has been an orthopedic surgeon as long as I have been a financial advisor.  When the discussion comes around which person you pick for a knee replacement, he always tells me that you don’t want someone who does one a month; you want someone who does five a week.  When the surgeon runs into a problem, they can rely on their experience and efficiency to solve the problem.  Makes sense.

Ten years ago, I was pursuing some business in a Central California oil town.  I happened upon the General Counsel of one of the major oil companies in that area during a social event. Making casual conversation I asked him which local law firm the company used to address legal matters in the oil community. He scoffed!  “None.” he said.  I can get answers far quicker and less expensive when I call our Houston firm, because they work on these projects more often.

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I bring these two stories up, because, more often than not you should not use your long-time advisors.  They simply don’t do enough transactions. In fact, you most likely shouldn’t even use the people they recommend.  You should use people who are in the industry and are frequent deal makers.  You should interview three and choose one.  This takes time and effort, as well as a broad knowledge of the landscape.

I can help with that.  My team and I can find people anywhere in the county who have experience and know your industry.  This is one of the things we do.

About Michael Ross

Michael Ross is a 30+ year veteran financial advisor. After 30 years with Morgan Stanley, he is now an independent financial advisor who excels in helping business owners exit their businesses and move to the next phase of their lives.

Advisory services are offered through Integrated Advisors Network LLC, a registered investment advisor.

Learn more: www.mylatticewealth.com

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