Pete Moore, a certified exit planner, explains why half of business owners fail to exit on their terms. He recommends a 3- to 5-year planning timeline covering tax, valuation, and deal structure, and notes that most failures stem from neglecting early preparation and overlooking the unique challenges of family succession versus external sales.
Chapters
There are certain tweaks and things that I needed and should have done that I didn't do.
Today we're joined by Pete Moore. Pete is a certified exit planner. He's a business coach, he's a speaker, and he's a fellow Colby Certified Consultant.
I am basically setting up businesses to be sold these days. Hopefully you've done this work because there's a lot to do. More typically, it's sort of that 3 to 5 year span where people are starting to say, hmm, there are several different ways of leaving your business. I got to sell this thing or I have to close it.
How did you come to realize that there was a need even for people to start planning proper exits? What was the domino effect for you to recognize, man, we really got to help people in this space?
It was probably my own business. Like, I mean, I'm talking, you know, I wanted to sell my own business years ago, the first business that I sold, and I realized I wasn't ready. I realized I didn't have things in order. I probably didn't maximize the value that I should have maximized. I probably didn't have my deal set up properly. I didn't have the things in alignment that I needed to have an alignment to really reap the benefits of, at that time, the 15 years that I had put in. And, you know, so just going back, the first 15 years of my career, I had a couple of different businesses. And one was this— well, they were both service businesses. One was a franchise that we ended up de-franchising and then ran it as a, as a, you know, independent business for about another 10 years. And then we sold it. And I had another franchise that I ran simultaneously there, and it was a cleaning company that we, uh, 10x'd over the years and then sold it. But once I was— this is 2010, and I was, uh, sort of ready to exit both of these businesses, kind of been there, done that, and looking for something different. Went back to school, took my MBA, and at the same time I said, by the time I finished my executive MBA, I want to be out of these businesses. So, you know, through the MBA process, my major project was for Sunbelt Business Brokers. And, and, you know, I'm working for Greg, who owns the master franchise for all Sunbelt at the time. We're doing this big project for him as he's trying to grow Sunbelt Business Brokers. And for those of you that don't know, Sunbelt Business Brokers is similar to like a Royal LePage or a Coldwell Banker. But what they do is they sell businesses, not homes. So I ended up using him for using, you know, their, their service for one of our businesses. I sold my other one independently. And Greg says, why don't you come work for me? And I'm like, hmm, that sounds pretty interesting. So I became a licensed realtor and I became a part of the International Business or International Board of Business Advisors and Brokers, IBBA, and sold businesses for a while, which is where I found my shoe stores, which I still own 15 years later. And we, we, we are shoe retailers today. You mentioned in the intro that I do some retail work.
Hey, I like free stuff. I hope you like free stuff. In fact, fact, we got something for free you can download right now. It's a copy of our book, Cash Follows the Leader. This book is all about how you can develop uninterrupted daily growth with high cash value life insurance. We explain a ton in there. We even have some fun images so you can follow along. Go ahead and go to cashfollows.com— that's cashfollows.com— and pick up a copy for yourself today.
But we still own and operate shoe stores too. So I'm looking through all this stuff at the time and saying, kind of looking back now, saying, boy, if I would have done this and I would have done that, I probably could have maximized maximized my value at the time, even though I was fairly, you know, been in business a long time and understand some stuff. There are certain tweaks and things that I needed and should have done that I didn't do. So, you know, you kind of look back at all of this stuff. And through the last 15 years in retail, I've, as you mentioned, ended up coaching and speaking and doing a variety of other things with a lot of other business owners. And I became a Certified Exit Planning Associate a couple of years ago. So, I'm what they call a CEPA. So I'm no longer licensed to sell businesses, but I am basically setting up businesses to be sold these days and helping people through that journey. And sometimes it's for family transition because I do a lot of family transition work. I run a family transition group in the internet or in the National Shoe Retailers Association, and I have been asked to do another one in a different association too. We'll see where that goes. But it's, it's a really interesting group for all of these parents and kids and how do we do this and what do we know? What do we need to do? How do we need to set it up? How do we transfer it? There's so many different things that are involved around family business. That's a piece of the exit planning side of things that I do. The other side is literally I don't have any family to exit to, so I got to sell this thing or I have to close it or I have to do whatever I need to do. There are several different ways of of leaving your business. But obviously, and you guys are in the financial world, we want to be maximizing our value. And what does it take? How long does it take? All of these different things sort of fall into, you know, whether you're ready here within the next year. Well, if it's the next year, hopefully you've done this work because there's a lot to do. More typically, it's sort of that 3- to 5-year span where people are starting to say, hmm, I think I got to start looking at this. And then we, then we've got a bit of time to work things. There's taxable areas that you got to look at. There's different transitions. And sometimes it just takes time to set up the right people, place, all of the different things, the process and everything so that it can be transferred properly.
Hey, if you like this video, go ahead, watch more right here. Or if you want to watch the full conversation, the full podcast episode, go ahead, click right here.
