Category: Business Owner

04- Sep2015
Posted By: Joe Alvarez
290 Views

Business ownership: A Going Concern or Start from Scratch ?

Previously we were discussing, not whether to go into business, but the decision of which method made sense for you. A chicken or egg scenario. Do you start from scratch with just an egg? An idea that has yet to hatch but holds great promise or do you purchase some chickens, a going concern that is producing revenue and , hopefully, income.

Under the egg method you must have time. Time to weather the delays of a startup; the lack of customers, employees, revenues and spendable income. In fact the reality is you will most likely go deeper in the debt hole having no personal income for many months if not years. Do you have that kind of staying power (reserves)? Investors, if you can find any, will not allow you to spend their money on your living cost. So for sake of analysis let?s examine which is better, the chicken or the egg.

Your egg has a cost obviously much less than buying a group of chickens. But it does not produce current income. Let?s say you have spent $50k on your egg (idea) so far. Even when it hatches you?ll have to build up your ?coup? of chickens letting other eggs hatch not taking income while this process build. You now have another $200k sunk into your business and / or debt from living expenses.

At $250k you could have bought a chicken farm, a revenue producing enterprise. You?d have debt but also income. You?d be buying a proven business because you did your due diligence and know the stream of revenue the business has been producing. You might have to spend a few dollars for sprucing up the business; perhaps a new marketing campaign but you have INCOME!

But my egg is a fantastic idea. Could be, I hope so. BUT 75% of all new businesses fail by or before year 3 and 85% by year 5. Risky?? You bet! Still want to be in business? Good. We?ll discuss alternative ways to make that happen while lowering the risk next.

Steve Ivey

24- Aug2015
Posted By: Tim Ajayi
257 Views

Keep it Confidential: When Selling your Business

Confidentiality when selling your business

confidentiality - Selling your business

The best way to relate to a situation is imagining you are there. If I were in a job, everything is going well, and then, rumor has it the company is on sale. The first thing it would come to my mind would be, what?s going to happen to my job? Should I start looking for a new one?

When selling a business the best is to do it discreetly for many?reasons:

News that your business is for sale can generate negative reactions among your employees, customers, suppliers, creditors and bankers.

As an employee, I believe this would lower the morale and make others nervous affecting productivity and customer service. Your competitors can get predatory and spread the word. It opens the door for them to steal business from you.

You, as a business owner, want to protect your business at all costs. Whatever is the reason for you selling your business, it is imperative to be discreet. Hiring a business broker can be beneficial when it comes to selling your business while keeping a low profile.?? They can list your business for sale while at the same time protecting the identity of your company.

A business broker uses a document called a Blind Profile, a document describing the company without revealing its identity.? In the case of a buyer showing up, he must sign a confidentiality agreement to have access to any sensitive information, protecting you and your business.

You as a business owner should focus on running your business even if it?s on sale. A business broker is an intermediator who will help you to run the process smoothly from beginning to end.

 

NewGate Capital Partners can help you sell your business.?Contact us anytime at?http://www.newgatecapitalpartners.com/business-brokerage/

 

 

13- Aug2015
Posted By: Tim Ajayi
298 Views

Why Hiring a Business Broker when Selling your Business is a Wise Idea

 

     

     

    Selling your business adFor starters, a broker is an independent agent whose main responsibility is to bring sellers and buyers together.? For example, if you hire a real estate broker to sell your house, the broker acts as a middleman, he doesn?t own the house, and he instead facilitates the transaction.? Just like with a house if you have a business, you as an owner can sell it yourself. However, there are many reasons why you should consider hiring a business broker:

    • Paperwork: Do you know how much paperwork you will need if you are selling? According to the Small Business Administration SBA you need to prepare a sales agreement. What else? You can invest your time doing the research on your own? OR consult a business broker. A business broker?s expertise consists of navigating through extensive paperwork and the formalities in a daily basis. Don?t forget that time is money!
    • Business Continuity: Selling a business is a full-time job as it is. The owner should maintain its focus on running the business and take it to its full potential. All of these while selling.
    • Confidentiality: If you are an owner and are selling your business how you keep the matter confidential from employees and other stakeholders. You don?t want anyone to panic. The situation can be disruptive to the normal operations of your business. If you choose a business broker, he can protect the identity of your company while on sale. They can use a blind profile, a document describing the company without revealing its identity. We are going to talk further about ?Confidentiality when selling a business? in our next blog.
    • Valuation Knowledge: Brokers can help you determine the value of your business. They have access to tools such as business transactions databases. There are also other variables that affect the value of your business. A broker can guide you in the right direction in to calculate the accurate value of your business.
    • Marketing: business brokers can help you market your business. They can suggest you diverse ways to advertise and put your business out there.?

    Ultimately, the decision is yours, you should take in account the variables of time, money and resources and put on?a balance and see what works better for you and your business.?

    New Gate Capital Partners is here to answer your questions, we can help you to sell your business. ?Feel free to check out our?business brokerage page.

    ?

15- Jul2015
Posted By: Joe Alvarez
258 Views

So You Want to be in Business, Be an Owner, Master of your Own Destiny?

I love the way my partner, Steve, goes about explaining this.

 

Chicken or the Egg

So you want to be in business, be an owner, master of your own destiny?

The age old question in the title might be worth thinking about. Should you do a start-up with an egg or should you buy some chickens? A silly analogy? ?Maybe not.

Many people dream of starting a venture. I?ve helped several hundred wanna- be- entrepreneurs work through this process. Many come in with the egg in hand, delicate, carefully guarded and full of promise. Perhaps they?ve decorated the egg to make it look more attractive and more advanced than other eggs. Convinced that their egg is unique yet they really aren?t quite sure what it will be when it hatches. ?They rarely consider that it may not hatch at all. After a time of incubation where you?ve kept it warm and looked at it all hours of the night maybe even added a few more colors to it, it hatches.

You have a chick! They are furry, loud and ready to be fed. It was a chicken after all and you are very proud of this new creature, you probably give it a name even though you can?t tell whether it?s male or female (which is very difficult in young chicks). A few days later you realize that you?ll need another egg or have to buy another chicken to mate with yours or your precious egg, after lots of feed and care, will have provided you with 1-chicken dinner and be gone. Your great idea didn?t produce much and you really were never in business.

Of course you are smarter than that so you had several eggs or a partner who also had an egg that was compatible with your egg, Hmm, more about that another time. The point or question is: Did you save time or resources by starting with the egg versus buying some chickens. Both actions will get you to the same place. You thought the egg route would be simpler and cheaper. Let?s explore that.

 

Steve Ivey

Partner

NewGate Capital

10- Jun2015
Posted By: Brett Andrews
282 Views

Ted talk on the single biggest reason why start-ups succeed

QUESTION: Which one of the reasons below does the Entrepreneur have the least amount of control over? Interesting…?

  1. Timing ????????42%
  2. Team/Execution ??32%
  3. Idea “Truth” Outlier 28%
  4. Business Model 24%
  5. Funding ????????????????????14%

?

From: “Ted talk on the single biggest reason why start-ups succeed:”

 

http://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed?utm_source=newsletter_weekly_2015-06-06&utm_campaign=newsletter_weekly&utm_medium=email&utm_content=talk_of_the_week_button

20- May2015
Posted By: Brett Andrews
244 Views

Lesson for Coachable Entrepreneurs

Be careful how you (we) interpret things because you (we) are looking at the world with a bias.

Check out this video ?”The Backwards Brain Bicycle” a simple experiment of how the brain works.

Lesson for Coachable Entrepreneurs: Knowledge doesn’t equal understanding

Video Source:?SmarterEveryday

 

02- Apr2015
Posted By: Brett Andrews
271 Views

Mentors Are The Secret Weapons Of Successful Startups. by Rhett Morris

Mentors Are The Secret Weapons Of Successful?Startups

Excerpt from Rhett Morris article:

..?I?ve probably revised this investor pitch deck 200 times,? a founder told me recently. She?d met with more than 50 potential investors before closing a seed round last month. This might sound excessive to some, but her experience is not unusual.

Entrepreneurs often spend hundreds of hours raising funds from angel and venture capital investors. While these activities are clearly important, analysis of new data on startups suggests that founders should also dedicate significant time to something that many people overlook: recruiting great mentors. This simple strategy can increase a company?s odds of success more than almost anything else..

 

Mentors Are The Secret Weapons Of Successful Startups

27- Aug2014
Posted By: Brett Andrews
299 Views

HBS Graduates About Startups

Harvard Business School Graduates

Excerpt From Wallstreet Journal Article,

Infographic

wallstreet journal Startups

 

JOURNAL REPORTS: SMALL BUSINESS

How an Entrepreneur’s Passion Can Destroy a Startup

Strong Feelings Can Lead Founders to Make Bad Choices at the Worst Times. Here’s What to Watch For.

28- Jul2014
Posted By: Brett Andrews
377 Views

New Tender Watch Video

?Tender Watch Video

Tender Watch is a proactive monitoring system that allows family members to keep track of elderly and handicapped loved ones who choose to live alone. This short video describes how the system works and the benefits of it’s use. Tender Watch is currently looking for strategic partners to help bring this innovation the world on a larger scale. Enjoy!

20- Mar2014
Posted By: Tim Ajayi
482 Views

You’ve Got the WHO. Now WHAT?

Last Thursday, I said your success as a startup founder depends a lot on you being crystal clear on WHOM you (your product and service) serve. Let’s allocate 40% weight to this.

So you say, “Allan, I’ve got the WHO down pat. I can picture her. I know her pains. I can feel her frustrations with this problem. I’ve seen and heard her curse aloud as she struggles with this problem. She’s starving for a solution that works – or one that sucks less than is currently available. Now what?”

Good question. I thought you’d never ask.

The next big piece (another 40 percent-er) you need to figure out is the WHAT you offer to your WHO.

As an entrepreneur, you’re wired to start and focus almost exclusively on the WHAT – your product, service, website, widget, whatever. We see this every day:

My product will revolutionize the industry.”

It’s the best thing since the iPhone

It’s a Facebook killer.

Big mistake. Don’t do that.

Start with WHO. Then follow with WHAT. Don’t believe me? See what Seth Godin says here about first starting with a tribe.?Got that? Great.

So WHAT do you offer your WHO? Is your product and service a dream-come-true solution to your WHO? Does your WHAT make a meaningful difference to your WHO? Will the dog,?as we say in the industry, eat the dog food?

The classic mistake to avoid here as you build your WHAT is keeping it under wraps – in beta or stealth mode – forever while you tinker away and burn your investors’ cash.

Once you have a version 0.1 of your product and service that works decently, launch AND charge for it. Free lunch is for losers.

Then keep your ears to the ground and observe your WHO as they interact with your WHAT. Take in every feedback as data and move on to version 1.0 of your WHAT.