Permanent Podcast: Real Talk About Private Equity and Buying, Selling, and Operating Small Businesses

Done well, Employee Option Pools present compelling incentives for the employees running the company post-close. As with most components of a deal, the structure and the math matter. In this episode, we talk about potential pitfalls and the hallmarks of a well-constructed employee compensation plan. Discussion with Brent Beshore and Emily Holdman starts @ 1:09.

While it's common for Private Equity firms to charge fees as part of the transaction, these fees can take on many forms. Some firms are transparent and only charge enough to cover their expenses, others not so much. In this episode, we cover fee types and structures, as well as things you should watch out for when examining the fees your potential buyer plans to assess. Discussion with Brent Beshore and Emily Holdman starts @ 1:43.

The math behind Net Working Capital seems straightforward, but agreeing on this number is often the most contentious part of doing a transaction. Why is there so much nuance and why is getting this number right so critically important? This episode dives in to this crucial negotiation point and we share how we almost lost our first deal because of it! Discussion with Brent Beshore and Emily Holdman starts @ 1:35.

In situations where the buyer and seller disagree on future earnings, earnouts help bridge the gap by taking a "wait and see" approach to a portion of the valuation. But they can also cause trepidation in sellers as they introduce uncertainty. In this episode, we lay out some questions you should consider before agreeing to an earnout in your transaction. Discussion with Brent Beshore and Emily Holdman starts @ 1:53.

The first component of financial deal terms is the amount of cash at closing. But even something as simple as "cash" can take on many different forms. In this episode, we examine the various types of cash at closing, why they are used, how they are structured, and the potential impact on your company after close. Discussion with Brent Beshore and Emily Holdman starts @ 3:09.

In many ways, the deal components are more important than the purchase price. When it comes to purchase price, there is often a tug-of-war between buyer and seller. This episode explores this back and forth by looking the motivations, mechanics, and messiness of agreeing on a price. Discussion with Brent Beshore and Emily Holdman starts @ 1:55.

When people hear about a transaction the first question they ask is: "What is the valuation?" While the answer seems simple on the surface - a single number - the way valuation is decided can take many different paths. In this example-packed episode, we show the diversity of approaches taken towards valuation and talk about why methodology matters. Discussion with Brent Beshore and Emily Holdman starts @ 8:18.

What is an intermediary? What do they do? How do I know if I need to hire one? In this episode, we present a list of helpful questions to answer as you consider hiring one of the most important advisors on your transaction team.

Your advisor team is critical to the success of your transaction. But how can you build your own Dream Team? In this episode we lay out a clever strategy we learned from an original Dream Team member, Larry Bird. Discussion with Brent Beshore and Emily Holdman starts @ 1:23.

Picking a great team of advisors is the most important transaction decision you will make. So what should your team look like? What should you look for in an advisor? In this episode we discuss the members and attributes necessary to build a stellar advisor team. Discussion with Brent Beshore and Emily Holdman starts @ 2:58.